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                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM 10-K

      FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTIONS 13 OR 15(d)
                    OF THE SECURITIES EXCHANGE ACT OF 1934

  (Mark One)

    [X]ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
       SECURITIES EXCHANGE ACT OF 1934
       For the fiscal year ended December 31, 1999

                                      OR

    [_]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
       SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
       For the transition period from         to

                         Commission File Number 1-9320

                          Wyndham International, Inc.
            (Exact name of registrant as specified in its charter)

               Delaware                              94-2878485
    (State or other jurisdiction of               (I.R.S. Employer
    incorporation or organization)               Identification No.)

   1950 Stemmons Freeway, Suite 6001
             Dallas, Texas                              75207
    (Address of principal executive                  (Zip Code)
               offices)

                                (214) 863-1000
             (Registrant's telephone number, including area code)

          Securities registered pursuant to Section 12(b) of the Act:

    Class A Common Stock, par value            New York Stock Exchange
            $0.01 per share


    Preferred Stock Purchase Rights            New York Stock Exchange
         (Title of each class)             (Name of each exchange on which
                                                     registered)

          Securities registered pursuant to Section 12(g) of the Act:

                             Series A Convertible
                          Preferred Stock, par value
                                $0.01 per share

  Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No [_]

  Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment of this Form 10-K. [X]

  The aggregate market value of the voting stock held by non-affiliates of
Wyndham International, Inc. as of March 22, 2000 was approximately $313
million, based upon a price of $2.0625 per share.

  As of March 22, 2000, there were 167,721,297 shares of Wyndham class A
common stock issued and outstanding.

                      DOCUMENTS INCORPORATED BY REFERENCE

  Certain information called for by Part III is incorporated by reference to
the definitive proxy statement for the annual meeting of the stockholders of
Wyndham to be held on May 16, 2000, which will be filed with the Securities
and Exchange Commission not later than 120 days after December 31, 1999.

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                          WYNDHAM INTERNATIONAL, INC.

                            Form 10-K Annual Report
                                     Index

Item                                                                  Form 10-K
No.                                                                  Report Page
----                                                                 -----------


PART I

1.Business................................................................    3
2.Properties..............................................................    3
3.Legal Proceedings ......................................................   17
4.Submission of Matters to a Vote of Security Holders.....................   19

PART II

5.Market Price for Registrant's Common Equity and Related Stockholder        20
 Matters..................................................................
6.Selected Financial Information..........................................   21
7.Management's Discussion and Analysis of Financial Condition and Results    24
 of Operations............................................................
7a.Qualitative and Quantitative Disclosures about Market Risks............   35
8.Financial Statements and Supplementary Data.............................   36
9.Changes in and Disagreements with Accountants on Accounting and            36
 Financial Disclosure.....................................................

PART III..................................................................   37

PART IV

14.Exhibits, Financial Statements and Schedules, and Reports on Form 8-K..   37

SIGNATURES..................................................................  40


                                       2
<PAGE>

                                    PART I

ITEM 1 AND 2. BUSINESS AND PROPERTIES

General Development of Business

  Wyndham International, Inc. (together with its consolidated subsidiaries,
"Wyndham" or the "Company") is a fully-integrated and multi-branded hotel
enterprise that operates primarily in the upscale and luxury segments. Through
a series of acquisitions, Wyndham has since 1995 grown from 20 hotels to
become one of the largest U.S. based hotel operators with a portfolio totaling
303 hotels and approximately 73,000 rooms.

  Wyndham is a Delaware corporation and its principal executive offices are
located at 1950 Stemmons Freeway, Suite 6001, Dallas, Texas 75207. As
discussed more fully below, effective June 30, 1999, Wyndham completed a
restructuring in which it acquired Patriot American Hospitality, Inc.
(together with its subsidiaries, "Patriot"). Unless the context otherwise
requires, references herein to "Old Wyndham" refer to Wyndham prior to the
June 30, 1999 restructuring and when the term Wyndham is used relating to a
period prior to June 30, 1999, such term refers to the combined entity of Old
Wyndham and Patriot.

  Patriot was formed in April 1995 as a self-administered real estate
investment trust ("REIT") for the purpose of acquiring equity interests in
hotel properties. On October 2, 1995, Patriot completed an initial public
offering of shares of common stock and commenced operations. Between October
1995 and July 1997, Patriot acquired interests in 56 hotel properties which it
leased to various third parties.

  On July 1, 1997, Patriot merged with and into California Jockey Club ("Cal
Jockey"), with Cal Jockey being the surviving legal entity. Cal Jockey's
shares of common stock were paired and traded together with the shares of
common stock of Bay Meadows Operating Company ("Bay Meadows") as a single unit
pursuant to a stock pairing agreement. In connection with the Cal Jockey
merger, Cal Jockey changed its name to "Patriot American Hospitality, Inc.,"
referred to herein as Patriot, and Bay Meadows changed its name to "Patriot
American Hospitality Operating Company". In January 1998, Patriot acquired
Wyndham Hotel Corporation through a merger (the "Wyndham merger"). In
connection with the Wyndham merger, Patriot American Hospitality Operating
Company changed its name to "Wyndham International, Inc." and is referred to
herein, collectively with its subsidiaries, as "Old Wyndham".

  The Cal Jockey merger was accounted for as a reverse acquisition in which
Cal Jockey was considered to be acquired by Patriot. For accounting purposes,
Old Wyndham commenced its operations concurrent with the closing of the Cal
Jockey merger on July 1, 1997.

  During 1998, Patriot and Wyndham grew rapidly, investing over $4.5 billion
in the acquisition of hotels and other related businesses. These acquisitions
were financed primarily with funds drawn on the companies' revolving credit
facility as well as through the issuance of paired shares and units of limited
partnership interests ("OP Units") in two operating partnerships owned
principally by Wyndham and Patriot (the "Operating Partnerships").

  In the Wyndham merger, Patriot acquired ownership of 10 Wyndham hotels, 14
ClubHouse hotels, 52 management and franchise contracts, the Wyndham and
ClubHouse proprietary brand names and the Wyndham hotel management company.
Other major acquisitions during 1998 included (a) the acquisition of three
resort hotels in San Juan, Puerto Rico and a majority interest in a related
management company, (b) the acquisition of Arcadian International Limited,
which owned 10 hotels in England, one hotel in Jersey, five owned and managed
Malmaison Hotels, two European resorts under development, the Malmaison
proprietary brand name and a 50% interest in a property being redeveloped in
London, (c) the acquisition of Interstate Hotels Company, which owned or had
controlling interests in 42 hotels representing over 12,000 rooms, leases for
84 hotels representing over 10,100 rooms, and management or service agreements
for 82 hotels representing over 20,400 rooms, (d) the acquisition of SF Hotel
Company, L.P., which owned four Summerfield Suites(R) hotels, leasehold and
management interests in 24 Summerfield Suites(R), Sierra Suites(R) and Sunrise
Suites hotels and management contracts and franchise interests for 12
additional hotels, and (e) the acquisition of the hospitality related business
of CHC International, Inc., including 17 leases and 16 of the associated
management contracts related to Patriot hotels, eight third-party management
contracts, two third-party asset management contracts, the Grand Bay
proprietary brand name and certain other assets.

                                       3
<PAGE>

Restructuring

  Effective June 30, 1999, Wyndham completed a restructuring that included (1)
an organizational restructuring, (2) a $1 billion equity investment, (3) a new
$2.45 billion credit facility, and (4) the issuance of $581 million of
mortgage notes.

 Organizational Restructuring

  As discussed above, prior to the restructuring, Old Wyndham and Patriot
operated under a paired share REIT structure. Patriot principally owned and
leased hotel properties, and Old Wyndham principally served as an operating
company that managed hotel properties, including properties leased from
Patriot. The shares of common stock of Old Wyndham were paired and traded
together with the shares of common stock of Patriot pursuant to a stock
pairing arrangement and were referred to as paired shares.

  On June 30, 1999, a subsidiary of Old Wyndham was merged with and into
Patriot and Patriot became a wholly-owned subsidiary of Wyndham. The pairing
arrangement was terminated and each outstanding paired share was converted
into a share of Wyndham class A common stock. In addition, Patriot's status as
a real estate investment trust was terminated effective January 1, 1999, and
Patriot became a taxable corporation as of that date.

  Wyndham recorded a one-time charge of $675 million to establish a deferred
tax liability that resulted from Patriot's change in tax status from a REIT to
a C corporation, as required by Statement of Financial Accounting Standard No.
109. This charge is included in income tax expense in the accompanying 1999
consolidated statement of operations.

  The restructuring was reflected as a reorganization of two companies under
common control and was accounted for in a manner similar to that used in
pooling of interest accounting. As such, there was no revaluation of the
assets and liabilities of Old Wyndham or Patriot. The financial statements
prior to the reorganization are presented on a combined basis and include the
combined accounts of Patriot and its subsidiaries with Old Wyndham and its
subsidiaries.

 Equity Investment

  Pursuant to the terms of the $1 billion equity investment, Wyndham issued
9.55 million shares of series B convertible preferred stock in exchange for
gross proceeds of $955 million representing an approximate 41% voting control
of Wyndham. The remaining $45 million of this investment was funded through
the transfer of one of the investor's loan receivable from PAH Realty Company
LLC, a subsidiary of Patriot, to Wyndham for the purchase of 450,000 shares of
series B convertible stock. Wyndham incurred approximately $77.6 million in
costs directly attributable to the equity investment. Among other terms, this
series B preferred stock pays quarterly dividends on a cumulative basis, at a
rate of 9.75% per year, and is convertible at the holders' option into Wyndham
class B common stock. Proceeds of the equity offering were used to pay down
existing indebtedness.

  In the fall of 1999, Wyndham issued to the holders of its class A common
stock and to holders of OP units rights to subscribe for up to $300 million of
series A preferred stock, with the proceeds from the offering to be used to
redeem a portion of the series B preferred stock. The rights offering was
completed December 13, 1999 with the issuance by Wyndham of 55,992 shares of
series A preferred stock in exchange for gross proceeds of approximately $5.6
million. Wyndham incurred approximately $1.2 million in costs attributable to
the issuance of this stock. Wyndham used these proceeds to redeem 55,992
shares of series B preferred stock at a redemption price of $102.00 per share
and accrued dividends of $2.0583 per share, or an aggregate of $5.8 million in
cash. The series A preferred stock generally has the same economic terms as
the series B preferred stock, but has no voting rights, except as required by
law and except for a limited right to elect two directors if dividends are in
arrears for six quarterly periods.


                                       4
<PAGE>

 New Credit Facility and Term Loans

  Concurrent with the closing of the $1 billion equity investment described
above, Wyndham closed on a new $2.45 billion credit facility which consists of
a $1.3 billion term loan with a seven-year term, a $500 million revolving
credit facility with a five-year term, and a $650 million increasing rate loan
facility with a five-year term. The proceeds, net of closing costs and fees of
approximately $41.1 million for the term loan and the revolving credit
facility, and approximately $17.9 million for the increasing rate loan
facility, were used to retire existing indebtedness. At December 31, 1999,
$270 million was drawn on the new revolving credit facility.

  Interest rates are based upon LIBOR plus spreads varying from 2.75% to 3.50%
per annum for the term loan, and 1.25% to 2.75% per annum for the revolving
credit facility, based both on Wyndham's leverage ratio, as defined, and
whether any increasing rate loans are outstanding. If any of the increasing
rate loan facility remains outstanding, the applicable margins shall be
increased by 0.25%. The term loan and the revolving credit facility are
guaranteed by the domestic subsidiaries of Wyndham and are secured by pledges
of equity interests held by Wyndham and its subsidiaries. Wyndham's ability to
borrow under its revolving credit facility is subject to Wyndham's compliance
with a number of customary financial and other covenants, including total
leverage and interest coverage ratios.

  Interest rates for the increasing rate loans are based on LIBOR rates (less
statutory reserves), plus 3.50% through September 30, 1999, and increasing
0.50% every three months, with a cap of LIBOR plus 4.75%. The lender under the
increasing rate loans receives the benefit of the same guarantees and pledges
of security provided under the new term loan and revolving credit facility.

 New Mortgage Loans

  Effective June 30, 1999, Wyndham also closed on a $346 million mortgage loan
with Bear, Stearns Funding, Inc., which is secured by twenty-five properties.
The loan matures on July 1, 2004 and bears interest at the LIBOR rate plus
3.25% per annum. Proceeds from the mortgage debt were used to retire existing
mortgage indebtedness. On November 5, 1999, the loan was modified to bear
interest at the LIBOR rate plus spreads of 0.82% through 4.50%.

  Additionally, effective June 30, 1999, Wyndham closed on a $235 million
mortgage loan with Lehman Brothers Holdings Inc., which is secured by ten
properties. The mortgage loan has a three-year term, with a one-year extension
option, and bears interest at the LIBOR rate plus 3.50% per annum, plus an
additional 1.75% on the principal amount payable at maturity. Proceeds from
this mortgage loan were used to retire existing mortgage indebtedness.

 Restructuring Charges

  In addition to the one-time charge of $675 million to establish a deferred
tax liability resulting from Patriot's change in tax status from a REIT to a C
corporation, Wyndham incurred restructuring charges of $285.3 million during
1999. The restructuring charges include an $83.1 million charge resulting from
termination of the paired share structure and $202.1 million in charges
resulting from management's decision to streamline its organization and focus
on its core brands primarily by closing several divisional offices, exiting
the European market for its non-branded assets, exiting the limited hotel
sector and rebranding certain assets. See "Item 7. Management's Discussion and
Analysis of Financial Conditions and Results of Operations--Background--
Restructuring."

                                       5
<PAGE>

Other 1999 Events

 Sale of Arcadian International Limited

  During 1999, as a part of management's strategy to exit from the European
market for their non-branded assets, Wyndham recorded a restructuring charge
of $97.9 million primarily for the write-down of assets to estimated fair
value, including goodwill of $28.4 million. The restructuring charge also
included $9.5 million associated with staffing reductions and other exit costs
necessary to reduce the Company's infrastructure in Arcadian International,
its management division in Europe. In 1999, the Company sold 11 hotels for a
purchase price of (Pounds)75 million (approximately $119.9 million based on
exchange rates at the time of closing). As a result of the sale, the Company
recorded a loss on the sale of $8.3 million, net of restructuring charges.

 Spin-off of Interstate Hotels Company

  On May 27, 1998, Patriot, Old Wyndham, and Interstate Hotels Company
("Interstate") entered into a settlement agreement, as amended, with Marriott
International, Inc. ("Marriott") which addressed certain claims asserted by
Marriott in connection with Patriot's then proposed merger with Interstate.
The settlement agreement provided for the dismissal of litigation brought by
Marriott, and allowed Patriot's merger with Interstate to close on June 2,
1998. In addition to dismissal of the Marriott litigation, the settlement
agreement provides for the re-branding of ten Marriott hotels under the
Wyndham name, the assumption by Marriott of the management of ten Marriott
hotels formerly managed by Interstate for the remaining term of the Marriott
franchise agreement, and the spin-off by Patriot of the third-party management
business that was operated by Interstate.

  Effective June 18, 1999, Patriot distributed approximately 92% of the shares
of Interstate Hotel Corporation ("New Interstate") in the form of a dividend
to shareholders. Shareholders of record on June 7, 1999 received one share of
New Interstate stock for every thirty shares of Patriot common stock, Patriot
series A preferred stock, Old Wyndham series A and B preferred stock, Patriot
common and preferred OP units, and Old Wyndham Class A and C preferred OP
units. The remaining 8% is owned equally by Wyndham and Marriott.

  As a result of the spin-off, the Company now owns an approximate 55% non-
controlling interest in the subsidiary of New Interstate, which operates the
third-party management business that Patriot acquired from Interstate.

 SF Hotel Company, L.P.

  In June 1998, Wyndham acquired all of the partnership interests in SF Hotel
Company, L.P. for approximately $298.9 million ("the Summerfield
acquisition"). The purchase agreement provided that the purchase price was
subject to further adjustment based on the market price of the paired shares
and achievement of certain performance criteria. Effective January 15, 1999,
the Operating Partnerships issued an additional 1,311,709 OP units valued at
approximately $9.0 million as additional consideration pursuant to the
purchase agreement. Effective February 8, 2000, the Company paid an additional
$32.8 million as additional consideration pursuant to the purchase agreement.

 Other

  During 1999, the Company acquired the remaining minority interests in 9
hotel assets. The acquisition of these interests was financed through cash of
approximately $4.2 million, additional mortgage indebtedness totaling $49.8
million and the sale of an additional 10% interest in another hotel.

  During 1999, the Company sold a racecourse, land adjacent to the racecourse
and 21 hotel properties, including 11 hotels in London discussed above. The
Company received net cash proceeds of approximately $123.4 million, after the
repayment of mortgage debt of $62.9 million and a mortgage note receivable in
the amount of $6.0 million. The Company recorded a net loss of $10.7 million
in connection with these transactions.


                                       6
<PAGE>

Recent Developments in 2000

  In January 2000, Wyndham acquired the remaining interests in Wyndham Chicago
from Oxford Blackpoint Company II, LLC, for approximately $20.6 million.

  In March 2000, Wyndham sold its Sierra Suites(R) hotel brand, properties and
related assets to Sierra Suites Hotel Company, L.P., an entity affiliated with
Mr. Rolf Ruhfus, a director of Wyndham, for approximately $53.0 million. The
transaction includes the sale by Wyndham of one owned and three leased
properties, seventeen franchise and management contracts for Sierra Suites(R)
and nine contracts for Summerfield Suites.

  On March 27, 2000, the Company announced that its Board of Directors has
named president Fred J. Kleisner to the additional position of chief executive
officer. He succeeds James D. Carreker, who will remain as chairman.
Additionally, Wyndham accepted the resignations of two senior officers, Anne
L. Raymond, executive vice president and chief investment officer, and Stanley
M. Koonce, Jr. executive vice president and chief administrative officer.
David Johnson, president of the Wyndham hotel division, has been named
executive vice president, sales and marketing.

Description of Business

  The Company is a fully-integrated hotel enterprise that operates primarily
in the upscale and luxury segments. The Company's portfolio consists of 303
owned, leased, managed or franchised hotels with approximately 73,000 rooms.
The Company classifies its business into proprietary and non-proprietary brand
hotel divisions under which it manages the business.

  The Company's principal proprietary branded assets, Wyndham Hotel &
Resorts(R) consist of 171 owned, leased, managed or franchised hotels with
approximately 40,855 rooms. The Company offers upscale, full-service
accommodations to business and leisure travelers, providing a quality and
consistent product through its Wyndham Hotels & Resorts brand and its Wyndham
Garden Hotels(R) brand. The Company is positioned in the luxury segment under
the Wyndham Luxury Resorts brand. Wyndham Luxury Resorts include five-star
resort properties, such as the Boulders and Carmel Valley Ranch. Additionally,
the Company offers proprietary branded all-suite accommodations through its
upscale Summerfield Suites by Wyndham brand. Other proprietary hotel brands
owned and developed by the Company include Malmaison (a chain of unique,
lifestyle hotels located in the United Kingdom) and ClubHouse Inns (offering
mid-priced hotels focused on the individual corporate traveler).

  The Company's primary growth strategy is to develop its proprietary hotel
brands through increasing distribution, generating greater customer awareness,
building brand loyalty, offering cutting-edge amenities and services, and
maintaining customer satisfaction. The Company intends to continue to expand
its Wyndham hotel portfolio through the rebranding of existing non-proprietary
branded hotels to one of its proprietary brands and through the selective
acquisition and development of hotels in major metropolitan areas and resort
destinations. In 1999, the Company converted 10 owned hotels to one of its
proprietary upscale or luxury hotel brands consistent with the Company's
strategy of increasing distribution in important urban and suburban markets.
Additionally, the Company has opened newly constructed Wyndham hotels in major
metropolitan markets including Boston, Chicago and Atlanta and acquired the
Canal Place Hotel in New Orleans (one of the leading hotels in that city)
which was converted to a Wyndham hotel in December. The Company also opened
Wyndham Hotels in Billerica (a suburb in Boston's high tech corridor) and
Denver Tech Center (the preeminent suburban market in Denver) which are
examples of its new suburban hotel prototype. This pattern of establishing
significant hotels in strategic urban centers and surrounding them with
additional locations in the important suburban sub-markets of the top 25
Metropolitan Statistical Areas ("MSA") are core to the Company's growth
strategy going forward.

  On a parallel course, the Company converted a number of independent and non-
proprietary branded four-star resort assets in its portfolio to Wyndham
Resorts, including the Buena Vista Palace in Orlando and the Casa Marina and
Reach Hotels in Key West. The Company also refined the focus of its five-star
business strategy to concentrate on full-service resort properties, and folded
them into the Wyndham brand through the designation of Wyndham Luxury Resorts.
This is designed to strengthen the competitive position of these assets by
retaining the individuality of these landmark properties while adding the
sales and marketing clout of the Wyndham brand.

                                       7
<PAGE>

  The Company's 74 non-proprietary branded hotels consist of 72 full service
hotels and 2 resort hotels. All but 5 of these hotels are operated under
franchise or brand affiliations with nationally recognized hotel companies,
including Crowne Plaza(R), Hilton(R), Hyatt(R), Radisson(R), Holiday Inn(R),
Doubletree(R), Embassy Suites(R), Ramada(R), Four Points by Sheraton(R),
Marriott(R), and Courtyard by Marriott(R). The Company's non-proprietary
branded hotels are primarily operated by one of its management divisions,
Performance Hospitality Management ("PHM"). In addition to the Company's owned
assets, PHM manages 20 non-proprietary hotels for third parties. It is focused
on maximizing hotel profitability at the owned hotels or for third-party hotel
owners.

  Consistent with the Company's strategy to grow its proprietary brands, the
Company has and will continue to review its portfolio to identify certain non-
proprietary hotels that can be converted into one of its Wyndham proprietary
brands. The balance of the Company's non-proprietary hotels will be
systematically disposed of through asset sales and exchanges to create a
source of capital for further expansion of the Wyndham proprietary brand.

Proprietary Brands

  Wyndham is the brand umbrella under which all of its proprietary products
are marketed. It includes three four-star, upscale hotel brands that offer
full-service accommodations to business and leisure travelers, as well as the
five-star luxury resort brand. It has earned recognition as among the best
upscale hotel brands for overall
customer satisfaction by J.D. Powers and Associates in 1999. With hotels in
major urban, suburban and resort markets, the Wyndham brand offers products
geared to the specific needs of travelers based on their location, facilities
and trip purpose.

  Wyndham Hotels & Resorts includes Wyndham Hotels which are upscale, full-
service hotels that contain an average of 400 hotel rooms, generally between
15,000 and 250,000 square feet of meeting space and a full range of guest
services and amenities, for business and leisure travelers, as well as
conferences and conventions. The hotels are located primarily in the central
business districts and dominant suburbs of major metropolitan markets and are
targeted to business groups, meetings, and individual business and leisure
travelers. These hotels offer elegantly appointed facilities and high levels
of guest service. In 1999, the Company identified new brand standards, which
are to be implemented throughout the Wyndham Hotels portfolio in 2000. These
brand standards are designed to further strengthen Wyndham's position as a
leader in product and service standards in the upscale segment. The upgraded
mattresses and bedding which are being introduced in all Wyndham Hotels over
the next 12 months are among the new brand product standards. New service
offerings include the "Wyndham By Request" guest recognition program which
focuses on rewarding repeat guests with on-site amenities and benefits during
their stay, as well as rewards for use during future travel. The Company has
targeted a number of technology initiatives designed to position Wyndham as a
dominant brand for the future. For example, all Wyndham Hotels will offer
wireless internet access to their guests. This initiative is a partnership
with Wayport, a leader in wireless internet technology. Wireless internet
access is expected to be available in all hotels by the third quarter of 2000.
Wyndham Resorts are distinctive properties and represent the largest hotel
chain in the Caribbean. The full-service and destination resorts average 300
rooms and service leisure and incentive travelers as well as business groups.
Primary destinations include Orlando, South Florida and the Caribbean.

  Wyndham Luxury Resorts are five-star, luxury hotel properties featuring
between 150 and 300 rooms, numerous fine dining options, and other luxury and
recreational amenities. The resorts are distinguished by their focus on
incorporating the local environment into every aspect of the property, from
decor to cuisine to recreation. The luxury collection includes the Golden
Door(R), one of the world's preeminent spas based in Escondido, California.
Luxury Resorts are located in Arizona, Colorado, Florida, Puerto Rico, and
Mexico.

  Wyndham Garden Hotels, which serve individual business travelers and small
business groups, are located principally near major airports and suburban
business districts. The full-service hotels feature between 150 and 225 guest
rooms, and include up to 5,000 square feet of meeting space. Amenities and
services generally include a three-meal restaurant, signature Wyndham
Garden(R) libraries and laundry and room service. Consistent with the
Company's strategy to grow the Wyndham Hotels & Resorts brand, the Company
plans to convert certain of the Wyndham Garden hotels into Wyndham Hotels,
which is consistent with the Company's primary focus on expanding the core
Wyndham Hotels & Resorts brand.

                                       8
<PAGE>

  Summerfield Suites by Wyndham(TM) hotel brand offers guests the highest
quality lodging in the upscale all suites segment. This brand received the
highest customer satisfaction score of any upscale all-suite brand in the J.
D. Powers and Associates 1999 survey. Each suite has a fully equipped kitchen,
a spacious living room and a private bedroom. Many of the suites feature two
bedroom, two bath units. The hotels also have a swimming pool, exercise room
and other amenities to serve business and leisure travelers. Each Summerfield
Suites hotel contains 86 to 150 suites in either interior or exterior corridor
design. The Company plans to lead its growth of this product through
franchising.

  Malmaison, the Company's upscale brand in the United Kingdom, is a full-
service collection of contemporary hotels with traditional French brasseries
catering primarily to the business and corporate traveler. Significant
emphasis is placed on the quality of Malmaison's food and beverage options,
centered around the philosophy of "the simple things done well" and
characterized by the best of produce, great wines, fast service and affordable
prices. The recipient of five major industry awards, the Malmaison brand was
named the "Best Hotels in the World Under (Pounds)100 Per Night" by England's
Tatler magazine in 1998.

  ClubHouse Inns are mid-priced, limited service hotels located principally in
secondary markets throughout the Midwest and the Southwest. ClubHouse Inns are
targeted at corporate individual travelers and feature an average of 135
rooms, two meeting rooms, full-service breakfast buffets and evening
reception. These assets are currently being held for disposition in a
portfolio transaction including the trademark rights as they are not
consistent with the Company's core strategy to concentrate the focus of future
growth in the upscale segment.

Non-Proprietary Brand

  Among its non-proprietary branded hotels, the Company owns and operates 74
hotels aggregating over 21,800 rooms under franchise or brand affiliations
with nationally recognized hotel companies, including Crowne Plaza(R),
Hilton(R), Hyatt(R), Radisson(R), Holiday Inn(R), Doubletree(R), Embassy
Suites(R), Ramada(R), Four Points by Sheraton(R), Marriott(R), and Courtyard
by Marriott(R). The majority of the Company's non-proprietary branded hotels
are full-service and operate in the luxury and upscale price points. Full-
service hotels generally offer a range of conference facilities and banquet
space, food and beverage accommodations, gift shops, and recreational areas,
including swimming pools. These hotels target both business and leisure
travelers, including meetings, groups and individuals.

LODGING

  The following table sets forth the number of hotels, number of rooms, total
revenue, average daily rate ("ADR"), average occupancy rate, and revenue per
available room ("REVPAR"), and capital expenditures (excluding corporate
capital expenditures) for the Company's owned and leased hotels by region and
worldwide as of December 31, 1999.

<TABLE>
<CAPTION>
                          Number    Room    Total                                Capital
         Region          of Hotels Count   Revenue     ADR   Occupancy REVPAR  Expenditures
         ------          --------- ------ ---------- ------- --------- ------- ------------
                                               (dollars in thousands)
<S>                      <C>       <C>    <C>        <C>     <C>       <C>     <C>
New England.............      8     1,913 $   75,956 $121.35   76.1%   $ 92.39   $  6,870
East North Central......     24     5,406    221,926  106.45   71.6      76.25     10,327
East South Central......      7     1,473     37,955   84.81   57.2      48.54      3,715
Mid Atlantic............     20     5,255    270,560  121.99   77.9      95.05     14,364
South Atlantic..........     48    12,942    561,382  112.54   69.9      78.71     60,190
Mountain................     15     3,118    183,575  121.93   69.1      84.28     10,654
West North Central......     18     3,634    120,360   88.06   65.7      57.83     15,499
West South Central......     24     6,506    214,977   98.41   68.3      67.18     17,160
Pacific.................     29     6,366    289,417  117.31   73.7      86.42     13,928
Canada..................      1       287     13,429   85.65   78.4      67.17        955
Caribbean...............      5     2,319    266,215  180.76   75.9     137.27     14,031
Europe..................      5       460     26,360  124.72   83.1     103.62     17,803
                            ---    ------ ---------- -------   ----    -------   --------
  Total.................    204    49,679 $2,282,112 $113.82   71.2%   $ 81.00   $185,496
                            ===    ====== ========== =======   ====    =======   ========
</TABLE>

                                       9
<PAGE>

Total Portfolio

<TABLE>
<CAPTION>
(Number of Hotels as of December 31,
1999)                                    Owned Leased Managed Franchised Total
------------------------------------     ----- ------ ------- ---------- -----
<S>                                      <C>   <C>    <C>     <C>        <C>
Wyndham Brand Hotels & Resorts..........   68    14      39        8      129
Wyndham Luxury Resorts..................    3   --        3      --         6
Summerfield Suites and Sierra Suites....    7    25      19        1       52
ClubHouse Inns..........................    8   --        2        1       11
Malmaison Hotels........................    5   --      --       --         5
Grand Heritage Hotels...................  --    --        1        1        2
                                          ---   ---     ---      ---      ---
Proprietary Brand Hotels--Subtotal......   91    39      64       11      205
Non-Proprietary Brand Hotels............   74   --       24      --        98
                                          ---   ---     ---      ---      ---
  Total.................................  165    39      88       11      303
                                          ===   ===     ===      ===      ===
</TABLE>

 Franchise and Brand Affiliations

  As of December 31, 1999, all but five of the Company's owned hotels are
operated under franchise or brand affiliations with nationally recognized
hotel companies. Franchisors and brand operators provide a variety of benefits
for hotels which include national advertising, publicity and other marketing
programs designed to increase brand awareness, training of personnel,
continuous review of quality standards and centralized reservation systems.
The Company generally is the licensee under the franchise agreement related to
such hotel. The Company is responsible for making all payments under the
franchise agreements to the franchisors. Franchise royalties and fees
generally range up to approximately 10% of room revenue. The duration of the
franchise agreements are varied, but generally may be terminated upon prior
notice and/or upon payment of certain specified fees.

 Management of the Hotels

  As of December 31, 1999, the Company managed 88 hotels for third parties
pursuant to management contracts under which it is responsible for the day-to-
day operation of the hotels. Of the 88 managed hotels, 64 hotels were managed
under proprietary brands of the Company, while 24 hotels were managed under
non-proprietary brands of the Company. These operations include managing hotel
accommodations, meeting rooms and food and beverage services as well as hiring
and training each hotel's staff, planning and providing sales and marketing
services, purchasing operating supplies, inventories and furniture, fixtures
and equipment, providing routine repairs and maintenance and performing hotel
accounting functions, including the preparation of monthly financial
statements. The terms of the management contracts vary from hotel to hotel,
but range from 1 to 20 years. As of December 31, 1999, the average remaining
term for the management contracts was approximately 9.5 years.

 Employees

  As of December 31, 1999, Wyndham had approximately 32,000 employees, and
retains appropriate support personnel to manage its operations.

Pending Adoption of Authoritative Statement on Derivative Instruments and
Hedging Activities

  In June 1999, FASB issued SFAS No. 137, "Accounting for Derivative
Instruments and Hedging Activities" which defers the effective date of SFAS
No. 133 to be adopted in years beginning after June 15, 2000. The Company
expects to adopt SFAS No. 133 effective January 1, 2001. Statement 133 will
require the Company to recognize all derivatives on the balance sheet at fair
value. Derivatives that are not hedges must be adjusted to fair value through
income. If the derivative is a hedge, depending on the nature of the hedge,
changes in the fair value of derivatives will either be offset against the
change in fair value of the hedged assets, liabilities, or firm commitments
through earnings, or recognized in other comprehensive income until the hedged
item is recognized in earnings. The ineffective portion of a derivative's
change in fair value will be immediately recognized in earnings. Management
has not yet determined what the effect of SFAS No. 133 will have on the
earnings and financial position of the Company.

                                      10
<PAGE>

Certain Risk Factors

  Set forth below are important risks and uncertainties that could cause
Wyndham's actual results to differ materially from those expressed in forward-
looking statements made by the management of Wyndham. In this section, the
words "we", "us", and "our" refer only to Wyndham and its subsidiaries and not
to any other person.

 Hotel Industry Risks

  Operating Risks. Our primary business is buying, selling, leasing and
managing hotels. This business is subject to operating risks common to the
hotel industry, including:

  .  competition for guests from other hotels, a number of which may have
     greater marketing and financial resources and experience than us and our
     hotel management companies;

  .  increases in operating costs due to inflation and other factors, which
     may not be offset by increased room rates;

  .  dependence on business and commercial travelers and tourism, which may
     fluctuate and be seasonal;

  .  increases in energy costs and other travel expenses, which may deter
     travelers; and

  .  adverse effects of general and local economic conditions.

  These factors could adversely affect our ability to generate revenues and
our financial condition and results of operations.

  We may be unable to obtain or transfer necessary operating licenses in hotel
acquisitions. When we acquire hotels or hotel operating companies, we may be
unable to transfer certain operating licenses or obtain new licenses in a
timely manner, such as food and beverage licenses. Although hotels can sell
alcoholic beverages under interim licenses or licenses obtained before we
acquire them, there can be no assurance that these licenses will remain in
effect until we (or the hotel management company) obtain new licenses. If a
hotel fails to have a food and beverage license or other operating licenses,
this failure would adversely affect the hotel's ability to generate revenues
and could adversely affect our financial condition and results of operations.

  Internet Reservation Channels. A percentage of our hotel rooms are booked
through internet travel intermediaries such as Expedia.com, Travelcity.com,
Priceline.com and Click-It weekends. As this percentage increases, these
intermediaries may be able to obtain higher commissions, reduced room rates or
other significant contract concessions from us. Moreover, some of these
internet travel intermediaries are attempting to commoditize hotel rooms, by
increasing the importance of price and general indicators of quality at the
expense of brand identification. These agencies hope that consumers will
eventually develop brand loyalties to their reservation systems rather than to
our lodging brands. If this occurs, it could adversely affect our financial
condition and results of operations.

  Hotel Renovation Costs and Capital Expenditures. In general, hotels have an
ongoing need for renovations and other capital improvements, particularly in
older structures, including periodically replacing or refurbishing furniture,
fixtures and equipment. Under the terms of participating leases, we must
establish a reserve to pay for certain capital expenditures and for
periodically replacing or refurbishing furniture, fixtures and equipment. If
capital expenditures exceed our expectations, this excess would have an
adverse effect on our available cash. In addition, we may acquire hotels that
require significant renovation. When we renovate hotels, we incur risks,
including the risk of environmental problems, construction cost overruns and
delays, uncertainties as to market demand after we renovate, market demand
deterioration after we begin renovating, and unanticipated competition
emerging from other hotels.

  Competition For Hotel Acquisition Opportunities. We may be competing for
hotel acquisition opportunities with entities that have substantially greater
financial resources. These entities may generally be able to accept more risk
than we can prudently manage, including risks of a hotel operator's
creditworthiness or a target hotel's geographic location. Competition may
generally reduce the number of hotel acquisition opportunities that we believe
suitable.

                                      11
<PAGE>

  Seasonality. The hotel industry is seasonal in nature. Revenues at certain
hotels are greater in the first and second quarters of a calendar year and at
other hotels in the second and third quarters of a calendar year. Seasonal
variations in hotel revenues may cause quarterly fluctuations in our operating
revenues.

Real Estate Risks

  General Risks. Our ability to generate revenues from our hotels may be
adversely affected by risks common to the ownership, lease or operation of
real property, including:

  .  changes in national economic conditions;

  .  changes in local market conditions due to changes in general or local
     economic conditions and neighborhood characteristics;

  .  changes in interest rates;

  .  changes in the availability, cost and terms of mortgage funds;

  .  the impact of present or future environmental legislation and compliance
     with environmental laws;

  .  the ongoing need for capital improvements, particularly in older
     structures;

  .  changes in real estate tax rates and other operating expenses;

  .  adverse changes in governmental rules and fiscal policies;

  .  adverse changes in zoning laws;

  .  civil unrest;

  .  acts of God, including earthquakes and other natural disasters (which
     may result in uninsured losses); and

  .  other factors that are beyond our control.

  Value and Illiquidity of Real Estate. Real estate is a relatively illiquid
asset. Therefore, our ability to respond to changes in economic and other
conditions will be limited. If we must sell a property, there can be no
assurance that we will be able to dispose of it in the time period we desire
or that the sales price of any property will equal or exceed the amount of our
initial investment in the property.

  Property Taxes. Our properties are subject to real property taxes. The real
property taxes on our properties may increase or decrease as property tax
rates change and as the value of the properties are assessed or reassessed by
taxing authorities. Increases in property taxes may adversely affect our
financial condition and results of operations.

  Consents of Ground Lessors Required For Sale of Certain Hotels. Some of our
properties are subject to ground leases with third party lessors. In addition,
we may acquire properties in the future that are subject to ground leases. If
we wish to sell a property that is subject to a ground lease or wish to assign
our leasehold interest in the ground lease, we may need the consent of third
party lessors. As a result, we may not be able to sell or assign our interest
in these properties without the consent of these lessors.

  Environmental Matters. Our operating costs may be affected by the cost of
complying with existing and future environmental laws, ordinances and
regulations. Under various federal, state and local environmental laws,
ordinances and regulations, we may be liable for the costs of removing or
remediating hazardous or toxic substances on, under, or in real property
currently or previously owned or operated by us. These laws often impose
liability whether or not we knew of, or were responsible for, the presence of
hazardous or toxic substances. In addition, our ability to borrow by using
real property as collateral may be adversely affected by the presence of
hazardous or toxic substances, or the failure to remediate the property
properly. By arranging for the transportation, disposal or treatment of
hazardous or toxic substances, we may also be liable for the costs of removing
or remediating these substances at the disposal or treatment facility, even if
we never owned or operated the disposal or treatment facility. We could be
held liable under environmental laws used to impose liability for releases of
hazardous materials, including asbestos-containing materials, into the
environment. Third parties may seek recovery from us for personal injuries
associated with exposure to hazardous materials on real

                                      12
<PAGE>

property owned or operated by us. Environmental laws may also impose
restrictions on the manner in which we may use or transfer a property or in
which we operate our business on a property. In connection with our hotels, we
may be potentially liable for any environmental costs. The cost of defending
against claims of liability or remediating contaminated property and the cost
of complying with environmental laws could materially adversely affect our
results of operations and financial condition. Qualified independent
environmental engineers have conducted Phase I environmental site assessments
on substantially all of our properties. The purpose of these environmental
assessments was to identify potential sources of contamination for which any
of our properties may be responsible and to assess the status of environmental
regulatory compliance. The environmental assessments have not revealed any
environmental liability or compliance concerns that we believe would have a
material adverse effect on our business, assets, results of operations or
liquidity, nor are we aware of any environmental liability or compliance
concerns. Nevertheless, these environmental assessments may not have revealed
all environmental liabilities or compliance concerns. Also, there may be
material environmental liabilities or compliance concerns of which we are
currently unaware. We have not been notified by any governmental authority,
and we have no other knowledge of, any material noncompliance, liability or
claim relating to hazardous or toxic substances or other environmental
substances in connection with any of our properties.

  Uninsured and Underinsured Losses. Each of the leases with third parties
specifies comprehensive insurance to be maintained on each of the applicable
leased hotels, including liability, fire and extended coverage. We believe
this specified coverage is of the type and amount customarily obtained for
hotels. Leases for subsequently acquired hotels will contain similar
provisions. However, there are certain types of losses, generally of a
catastrophic nature such as earthquakes and floods, that may be uninsurable or
not economically insurable. Our Board of Directors and management will use
their discretion in determining amounts, coverage limits and deductibility
provisions of insurance, with a view to maintaining appropriate insurance
coverage on our investments at a reasonable cost and on suitable terms. This
may result in insurance coverage that, in the event of a substantial loss,
would not be sufficient to pay the full current market value or current
replacement cost of the lost investment. Inflation, changes in building codes
and ordinances, environmental considerations, and other factors also might
make it impractical to use insurance proceeds to replace the property after it
has been damaged or destroyed. Under these circumstances, the insurance
proceeds received might not be adequate to restore our economic position with
respect to the damaged property.

  Acquisition and development risks. We currently intend to pursue
acquisitions of additional hotels and hotel operating companies and, under
appropriate circumstances, may pursue development opportunities. Acquisitions
entail risks that the acquired hotels or hotel operating companies will fail
to perform according to our expectations or that our cost estimates to market,
acquire and operate properties will prove inaccurate. In addition, hotel
development is subject to other risks, including risks of construction delays
or cost overruns that may increase project costs, new project commencement
risks such as receiving zoning, occupancy and other required governmental
approvals and permits, and incurring development costs for projects that are
not pursued to completion.

  We depend on management contracts. We manage hotels for third party owners
pursuant to management contracts. These contracts may be acquired, terminated,
renegotiated or converted to franchise agreements in the ordinary course of
our business. However, the hotel property owner may terminate these management
contracts if we fail to meet certain performance standards, if the property is
sold to a third party, if the owner defaults on indebtedness encumbering the
property, upon a foreclosure of the property, closing of the property and
certain business combinations involving us in which our name or current
management team does not survive.

  There can be no assurance that we will be able to replace terminated
management contracts, or that the terms of renegotiated or converted contracts
will be as favorable as the terms that existed before such renegotiation or
conversion. We also will be subject to the risk that a hotel property owner
will be unable to pay management fees to us. In addition, in certain
circumstances, we may be required to make loans to or capital investments in
hotel properties in connection with management contracts. If any of these
hotel properties suffers poor operating results or if we lose our management
contract, we may not recover our loan or capital investment.

                                      13
<PAGE>

 Risks of Operating Hotels under Franchise or Brand Affiliations

  We operate some of our hotels under franchise or brand affiliations. In
addition, we may acquire hotels in the future which are operated under
franchise or brand affiliations. Each franchised hotel must meet specified
operating standards and other terms and conditions to continue its franchise
license. The continued use of a brand generally depends upon the continuation
of the management agreement related to that hotel with the hotel's management
entity. Franchisors typically inspect licensed properties periodically to
confirm adherence to operating standards. Actions by us, our affiliates or the
hotel management entities could cause a breach of these standards or other
terms and conditions of a franchise license or the loss or cancellation of a
franchise license. It is possible that a franchisor could condition the
continuation of a franchise license on the completion of capital improvements
which our Board of Directors determines are too expensive or otherwise
unwarranted in light of general economic conditions or the operating results
or prospects of the affected hotel. In that event, our Board of Directors may
elect to allow the franchise license to lapse which could result in our
incurring significant termination costs. If a franchise or brand affiliation
is terminated for any reason, we may try to obtain a suitable replacement
franchise or brand affiliation, or to operate the hotel independent of a
franchise or brand affiliation. If we lose a franchise or brand affiliation,
we will lose the associated name recognition, marketing support and
centralized reservation systems provided by the franchisor or brand owner.
This loss could adversely affect the value of the hotel and our results of
operations.

 Risks Relating to Gaming Operations

  Regulation of Gaming Operations. We own and operate several casino gaming
facilities at some of our hotels, including El San Juan, El Conquistador,
Condado Plaza and Old San Juan in Puerto Rico. Each of these gaming operations
is subject to extensive licensing, permitting and regulatory requirements
administered by various governmental entities.

  Typically, gaming regulatory authorities have broad powers related to the
gaming operations licenses. They may revoke, suspend, condition or limit our
gaming approvals and licenses, impose substantial fines and take other
actions, any of which could have a material adverse effect on our business and
the value of our hotel/casinos. Our directors, officers and some key employees
are subject to licensing or suitability determinations by various gaming
authorities. If any of those gaming authorities were to find someone
unsuitable, we would have to sever our relationship with that person.

  Risks Associated with High-End Gaming. The high-end gaming business is more
volatile than other forms of gaming. Fluctuations in customers' high-end
gaming activities could have an adverse impact on our financial condition and
results of operations. In addition, a significant portion of our table gaming
is attributable to a relatively small number of international customers. If
the most significant of these customers reduces or quits his or her gaming, it
could have an adverse effect on our financial condition and results of
operations.

 Risks Relating to Our Indebtedness

  As of December 31, 1999, our outstanding debt was approximately $3.6 billion
and our ratio of debt to total stockholders' equity was approximately 170%.
Our aggregate outstanding debt includes the following:

  .  Senior Credit Facility. We have a senior credit facility comprised of
     (1) term loans in an aggregate principal amount of $1.3 billion expiring
     on June 30, 2006, and (2) a revolving loan facility in an aggregate
     principal amount of up to $500 million expiring on June 30, 2004. As of
     December 31, 1999, we had borrowed $270 million under the revolving loan
     facility. The senior credit facility is guaranteed by our domestic
     subsidiaries and secured by pledges of our equity interests and the
     equity interests of our subsidiaries.

  .  Increasing Rate Loans. We have an increasing rate loan facility in the
     aggregate principal amount of $650 million which expires on June 30,
     2004. The lenders under the increasing rate loans receive the benefit of
     the same guarantees and pledges of security provided under the senior
     credit facility.

                                      14
<PAGE>

  .  New Mortgage Debt. On June 30, 1999, we closed on a $346 million
     mortgage loan secured by first liens on 25 of our hotel properties
     located throughout the United States and closed on a $235 million
     mortgage loan secured by first liens on 10 other of our hotel properties
     located throughout the United States. A separate special purpose entity
     subsidiary of ours owns each of the hotel properties subject to the
     liens.

  .  Other Mortgage Debt. As of December 31, 1999, we had outstanding $809.5
     million of other mortgage and secured debt. The mortgage debt has a
     weighted average interest rate of 7.92% and a weighted average remaining
     life of 5.6 years. This mortgage debt is secured by 38 of our
     properties.

  We also may borrow additional amounts from the same or other lenders in the
future, may assume debt in connection with acquisitions, or may issue
corporate debt securities in public or private offerings. Our organizational
documents do not limit the amount of indebtedness we may incur. However, our
ability to borrow under the revolving credit facility is subject to our
compliance with a number of customary financial and other covenants, including
total leverage and interest coverage ratios. Our inability to borrow under the
revolving credit facility could adversely affect our ability to fund
operations or expand our business. Further, substantially all of our debt
bears interest at a variable rate. Economic conditions could result in higher
interest rates, which could increase debt service requirements on variable
rate debt. Our debt service requirements will require the use of a substantial
portion of our operating cash flow to pay interest on our debt instead of for
other corporate purposes.

  There can be no assurance that we will be able to meet our debt service
obligations and, to the extent that we cannot, we may lose some or all of our
assets, including hotel properties. Adverse economic conditions could cause
the terms on which we borrow to worsen. Those circumstances, if we are in need
of funds to repay indebtedness, could force us to liquidate one or more
investments in properties at times that may not permit realization of the
maximum return on those investments.

  The foregoing risks associated with our debt obligations may inhibit our
ability to raise capital in both the public and private markets and may have a
negative impact on our credit rating.

 Risks Relating to Our Rapid Growth

  We have recently experienced a period of rapid growth. We are responsible
for the management and operation of several new businesses, including direct
hotel management, and branding and franchising, which previously were not part
of our operations. In addition, we may acquire other new businesses in the
future. The integration of departments, systems and procedures presents a
significant management challenge, and the failure to integrate new
acquisitions into existing management and operating structures could have a
material adverse effect on our results of operations and financial condition.

 Executive Officers of the Registrant

  Set forth below are the names, ages and certain other information concerning
the executive officers of Wyndham:

  James D. Carreker has served as Chairman of the Board of Directors since
January 1998 and Chief Executive Officer of Wyndham from January 1998 to March
2000. On March 27, 2000, the Company and Mr. Carreker agreed to amend the
terms of his employment agreement to provide among other things that he will
continue to serve solely as the Chairman of the Board of Directors. In
February 1999, Mr. Carreker was also named Chief Executive Officer of Patriot.
Prior to the merger of Wyndham Hotel Corporation with the companies in January
1998, Mr. Carreker had served as President and Chief Executive Officer of
Wyndham Hotel Corporation from May 1988 to January 1998 and as a director of
Wyndham Hotel Corporation from February 1996 to January 1998. He also served
as Chief Executive Officer of Trammell Crow Company, a national real estate
company, from August 1994 to December 1995. Prior to 1988, Mr. Carreker served
as President of Burdine's, the Miami based division of Federated Department
Stores. Mr. Carreker also serves as a director of Trammell Crow Company and of
Carreker-Antinori, Inc., a computer service company that completed its initial
public offering in May 1998. Mr. Carreker holds a B.S. and a Master of
Business Administration from Oklahoma State University. Mr. Carreker is 52
years old.

                                      15
<PAGE>

  Fred J. Kleisner became Chief Executive Officer on March 27, 2000. Prior to
this position he was President and Chief Operating Officer of Wyndham from
August 1999. He was previously President and Chief Operating Officer of The
Americas, for Starwood Hotels & Resorts Worldwide, Inc. Hotel Group from 1998
to 1999. His experience in the industry also include senior positions with
Westin Hotels and Resorts, where he was President and Chief Operating Officer
from 1995 to 1998; Interstate Hotels, where he was Executive Vice President
and Group President of Operations from 1990 to 1995; The Sheraton Corporation,
where he was Senior Vice President, Director of Operations, North America
Division-East from 1985 to 1990; and Hilton Hotels, where for 16 years he
served as General Manager of several landmark hotels, including The Waldorf
Astoria and The Waldorf Towers in New York, The Capital Hilton in Washington,
D.C., and The Hilton Hawaiian Village in Honolulu. Mr. Kleisner, who holds a
B.A. degree in Hotel Management from Michigan State University, completed
advanced studies at the University of Virginia and Catholic University of
America. Mr. Kleisner is 55 years old.

  Richard Mahoney became Chief Financial Officer of Wyndham in May 1999.
Before joining Wyndham, Mr. Mahoney served as Executive Vice President and
Chief Operating Officer of Starwood Hotels & Resorts' gaming division. From
1995 to 1998, Mr. Mahoney served as Executive Vice President and Chief
Financial Officer of Westin Hotels & Resorts. From 1988 to 1993, he served as
Vice President and Controller of Carnival Hotels and Casinos. Mr. Mahoney
holds an M.S. in Finance from Boston College. Mr. Mahoney is 47 years old.

  Leslie V. Bentley became an Executive Vice President of Wyndham in January
1998. He was employed by Wyndham Hotel Corporation since March 1985, served as
Executive Vice President and President of the Wyndham Garden Division since
May 1990 and was elected a director of Wyndham Hotel Corporation in January
1997. From January 1987 to June 1988, Mr. Bentley served as Regional Vice
President of Wyndham Hotel Corporation. From June 1988 to December 1988, Mr.
Bentley served as Vice President of Operations of Wyndham Hotel Corporation
and from December 1988 to May 1990, he served as Senior Vice President of
Operations of Wyndham Hotel Corporation. Prior to joining Wyndham Hotel
Corporation, Mr. Bentley was employed by Marriott International Hotels for
eight years. Mr. Bentley holds a B.S. in Hotel and Restaurant Administration
from Pennsylvania State University. Mr. Bentley is 47 years old.

  Michael A. Grossman serves as Executive Vice President of Wyndham and
divisional president of the management services division of the Company. From
1977 to 1993, Mr. Grossman owned and operated Grossman and Associates, a hotel
management company. Mr. Grossman joined Patriot American in August 1993 as a
Senior Vice President heading up its hotel division. Mr. Grossman was
subsequently appointed Chief Operating Officer of Gencom American Hospitality,
which initially served as a third party manager for Patriot and was
subsequently acquired by Patriot. Mr. Grossman holds a B.B.A. from the
University of Texas and a J.D. from Southern Methodist University. Mr.
Grossman is 46 years old.

  Dave Johnson became executive vice president, sales and marketing, in March
2000. He was previously president of the Wyndham hotel division from August
1999 to March 2000, and president of the Wyndham Garden division from January
1998 to August 1999, prior to these positions, Mr. Johnson was Senior Vice
President of Operations for the Eastern United States. His career with senior
management began in 1987 as Director of Sales & Marketing for Wyndham Hotels
and Resorts. Dave Johnson holds a BA and MA from Northeastern Illinois
University.

  Carla S. Moreland was named Executive Vice President--General Counsel of
Wyndham in April 1999. She served as Senior Vice President--General Counsel of
Wyndham from January 1998 to April 1999. Ms. Moreland served as general
counsel of Wyndham Hotel Corporation from April 1994 until January 1998. From
1987 to 1994 she practiced law with the firm of Weil Gotshol and Manges. Ms.
Moreland holds a B.A. and J.D. from The College of William and Mary. Ms.
Moreland is 40 years old.

                                      16
<PAGE>

ITEM 3. LEGAL PROCEEDINGS

  On June 29, 1992, an action for trademark infringement was filed in the New
York Supreme Court, County of New York, Index No. 17474/92 titled Wyndham
Hotel Company, John Mados, and Suzanne Mados et al v. Wyndham Hotel Company.
Ltd. It is based upon the Madoses' alleged use of the mark WYNDHAM in
connection with the Wyndham Hotel located in Manhattan, New York City, and
operated by the Madoses since 1966 pursuant to a lease agreement entered into
by the Madoses on June 1, 1957. The case was tried in May 1996, and an order
and partial judgement was entered in March 1998. The order enjoins us from
using the name and mark "Wyndham" in connection with the advertising,
promoting, managing or operating a hotel in Manhattan, New York City, and
places restrictions on Wyndham's use of the name and mark "Wyndham" in all
other areas of New York outside of Manhattan. In November 1998, an order was
issued clarifying the original order and a final judgment was entered. In
December 1998, Wyndham appealed that judgment to the New York Supreme Court,
Appellate Division, First Department. In January 1999, Wyndham moved for a
stay of the injunction pending appeal which motion was granted by the
Appellate Division, First Department on February 4, 1999. On May 18, 1999 the
Appellate Division, First Department rendered a decision and order affirming
the final judgment. On May 24, 1999, Wyndham filed a motion for permission to
appeal that decision to the Court of Appeals of the State of New York. In July
1999, Wyndham received notice that the Court of Appeals of the State of New
York would not hear the appeal.

  Patriot and Old Wyndham have disclosed various matters relating to Patriot
and Old Wyndham in their Form 8-K filed with the Securities and Exchange
Commission on November 9, 1998 including, without limitation, an assertion by
UBS AG, London Branch ("UBS") that Patriot and Old Wyndham are in default
under the terms of a forward contract by and among Patriot, Old Wyndham and
UBS. Patriot and Old Wyndham also have disclosed various matters in their
Joint Annual Report on Form 10-K, filed with the Securities and Exchange
Commission on March 26, 1999, and in registration statements on Form S-3
(filed on April 28, 1999) and Form S-4 (filed on April 14, 1999).

  On or about January 12, 1999, a purported class action lawsuit was filed on
behalf of the shareholders of Patriot and Wyndham in the Delaware Chancery
Court. The lawsuit, captioned Fraschilla v. Paul A. Nussbaum, et al., No.
16895NC, named as defendants certain persons who then were directors of
Patriot, as well as certain other individuals and entities alleged to be
investors in the Company (the "Investors"). The lawsuit alleged that the
director defendants breached their fiduciary duties to Patriot's shareholders
with respect to Patriot's financial condition and breached their fiduciary
duties to Patriot's shareholders by "effectively selling control" of Patriot
to the Investors for inadequate consideration and without having adequately
considered or explored all other alternatives to this sale or having taken
steps to maximize stockholder value. The lawsuit also alleged that the
Investors aided and abetted the director defendants in their purported
breaches of fiduciary duty. The plaintiffs sought monetary damages from the
director defendants as well as an injunction preventing the consummation of
the proposed transaction with the Investors. On January 19, 1999, three nearly
identical purported class action lawsuits were filed in the same court on
behalf of different purported class representatives: (i) Sybil R. Meisel and
Steven Langsam, Trustees, No. 16905NC; (ii) Crandon Capital Partners, No.
16906NC; and (iii) Robert A. Staub, No. 16907NC. All of the actions were
consolidated into the Fraschilla action. In September 1999, the parties
entered into a Stipulation of Settlement to settle these lawsuits. Pursuant to
the Stipulation of Settlement, Wyndham agreed that it would make the rights
offering it previously announced it may make, no later than December 17, 1999,
and to hold this offering open for a period of not less than 30 days. On
November 1, 1999, the Delaware Chancery Court approved the amended Stipulation
of Settlement along with class counsels' fee request of $1,125,000 and entered
an order and final judgment dismissing all of these lawsuits (the "Order").
The Order became final on or about December 2, 1999. Currently, Wyndham is
seeking recovery for costs incurred in the defense and settlements of these
lawsuits from its directors and officers insurance carriers.

  On February 3, 1999, McNeill Investment Company, Inc. filed a lawsuit
against Patriot in the United States District Court for the Western District
of Pennsylvania. In the lawsuit, captioned McNeill Investment Company, Inc. v.
Patriot American Hospitality, Inc., No. 99-165, the plaintiff alleges that
Patriot breached its obligations under a registration rights agreement that
Patriot became obligated under through its merger transaction with

                                      17
<PAGE>

Interstate Hotels Corporation. The plaintiff claims approximately $9 million
in damages. The case presently is in the early discovery stage. Wyndham
intends to defend the suit vigorously.

  On May 7, 1999, Doris Johnson and Charles Dougherty filed a lawsuit in the
Northern District of California against Patriot, Wyndham, their respective
operating partnerships and Paine Webber Group, Inc. This action, Johnson v.
Patriot American Hospitality, Inc., et al., No. C-99-2153, was commenced on
behalf of all former stockholders of Bay Meadows stock during a class period
from June 2, 1997 to the date of filing. The action asserts securities fraud
claims and alleges that the purported class members were wrongfully induced to
tender their shares as part of the Patriot/Bay Meadows merger based on a
fraudulent prospectus. The action further alleges that defendants continued to
defraud shareholders about their intentions to acquire numerous hotels and
saddle the company with massive debt during the class period. Three other
actions against the same defendants subsequently were filed in the Northern
District of California: (i) Ansell v. Patriot American Hospitality, Inc., et
al., No. C-99-2239 (filed May 14, 1999), (ii) Sola v. Paine Webber Group,
Inc., et al., No. C-99-2770 (filed June 11, 1999), and (iii) Gunderson v.
Patriot American Hospitality, Inc., et al., No. C-99-3040 (filed
June 23, 1999). Another action with substantially identical allegations,
Susnow v. Patriot American Hospitality, Inc., et al., No. 3-99-CV1354-T (filed
June 15, 1999) also subsequently was filed in the Northern District of Texas.
The complaints in these actions seek unspecified damages but assert that the
defendants are liable for the diminution in value of Patriot stock held by
class members during the class period. By order of the Judicial Panel on
Multidistrict Litigation, these actions along with certain actions identified
below have been consolidated in the Northern District of California for
consolidated pretrial purposes. To date, none of the defendants have been
required to answer, move or otherwise respond to the complaints, and no
discovery has been taken. Wyndham intends to defend the suits vigorously.

  On or about June 22, 1999, a lawsuit captioned Levitch v. Patriot American
Hospitality, Inc., et al., No. 3-99-CV1416-D, was filed in the Northern
District of Texas against Patriot, Wyndham, James D. Carreker and
Paul A. Nussbaum. This action asserts securities fraud claims and alleges
that, during the period from January 5, 1998 to December 17, 1998, the
defendants defrauded stockholders by issuing false statements about the
company. The complaint was filed on behalf of all shareholders who purchased
Patriot and Wyndham stock during that period. Three other actions, Gallagher
v. Patriot American Hospitality, Inc., et al., No. 3-99-CV1429-L, filed on
June 23, 1999, David Lee Meisenburg, et al. v. Patriot American Hospitality,
Inc., Wyndham International, Inc., James D. Carreker, and Paul A. Nussbaum
Case No. 3-99-CV1686-X, filed July 27, 1999 and Deborah Szekely v. Patriot
American Hospitality, Inc., et al., No. 3-99-CV1866-D, filed on or about
August 27, 1999, allege substantially the same allegations. The complaints in
these actions seek unspecified damages but assert that the defendants are
liable for the diminution in value of Patriot stock held by class members
during the class period. By order of the Judicial Panel on Multidistrict
Litigation, these actions have been consolidated with certain other
stockholder actions and transferred to the Northern District of California for
consolidated pre-trial purposes. To date, none of the defendants have been
required to answer, move or otherwise respond to the complaints, and no
discovery has been taken. Wyndham intends to defend the suits vigorously.

  Wyndham has received a draft complaint which threatens to assert claims on
behalf of Golden Door, LLC, Golden Springs, LLC, Golden Door, Inc., Deer
Springs Ranch, LLC, Deborah Szekely and Sarah Livia Brightwood. The potential
plaintiffs appear to be the same as the plaintiffs who filed the action
referenced above, Deborah Szekely v. Patriot American Hospitality, Inc., et
al., No. 3-99-CV1866-D, however the allegations of the complaints are not the
same. The draft complaint purports to assert claims against Patriot, Wyndham
and their respective operating partnerships for securities fraud under the
California securities code, common law fraud, breach of fiduciary duty and
deceit in connection with the purchase by Patriot of the Golden Door Spa in
February 1998. The draft complaint seeks compensatory damages for the alleged
lost value of the potential plaintiff's stock and other unspecified damages.
Although the Company has received a draft complaint, to date no complaint has
been filed.

  Patriot and PAH Stanley Ranch ("PAH") are engaged in a dispute with Carneros
Valley Investors involving a contract which calls for a purchase price of $14
million with an additional $5 million to be paid if PAH gets approval for a
development in the Napa Valley. PAH did not get approval for this development.
In September, 1999, Carneros Valley Investors filed a complaint in the
Superior Court of California, San Francisco, which

                                      18
<PAGE>

alleges that Patriot owes it $5 million and alleges that it acted negligently,
fraudulently and in bad faith in attempting to get the approval for the
development. The complaint has been amended to allege fraud, allegedly
entitling the plaintiff to rescission of the sale. Patriot has answered the
complaint, but to date, no discovery has been taken. Wyndham intends to defend
the suit vigorously.

  Patriot American Hospitality, Inc., IHC/Jacksonville Corporation and IHC
Realty Partnership, are parties to a dispute with another limited partner of
the Partnership relating to a proposed hotel development in Jacksonville,
Florida. The case is captioned C&M Investors Limited v. Patriot American
Hospitality, Inc. et al., originally filed in the Florida Circuit Court,
Fourth Judicial Circuit, in and for Duval County, Florida, but later removed
and now pending in the United States District Court, Middle District of
Florida, Jacksonville Division, Civil Action No. 98-1236-Civ. J 20B. Wyndham
plans to vigorously defend this lawsuit.

  On September 17, 1999, Starwood Hotels & Resorts Worldwide Inc. ("Starwood")
filed a lawsuit against Fred J. Kleisner, Richard Mahoney and Wyndham in the
United States District Court for the Southern District of New York. In the
lawsuit, captioned Starwood Hotels & Resorts Worldwide Inc. v. Fred J.
Kleisner et al, No. 99 Civ. 9811, the plaintiff alleged that Wyndham
tortiously interfered with alleged employment contracts between Starwood and
Kleisner and Mahoney, respectively, that the defendants misappropriated trade
secrets belonging to Starwood, that the defendants tortiously interfered with
Starwood's prospective business relationships and that the defendants are
unfairly competing with Starwood. The complaint sought injunctive relief and
other damages.

  On November 12, 1999, Wyndham, Kleisner, Mahoney (the "Wyndham Defendants")
and Starwood entered into a Settlement Agreement and Mutual Release (the
"Settlement Agreement") under the terms of which all claims against the
Wyndham Defendants were dismissed with prejudice and the Wyndham Defendants
paid no damages. Under the Settlement Agreement, Wyndham agreed to
restrictions on its ability to hire and solicit for employment certain
Starwood employees until July 2000.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

  None.

                                      19
<PAGE>

                                    PART II

ITEM 5.  MARKET PRICE FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
         MATTERS

Market Information

  The following table sets forth the quarterly high and low sale prices per
share as reported on the New York Stock Exchange ("NYSE") of the paired shares
as reported on the NYSE (symbol "PAH") through June 29, 1999. Effective June
30, 1999, Patriot and Old Wyndham completed a series of transactions, which
included a restructuring of their existing organizational structure. The stock
pairing agreement was terminated; Patriot became a wholly owned subsidiary of
Wyndham International Inc., and on June 30, 1999, the shares of Wyndham class
A common stock commenced trading on the NYSE under the symbol "WYN". The sale
prices and distributions in the table have been adjusted to reflect the stock
dividend of $0.44 declared on December 22, 1998 and distributed to
shareholders of record on December 30, 1998.

<TABLE>
<CAPTION>
                                                                     Per Share
                                                    High(1) Low(1)  Dividend(1)
                                                    ------- ------- -----------
<S>                                                 <C>     <C>     <C>
1998:
  First Quarter.................................... $29.50  $ 24.00   $0.2981
  Second Quarter................................... $28.25  $ 19.75   $0.2981
  Third Quarter.................................... $24.50  $ 11.50   $   -- (2)
  Fourth Quarter................................... $13.25  $ 5.313   $0.4400(3)
1999:
  First Quarter.................................... $ 7.00  $4.4375   $   --
  Second Quarter................................... $ 5.50  $  4.00   $   -- (4)
  Third Quarter.................................... $4.875  $ 2.625   $   --
  Fourth Quarter................................... $3.875  $2.4375   $   --
</TABLE>
--------
(1) Represents paired shares for periods from January 1998 and through June
    29, 1999, and Wyndham class A common stock subsequent to June 29, 1999.
    Dividends have been paid only on shares of Patriot common stock for
    periods after January 1, 1998. No dividends have been paid on Wyndham
    common stock.
(2) On October 5, 1998, Patriot made a significant capital contribution to
    Wyndham to facilitate an acquisition by Wyndham. This contribution
    resulted in a "deemed distribution" for tax purposes to holders of Patriot
    common stock of $0.7081 per share. No cash was actually distributed to the
    shareholders. However, for tax purposes the distribution is treated by
    shareholders as though cash was received and then contributed to Wyndham.
    On November 20, 1998, Patriot announced that it would not declare a
    dividend with respect to the third quarter of 1998.
(3) On December 22, 1998, Patriot declared a stock dividend of $0.44 cents per
    share of common stock for the fourth quarter of 1998. The dividend was
    paid on January 25, 1999 to shareholders of record on December 30, 1998.
(4) On June 18, 1999 there was a spin-off of Interstate Hotel Corporation.
    Each record holder as of June 7, 1999 received one share of newly issued
    Interstate stock for every 30 shares held of Patriot common stock, Patriot
    series A preferred stock, Old Wyndham series A and B preferred stock,
    Patriot American Hospitality Partnership L.P. common and preferred OP
    units, and Wyndham International L.P. class A and class C preferred OP
    units.

Holders

  As of March 22, 2000, there were approximately 1,497 record holders of the
Company's shares of class A common stock, including shares held in "street
name" by nominees who are record holders, and approximately 22,200
shareholders.

                                      20
<PAGE>

Dividends

  Prior to the restructuring, the Board of Directors of Patriot determined the
actual distribution rate based on a number of factors, including the amount of
cash available for distribution, Patriot's financial condition, capital
expenditure requirements for Patriot's properties, the annual distribution
requirements under the REIT provisions of the Internal Revenue Code of 1986,
as amended (the "Code") and such other factors as the Board of Directors
deemed relevant. Patriot's status as a REIT was terminated as a result of the
restructuring and the Company is no longer required to pay dividends to its
common shareholders.

  The Company does not anticipate paying a dividend to its common shareholders
and is prohibited under the terms of its new credit facility and term loans
from paying dividends on its common stock. However, for the first six years,
dividends on the series A and series B convertible preferred stock are
structured to ensure an aggregate fixed cash dividend payment of $29.25
million per year, so long as there is no redemption or conversion of the
preferred stock; therefore, for that period, dividends are payable partly in
cash and partly in additional shares of preferred stock. For the following
four years, dividends are payable in cash or additional shares of series A or
series B convertible preferred stock, as the case may be, as determined by the
Board of Directors. After year ten, dividends are payable solely in cash.

Recent Sales of Unregistered Securities

  None

ITEM 6. SELECTED FINANCIAL INFORMATION

  The following tables set forth selected consolidated historical financial
information for the Company. The following financial information should be
read in conjunction with, and is qualified in its entirety by, the historical
financial statements and notes thereto of the Company included elsewhere in
this Annual Report on Form 10-K. The selected financial and other data for the
Company for 1999 has been derived from the consolidated financial statements
of the Company audited by PricewaterhouseCoopers LLP, independent accountants.


                                      21
<PAGE>

                             WYNDHAM INTERNATIONAL
           Selected Condensed Consolidated Historical Financial Data

<TABLE>
<CAPTION>
                                                                                 Period
                                                                             October 2, 1995
                                    Year Ended December 31,                   (Inception of
                         ------------------------------------------------  Operations) through
                            1999         1998         1997        1996      December 31, 1995
                         -----------  -----------  -----------  ---------  -------------------
                                       (in thousands, except per share data)
<S>                      <C>          <C>          <C>          <C>        <C>
Operating Data:
Total revenue........... $ 2,495,335  $ 2,056,341  $   335,035  $  76,493       $  11,095
(Loss) income before
 income tax provision,
 minority interest and
 extraordinary item.....    (491,335)    (112,508)       4,142     44,813           7,064
(Loss) income before
 extraordinary item.....  (1,062,131)    (126,406)         362     37,991           6,096
Net (loss) income....... $(1,071,969) $  (158,223) $    (2,172) $  37,991       $   5,359
Per Share Data (1):
Basic earnings per
 share:
  (Loss) income before
   extraordinary item... $     (7.02) $     (1.13) $      0.01  $    0.84       $    0.16
  Extraordinary item,
   net of minority
   interest.............       (0.06)       (0.23)       (0.04)       --            (0.02)
                         -----------  -----------  -----------  ---------       ---------
  Net (loss) income per
   share................ $     (7.08) $     (1.36) $     (0.03) $    0.84       $    0.14
                         ===========  ===========  ===========  =========       =========
  Diluted earnings per
   share(2)............. $     (7.20) $     (2.57) $     (0.03) $    0.83       $    0.14
                         ===========  ===========  ===========  =========       =========
  Dividends per
   share(3)............. $       --   $    1.0362  $    1.0878  $  0.9154       $  0.2236
                         ===========  ===========  ===========  =========       =========
Cash Flow Data:
Cash provided by
 operating activities... $   202,302  $   244,493  $   108,110  $  61,196       $   7,618
Cash used in investing
 activities.............    (289,953)  (2,076,359)  (1,202,124)  (419,685)       (306,948)
Cash provided by
 financing activities...     175,510    1,943,384    1,134,846    360,324         304,099
</TABLE>

<TABLE>
<CAPTION>
                                              As of December 31,
                              --------------------------------------------------
                                 1999       1998       1997      1996     1995
                              ---------- ---------- ---------- -------- --------
                                                (in thousands)
<S>                           <C>        <C>        <C>        <C>      <C>
Balance Sheet Data:
Investment in real estate
 and related improvements
 and land held for
 development, at cost, net..  $5,413,178 $5,585,616 $2,044,649 $641,825 $265,759
Total assets................   7,003,490  7,415,670  2,507,853  760,931  324,224
Total debt..................   3,643,556  3,857,521  1,112,709  214,339    9,500
Minority interest in
 Operating Partnerships.....      22,435    253,970    220,177   68,562   41,522
Minority interest in
 consolidated subsidiaries..     166,483    229,537     49,694   11,711      --
Stockholders' equity........   2,137,662  2,603,037    989,892  437,039  261,778
</TABLE>

                                       22
<PAGE>

<TABLE>
<CAPTION>
                                                                   Period
                                                               October 2, 1995
                              Year Ended December 31,           (Inception of
                         ----------------------------------- Operations) through
                           1999      1998     1997    1996    December 31, 1995
                         --------  -------- -------- ------- -------------------
                                             (in thousands)
<S>                      <C>       <C>      <C>      <C>     <C>
Other Data:
EBITDA(4)............... $158,765  $369,401 $105,743 $69,558       $ 9,006
Weighted average number
 of common shares
 outstanding............  161,255   137,764   64,260  45,997        39,407
Ratio of earnings to
 fixed charges..........    (0.36)     0.59     1.08    7.00         80.37
Deficiency of earnings
 to fixed charges.......  491,335   112,508      --      --            --
</TABLE>

Notes to Selected Financial Information

(1) On January 30, 1997, the Patriot Board of Directors declared a 2-for-1
    stock split effected in the form of a stock dividend on March 18, 1997 to
    stockholders of record on March 7, 1997. On July 1, 1997, by operation of
    the Cal Jockey Merger, each issued and outstanding share of Patriot common
    stock was converted into 0.51895 paired shares. In addition, on July 10,
    1997, the respective Boards of Directors of Patriot and Wyndham declared a
    1.927-for-1 stock split on their shares of common stock effected in the
    form of a stock dividend distributed on July 25, 1997 to stockholders of
    record on July 15, 1997. All references herein to the number of shares,
    per share amounts and market prices of the paired shares and options to
    purchase Paired shares have been restated to reflect the impact of the Cal
    Jockey Merger and the above-described stock splits, as applicable.

    In addition, in February 1997, the Financial Accounting Standards Board
    issued Statement of Financial Accounting Standards No. 128 "Earnings Per
    Share" ("Statement 128"). Statement 128 specifies the computation,
    presentation and disclosure requirements for basic earnings per share and
    diluted earnings per share. The earnings per share amounts presented
    herein have been restated to reflect the impact of Statement 128.

    On December 22, 1998, Patriot declared a stock dividend of $0.44 cents per
    share of common stock for the fourth quarter of 1998. The dividend was
    paid on January 25, 1999 to shareholders of record on December 30, 1998.
    Each shareholder received the option to receive the dividend in the form
    of additional paired shares or shares of Series B Cumulative Perpetual
    Preferred Stock, par value $0.01 per share, of Patriot.

    Earnings per common share, weighted average shares outstanding and all
    stock option activity have been restated to reflect the stock dividend.

    On June 30, 1999, a subsidiary of Old Wyndham was merged with and into
    Patriot and Patriot became a wholly-owned subsidiary of Wyndham. The
    pairing arrangement was terminated and each outstanding paired share was
    converted into a share of Wyndham class A common stock.

(2) For 1999, the dilutive effect of unvested stock grants of 803,000; the
    option to purchase common stock of 59,000 and preferred stock of
    64,367,000 were not included in the computation of earnings per share
    because they are anti-dilutive. For 1998, the dilutive effect of unvested
    stock grants of 880,000 shares, the option to purchase common stock of
    753,000 shares of common stock; 2,507,000 shares issued in connection with
    forward equity contracts; and 6,613,000 preferred shares, were not
    included in the computation of earnings per share because they are anti-
    dilutive. For 1997, the effect of unvested stock grants of 804,000 and the
    option to purchase common stock of 1,017,000 were excluded in the
    computation of diluted earnings per share because they are anti-dilutive.

(3) Dividends for the year ended 1998 include a $0.44 stock dividend.
    Dividends paid for the year ended December 31, 1997 include a special
    dividend of $0.06 per share paid by Patriot's predecessor on June 30,
    1997. To maintain its qualification as a REIT prior to consummation of the
    Cal Jockey Merger, Patriot was required to distribute to its stockholders
    any undistributed "real estate investment trust taxable income" for its
    short taxable year ending with the consummation of the Cal Jockey Merger.
    Old Wyndham did not pay any dividends for the six months ended December
    31, 1997.

                                      23
<PAGE>

(4) EBITDA represents earnings of the Company before interest, taxes,
    depreciation and amortization expense. The Company believes that EBITDA is
    a widely accepted financial indicator used by investors and analysts to
    analyze and compare companies on the basis of operating performance.
    EBITDA is not intended to represent cash flows for the periods presented,
    nor has it been presented as an alternative to operating income or as an
    indicator of operating performance. Readers should not consider EBITDA in
    isolation or as a substitute for measures of performance prepared in
    accordance with generally accepted accounting principles. While EBITDA is
    frequently used by securities analysts in the evaluation of companies,
    EBITDA is not necessarily comparable to other similarly titled measures of
    other companies due to potential inconsistencies in the methods of
    calculation. A reconciliation from net income to EBITDA for the years
    ended December 31, 1999, 1998, 1997, 1996 and for the period from October
    2, 1995 (inception of operation) through December 31, 1995 is as follows:

<TABLE>
<CAPTION>
                                                                            Period
                                                                        October 2, 1995
                                   Year Ended December 31,               (Inception of
                            ----------------------------------------- Operations) through
                              1999(a)     1998(b)   1997(c)    1996    December 31, 1995
                            -----------  ---------  --------  ------- -------------------
                                              (dollars in thousands)
   <S>                      <C>          <C>        <C>       <C>     <C>
   Net (loss) income....... $(1,071,969) $(158,223) $ (2,172) $37,991       $5,359
   Extraordinary loss......       9,838     31,817     2,534      --           --
   Minority interest in
    operating
    partnerships...........      (6,642)   (12,651)    1,684    6,767          968
   Income taxes............     571,421     17,122       481      --           --
   Depreciation and
    amortization...........     302,890    231,233    52,685   17,420        2,590
   Interest expense........     353,227    260,103    50,531    7,380           89
                            -----------  ---------  --------  -------       ------
   EBITDA.................. $   158,765  $ 369,401  $105,743  $69,558       $9,006
                            ===========  =========  ========  =======       ======
</TABLE>
--------
(a)  For the year ended December 31, 1999, EBITDA would be $622,061 after
     adjusting for the following unusual or non-recurring items: restructuring
     expenses and strategic reorganization costs of $316,886, Interstate spin-
     off costs of $5,435, abandoned transaction costs of $13,530, Y2K costs
     and preopening expenses of $21,131, impairment loss on assets held for
     sale of $70,912, loss on the sale of assets of $10,702, allocable
     percentage of EBITDA from unconsolidated subsidiaries and third party
     minority interest of $13,068, and other non-recurring charges of $11,632.
(b)  For the year ended December 31, 1998, EBITDA would be $568,200 after
     adjusting for the following unusual or non-recurring items: cost of
     acquiring leaseholds and license agreements of $64,407, treasury lock
     settlement of $49,334, loss on sale of assets of $9,453 and impairment
     loss on assets held for sale of $51,081, abandoned transaction costs of
     $14,813, amortization of unearned compensation of $9,670, and other costs
     of $41.
(c)  For the year ended December 31, 1997, EBITDA would be $160,242 after
     adjusting for the cost of acquiring leaseholds of $54,499.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

  Certain statements this Form 10-K constitute "forward-looking statements" as
that term is defined under (S)21E of the Securities Exchange Act of 1934, as
amended, and the Private Securities Litigation Reform Act of 1995. The words
"believe", "expect", "anticipate", "intend", "estimate", and other expressions
which are predictions of or indicate future events and trends and which do not
relate to historical matters identify forward-looking statements. Readers are
cautioned not to place undue reliance on these forward-looking statements.
Although forward-looking statements reflect management's good faith beliefs,
reliance should not be placed on forward-looking statements because they
involve known and unknown risks, uncertainties and other factors, which may
cause the actual results, performance or achievement of the Company to differ
materially from anticipated future results, performance or achievements
expressed or implied by such forward-looking statements. The Company
undertakes no obligation to publicly update or revise any forward-looking
statement,

                                      24
<PAGE>

whether as a result of new information, future events or otherwise. Certain
factors that might cause a difference include, but are not limited to, risks
associated with the availability of equity or debt financing at terms and
conditions favorable to the Company, the Company's ability to effect sales of
assets on favorable terms and conditions, risks associated with the hotel
industry and real estate markets in general; risks associated with debt
financing and the risks discussed above in Part I--Business and Properties--
Certain Risk Factors.

Background

 Organization

  Patriot was formed April 17, 1995 as a self-administered real estate
investment trust ("REIT") for the purpose of acquiring equity interests in
hotel properties. On October 2, 1995, Patriot completed an initial public
offering of shares of common stock and commenced operations. Between October
2, 1995 and July 1, 1997, Patriot acquired interests in 56 hotel properties.
These hotels were leased to various third party lessees.

  On July 1, 1997, Patriot merged with and into California Jockey Club, with
Cal Jockey being the surviving legal entity, hereinafter referred to as the
"Cal Jockey merger". Cal Jockey's shares of common stock were paired and
traded together with the shares of common stock of Bay Meadows Operating
Company ("Bay Meadows") as a single unit pursuant to a stock pairing
agreement. In connection with the Cal Jockey merger, Cal Jockey changed its
name to "Patriot American Hospitality, Inc." ("Patriot") and Bay Meadows
changed its name to "Patriot American Hospitality Operating Company".
Subsequent to December 31, 1997, as a result of the merger of Wyndham Hotel
Corporation with and into Patriot as discussed below (the "Wyndham merger"),
Patriot American Hospitality Operating Company changed its name to "Wyndham
International, Inc." and is referred to herein, collectively with its
subsidiaries, as "Old Wyndham".

  Subsequent to the Cal Jockey merger through December 31, 1998, the Company
went through a series of mergers and acquisitions including the Wyndham
merger, the merger with WHG Casinos & Resorts Inc. ("WHG") and acquisition of
partners' interests, the merger with Arcadian International ("Arcadian"), the
Summerfield acquisition, the merger with CHCI International Inc. ("CHCI") and
the merger with Interstate.

  Effective June 30, 1999, a subsidiary of Old Wyndham merged with and into
Patriot with Patriot being the surviving entity and becoming a subsidiary of
Old Wyndham. In connection with this restructuring, the pairing agreement
between Patriot and Old Wyndham was terminated, Patriot's status as a real
estate investment trust terminated effective January 1, 1999, and Patriot
became a taxable corporation as of that date. This merger converted each
previously outstanding paired share into one share of Wyndham class A common
stock. Old Wyndham and its subsidiaries, which now include Patriot, is
hereafter referred to as Wyndham or the Company.

  The restructuring was reflected as a reorganization of two companies under
common control and was accounted for in a manner similar to that used in
pooling of interest accounting. As such, there was no revaluation of the
assets and liabilities of Old Wyndham or Patriot. The financial statements
prior to the reorganization are presented on a combined basis and include the
combined accounts of Patriot and its subsidiaries with Old Wyndham and its
subsidiaries.

 Restructuring

  During 1999, the Company recorded $285.3 million of costs associated with
the restructuring of the organization. As a condition of the $1 billion equity
investment, Old Wyndham was required to terminate the pairing agreement with
Patriot. As a result, the Company recorded a charge of approximately $83.1
million for the write-off of the unamortized intangible asset associated with
the paired share structure which was abandoned June 30, 1999. In addition, the
Company incurred approximately $4.7 million in severance and employee related
costs for seven employees in the New York corporate office and two employees
in the Dallas corporate office, and $0.7 million in legal costs. The New York
office was closed on June 30, 1999 and its employees were terminated at that
time.

                                      25
<PAGE>

  The Company recorded a charge of $97.9 million for the write-down of assets
to estimated fair value, including goodwill of $28.4 million as a result of
management's strategy to exit from the European market for its non-branded
assets which will be sold. In addition, the Company recorded costs of $9.5
million associated with severance costs for 67 employees and other exit costs
necessary to reduce the Company's infrastructure in Arcadian International,
the Company's management division in Europe.

  On August 11, 1999, the Company announced its plan to realign its luxury
division, in its continuing efforts to streamline its organization. As a
result, the Phoenix division office was closed on September 10, 1999. The
Company recorded costs of $2.5 million associated with severance payments for
staffing reductions of 19 employees, and other exit costs. In addition,
management has decided to focus on the Company's core brands, and has
rebranded many of the Grand Bay Resorts (formerly Carefree Resorts) to Wyndham
Luxury Resorts, to signal a more apparent relationship to Wyndham. As such, a
charge of $12.8 million for the tradename intangibles attributable to the
Grand Bay and Carefree brands was recorded.

  The Company also announced it would close its Wichita divisional office and
as a result, recorded $1.9 million in severance payments for 82 employees.

  In addition, Wyndham recorded a charge of $72.2 million including a write-
down of assets to estimated fair value. The write-down included $8.8 million
of intangible assets as a result of management's strategy to exit from the
limited service hotel sector. The following table details the restructuring
charges incurred by the Company during 1999.
<TABLE>
<CAPTION>
                                   Cash/Non-   Restructuring Accrued Balance at
    Description                      Cash         Charge          12/31/99
    -----------                  ------------- ------------- ------------------
                                                 (in thousands)
<S>                              <C>           <C>           <C>
Organizational Restructuring
Write-down of intangible
 assets........................  Non-cash        $ (83,094)       $   --
Severance packages.............  Cash/non-cash      (4,675)          (500)
Downsizing European division
Write-down of assets held for
 sale..........................  Non-cash          (69,491)           --
Write-down of intangible
 assets........................  Non-cash          (28,394)           --
Severance packages.............  Cash               (3,578)        (2,458)
Lease cancellations and
 commitments...................  Cash               (1,907)        (1,907)
Other exit costs...............  Cash               (4,062)        (2,408)
Exiting limited service market
 sector
Write-down of assets held for
 sale..........................  Non-cash          (63,328)           --
Write-down of intangible
 assets........................  Non-cash           (8,834)           --
Closing the Phoenix division
 office
Severance packages.............  Cash               (2,006)          (312)
Lease cancellations and
 commitments...................  Cash                 (492)          (321)
Closing of the Wichita division
 office
Severance packages.............  Cash               (1,872)        (1,872)
Elimination of certain hotel
 brands
Write-down of intangible
 assets........................  Non-cash          (12,821)           --
Other
Other exit costs...............  Cash                 (713)           --
Effect of foreign currency
 translation...................                        --               8
                                                 ---------        -------
  Total........................                  $(285,267)       $(9,770)
                                                 =========        =======
</TABLE>

  As of December 31, 1999, the Company owned interests in 165 hotels with an
aggregate of over 43,900 guestrooms and leased 39 hotels from third parties
with over 5,700 rooms. In addition, Wyndham manages 88 hotels for third party
owners with over 20,800 guestrooms and franchises 11 hotels with over 2,600
guestrooms.

Results of Operations: Year Ended December 31, 1999 Compared with Year Ended
December 31, 1998

  For the year ended December 31, 1999 hotel revenues were $2,409,046,000 as
compared to $1,842,682,000 during 1998. Of the approximate $566,364,000
increase, approximately $337,377,000 was attributable to the

                                      26
<PAGE>

1998 acquisitions including Interstate, Summerfield, Arcadian and WHG, net of
leases which were included in the Interstate spin-off. In addition, the
purchase of the remaining third party leasehold interests, primarily CHC Lease
Partners, NorthCoast Hotels L.L.C. ("NorthCoast"), and the DTR North Canton
Inc (the "Doubletree Lessee"), in June 1998, December 1998 and January 1999
led to increases in hotel revenue of $124,712,000 as the operations of the
hotels during 1999 were consolidated in the statement of operations, whereas
in 1998, the Company was receiving a participating rent payment. Additionally,
$25,072,000 can be attributed to the consolidation of two hotels which were
previously accounted as an equity investment.

  Hotel expenses increased from $1,351,872,000 in 1998 to $1,759,993,000 in
1999. As with revenues, the vast majority of this increase is a result of
acquisitions and the acquisition of third party leaseholds.

  The contributing factor in the decline in participating revenue from
$58,440,000 during the year ended December 31, 1998 to $1,194,000 for the same
period in 1999 was the acquisition of the third party leaseholds discussed
above.

  Management fee and service fee income was $69,278,000 in 1999 compared to
$89,067,000 in 1998. The decrease is primarily the result of a decrease in
incentive fee income associated with seventeen management contracts which were
renewed in 1998 with no provision to earn incentives fees, and management
contracts lost during the period. This was partially offset by the acquisition
of third party management contracts acquired in June 1998 and the Interstate
management contracts also acquired in June 1998, but were included in the
Interstate spin-off on June 18, 1999.

  Interest and other income was $11,256,000 in 1999 as compared to $14,893,000
in 1998. The decrease resulted from a management termination fee of $2,950,000
in 1998.

  Total revenues from the racecourse facility operations (including interest
and other income) were $4,561,000 for 1999 compared to $51,259,000 in 1998.
Total costs and expenses associated with the racecourse operations (included
marketing costs, and general and administrative expenses) were $3,867,000 for
1999 compared to $43,198,000 for 1998. These decreases are due to the sale of
Bay Meadows racecourse effective February 1999.

  General and administrative expenses were $190,770,000 for 1999 compared to
$117,666,000 for 1998. In part, the increase is due to the overhead required
due to the growth in the portfolio of owned, managed and leased hotels during
1998. However, the significant portion of the increase was due to the
following factors:

  As a result of the $1 billion equity investment, the Company incurred
  $13,047,000 of strategic reorganization costs, including fees to settle the
  forward equity contracts, and the acceleration of vesting of certain
  employees' stock awards. The reorganization resulted in work associated
  with a high yield bond offering and a bond offering in Puerto Rico to
  cease, resulting in a write-off of costs associated with the offerings
  totaling $3,917,000 and $13,530,000 in other abandoned transaction costs.

  The Company also incurred $5,435,000 of costs associated with the spin-off
  of Interstate's third-party management business, $21,131,000 with costs
  associated with becoming Year 2000 compliant and conversion costs, and
  $4,695,000 in bad debt expense for the write-off of receivables from a
  hotel that Wyndham no longer intends to manage and has terminated the
  management contract.

  Interest expense for 1999 was $353,227,000 as compared to $260,103,000 for
1998. The increase is due in part to the closing of $1.45 billion in debt in
June of 1998 for the merger with Old Interstate. Secondly, as a result of
extending certain maturities of the credit facilities, Wyndham paid
$11,700,000 in fees, which were amortized and included in interest expense.
Finally, Wyndham assumed and incurred additional debt in order to finance the
Summerfield, Interstate and Arcadian transactions during 1998.

  Cost of acquiring license agreements and leaseholds was $1,296,000 for 1999
as compared to $64,407,000 for 1998. This decrease is primarily due to the
prior year amount including the purchase of 17 leasehold interest acquired in
connection with the CHCI merger.


                                      27
<PAGE>

  The Company recognized a loss on the sale of assets of $10,702,000 based on
the excess book value over the cash proceeds received in the sale as compared
to $9,453,000 in the prior year.

  For the year ended December 31, 1999, the Company recognized approximately
$70,912,000 of impairment losses related to assets held for sale. In 1998, the
Company recognized approximately $51,081,000 of impairment losses. In
accordance with SFAS No. 121, when management identifies an asset held for
sale a fair value is estimated. If the fair value of the asset is less than
the carrying value amount, a reserve for impairment is established.

  As discussed in Note 6 to the financial statements, the Company recorded
$285,267,000 of costs associated with the restructuring. These costs primarily
relate to the non-cash write down of assets of approximately $265,962,000 as
the Company exits from certain business sectors, and focuses on its core
brands and products. In management's attempt to streamline its organization,
it has closed offices in New York, London, Phoenix, and Wichita. Severance,
lease cancellation costs, legal costs and other costs to exit to close these
offices resulted in the Company recording costs of $19,305,000.

  Depreciation and amortization expense was $302,890,000 for the year ended
December 31, 1999 compared to $231,233,000 for the year ended December 31,
1998. A significant number of assets were acquired in 1998 as a result of the
mergers and acquisition as discussed, and therefore twelve months of
depreciation is not reflected in 1998 as compared to 1999. Of the $71,657,000
increase, $34,817,000 of depreciation was attributable to the significant
transactions which occurred during 1998, which included Arcadian in April
1998, and Summerfield, CHCI and Interstate in June 1998. The remaining
increase is due to depreciation on renovations at the hotels which were under
construction in 1998, but in service in 1999 as well as full year amortization
of goodwill and other intangible assets in 1999 for those intangibles acquired
in the mergers during 1998.

  The Company's share of losses from unconsolidated subsidiaries was
$7,746,000 for the year ended December 31, 1999 as compared to income of
$9,498,000 for the year ended December 31, 1998. The decrease is primarily a
result of two hotels, no longer being accounted for as equity investments. In
June 1999, Wyndham acquired the 1% controlling interest in these hotels, and
they are now being accounted for on a consolidated basis. In addition, the
decrease is due to the allocation of losses from the Company's approximate 55%
investment in Interstate.

  The provision for income taxes increased from $17,122,000 for 1998 to
$571,421,000 for 1999. The increase is primarily due to the $675,000,000
charge recorded during June 1999 due to Patriot converting from a REIT to a C
corporation, and the operations of certain special purpose controlled
subsidiaries which separately report and pay taxes on their taxable income.
For federal income tax purposes, the taxable income from these subsidiaries
cannot be consolidated with Wyndham's taxable income or loss and hence cannot
be offset by operating losses created at the Wyndham Partnership.
Additionally, the provision was decreased by benefits recorded in conjunction
with certain restructuring changes taken during 1999.

  Minority interest's share of loss associated with the Operating Partnerships
was $6,642,000 for the year ended December 31, 1999 as compared to $12,651,000
for 1998 due to increased losses in the Operating Partnerships prior to the
amendments in the partnership agreements on June 30, 1999.

  Minority interest's share of income in other consolidated subsidiaries were
$6,017,000 in 1999 as compared to $9,427,000 in 1998. This reduction in
minority interest's share of income is due primarily to the acquisition of the
outside interests in nine hotels.

  For the year ended 1998, certain debt obligations of Old Wyndham, Interstate
and Summerfield were repaid upon the merger and acquisition of these entities.
In addition, certain debt of WHG was refinanced in 1998. As a result, Wyndham
incurred certain prepayment penalties and wrote off the remaining balance of
unamortized deferred financing costs associated with such debt, resulting in
an extraordinary loss of $31,817,000, net of minority interest and income
taxes. In connection with the new debt financing in 1999, Wyndham wrote off
the

                                      28
<PAGE>

remaining balance of unamortized deferred financing costs associated with the
old credit facility, resulting in an extraordinary loss of $9,838,000, net of
minority interest and income taxes.

  As a result, the net loss was $1,071,969,000 for 1999 and $158,223,000 for
1998.

Results of Operations: Year Ended December 31, 1998 Compared with Year Ended
December 31, 1997

  Concurrent with the closing of the Cal Jockey merger, the Company began
operating four hotels and commenced its hotel management operations on July 1,
1997. At December 31, 1997, the Company owned 91 hotels of which it operated
55 of those hotels, leased 34 hotels to third party lessees, and two hotels
were owned through special purpose entities. At December 31, 1997, it managed
12 hotels for third parties. In 1998, the Company underwent a series of
mergers and acquisitions, including Wyndham, WHG, Summerfield, Interstate and
CHCI. As a result of the mergers and acquisitions, at December 31, 1998 the
Company owned interests in 178 hotels, leased 121 hotels from third parties,
and managed 161 hotels for third party owners. This significant increase in
the number of hotels operated by the Company is the primary cause of the
increases in revenues and expenses between 1997 and 1998.

  Hotel revenues were $1,842,682,000 for the year ended December 31, 1998 as
compared to $167,727,000 for the same period December 31, 1997. The increase
in revenues is due not only to the increase in the number of hotels operated,
but also due in increases in REVPAR experienced by the hotel portfolio as a
whole.

  Hotel expenses increased to $1,351,872,000 for 1998 as compared to
$140,392,000 for 1997. The increases are due to the full year's results in
1998 for hotels leased to third parties during 1997 and the additional hotels
acquired during 1998.

  Racecourse facility revenue increased from $26,511,000 for 1997 to
$51,259,000 for 1998. Racecourse facility expenses increased from $21,620,000
for 1997 to $43,198,000 for 1998. The increase is due to the number of racing
days in 1998 of 106 as opposed to the number of race days in 1997 of 63.

  Management fee and service fee income increased from $7,088,000 for 1997 to
$89,067,000 for 1998. This increase is primarily the result of a net increase
of 149 management contracts during the year primarily from the mergers and
acquisitions that occurred during 1998, as discussed above.

  Interest and other income increased from $6,676,000 in 1997 to $14,893,000
in 1998. The increase is primarily attributable to the mergers and
acquisitions of the hotel management and related business of Interstate,
Summerfield, Wyndham and Arcadian during 1998, and interest and dividend
income earned on cash investments, and notes receivables assumed during those
transactions.

  General and administrative expenses increased from $17,181,000 in 1997 to
$117,666,000 in 1998. Of this increase, salaries and wages is the major
component. This increase is due primarily to the overhead required due to the
growth in portfolio and managed and leased hotels during 1998. Also, the
Company recorded $14,813,000 costs associated with evaluating properties and
companies which were ultimately not acquired in 1998.

  Interest expense for 1998 was $260,103,000 compared to $50,531,000 for 1997.
The increase is a result of the increase in the Company's outstanding debt
obligations from $1,112,709,000 to $3,857,521,000. The increase in the
Company's debt outstanding is the result of borrowings to fund the cash
purchase prices of acquisition of hotel properties and companies during 1998
and the assumption of debt in connection with various mergers executed during
1998.

  In 1998, the Company recognized $64,407,000 in costs of acquiring
leaseholds, as compared to $54,499,000 in 1997. The primary component of the
expense in both years was the acquisition of leaseholds from CHC lease
partners, eight leasehold interest in 1997 and 17 in 1998.

  During 1998, the Company recorded a $49,334,000 one-time charge to earnings
as a result of the settlement of three treasury interest rate lock agreements.
These agreements were executed to protect the Company against

                                      29
<PAGE>

the possibility of rising interest rates in anticipation of closing mortgage
loans in the near future. Under the rate lock agreements, the Company received
or made payments based on the difference between specified interest rates,
6.06%, 6.07%, and 5.62%, and the actual 10-year U.S. Treasury interest rate on
a principal amount of $525,000,000. Due to the substantial downward movement
in the underlying treasury security market and the Company's liquidity
situation, the agreements were settled and the settlement cost was recorded as
a charge against earnings.

  In the connection with the assets in 1998, the Company recognized a loss on
the sale of assets of $9,453,000 based on the excess book value over the cash
proceeds received in the sale.

  For the year ended December 31, 1998, the Company recognized approximately
$51,081,000 of impairment losses related to assets held for sale. In
accordance with SFAS No. 121, when management identifies an asset held for
sale a fair value is estimated. If the fair value of the asset is less than
the carrying value amount, a reserve for impairment is established.

  Depreciation and amortization expense was $231,233,000 for 1998, compared to
$52,685,000 in 1997. The increase is primarily due to the net increase in
owned and leased hotel properties to 299 at December 31, 1998 from 91 in 1997.

  Minority interest share of loss was $12,651,000 in 1998 as compared to
income of $1,684,000 as a result of certain non-recurring expenses recognized
by the operating partnerships in 1998.

  Minority interest in other consolidated subsidiaries increased from
$1,615,000 to $9,427,000 as a result of an increase in unconsolidated
subsidiaries acquired through various mergers and acquisitions during 1998.

  In connection with the Wyndham merger, the Interstate merger, the
Summerfield acquisition, and the WHG acquisition, the Company repaid certain
debt obligations of Old Wyndham, Interstate, Summerfield and WHG. As a result,
the Company incurred prepayment penalties and wrote-off the remaining balance
of unamortized deferred financing costs associated with such debt in the
amount of $31,817,000, net of minority interest share of the net loss. This
has been reported as an extraordinary item. Concurrent with the repayment of
the old line of credit, Patriot wrote off the remaining balance of unamortized
deferred financing costs associated with the old line of credit in the amount
of $2,534,000 of minority interest share of the net loss, has been reported as
an extraordinary item.

  As a result, net loss was $158,223,000 for 1998, compared to net loss of
$2,172,000 for 1997.

Results of reporting segments

  For the year ended December 31, 1999 compared with the year ended December
31, 1998

  Wyndham hotel properties include Wyndham Hotels, Wyndham Gardens and Wyndham
Grand Heritage and represent approximately 22.8% and 29.7% of total revenue
for the years ended December 31, 1999 and 1998, respectively. Total revenue
was $568,584,000 in 1999 as compared to $610,523,000 in 1998 for a decrease of
6.9%. Operating income was $149,688,000 in 1999 as compared to $153,723,000 in
1998, or a decrease of 2.6%. This decrease was a result of the repositioning
of three Wyndham hotels to Wyndham resorts in 1999. The total revenue included
in 1998 for those three properties was $97,755,000 and operating income of
$22,817,000. Excluding those three hotels, Wyndham hotel revenue actually
increased by 10.9% with operating income increasing 14.3%. The increase in
both revenues and operating income is primarily a result of the rebranding of
certain hotels acquired in 1998 from non-proprietary brands to Wyndham Hotels,
as well as the opening of several Wyndham hotels which were under development
in 1998 and opened in 1999.

  Resort properties including Wyndham Luxury Resorts and Wyndham Resort hotel
properties represent approximately 20.9% and 15.4% of total revenue for the
years ended December 31, 1999 and 1998, respectively. Total revenue increased
from $315,674,000 in 1998 to $520,813,000 in 1999 while operating income
increased from $76,349,000 in 1998 to $120,254,000 in 1999. The increase is
primarily due to the repositioning of the

                                      30
<PAGE>

above mentioned hotels and the acquisition of the remaining partners' interest
in certain resorts in March 1998. Prior to the acquisition, Wyndham accounted
for its investment in these resorts, on the equity basis of accounting.
Subsequent to the purchase of the partners' interest, the operations were
consolidated into the statement of operations. In addition, Hurricane Georges
adversely affected 1998's third and fourth quarter revenues and earnings at
several Wyndham resort properties.

  All suite properties including Summerfield and Sierra represent
approximately 5.6% and 3.6% of total revenue for the year ended December 31,
1999 as compared to 1998. Total revenue increased from $74,333,000 to
$138,900,000 and operating income increased from $14,690,000 to $27,059,000
from 1998 to 1999, respectively. Summerfield was not acquired until June of
1998; and therefore only reflect seven months of operations. In addition, 1999
results reflected the opening of additional Summerfield and Sierra Suites
which were under development in 1998 but operational in 1999.

  Other proprietary branded properties, including Malmaison, Grand Heritage,
ClubHouse and hotels acquired in the Arcadian acquisition, represent
approximately 3.8% of total revenue for the year ended December 31 1999, as
compared to 3.9% for 1998. Total revenue increased from $80,998,000 to
$95,669,000 and operating income increased from $26,492,000 to $27,405,000 for
the years ended 1998 to 1999, respectively. The hotels acquired in the
Arcadian acquisition were not acquired until April of 1998, accounting
primarily for the increase of both revenues and operating income. In addition,
1999 results reflected the opening of an additional hotel which was under
development in 1998 and the addition of the controlling interest in a third
hotel in September of 1999. However, these increases were partially offset by
the sale of the 11 hotels from Arcadian in December of 1999 and the decreases
in revenues and operating income for the ClubHouse branded hotels.

  Non-proprietary branded properties, including Hilton(R), Holiday Inn(R),
Marriott(R), Doubletree(R), Radisson(R) and other major hotel franchises,
represent approximately 43.4% and 37.0% of total revenue for the year ended
December 31, 1999 as compared to 1998. Total revenue increased from
$761,154,000 to $1,085,080,000 and operating income increased from
$183,703,000 to $259,616,000 for the years ended 1998 and 1999, respectively.
The increase is due primarily to the acquisition of the owned and leased
Interstate properties, and the leasehold interest in CHC Lease Partners,
NorthCoast and the Doubletree Lessees. The increases were partially offset by
asset sales during the year, as well as the loss of certain leaseholds in the
Interstate spin-off.

  Other represents revenue from various operating businesses including
management and other service companies, and participating lease revenue for
one hotel and a parcel of land. Total revenue for the other segment was
$86,289,000 and $213,659,000 for 1999 and 1998, respectively. The overall
$127,370,000 decrease in this segment's revenue was caused by several factors.
The sale of Bay Meadows Race Track operations and leasehold effective February
1, 1999 reduced revenue by $46,698,000. The purchase of the third party
leasehold interests, primarily CHC Lease Partners and NorthCoast Hotels,
reduced participating lease revenue by $57,246,000. Operating losses for the
segment were $1,067,611,000 and $576,963,000 for the years ended December 31,
1999 and 1998, respectively. In addition to the decrease in revenues, the
increase in the segment's operating loss is a result of increased expenses
resulting from the mergers and acquisitions in 1998. Interest expense
increased $93,124,000, depreciation and amortization increased $71,657,000 and
corporate and general and administrative expenses increased $73,104,000. The
sale of the Bay Meadows Racetrack accounted for an approximate $39,331,000
decrease in expenses and the cost of acquiring the third party leaseholds in
1998 decreased expenses by an additional $63,111,000.

  For the year ended December 31, 1998 compared with the year ended December
  31, 1997

  Wyndham hotels properties represent approximately 29.7% and 3.2% of total
revenue for 1998 and 1997, respectively. Total revenue was $610,523,000 for
the year ended December 31, 1998 compared to $10,711,000 in 1997. The increase
is primarily due to the additional hotels acquired as a result of the
acquisition of hotels and mergers in 1998. Operating income for the Wyndham
hotels was $153,723,000 for the year ended December 31, 1998 compared to
$2,388,000 for 1997.

  Resort properties represent approximately 15.4% and 9.1% of total revenue
for 1998 and 1997, respectively. Total revenue was $315,674,000 for the year
ended December 31, 1998 compared to $30,334,000 in 1997. The

                                      31
<PAGE>

increase is primarily due to the additional hotels acquired as a result of the
acquisition of hotels and mergers in 1998. Operating income for the resort
properties was $76,349,000 for the year ended December 31, 1998 compared to
$6,628,000 for 1997.

  All suite properties represent approximately 3.6% of total revenue for 1998.
Patriot purchased 4 properties and Patriot and Wyndham acquired 26 leaseholds
in 1998 and leased them to Wyndham. Total revenue was $74,333,000 for the year
ended December 31, 1998 and operating income was $14,690,000 in 1998.

  Other proprietary branded properties represent approximately 3.9% and 2.9%
of total revenue for 1998 and 1997, respectively. Total revenue was
$80,998,000 for the year ended December 31, 1998 compared to $9,595,000 in
1997. The increase is primarily due to the additional hotels acquired as a
result of the acquisition of hotels and mergers in 1998. Operating income for
these properties was $26,492,000 for the year ended December 31, 1998 compared
to $1,436,000 for 1997.

  Non-proprietary branded properties represent approximately 37.0% and 34.4%
of total revenue for 1998 and 1997, respectively. Total revenue was
$761,154,000 for the year ended December 31, 1998 compared to $115,223,000 in
1997. The increase is primarily due to the additional hotels acquired as a
result of the acquisition of hotels and mergers in 1998. Operating income for
these properties was $183,703,000 for the year ended December 31, 1998
compared to $29,947,000 for 1997.

  Other represents revenue from various operating businesses including Bay
Meadows racetrack, management and other service companies as well as
participating lease revenue for those hotels leased to third parties. Total
revenue for the other segment was $213,659,000 and $169,172,000 for the years
ended December 31, 1998 and 1997, respectively. The increase in total revenue
is a result of a full year of operations reflected in 1998 compared to six
months of operations in 1997. Operating loss of the other segment was
$576,963,000 for 1998 compared to $42,272,000 in 1997. The increase in
operating loss is a result of the following items: the treasury lock
settlement of $49,334,000; the loss on the sale of the North Coast Transaction
assets of $9,453,000; the impairment loss on assets held for sale (including
the Bay Meadows racetrack) of $51,081,000; the increase in the costs of
acquiring leaseholds in 1998 over 1997 of $9,908,000; the increase in interest
expense of $209,572,000 as a result of the increased borrowings to fund the
1998 mergers and acquisitions; and the increase in depreciation and
amortization of $178,548,000 as a result of the 1998 mergers and acquisitions.

 Statistical Information

  During 1999, the Company's portfolio of 204 owned and leased hotels
experienced moderate growth in both average daily rate ("ADR") and revenue per
available room ("REVPAR") of approximately 2.8% and 1.3%, respectively, while
occupancy decreased slightly by 1.4%. Management attributes this growth to
continued marketing efforts throughout the portfolio on hotels that have been
repositioned and converted, as well as to the current market conditions in the
U.S. lodging industry. The following table sets forth certain statistical
information for the Company's 204 owned and leased hotels for 1999 and 1998 as
if the hotels were owned or leased for the entire periods presented.

<TABLE>
<CAPTION>
                                   Occupancy         ADR           REVPAR
                                   ----------  --------------- ---------------
                                   1999  1998   1999    1998    1999    1998
                                   ----  ----  ------- ------- ------- -------
<S>                                <C>   <C>   <C>     <C>     <C>     <C>
Wyndham Hotels.................... 69.3% 70.7% $109.81 $107.57 $ 76.07 $ 76.08
Wyndham Resorts................... 73.4  70.9   160.09  153.06  117.55  108.58
Wyndham Luxury Resort (formerly
 Grand Bay Hotels & Resorts)...... 72.0  68.6   300.97  312.52  216.63  214.41
Summerfield Suites & Sierra
 Suites........................... 80.2  81.2   116.65  116.08   93.56   94.26
Malmaison......................... 83.1  79.0   124.72  123.13  103.62   97.27
ClubHouse......................... 58.3  66.4    66.20   68.06   38.62   45.21
Non-proprietary brands............ 70.9  72.3   102.22   99.78   72.44   72.16
                                   ----  ----  ------- ------- ------- -------
  Weighted average................ 71.2% 72.2% $113.82 $110.68 $ 81.00 $ 79.92
                                   ====  ====  ======= ======= ======= =======
</TABLE>

                                      32
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

  Cash and cash equivalents as of December 31, 1999 were $246.8 million,
including restricted cash of $102.5 million. Cash and cash equivalents as of
December 31, 1998 were $158.9 million, including restricted cash of $35.9
million.

Cash Flow Provided by Operating Activities

  The Company's principal source of cash flow is from the operations of the
hotels that it owns, leases and manages. Cash flows from operating activities
were $202.3 million for 1999. Cash flows from operating activities of the
Company were $244.5 million 1998, which represent a combination of collection
of rents under participating leases with third party lessees and cash flows
generated by the hotels operated by the Company. Cash flows from operating
activities were $108.1 million for 1997, which primarily represent collection
of rents under participating leases.

  As a result of the reorganization, the Company will pay significantly more
in federal income taxes, but will have the ability to retain significantly
more earnings than was previously the case because the Company is not required
to distribute at least 95% or more of its taxable income to its shareholders.
The Company anticipates that its enhanced ability to retain earnings will
allow it to utilize cash flow from operating activities to fund maintenance,
capital expenditures and acquisitions. The Company does not anticipate paying
a dividend to its common shareholders. However, for the first six years,
dividends on the series A and series B convertible preferred stock are
structured to ensure an aggregate fixed cash dividend payment of $29.25
million per year, so long as there is no redemption or conversion of the
preferred stock; therefore, for that period, dividends are payable partly in
cash and partly in additional shares of preferred stock. For the following
four years, dividends are payable in cash or additional shares of series A or
series B convertible preferred stock, as the case may be, as determined by the
Board of Directors. After year ten, dividends are payable solely in cash.

Cash Flows from Investing and Financing Activities

  Cash flows used in investing activities of the Company were approximately
$290.0 million for 1999, resulting primarily from the acquisition of hotel
properties, property renovations and improvements, and cash deposited as
escrows and property improvement reserves.

  Cash flows provided by financing activities of approximately $175.5 million
for 1999 were primarily related to the net proceeds from the sale of the
series B preferred stock, the net proceeds from the new credit facility and
the net proceeds from the new mortgage debt, partially offset by the repayment
of the old credit facility, term loans, and the settlement of the forward
equity contracts.

  During 1998, the Company continued to experience rapid growth through the
merger and acquisition of hotel properties and management companies. These
transactions were funded with a combination of issuance and or assumption of
debt as well as sale of registered securities, issuance of OP units and
proceeds from the forward equity transactions. The proceeds from the forward
equity transactions were used to repay borrowings under the credit facility.
The credit facility was then used to fund the cash portion of the Company's
mergers and acquisitions.

  Cash flows used in investing activities of the Company were approximately
$2.1 billion for 1998, resulting primarily from the merger and acquisition of
various hotel properties and management companies and the renovation
expenditures at certain hotels. Cash flows used in investing activities of the
Company were approximately $1.2 billion for the year ended December 31, 1997,
resulting primarily from the Cal Jockey merger, the acquisition of various
hotel properties and management companies, and the renovation of certain
hotels.

  Cash flows from financing activities of $1.9 billion for 1998 were primarily
related to the borrowings on the credit facility, the term loans and mortgage
notes and net proceeds from public and private placement of equity securities,
net of payments of dividends and distributions. Cash flows from financing
activities of

                                      33
<PAGE>

approximately $1.1 billion for 1997 were primarily related to borrowings under
the credit facility, the term loans and mortgage notes and net proceeds from
public and private equity securities, net of payments of dividends and
distributions.

  Concurrent with the closing of the $1 billion equity investment, Wyndham
closed on a new $2.45 billion credit facility which consists of a $1.3 billion
term loan with a seven-year term, a $500 million revolving credit facility
with a five-year term, and a $650 million increasing rate loan facility with a
five-year term. The proceeds, net of closing costs and fees of approximately
$41.1 million, for the term loan and the revolving credit facility, and
approximately $17.9 million, for the increasing rate loan facility, were used
to retire existing indebtedness. At December 31, 1999, $270 million was drawn
on the new revolving credit facility.

  Interest rates are based upon LIBOR plus spreads varying from 2.75% to 3.50%
per annum for the term loan, and 1.25% to 2.75% per annum for the revolving
credit facility, based both on Wyndham's leverage ratio, as defined, and
whether any increasing rate loans are outstanding. If any of the increasing
rate loan facility remains outstanding, the applicable margins shall be
increased by 0.25%. The term loan and the revolving credit facility are
guaranteed by the domestic subsidiaries of Wyndham and are secured by pledges
of equity interests held by Wyndham and its subsidiaries. Wyndham's ability to
borrow under its revolving credit facility is subject to Wyndham's compliance
with a number of customary financial and other covenants, including total
leverage and interest coverage ratios.

  Interest rates for the increasing rate loans are based on LIBOR rates (less
statutory reserves), plus 3.50% through September 30, 1999, and increasing
0.50% every three months, with a cap of LIBOR plus 4.75%. The lender under the
increasing rate loans receives the benefit of the same guarantees and pledges
of security provided under the new term loan and revolving credit facility.

  As of March 22, 2000, the Company had approximately $315 million outstanding
under the revolving credit facility and $1.3 billion outstanding on the term
loans, and $650 million outstanding under the increasing rate loans.
Additionally, the Company had outstanding letters of credit totaling $21.2
million. As of such date, the Company also had over $1.4 billion of mortgage
debt outstanding that encumbered 74 hotels, resulting in total indebtedness of
approximately $3.7 billion. As of March 22, 2000, the Company had $163.8
additional availability under the Revolving Credit Facility.

  In March 2000, the Company entered into three additional interest rate
hedges for a total notional amount of $1.5 billion. The hedges are structured
such that each hedge has a series of trigger levels in which the hedge can
become ineffective for any reset period that the 1-month LIBOR rises above the
trigger level. If LIBOR resets below the trigger level, the hedge becomes
effective again. The Company paid approximately $34.3 million in premiums,
which will be amortized over the terms of the contracts, to enter into these
transactions. The hedges are as follows:

<TABLE>
<CAPTION>
                                        Notional                        Trigger
   Hedge                                 Amount     Terms      Rate      Level
   -----                              ------------ -------- ---------- ---------
   <S>                                <C>          <C>      <C>        <C>
   Interest Rate Swap................ $700 million  5 years 6.1%-6.75% 7.0%-8.5%
   Interest Cap...................... $250 million  3 years      4.75%      7.5%
   Interest Corridor................. $550 million  3 years      5.25%      7.5%

  In addition, the Company shortened the terms of three existing hedges and
received net proceeds of approximately $6.8 million. The hedges were as
follows:

<CAPTION>
                                        Notional   Original  Revised
   Hedge                                 Amount    Maturity  Maturity    Rate
   -----                              ------------ -------- ---------- ---------
   <S>                                <C>          <C>      <C>        <C>
   Interest Rate Swap................ $375 million 11/01/02    3/01/02     6.26%
   Interest Rate Swap................ $125 million 11/01/02    3/01/02     5.56%
   Interest Rate Swap................ $250 million 06/01/03    3/01/02     5.84%
</TABLE>

                                      34
<PAGE>

 Forward Equity Transactions

  The Company was party to transactions with three counterparties involving
the sale of an aggregate of 13.3 million paired shares, with related purchase
price adjustment mechanisms. The Company's aggregate obligation under the
forward equity transactions was approximately $335.8 million at June 30, 1999.
Effective June 30, 1999, the Company settled in full all of the forward equity
transactions in cash with part of the proceeds of the $1 billion equity
investment. The 100.7 million shares owned or held by the counterparties were
retired effective June 30, 1999.

Renovations and Capital Improvements

  During 1999, the Company completed approximately $230.7 million in total
capital improvements and renovations on various hotel properties. These major
renovations included upgrading the quality of the furniture and fixtures in
guest rooms, public meeting space and lobby areas as well as adding additional
rooms to certain of the hotels. During 2000, the Company anticipates spending
approximately $198.8 million in capital expenditures, including (i) costs
related to converting hotels to one of the Company's proprietary brands, (ii)
costs related to converting certain Wyndham Garden hotels to Wyndham hotels,
(iii) costs related to enhancing the revenue-producing capabilities of its
hotels, and (iv) costs related to recurring maintenance capital expenditures.

  The Company attempts to schedule renovations and improvements during
traditionally lower occupancy periods in an effort to minimize disruption to
the hotel's operations. Therefore, management does not believe such
renovations and capital improvements will have a material effect on the
results of operations of the hotels. However, no assurance can be made that
such renovations and capital improvements will not impact the results of
operations. Capital expenditures will be financed through the capital
expenditure reserves, the credit facility, other financing sources, or with
working capital.

ITEM 7A. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISKS

  The Company's primary market risk exposure is to future changes in interest
rates related to the Company's derivative financial instruments and other
financial instruments including debt obligations, interest rate swaps,
interest rate caps, and future debt commitments.

  The Company manages its debt portfolio by periodically entering into
interest rate swaps and caps to achieve an overall desired position of fixed
and floating rates or to limit its exposure to rising interest rates.

                                      35
<PAGE>

  The following table provides information about the Company's derivative and
other financial instruments that are sensitive to changes in interest rates.

 .  For fixed rate debt obligations, the table presents principal cash flows
   and related weighted-average interest rates by expected maturity date and
   contracted interest rates at December 31, 1999. For variable rate debt
   obligations, the table presents principal cash flows by expected maturity
   date and contracted interest rates at December 31, 1999.

 .  For interest rate swaps and caps, the table presents notional amounts and
   weighted-average interest rates or strike rates by expected (contractual)
   maturity dates. Notional amounts are used to calculate the contractual cash
   flows to be exchanged under the contract. Weighted average variable rates
   are based on implied forward rates in the yield curve at December 31, 1999.

<TABLE>
<CAPTION>
                             2000       2001      2002      2003       2004     Thereafter  Face Value Fair Value
                          ----------  --------  --------  --------  ----------  ----------  ---------- ----------
                                                       (dollars in thousands)
<S>                       <C>         <C>       <C>       <C>       <C>         <C>         <C>        <C>
Debt
Long-term debt
 obligations
 Including Current
  Portion Fixed Rate....  $   23,896  $ 17,915  $ 46,092  $  6,726  $   52,467  $  282,731  $  429,827 $  429,827
 Average Interest Rate..        8.95%     7.92%     8.89%     8.55%       8.21%       8.17%
 Variable Rate..........  $  106,281  $144,804  $278,853  $ 37,853  $1,326,589  $1,319,349  $3,213,729 $3,213,729
 Average Interest Rate..        8.51%     7.88%     8.67%     8.29%       9.13%       8.68%
Interest Rate Derivative
 Financial Instruments
 Related to Debt
Interest Rate Swaps
 Pay Fixed/Receive
  Variable..............  $  491,988  $ 31,000  $500,000  $250,000  $      --   $      --   $1,272,988 $   16,440
 Average Pay Rate.......        5.93%     5.98%     6.00%     5.84%        --          --
 Average Receive Rate...        7.20%     7.57%     7.56%     7.56%        --          --
Interest Rate Caps
 Notional Amount........  $1,500,000  $ 57,475  $    --   $    --   $  340,615         --   $1,898,090 $   (1,887)
 Strike Rate............        7.08%     7.38%     7.37%     7.37%       7.37%        --
 Forward Rate...........        7.20%     7.57%     7.56%     7.56%       7.58%        --
</TABLE>

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

  The independent auditors' reports, financial statements and financial
statement schedules listed in the accompanying index are filed as part of this
report. See Index to Financial Statements and Financial Statement Schedules on
page F-1.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

  On August 19, 1999, the Company dismissed Ernst & Young LLP as its
independent accountants. The reports of Ernst & Young LLP on the financial
statements of the Company for the past two fiscal years contain no adverse
opinion or disclaimer of opinion and were not qualified or modified as to
uncertainty, audit scope or accounting principles. The audit committee of the
Board of Directors of the Company participated in and approved the decision to
change independent accountants. In connection with Ernst & Young LLP's audits
for Wyndham's two most recent fiscal years ended December 31, 1998 and in the
subsequent interim period, there have been no disagreements with Ernst & Young
LLP on any matter of accounting principles or financial statement disclosure,
or auditing scope or procedure which if not resolved to the satisfaction of
Ernst & Young LLP would have caused them to make reference to the subject
matter in their report. There were no reportable events as defined in
Regulation S-K Item 304(a) (1) (v).

                                      36
<PAGE>

                                   PART III

  The information called for by this Part III (other than the information
required by Item 10 with respect to executive officers of Wyndham, which
information appears under the heading "Executive Officers of the Registrant"
in Part I hereof) is, in accordance with General Instruction G(3) to Form 10-
K, incorporated herein by reference to the information contained in the
Company's definitive proxy statement for the annual meeting of stockholders of
Wyndham to be held May 16, 2000, which will be filed with the Securities and
Exchange Commission not later than 120 days after December 31, 1999.

                                    PART IV

ITEM 14. Exhibits, Financial Statements and Schedules, and Reports on Form 8K

(a) The index to the audited financial statements and financial statement
    schedules is included on page F-1 of this report. The financial statements
    are included herein at pages F-1 through F-49. The following financial
    statement schedule is included herein at pages F-50 through F-61:

    Schedule III--Real Estate and Accumulated Depreciation for Wyndham
    International, Inc.

    All other schedules for which provision is made in Regulation S-X are
    either not required to be included herein under the related instructions or
    are inapplicable or the related information is included in the footnotes to
    the applicable financial statement and, therefore, have been omitted.

(b) Reports on Form 8-K for the quarter ended December 31, 1999:

    Current Report on Form 8-K of Wyndham International, Inc. dated November 8,
    1999 (001-9320) reporting under Item 5, announcing its earnings for the
    quarter and the nine months ended September 30, 1999.

(c) Exhibits:

<TABLE>
<CAPTION>
 Exhibit
 Number                                Description
 -------                               -----------
 <C>     <S>
   2.1   Securities Purchase Agreement dated as of February 18, 1999 by and
         among Patriot American Hospitality, Inc. ("Patriot"), Wyndham
         International, Inc. ("Wyndham"), Patriot American Hospitality
         Partnership, L.P., Wyndham International Operating Partnership, L.P.
         and the Investors named therein, incorporated by reference to Exhibit
         2.1 to Wyndham's Registration Statement on Form S-4/A (SEC file no.
         33379527) filed June 1, 1999.

   2.2   Amendment to Securities Purchase Agreement, dated as of June 28, 1999,
         by and among Patriot, Wyndham, Patriot American Hospitality
         Partnership, L.P., Wyndham International Operating Partnership, L.P.
         and the parties identified on the signature page as the Original
         Investors, incorporated by reference to Exhibit 2.2 to Wyndham's
         Current Report on Form 8-K filed July 13, 1999.

   2.3   Restructuring Plan, incorporated by reference to Exhibit 2.2 to
         Wyndham's Registration Statement on Form S-4/A (SEC file no. 33379527)
         filed June 1, 1999.

   2.4   Agreement and Plan of Merger, dated as of March 26, 1999, by and among
         Wyndham, Wyndham International Acquisition Subsidiary, Inc. and
         Patriot, incorporated by reference to Exhibit 2.3 to Wyndham's
         Registration Statement on Form S-4/A (SEC file no. 33379527) filed
         June 1, 1999.

   3.1   Amended and Restated Certificate of Incorporation of Wyndham,
         incorporated by reference to Exhibit 3.1 to Wyndham's Registration
         Statement on Form S-8 filed July 2, 1999.

   3.2   Amended and Restated Bylaws of Wyndham, incorporated by reference to
         Exhibit 3.2 to Wyndham's Registration Statement on Form S-8 filed July
         2, 1999.
</TABLE>

                                      37
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                                Description
 -------                               -----------
 <C>     <S>
    4.1  Certificate of Designation of Series A Convertible Stock of Wyndham,
         incorporated by reference to Exhibit 99.5 to Wyndham's and Patriot's
         Current Report on Form 8-K dated March 2, 1999 (filed March 2, 1999).

    4.2  Certificate of Designation of Series B Convertible Preferred Stock of
         Wyndham, incorporated by reference to Exhibit 4.2 to Wyndham's
         Registration Statement on Form S-4/A (SEC file no. 33379527) filed
         June 1, 1999.

    4.3  Certificate of Designation of Series C Junior Participating Cumulative
         Preferred Stock of Wyndham, incorporated by reference to Exhibit 3.1
         to the Company's Current Report on Form 8-K (filed July 12, 1999).

    4.4  Registration Rights Agreement, dated as of February 18, 1999, by and
         among Wyndham and the holders of Series B Convertible Preferred Stock
         of Wyndham party thereto, incorporated by reference to Exhibit 4.1 to
         Wyndham's Quarterly Report on Form 10-Q for the quarterly period ended
         June 30, 1999.

    4.5  Registration Rights Agreement, dated as of June 30, 1999, by and among
         Wyndham and former Operating Partnership unit holders party thereto,
         incorporated by reference to Exhibit 10.1 to Wyndham's Registration
         Statement on Form S-3 (SEC file no. 33386189) filed August 30, 1999.

    4.6  Shareholder Rights Agreement, dated as of June 29, 1999, between
         Wyndham and American Stock Transfer and Trust Company, as Rights
         Agent, incorporated by reference to Exhibit 4.1 to Wyndham's Current
         Report on Form 8-K, filed July 12, 1999.

  *10.1  Credit Agreement, dated as of June 30, 1999, by and among Wyndham and
         the Lenders named therein.

  *10.2  Increasing Rate Note Purchase and Loan Agreement, dated as of June 30,
         1999, by and among Wyndham and the Lenders named therein.

   10.3  Letter Agreement, dated February 26, 1999, by and among Wyndham,
         Patriot and Paul A. Nussbaum, incorporated by reference to Exhibit
         99.1 to Wyndham's and Patriot's Current Report on Form 8-K dated
         February 26, 1999 (filed March 3, 1999).

  *10.4  Executive Employment Agreement As Amended and Restated, dated as of
         April 19, 1999, between Wyndham and Leslie V. Bentley.

  *10.5  Executive Employment Agreement As Amended and Restated, dated as of
         April 19, 1999, between Wyndham and Michael A. Grossman.

  *10.6  Executive Employment Agreement As Amended and Restated, dated as of
         April 19, 1999, between Wyndham and Stanley M. Koonce, Jr.

  *10.7  Executive Employment Agreement As Amended and Restated, dated as of
         April 19, 1999, between Wyndham and Carla S. Moreland.

   10.8  Executive Employment Agreement As Amended and Restated, dated as of
         May 26, 1999 between Wyndham and Richard Mahoney, incorporated by
         reference to Exhibit 10.5 to Wyndham's Quarterly Report on Form 10-Q
         for the quarterly period ended June 30, 1999.

  *10.9  Non-qualified Stock Option Agreement dated as of May 7, 1999 between
         Wyndham and Richard Mahoney.

  10.10  Letter agreement dated July 12, 1999 between Lawrence S. Jones and
         Wyndham incorporated by reference to Exhibit 10.6 to Wyndham's
         Quarterly Report on Form 10-Q for the quarterly period ended June 30,
         1999.
</TABLE>

                                       38
<PAGE>

<TABLE>
<CAPTION>
 Exhibit
 Number                                Description
 -------                               -----------
 <C>     <S>
  10.11  Letter agreement dated July 12, 1999 between William W. Evans III and
         Patriot incorporated by reference to Exhibit 10.7 to Wyndham's
         Quarterly Report on Form 10-Q for the quarterly period ended June 30,
         1999.

 *10.12  Executive Employment Agreement As Amended and Restated, dated as of
         April 19, 1999, between Wyndham and Anne L. Raymond.

 *10.13  Executive Employment Agreement, dated as of August 12, 1999, between
         Wyndham and Fred J. Kleisner.

 *10.14  Executive Employment Agreement, dated as of August 18, 1999, between
         Wyndham and James D. Carreker.

 *10.15  Amendment No. 1 to Executive Employment Agreement, dated as of March
         27, 2000 between Wyndham and James D. Carreker.

  10.16  Letter agreement dated July 7, 1999 between Wyndham and Karim Alibhai,
         incorporated by reference to Exhibit 10.4 to Wyndham's Quarterly
         Report on Form 10-Q for the quarterly period ended September 30, 1999.

 *10.17  Letter Agreement dated November 3, 1999 between Richard A. Holtzman
         and Wyndham.

 *10.18  Letter Agreement dated November 3, 1999 between Thomas W. Lattin and
         Wyndham.

 *10.19  Letter Agreement dated March 22, 2000 between Stanely M. Koonce, Jr.
         and Wyndham.

 *10.20  Amended and Restated Wyndham International, Inc. 1997 Incentive Plan.

 *12.1   Statement Regarding Computation of Ratios.

 *21.1   Significant Subsidiaries of Wyndham.

 *23.1   Consent of Ernst & Young LLP.

 *23.2   Consent of PricewaterhouseCoopers LLP.

 *27.1   Financial Date Schedule.
</TABLE>
--------
* Filed herewith.

                                       39
<PAGE>

                                  SIGNATURES

  Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.

Dated: March 29, 2000

                                          Wyndham International, Inc.

                                                  /s/ Fred J. Kleisner
                                          By: _________________________________
                                                      Fred J. Kleisner
                                                       President and
                                                  Chief Executive Officer

  Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
              Signature                Capacities in which signed        Date
              ---------                --------------------------        ----

<S>                                    <C>                        <C>
      /s/ James D. Carreker            Chairman of the Board of     March 29, 2000
______________________________________  Directors
          James D. Carreker

       /s/ Fred J. Kleisner            President and Chief          March 29, 2000
______________________________________  Executive Officer
           Fred J. Kleisner

       /s/ Richard Mahoney             Executive Vice President     March 29, 2000
______________________________________  and Chief Financial
           Richard Mahoney              Officer

        /s/ Karim Alibhai              Director                     March 29, 2000
______________________________________
            Karim Alibhai

        /s/ Leonard Boxer              Director                     March 29, 2000
______________________________________
            Leonard Boxer

         /s/ Milton Fine               Director                     March 29, 2000
______________________________________
             Milton Fine

                                       Director                      March  , 2000
______________________________________
           Susan Groenteman

        /s/ Paul Nussbaum              Director                     March 29, 2000
______________________________________
            Paul Nussbaum

</TABLE>

                                      40
<PAGE>

<TABLE>
<CAPTION>
              Signature                Capacities in which signed        Date
              ---------                --------------------------        ----

<S>                                    <C>                        <C>
         /s/ Rolf Ruhfus               Director                     March 29, 2000
______________________________________
             Rolf Ruhfus

                                       Director                      March  , 2000
______________________________________
            Leon D. Black

      /s/ Norman Brownstein            Director                     March 29, 2000
______________________________________
          Norman Brownstein

       /s/ Stephen T. Clark            Director                     March 29, 2000
______________________________________
           Stephen T. Clark

                                       Director                      March  , 2000
______________________________________
            Paul Fribourg

        /s/ Thomas H. Lee              Director                     March 29, 2000
______________________________________
            Thomas H. Lee

      /s/ Alan M. Leventhal            Director                     March 29, 2000
______________________________________
          Alan M. Leventhal

         /s/ William Mack              Director                     March 29, 2000
______________________________________
             William Mack

         /s/ Lee Neibert               Director                     March 29, 2000
______________________________________
             Lee Neibert

          /s/ Marc Rowan               Director                     March 29, 2000
______________________________________
              Marc Rowan

         /s/ Scott Schoen              Director                     March 29, 2000
______________________________________
             Scott Schoen

        /s/ Scott Sperling             Director                     March 29, 2000
______________________________________
            Scott Sperling
</TABLE>

                                       41
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

        INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES

                        HISTORICAL FINANCIAL INFORMATION

<TABLE>
<CAPTION>
                                                                           Page
                                                                           ----
<S>                                                                        <C>
Wyndham International, Inc.:
  Report of Independent Accountants--PricewaterhouseCoopers LLP...........  F-2

  Report of Independent Auditors--Ernst & Young LLP.......................  F-3

  Consolidated Balance Sheets as of December 31, 1999 and 1998............  F-4

  Consolidated Statements of Operations for the years ended December 31,
   1999, 1998 and 1997....................................................  F-5

  Consolidated Statements of Shareholders' Equity for the years ended
   December 31, 1999, 1998 and 1997.......................................  F-6

  Consolidated Statements of Cash Flows for the years ended December 31,
   1999, 1998 and 1997....................................................  F-8

  Notes to Financial Statements........................................... F-10

  Report of Independent Accountants on Financial Statement Schedule....... F-50

  Financial Statement Schedule:

  Schedule III--Real Estate and Accumulated Depreciation.................. F-51
</TABLE>

                                      F-1
<PAGE>

                       REPORT OF INDEPENDENT ACCOUNTANTS

Board of Directors and Shareholders
Wyndham International, Inc.

  In our opinion, the accompanying consolidated balance sheet as of December
31, 1999 and the related consolidated statements of operations, shareholders'
equity and cash flows present fairly in all material respects the financial
position of Wyndham International, Inc. and its subsidiaries (the "Company")
at December 31, 1999, and the results of their operations and their cash flows
for the year then ended in conformity with accounting principles generally
accepted in the United States. These consolidated financial statements are the
responsibility of the Company's management; our responsibility is to express
an opinion on these financial statements based on our audit. We conducted our
audit in accordance with auditing standards generally accepted auditing in the
United States, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion expressed above. The
financial statements of the Company as of December 31, 1998 and 1997 and for
the years then ended were audited by other independent accountants whose
report dated March 1, 1999 expressed an unqualified opinion.

/s/ PricewaterhouseCoopers LLP

Dallas, Texas
February 15, 2000, except as to the
 information in Note 21 for which
 the date is March 27, 2000

                                      F-2
<PAGE>

                        Report of Independent Auditors

Board of Directors and Shareholders
 Wyndham International, Inc.

We have audited the accompanying consolidated balance sheet of Wyndham
International, Inc. as of December 31, 1998, and the related consolidated
statements of operations, shareholders' equity, and cash flows for each of the
two years in the period ended December 31, 1998. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Wyndham
International, Inc. at December 31, 1998, and the consolidated results of its
operations and its cash flows for each of the two years in the period ended
December 31, 1998, in conformity with accounting principles generally accepted
in the United States.

                                          /s/ Ernst & Young LLP

Dallas, Texas
March 1, 1999

                                      F-3
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                          CONSOLIDATED BALANCE SHEETS

                         PART I: FINANCIAL INFORMATION

Item 1. Financial Statements

<TABLE>
<CAPTION>
                                                      December 31, December 31,
                                                          1999         1998
                                                      ------------ ------------
                                                           (in thousands,
                                                        except share amounts)
<S>                                                   <C>          <C>
                       ASSETS
Current assets:
 Cash and cash equivalents..........................   $  144,333   $  123,085
 Restricted cash....................................      102,480       35,869
 Accounts and lease revenue receivable..............      186,321      194,583
 Inventories........................................       23,304       23,583
 Prepaid expenses and other assets..................       21,197       35,346
                                                       ----------   ----------
 Total current assets...............................      477,635      412,466
                                                       ----------   ----------
Investment in real estate and related improvements
 net of accumulated depreciation of $478,494 in 1999
 and $252,580 in 1998...............................    5,413,178    5,585,616
Investment in unconsolidated subsidiaries...........      165,663      146,912
Mortgage notes and other receivables from
 unconsolidated subsidiaries........................        2,168       78,403
Notes and other receivables.........................       40,485       41,334
Management contract costs, net of accumulated
 amortization $26,359 in 1999 and $11,258 in 1998...      129,362      194,014
Leasehold costs, net of accumulated amortization of
 $15,305 in 1999 and $5,989 in 1998.................      133,102      179,922
Trade names and franchise costs, net of accumulated
 amortization of $11,328 in 1999 and $6,670 in
 1998...............................................      116,521      125,974
Deferred acquisition costs..........................        2,584       16,144
Goodwill and intangibles, net of accumulated
 amortization of $30,141 in 1999 and $20,895 in
 1998...                                                  378,916      553,889
Deferred expenses, net of accumulated amortization
 of $46,614 in 1999 and $29,136 in 1998.............       97,767       37,998
Other assets........................................       46,109       42,998
                                                       ----------   ----------
 Total assets.......................................   $7,003,490   $7,415,670
                                                       ==========   ==========
        LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
 Accounts payable and accrued expenses..............   $  322,195   $  313,657
 Deposits...........................................       39,452       26,392
 Current portion of borrowings under credit
  facility, term loans, mortgage notes and capital
  lease obligations.................................      130,177    1,274,918
                                                       ----------   ----------
 Total current liabilities..........................      491,824    1,614,967
                                                       ----------   ----------
Borrowings under credit facility, term loans,
 mortgage notes and capital lease obligations.......    3,513,379    2,582,603
Deferred income taxes...............................      656,164      123,463
Due to unconsolidated subsidiaries..................          --         7,919
Deferred income.....................................       15,543          174
Minority interest in the Operating Partnerships.....       22,435      253,970
Minority interest in other consolidated
 subsidiaries.......................................      166,483      229,537
Commitments and contingencies
Shareholders' equity:
 Preferred stock, $0.01 par value; authorized:
  150,000,000 shares; shares issued and outstanding:
  10,344,662 in 1999................................          103          --
 Preferred stock, $0.01 par value; authorized:
  100,000,000 shares; shares issued and outstanding:
  8,981,886 in 1998.................................          --            90
 Excess stock, $0.01 par value; authorized:
  750,000,000 shares; no shares issued and
  outstanding.......................................          --           --
 Common stock, $0.01 par value; authorized:
  750,000,000 shares; shares issued and outstanding:
  167,193,696 in 1999 and 213,521,647 in 1998.......        1,672        4,270
 Additional paid in capital.........................    3,753,235    3,024,540
 Receivable from shareholders and affiliates........      (17,210)     (16,364)
 Unearned stock compensation, net of accumulated
  amortization of $19,297 in 1999 and $13,447 in
  1998..............................................         (255)      (5,494)
 Unrealized loss on securities available for sale...       (1,000)      (1,245)
 Unrealized foreign exchange (loss) gain............       (7,576)       2,749
 Accumulated deficit................................   (1,591,307)    (405,509)
                                                       ----------   ----------
 Total shareholders' equity.........................    2,137,662    2,603,037
                                                       ----------   ----------
  Total liabilities and shareholders' equity........   $7,003,490   $7,415,670
                                                       ==========   ==========
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-4
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                 1999         1998       1997
                                              -----------  ----------  --------
                                              (in thousands, except per share
                                                         amounts)
<S>                                           <C>          <C>         <C>
Revenue:
 Hotel revenue..............................  $ 2,409,046  $1,842,682  $167,727
 Participating lease revenue................        1,194      58,440   127,033
 Racecourse facility and land lease
  revenue...................................        4,561      51,259    26,511
 Management fee and service fee income......       69,278      89,067     7,088
 Interest and other income..................       11,256      14,893     6,676
                                              -----------  ----------  --------
 Total revenue..............................    2,495,335   2,056,341   335,035
                                              -----------  ----------  --------
Expenses:
 Hotel expenses.............................    1,759,993   1,351,872   140,392
 Racing facility operations.................        3,867      43,198    21,620
 General and administrative.................      190,770     117,666    17,181
 Interest expense...........................      353,227     260,103    50,531
 Cost of acquiring leaseholds and license
  agreements................................        1,296      64,407    54,499
 Treasury lock settlement...................          --       49,334       --
 Loss on sale of assets.....................       10,702       9,453       --
 Impairment loss on assets held for sale....       70,912      51,081       --
 Restructuring charge.......................      285,267         --        --
 Depreciation and amortization..............      302,890     231,233    52,685
                                              -----------  ----------  --------
 Total expenses.............................    2,978,924   2,178,347   336,908
                                              -----------  ----------  --------
Operating loss..............................     (483,589)   (122,006)   (1,873)
 Equity in (losses) earnings of
  unconsolidated subsidiaries...............       (7,746)      9,498     6,015
                                              -----------  ----------  --------
(Loss) income before income tax provision,
 minority interests and extraordinary item..     (491,335)   (112,508)    4,142
 Income tax provision.......................     (571,421)    (17,122)     (481)
                                              -----------  ----------  --------
(Loss) income before minority interests and
 extraordinary item.........................   (1,062,756)   (129,630)    3,661
 Minority interest in the Operating
  Partnerships..............................        6,642      12,651    (1,684)
 Minority interest in consolidated
  subsidiaries..............................       (6,017)     (9,427)   (1,615)
                                              -----------  ----------  --------
(Loss) income before extraordinary item.....   (1,062,131)   (126,406)      362
 Extraordinary loss from early
  extinguishment of debt, net of minority
  interest and income taxes.................       (9,838)    (31,817)   (2,534)
                                              -----------  ----------  --------
Net loss....................................  $(1,071,969) $ (158,223) $ (2,172)
                                              ===========  ==========  ========
Basic loss attributable to common
 shareholders:
 Net loss...................................  $(1,071,969) $ (158,223) $ (2,172)
 Adjustment for equity forwards.............      (19,372)    (21,151)      --
 Preferred stock dividends..................      (50,190)     (7,956)      --
 Excess of fair value of consideration to
  redeem preferred stock....................         (115)        --        --
                                              -----------  ----------  --------
 Basic net loss.............................  $(1,141,646) $ (187,330) $ (2,172)
                                              ===========  ==========  ========
Basic (loss) earnings per common share:
 (Loss) income before extraordinary item....  $     (7.02) $    (1.13) $   0.01
 Extraordinary loss.........................        (0.06)      (0.23)    (0.04)
                                              -----------  ----------  --------
 Net loss per common share..................  $     (7.08) $    (1.36) $  (0.03)
                                              ===========  ==========  ========
Diluted loss attributable to common
 shareholders:
 Net loss...................................  $(1,071,969) $ (158,223) $ (2,172)
 Adjustment for equity forwards.............      (39,322)   (188,392)      --
 Preferred stock dividends..................      (50,190)     (7,956)      --
 Excess of fair value of consideration to
  redeem preferred stock....................         (115)        --        --
                                              -----------  ----------  --------
 Diluted net loss...........................  $(1,161,596) $ (354,571) $ (2,172)
                                              ===========  ==========  ========
Diluted (loss) earnings per common share:
 (Loss) income before extraordinary item....  $     (7.14) $    (2.34) $   0.01
 Extraordinary loss.........................        (0.06)      (0.23)    (0.04)
                                              -----------  ----------  --------
 Net loss per common share..................  $     (7.20) $    (2.57) $  (0.03)
                                              ===========  ==========  ========
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-5
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
                    Preferred Stock          Common Stock
                    --------------- --------------------------------                 Notes
                                                                                   Receivable                 Accumulated
                                      Patriot      Wyndham           Additional       From        Unearned    Deficit and
                     Number    Par    Number       Number      Par    Paid in     Shareholders     Stock       Dividend
                    of Shares Value  of Shares    of Shares   Value   Capital    and affiliates Compensation Distributions
                    --------- ----- -----------  -----------  ------ ----------  -------------- ------------ -------------
                                                                    (in thousands, except share amounts)
 <S>                <C>       <C>   <C>          <C>          <C>    <C>         <C>            <C>          <C>
 Balance,
 December 31,
 1996............         --  $ --   43,613,496          --   $  436 $  442,104     $    --       $(5,427)     $     (74)
 Issuance of
 shares for
 mergers and
 acquisition of
 properties......         --    --   12,824,433   57,135,658     699    231,247          --           --             --
 Issuance of
 shares, net of
 offering
 expenses........         --    --   15,830,033   15,830,033     318    386,417          --           --             --
 Issuance of
 shares to
 employees and
 directors.......         --    --      547,867        4,167       5     12,896          --       (12,839)           --
 Forfeiture of
 unvested
 employee stock
 grants..........         --    --      (42,900)     (42,900)    --        (464)         --           464            --
 Issuance of
 shares for
 exercise of
 options.........         --    --      314,967      310,938       6      2,301          --           --             --
 Issuance of
 shares to redeem
 OP units........         --    --      188,820       38,820       2      2,554          --           --             --
 Redemption price
 of OP units in
 excess of book
 value...........         --    --          --           --      --      (6,082)         --           --             --
 Net loss........         --    --          --           --      --         --           --           --          (2,172)
 Amortization of
 unearned stock
 compensation....         --    --          --           --      --         --           --         4,686            --
 Cash dividends..         --    --          --           --      --         --           --           --         (67,185)
                    --------- ----- -----------  -----------  ------ ----------     --------      -------      ---------
 Balance,
 December 31,
 1997............         --    --   73,276,716   73,276,716   1,466  1,070,973          --       (13,116)       (69,431)
 Issuance of
 shares for
 mergers and
 acquisitions of
 properties......   8,423,230    85  59,491,863   59,491,863   1,190  1,607,050          --           --             --
 Issuance of
 shares, net of
 offering
 expenses........         --    --   64,084,627   64,084,627   1,282    257,439          --           --             --
 Return of
 capital.........         --    --          --           --      --     (52,873)         --           --             --
 Issuance of
 shares to
 employees and
 directors.......         --    --       39,790       39,790     --         928          --           --             --
 Issuance of
 shares for
 exercise of
 options.........         --    --    1,210,737    1,210,737      24     15,250          --           --             --
 Issuance of
 shares to redeem
 OP units........         --    --    1,362,316    1,362,316      28     27,868          --           --             --
 Issuance of
 notes receivable
 from
 shareholders and
 affiliates for
 mergers and
 acquisitions....         --    --          --           --      --         --       (18,617)         --             --
 Accrued interest
 on notes
 receivable from
 shareholders and
 affiliates......         --    --          --           --      --         --          (863)         --             863
 Collections on
 notes receivable
 from
 shareholders and
 affiliates......         --    --          --           --      --         --         3,116          --             --
 Amortization of
 unearned stock
 compensation....         --    --          --           --      --         --           --         7,622            --
 Net loss........         --    --          --           --      --         --           --           --        (158,223)
 Foreign currency
 translation
 adjustment......         --    --          --           --      --         --           --           --             --
 Unrealized loss
 on securities
 held for sale...         --    --          --           --      --         --           --           --             --
                    --------- ----- -----------  -----------  ------ ----------     --------      -------      ---------
 Comprehensive
 loss............
                    --------- ----- -----------  -----------  ------ ----------     --------      -------      ---------
 Cash dividends..         --    --          --           --      --         --           --           --         (87,390)
 Stock dividends
 declared........     558,656     5  14,055,598   14,055,598     280     97,905          --           --         (91,328)
                    --------- ----- -----------  -----------  ------ ----------     --------      -------      ---------
 Balance,
 December 31,
 1998............   8,981,886 $  90 213,521,647  213,521,647  $4,270 $3,024,540     $(16,364)     $(5,494)     $(405,509)
<CAPTION>
                      Accumulated Other
                     Comprehensive Income
                    ----------------------
                              Unrealized
                    Foreign     Loss on
                    Currency  Securities
                    Exchange Held for Sale   Total
                    -------- ------------- -----------
 <S>                <C>      <C>           <C>
 Balance,
 December 31,
 1996............    $  --      $   --     $  437,039
 Issuance of
 shares for
 mergers and
 acquisition of
 properties......       --          --        231,946
 Issuance of
 shares, net of
 offering
 expenses........       --          --        386,735
 Issuance of
 shares to
 employees and
 directors.......       --          --             62
 Forfeiture of
 unvested
 employee stock
 grants..........       --          --            --
 Issuance of
 shares for
 exercise of
 options.........       --          --          2,307
 Issuance of
 shares to redeem
 OP units........       --          --          2,556
 Redemption price
 of OP units in
 excess of book
 value...........       --          --         (6,082)
 Net loss........       --          --         (2,172)
 Amortization of
 unearned stock
 compensation....       --          --          4,686
 Cash dividends..       --          --        (67,185)
                    -------- ------------- -----------
 Balance,
 December 31,
 1997............       --          --        989,892
 Issuance of
 shares for
 mergers and
 acquisitions of
 properties......       --          --      1,608,325
 Issuance of
 shares, net of
 offering
 expenses........       --          --        258,721
 Return of
 capital.........       --          --        (52,873)
 Issuance of
 shares to
 employees and
 directors.......       --          --            928
 Issuance of
 shares for
 exercise of
 options.........       --          --         15,274
 Issuance of
 shares to redeem
 OP units........       --          --         27,896
 Issuance of
 notes receivable
 from
 shareholders and
 affiliates for
 mergers and
 acquisitions....       --          --        (18,617)
 Accrued interest
 on notes
 receivable from
 shareholders and
 affiliates......       --          --            --
 Collections on
 notes receivable
 from
 shareholders and
 affiliates......       --          --          3,116
 Amortization of
 unearned stock
 compensation....       --          --          7,622
 Net loss........       --          --       (158,223)
 Foreign currency
 translation
 adjustment......     2,749         --          2,749
 Unrealized loss
 on securities
 held for sale...       --       (1,245)       (1,245)
                    -------- ------------- -----------
 Comprehensive
 loss............                            (156,719)
                    -------- ------------- -----------
 Cash dividends..       --          --        (87,390)
 Stock dividends
 declared........       --          --          6,862
                    -------- ------------- -----------
 Balance,
 December 31,
 1998............    $2,749     $(1,245)   $2,603,037
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-6
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
                    Preferred Stock              Common Stock
                    -----------------  -----------------------------------                  Notes
                                                                                          Receivable                 Accumulated
                                         Patriot       Wyndham              Additional       From        Unearned    Deficit and
                      Number     Par      Number        Number       Par     Paid in     Shareholders     Stock       Dividend
                    of Shares   Value    of Shares    of Shares     Value    Capital    and affiliates Compensation Distributions
                    ----------  -----  ------------  ------------  -------  ----------  -------------- ------------ -------------
                                                                       (in thousands, except share amounts)
 <S>                <C>         <C>    <C>           <C>           <C>      <C>         <C>            <C>          <C>
 Settlement of
 forward equity
 contracts.......          --    --    (100,701,863) (100,701,863)  (2,014)   (327,466)         --           --              --
 Merger of PAH
 Inc. into
 Wyndham
 International
 Inc.............   (4,860,876)  (50)  (142,865,949)    4,860,876   (1,380)      1,430          --           --              --
 Exchange of Old
 Wyndham
 preferred stock
 to common
 stock...........   (3,562,354)  (36)           --      3,562,354       36         --           --           --              --
 Redemption of
 PAH Inc.
 Preferred B
 Stock...........     (558,656)   (5)           --            --       --      (13,961)         --           --             (896)
 Issuance of
 shares net of
 offering
 expenses........   10,000,000   100     29,239,336    29,239,336      585     917,306          --           --              --
 Issues of shares
 to employees and
 directors.......          --    --         538,496       955,757       14      11,820          --          (611)            --
 Issuance of
 shares to redeem
 OP units........          --    --         268,333    15,390,452      156     114,381          --           --              --
 Issuance of
 shares for
 mergers and
 acquisition of
 properties......          --    --             --      1,336,276       13       6,030          --           --              --
 Accrued interest
 on notes
 receivable from
 shareholders and
 affiliates......          --    --             --            --       --          --          (846)         --              846
 Amortization of
 unearned stock
 compensation....          --    --             --            --       --          --           --         5,850             --
 Retirement of
 stock...........          --    --             --       (971,139)      (8)    (15,307)         --           --              --
 Net loss........          --    --             --            --       --          --           --           --       (1,071,969)
 Foreign currency
 translation
 adjustment......          --    --             --            --       --          --           --           --              --
 Unrealized gain
 on securities
 held for sale...          --    --             --            --       --          --           --           --              --
                    ----------  ----   ------------  ------------  -------  ----------     --------       ------     -----------
 Comprehensive
 loss............
                    ----------  ----   ------------  ------------  -------  ----------     --------       ------     -----------
 Interstate Spin-
 off Dividend....          --    --             --            --       --          --           --           --          (64,602)
 Cash Dividends..          --    --             --            --       --          --           --           --          (14,711)
 Stock
 Dividends.......      344,662     4            --            --       --       34,462          --           --          (34,466)
                    ----------  ----   ------------  ------------  -------  ----------     --------       ------     -----------
 Balance as of
 December 31,
 1999............   10,344,662  $103            --    167,193,696  $ 1,672  $3,753,235     $(17,210)      $ (255)    $(1,591,307)
                    ==========  ====   ============  ============  =======  ==========     ========       ======     ===========
<CAPTION>
                      Accumulated Other
                     Comprehensive Income
                    -----------------------
                               Unrealized
                    Foreign      Loss on
                    Currency   Securities
                    Exchange  Held for Sale    Total
                    --------- ------------- ------------
 <S>                <C>       <C>           <C>
 Settlement of
 forward equity
 contracts.......       --           --        (329,480)
 Merger of PAH
 Inc. into
 Wyndham
 International
 Inc.............       --           --             --
 Exchange of Old
 Wyndham
 preferred stock
 to common
 stock...........       --           --             --
 Redemption of
 PAH Inc.
 Preferred B
 Stock...........       --           --         (14,862)
 Issuance of
 shares net of
 offering
 expenses........       --           --         917,991
 Issues of shares
 to employees and
 directors.......       --           --          11,223
 Issuance of
 shares to redeem
 OP units........       --           --         114,537
 Issuance of
 shares for
 mergers and
 acquisition of
 properties......       --           --           6,043
 Accrued interest
 on notes
 receivable from
 shareholders and
 affiliates......       --           --             --
 Amortization of
 unearned stock
 compensation....       --           --           5,850
 Retirement of
 stock...........       --           --         (15,315)
 Net loss........       --           --      (1,071,969)
 Foreign currency
 translation
 adjustment......   (10,325)         --         (10,325)
 Unrealized gain
 on securities
 held for sale...       --           245            245
                    --------- ------------- ------------
 Comprehensive
 loss............                            (1,082,049)
                    --------- ------------- ------------
 Interstate Spin-
 off Dividend....       --           --         (64,602)
 Cash Dividends..       --           --         (14,711)
 Stock
 Dividends.......       --           --             --
                    --------- ------------- ------------
 Balance as of
 December 31,
 1999............   $(7,576)     $(1,000)   $ 2,137,662
                    ========= ============= ============
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-7
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                               Years Ended December 31,
                                          -------------------------------------
                                             1999         1998         1997
                                          -----------  -----------  -----------
                                                    (in thousands)
<S>                                       <C>          <C>          <C>
Cash flows from operating activities:
Net loss................................  $(1,071,969) $  (158,223) $    (2,172)
Adjustments to reconcile net loss to net
 cash provided by operating activities:
  Depreciation and amortization.........      302,890      231,233       52,787
  Amortization of unearned stock
   compensation.........................        5,850        7,622        4,686
  Amortization of deferred loan costs...       34,946       26,914        2,630
  Net loss on sale of assets............       10,702        9,453          --
  Impairment loss on assets held for
   sale.................................      203,731       51,081          --
  Write-off of intangible assets........      133,143          --           --
  Write-off of deferred acquisition
   costs................................        8,349          --           --
  Forgiveness of debt...................        7,898          --           --
  Cost of acquiring leaseholds..........          --        64,407       54,499
  Payment of interest on notes
   receivable from unconsolidated
   subsidiaries.........................          --           --         5,001
  Treasury lock settlement..............          --        49,225          --
  Award of unearned stock compensation
   and other............................          --           928           61
  Equity in losses (earnings) of
   unconsolidated subsidiaries..........        7,746       (9,498)      (6,015)
  Minority interest in income of
   Operating partnerships...............       (6,642)     (12,652)       1,684
  Minority interest in consolidated
   subsidiaries.........................        6,017        9,427        1,615
  Deferred income taxes.................      539,313      (14,665)         --
  Extraordinary items...................        9,838       31,817        2,534
  Changes in assets and liabilities:
    Accounts receivable.................       (6,168)     (65,927)     (19,494)
    Prepaid expenses and other assets...        6,552       47,020       (5,965)
    Lease revenue receivable............        3,440          924       (4,359)
    Due to/from affiliates..............          --           --          (421)
    Accounts payable and other accrued
     expenses...........................        6,666      (24,593)      21,039
                                          -----------  -----------  -----------
      Net cash provided by operating
       activities.......................      202,302      244,493      108,110
                                          -----------  -----------  -----------
Cash flows from investing activities:
Acquisition of hotel properties and
 related working capital assets, net of
 cash acquired..........................     (264,086)  (1,946,227)    (933,948)
Improvements and additions to hotel
 properties.............................     (230,653)    (189,885)     (82,269)
Proceeds from sale of assets............      205,553       77,325          --
Termination of management contracts.....       16,086          --           --
Change in other assets..................         (772)         880          --
Collection on other notes receivable....        2,681       12,009          --
Deferred acquisition costs..............         (613)     (19,926)     (67,743)
Investment in unconsolidated
 subsidiaries...........................      (10,077)     (24,557)      (1,574)
Principal payments received on mortgage
 and other notes receivable.............        2,357          --          (500)
Investment in other mortgage and other
 notes receivable.......................      (10,429)      14,022     (116,090)
                                          -----------  -----------  -----------
      Net cash used in investing
       activities.......................     (289,953)  (2,076,359)  (1,202,124)
                                          -----------  -----------  -----------
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-8
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

               CONSOLIDATED STATEMENTS OF CASH FLOWS--(Continued)

<TABLE>
<CAPTION>
                                               Years Ended December 31,
                                          ------------------------------------
                                             1999         1998        1997
                                          -----------  ----------  -----------
                                                    (in thousands)
<S>                                       <C>          <C>         <C>
Cash flows from financing activities:
Borrowings under line of credit facility
 and mortgage notes.....................  $ 2,930,205  $2,883,719  $ 1,865,634
Repayments of borrowings under credit
 facility and other debt................   (3,153,525)   (997,436)  (1,001,236)
Payment of deferred loan costs..........     (110,655)    (39,923)     (24,471)
Proceeds from issuance of common stock..          --      273,995      388,621
Net proceeds from issuance of preferred
 stock..................................      921,702         --           --
Cost to retire Patriot series B
 preferred stock........................      (13,966)        --           --
Cash settlement with Interstate upon
 spin-off...............................      (17,102)        --           --
Contributions received from minority
 interest in consolidated subsidiaries..          180       5,952       35,829
Distribution made to minority interest
 in other partnerships..................      (29,907)    (11,081)         --
Collections on notes receivables from
 shareholders...........................          --        3,116          --
Payments to redeem OP units.............          --          --       (63,826)
Dividends and distributions paid........      (15,607)   (124,834)     (65,705)
Forward equity settlements..............     (329,480)    (52,873)         --
Foreign currency translation
 adjustment.............................       (6,379)      2,749          --
Other...................................           44         --           --
                                          -----------  ----------  -----------
  Net cash provided by financing
   activities...........................      175,510   1,943,384    1,134,846
                                          -----------  ----------  -----------
Net increase in cash and cash
 equivalents............................       87,859     111,518       40,832
Cash and cash equivalents at beginning
 of period..............................      158,954      47,436        6,604
                                          -----------  ----------  -----------
Cash and cash equivalents at end of
 period.................................  $   246,813  $  158,954  $    47,436
                                          ===========  ==========  ===========
Supplemental disclosure of cash flow
 information:
  Cash paid during the period for
   interest.............................  $   338,675  $  224,444  $    48,254
                                          ===========  ==========  ===========
  Cash paid during the period for income
   taxes................................  $    31,978  $   26,729  $       325
                                          ===========  ==========  ===========
</TABLE>


  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                      F-9
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                         NOTES TO FINANCIAL STATEMENTS
                 (dollars in thousands, except share amounts)

1. Organization:

  Patriot American Hospitality, Inc. (collectively with its subsidiaries,
"Patriot"), was formed April 17, 1995 as a self-administered real estate
investment trust ("REIT") for the purpose of acquiring equity interests in
hotel properties. Wyndham International, Inc. (collectively with its
subsidiaries, "Old Wyndham") was formed in connection with Patriot's merger
with and into California Jockey Club and Bay Meadows Operating Company on July
1, 1997 (the "Cal Jockey Merger"). Patriot and Old Wyndham are both Delaware
corporations.

  Wyndham International Inc., as currently constituted, was formed through the
June 30, 1999 restructuring and reorganization of Patriot and Old Wyndham.
Prior to June 30, 1999, the shares of common stock of Patriot were paired and
traded together with the shares of Old Wyndham, on a one for one basis, as a
single unit pursuant to a stock pairing arrangement, and were referred to as a
paired share.

  Effective June 30, 1999, a subsidiary of Old Wyndham merged with and into
Patriot with Patriot being the surviving entity and becoming a subsidiary of
Old Wyndham. In connection with this restructuring, the pairing agreement
between Patriot and Old Wyndham was terminated, Patriot's status as a real
estate investment trust terminated effective January 1, 1999, and Patriot
became a taxable corporation as of that date. This merger converted each
previously outstanding paired share into one share of Wyndham class A common
stock. Old Wyndham and its subsidiaries, which now include Patriot, is
hereafter referred to as Wyndham or the Company. Unless otherwise stated
herein, all information with respect to shares refers to Wyndham class A
common stock since June 30, 1999 and to paired shares for periods before June
30, 1999.

  Wyndham primarily operates through Patriot and the Wyndham International
Operating Partnership, L.P. (the "Wyndham Partnership") in which it owns a 1%
general partnership interest and an approximate 98% limited partnership
interest. Patriot primarily operates through Patriot American Hospitality
Operating Partnership, L.P. (the "Patriot Partnership") in which it owns a 1%
general partnership interest and an approximate 98% partnership interest. The
Patriot Partnership primarily owns interests in hotel properties and third
party leaseholds. The Wyndham Partnership primarily leases hotel properties
from the Patriot Partnership, owns interests in hotel properties, and manages
and franchises hotels for third parties. The Patriot Partnership and the
Wyndham Partnership are collectively referred to as the Operating
Partnerships.

  The restructuring was reflected as a reorganization of two companies under
common control and was accounted for in a manner similar to that used in
pooling of interest accounting. As such, there was no revaluation of the
assets and liabilities of Old Wyndham or Patriot. The financial statements
prior to the reorganization are presented on a combined basis and include the
combined accounts of Patriot and its subsidiaries with Old Wyndham and its
subsidiaries.

  As of December 31, 1999, Wyndham owned interests in 165 hotels with an
aggregate of over 43,900 guest rooms and leased 39 hotels from third parties
with over 5,700 rooms. In addition, Wyndham managed 88 hotels for third party
owners with over 20,800 guest rooms and franchises 11 hotels with over 2,600
guest rooms.

2. Summary of Significant Accounting Policies:

 Principles of Consolidation

  The consolidated financial statements for 1999 include the accounts of
Wyndham, its wholly-owned subsidiaries, and the partnerships, corporations,
and limited liability companies in which Wyndham owns a controlling interest.

  Partnerships--The condition for control is the ownership of a majority
voting interest and the ownership of the general partnership interest.

                                     F-10
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  Corporations and Limited Liability Companies--The condition for control is
the ownership of a majority voting interest.

  The financial statements prior to the reorganization are presented on a
combined basis and include the combined accounts of Patriot and its
subsidiaries with Old Wyndham and its subsidiaries.

 Investment in Real Estate and Related Improvements

  The hotel properties are stated at lower of cost or fair market value.
Depreciation is computed using the straight-line method based upon estimated
useful lives of the assets of 35 to 40 years for the hotel buildings and
improvements, 7 years for the racecourse facility and 3 to 10 years for
furniture, fixtures and equipment. These estimated useful lives are based on
management's knowledge of the properties and the industry in general.

  Maintenance and repairs are charged to operations as incurred; major
renewals and betterments are capitalized. Upon the sale or disposition of a
fixed asset, the asset and the related accumulated depreciation are removed
from the accounts and the gain or loss is included in operations.

  Interest associated with borrowings used to finance substantial hotel
renovations is capitalized and amortized over the estimated useful life of the
assets. Interest of $6,910, $12,112 and $2,562 was capitalized in 1999, 1998
and 1997, respectively.

  In accordance with Statement of Financial Accounting Standards ("SFAS") No.
121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of, the Company would record impairment losses on long-
lived assets used in operations when events and circumstances indicate that
the assets might be impaired and the undiscounted cash flows estimated to be
generated by those assets are less than the carrying amounts of those assets.

  When management identifies an asset as held for sale, the Company estimates
the fair value of such assets. If in management's opinion, the fair value of
the asset is less than the carrying amount of the asset, a reserve for losses
is established. Fair value is estimated as the amount at which the asset could
be bought or sold less costs to sell. Impairment is evaluated based on
undiscounted cash flows to be generated by the assets held for sale, as well
as prevailing market conditions, appraisals or current estimated net sales
proceeds from pending offers, if appropriate. The Company recognized
approximately $70,912 and $30,578 of impairment losses for the years ended
December 31, 1999 and 1998, respectively. During 1999, the Company also
recorded a restructuring charge of $132,819 associated with write-down of
assets to estimated fair market value, as the Company will exit from these
business sectors. The Company also recognized approximately $10,702, net of
impairment, and $9,453 of losses related to other assets sold during 1999 and
1998, respectively.

 Cash and Cash Equivalents

  All highly liquid investments with an original maturity date of three months
or less when purchased are considered to be cash equivalents.

 Investment in Unconsolidated Subsidiaries

  The Company's investments in unconsolidated subsidiaries include investments
in 18 entities ranging from approximately 5% to 55%. Investments in
partnerships and joint ventures are accounted for using the equity method of
accounting when the Company has a 20% or more ownership interest or exercises
significant influence over the venture. If the Company owns less than 20% and
does not exercise significant influence, the investment is accounted under the
cost method.

                                     F-11
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


 Management contracts, trade names and franchise costs

  The costs associated with the acquisition of management contracts, trade
names and franchises have been recorded as deferred costs. Amortization of
management contracts is computed using the straight-line method over the term
of the related management agreements. Amortization of trade names and
franchise costs is computed using the straight-line method over estimated
useful lives ranging from 12 to 20 years.

 Leaseholds

  The costs associated with the acquisition of leaseholds for hotel properties
leased from third party owners have been recorded as deferred costs. Leasehold
costs are amortized using the straight-line method over the terms of the
related leasehold agreement.

 Goodwill and intangibles

  Goodwill and intangibles recognized in connection with the acquisition of
certain businesses are amortized utilizing the straight-line method over a
period of 10 to 40 years. The carrying value of goodwill is reviewed based on
undiscounted cash flows over the remaining amortization period. Should this
review indicate that the goodwill will not be recoverable, a reserve for
impairment is established. During 1999, the Company recorded a write-down of
goodwill and intangibles of $112,702, as a result of the Company's
restructuring plan. During 1998, Wyndham recognized approximately $20,503
impairment loss on goodwill, related to assets and business held for sale at
December 31, 1998.

 Deferred Expenses

  Deferred expenses consist of the following:

<TABLE>
<CAPTION>
                                                               December 31,
                                                             ------------------
                                                               1999      1998
                                                             --------  --------
   <S>                                                       <C>       <C>
   Deferred loan costs...................................... $140,038  $ 61,708
   Costs of non-compete agreements..........................    1,479     1,479
   Franchise fees...........................................    1,147       616
   Other....................................................    1,717     3,331
                                                             --------  --------
                                                              144,381    67,134
   Less: accumulated amortization...........................  (46,614)  (29,136)
                                                             --------  --------
                                                             $ 97,767  $ 37,998
                                                             ========  ========
</TABLE>

  Deferred loan costs are amortized to interest expense on a straight-line
basis (which approximates the interest method) over the terms of the related
loans, which range from one to ten years. Deferred loan costs include $32,503
of fully-amortized costs associated with Patriot's old credit facility and
other debt which was repaid on June 30, 1999. Costs of non-compete agreements
are amortized using the straight-line method over the terms of the related
agreement. Franchise costs are amortized using the straight-line method over
the terms of the related franchise agreements.

 Inventories

  Inventories consist of food, beverages, china, linen, glassware and
silverware and are stated at cost, which approximates market.


                                     F-12
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

 Other Assets

  Leasehold improvements and furniture, fixtures and equipment related to the
corporate offices are carried at cost and amortized over estimated useful
lives of 5 to 7 years. Insurance premiums included in other assets are
expensed on a pro-rata basis over the life of the related policies. Security
deposits paid in connection with certain leasehold agreements of approximately
$46,109 are included in other assets.

 Dividends

  Patriot paid sufficient dividends in order to maintain its status as a REIT
under the Internal Revenue Code in 1998 and 1997. At June 30, 1999, as a
result of the reorganization, Patriot's status as a real estate investment
trust terminated effective January 1, 1999, and Patriot became a taxable
corporation as of that date. The Company does not anticipate paying a dividend
to its common shareholders.

 Deposits

  Deposits represent cash received from guests for future hotel reservations
at the hotels that Wyndham manages.

 Income Taxes

  Wyndham records its provision for income taxes in accordance with SFAS No.
109, Accounting for Income Taxes. Under the liability method of Statement 109,
deferred taxes are determined based on the difference between the financial
statements and tax bases of assets and liabilities using enacted tax rates in
effect in the years the differences are expected to reverse (see Note 14).

  Wyndham recorded a one-time charge of $675,000 to establish a deferred tax
liability that resulted from Patriot's change in tax status from a REIT to a C
corporation, as required by SFAS No. 109. This charge is included in income
tax expense in the accompanying 1999 consolidated statement of operations.

 Minority Interest in the Operating Partnerships

  Minority interest in the Operating Partnerships includes adjustments for the
minority partners' share of the current period net income and certain other
adjustments for the issuance or redemption of OP units.

 Minority Interest in Consolidated Subsidiaries

  The Company has entered into a number of joint ventures in which a third
party owns a minority interest. For financial reporting purposes, the
financial position and results of operations for each joint venture is
included in the consolidated financial statements of the Company.

 Forward Equity Transactions Subject to Price Adjustments

  The Company was party to transactions with three cournterparties involving
the sale of paired shares, with the related price adjustment mechanisms. The
original agreements and subsequent amendments provided for a settlement
mechanism in either cash or additional paired shares. At each settlement date,
the Company recorded an adjustment to equity for the change in fair market
value of the Company's paired shares until the forward equity contracts were
settled in full. See Note (10) for additional details on the forward equity
transactions.


                                     F-13
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

 Stock Splits

  On January 30, 1997, the Board of Directors declared a 2-for-1 stock split
on Patriot common stock effected in the form of a stock dividend distributed
on March 18, 1997 to shareholders of record on March 7, 1997.

  In addition, on July 10, 1997, the respective Boards of Directors of Patriot
and Old Wyndham declared a 1.927-for-1 stock split on its shares of common
stock effected in the form of a stock dividend distributed on July 25, 1997 to
shareholders of record on July 15, 1997.

  Unless otherwise indicated, all references in the consolidated financial
statements to the number of shares, per share amounts, and market prices of
the common stock and options to purchase common stock have been restated to
reflect the impact of the conversion of each share of Patriot common stock
into 0.51895 paired shares issued in the Cal Jockey merger and the 1.927-for-1
stock split. In addition, all references in the consolidated financial
statements to the number of shares, per share amounts, and market prices of
the common stock and options to purchase common stock related to periods prior
to the 2-for-1 stock split distributed in March 1997 have been restated to
reflect the impact of such stock split.

  As a result of the 2-for-1 stock split in March 1997, the Cal Jockey merger
and the 1.927-for-1 stock split in July 1997, the number of OP units
outstanding and the OP unit conversion factor has been adjusted to re-
establish a 1-for-1 exchange ratio of OP units to common shares.

 Stock Dividend

  On December 22, 1998, Patriot declared a stock dividend of $0.44 cents per
share of common stock for the fourth quarter of 1998. The dividend was paid on
January 25, 1999 to shareholders of record on December 30, 1998. Each
shareholder received the option to receive the dividend in the form of
additional paired shares or shares of Series B Cumulative Perpetual Preferred
Stock, par value $0.01 per share, of Patriot.

  Per share data (including dividends), weighted average shares outstanding
and all stock option activity have been restated to reflect the stock
dividend.

 Earnings per Share

  The Company has adopted SFAS No. 128 "Earnings Per Share" which specifies
the computation, presentation and disclosure requirements for basic earnings
per share and diluted earnings per share. Earnings per share disclosures for
all periods presented have been calculated in accordance with requirements of
SFAS No. 128. Basic earnings per share is computed based upon the weighted
average number of shares of common stock outstanding during the period
presented. Shares of common stock granted to officers and employees of the
Company are included in the computation only after the shares become fully
vested. Diluted earnings per share is computed based upon the weighted average
number of shares of common stock and dilutive common stock equivalents
outstanding during the periods presented. The diluted earnings per share
computations also include the dilutive impact of options to purchase common
stock which were outstanding during the period calculated by the "treasury
stock" method, unvested stock grants and other restricted awards to officers
and employees, convertible preferred shares and collateral shares issued in
conjunction with certain forward equity transactions (see Note 9).

 Stock Compensation

  The Company accounts for its stock compensation arrangements under the
provisions of Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees" ("APB 25"), and intends to

                                     F-14
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

continue to do so. See Note 13 for a discussion of the Company's stock
compensation arrangements and pro forma disclosure of the effect on income
from operations and earnings per share of such arrangements pursuant to the
requirements of SFAS No. 123, "Accounting for Stock-Based Compensation."

 Revenue Recognition

  The Company primarily owns, operates and manages hotel properties. Hotel
revenue, management fees, service and other fees, are recognized when earned.

 Foreign Currency Translation

  Financial statements of foreign subsidiaries not maintained using U.S.
dollars are remeasured into the U.S. dollar functional currency for
consolidation and reporting purposes. Assets and liabilities of non-U.S.
operations are translated into U.S. dollars at the exchange rate in effect at
the balance sheet date. Revenues and expenses of non-U.S. operations are
translated at the weighted average exchange rate during the year. Resulting
translation adjustments are reflected in shareholders' equity. Realized
foreign currency gains and losses are included in results of operations.

 Advertising Costs

  The Company participates in various advertising and marketing programs. All
costs are expensed in the period incurred. The Company has recognized
advertising expenses of $68,834 and $61,468 for 1999 and 1998 respectively.

 Self Insurance

  The Company is self insured for various levels of general liability,
workers' compensation and employee medical coverage. Accrued expenses include
the estimated cost from unpaid incurred claims.

 Use of Estimates

  The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

 Concentrations

  The Company currently invests primarily in hotel properties. The hotel
industry is highly competitive and the Company's hotel investments are subject
to competition from other hotels for guests. Each of the Company's hotels
competes for guests primarily with other similar hotels in its immediate
vicinity and other similar hotels in its geographic market. The Company
believes that brand recognition, location, quality of the hotel, services
provided and price are the principal competitive factors affecting its hotel
investments.

 Derivative Instruments and Hedging Activities

  In June 1999, FASB issued SFAS No. 137, "Accounting for Derivative
Instruments and Hedging Activities" which defers the effective date of SFAS
No. 133 to be adopted in years beginning after June 15, 2000. The Company
expects to adopt SFAS No. 133 effective January 1, 2001. Statement 133 will
require the Company to recognize all derivatives on the balance sheet at fair
value. Derivatives that are not hedges must be

                                     F-15
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

adjusted to fair value through income. If the derivative is a hedge, depending
on the nature of the hedge, changes in the fair value of derivatives will
either be offset against the change in fair value of the hedged assets,
liabilities, or firm commitments through earnings, or recognized in other
comprehensive income until the hedged item is recognized in earnings. The
ineffective portion of a derivative's change in fair value will be immediately
recognized in earnings. Management has not yet determined what the effect of
SFAS No. 133 will have on the earnings and financial position of the Company.

 Seasonality

  The hotel industry is seasonal in nature. Revenues at certain hotels are
greater in the first and second quarters of a calendar year and at other
hotels in the second and third quarters of a calendar year.

 Reclassification

  Certain prior year balances have been reclassified to conform to the current
year presentation with no effect on previously reported amounts of income or
retained earnings.

3. Investments in Real Estate and Related Improvements and Land Held for
Development:

  Investments in real estate and related improvements and land held for
development consists of the following:

<TABLE>
<CAPTION>
                                                  As of December 31, 1999
                                              ---------------------------------
                                                Hotel     Racecourse
                                              Properties   Facility    Total
                                              ----------  ---------- ----------
<S>                                           <C>         <C>        <C>
Land......................................... $  466,573   $    --   $  466,573
Land held for development....................     68,266        --       68,266
Buildings and improvements...................  4,640,150        --    4,640,150
Furniture, fixtures and equipment............    810,743        --      810,743
Renovations in progress......................     44,729        --       44,729
                                              ----------   --------  ----------
                                               6,030,461        --    6,030,461
Less: impairment reserve.....................   (138,789)       --     (138,789)
Less: accumulated depreciation...............   (478,494)       --     (478,494)
                                              ----------   --------  ----------
                                              $5,413,178   $    --   $5,413,178
                                              ==========   ========  ==========
<CAPTION>
                                                  As of December 31, 1998
                                              ---------------------------------
                                                Hotel     Racecourse
                                              Properties   Facility    Total
                                              ----------  ---------- ----------
<S>                                           <C>         <C>        <C>
Land......................................... $  491,458   $  2,340  $  493,798
Land held for development....................     81,314        --       81,314
Buildings and improvements...................  4,480,174     21,865   4,502,039
Furniture, fixtures and equipment............    636,598        837     637,435
Renovations in progress......................    153,652        536     154,188
                                              ----------   --------  ----------
                                               5,843,196     25,578   5,868,774
Less: impairment reserve.....................    (11,484)   (19,094)    (30,578)
Less: accumulated depreciation...............   (248,832)    (3,748)   (252,580)
                                              ----------   --------  ----------
                                              $5,582,880   $  2,736  $5,585,616
                                              ==========   ========  ==========
</TABLE>


                                     F-16
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

  The Company has approximately $423,870 of assets held for sale which are
included in investments in real estate and related improvements and land held
for development in the accompanying financial statements which are expected to
be sold during 2000. The assets held for sale include approximately $343,994
of non-proprietary branded segment assets, $26,368 of Wyndham segment assets
and $53,508 of other segment assets. See Note 17 for Segment Reporting. The
Company has recorded an impairment reserve of approximately $138,789 related
to these assets held for sale. The impairment relates to 29 hotels, which had
a combined net operating income of $12,440 for the year ended December 31,
1999. At December 31, 1998, the Company had approximately $550,315 of assets
held for sale which are included in investments in real estate and related
improvements and land held for development in the accompanying financial
statements which were expected to be sold during 1999. The assets held for
sale include approximately $435,906 of non-proprietary branded segment assets,
$93,337 of resort segment assets and $21,072 of other segment assets.
Additionally, the Company has recorded an impairment reserve of approximately
$30,578 related to these assets held for sale. The impairment relates in part
to six hotels which had a combined net income of $1,323 for the year ended
December 31, 1998. Additionally, the impairment relates to the Bay Meadows
Racecourse which had operating income of $969 for the year ended December 31,
1998 and was sold in February of 1999.

 Investments in Hotel Properties

  During 1998, Patriot, through the Patriot Partnership and its subsidiaries,
invested approximately $234,116 in the acquisition of four hotels with a total
of over 1,700 guest rooms and the Golden Door Spa. These acquisitions were
financed primarily with funds drawn on Patriot's revolving credit facility,
the issuance of 53,989 OP units valued at approximately $1,496, the issuance
of 390,335 paired shares valued at approximately $10,000 and the assumption of
mortgage debt in the amount of approximately $80,074. In addition, Patriot
acquired an office building that was converted into a hotel for approximately
$33,900.

  During 1999, the Company invested approximately $210,123 in the acquisition
of four hotels with over 900 guest rooms. These acquisitions were financed
primarily with funds drawn on the credit facility and the assumption of
mortgage debt in the amount of approximately $24,593.

 Asset Sales

  During 1998, Patriot sold its interest in four hotel assets: Orange
Courtyard Hotel in Orange, Connecticut; St. Louis Courtyard Hotel in St.
Louis, Missouri; Pittsburgh Residence in Pittsburgh, Pennsylvania; and the
Westborough Courtyard in Westborough, Massachusetts, collectively hereinafter
referred to as the Fine Transaction, for a net purchase price of approximately
$32,500. The assets were sold to an affiliate of an independent member of the
board of directors. No gain or loss on sale was recognized as a result of this
transaction.

  Additionally in December 1998, Patriot sold its interest in three hotel
assets previously leased to NorthCoast Hotels LLC (a third party lessee of
Patriot); the WestCoast Roosevelt Hotel, the WestCoast Gateway Hotel located
in Seattle, Washington and the WestCoast Wenatchee Hotel located in Wenatchee,
Washington to an affiliate of NorthCoast. Patriot received net cash proceeds
of approximately $23,700 plus a mortgage note receivable in the amount of
$2,000. Patriot also contracted with an affiliate of NorthCoast to sell a
fourth hotel, the WestCoast Long Beach Hotel and Marina located in Long Beach,
California, for a total purchase price of approximately $7,000, which was sold
in 1999. Patriot recognized a loss on sale of approximately $9,453 as a result
of the sale of these three assets.

  During 1999, the Company sold 21 hotel properties, including 11 hotels in
London. See Note (4). The Company received net cash proceeds of approximately
$116,424, after the repayment of mortgage debt of $62,865, and a mortgage note
receivable in the amount of $6,000. The Company recorded a net loss of $10,740
as a result of these transactions.

                                     F-17
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


4. Other Businesses Acquired and Disposed:

 Cal Jockey Club and Bay Meadows Operating Company

  On July 1, 1997 Patriot consummated its merger with California Jockey Club
("Cal Jockey") and Bay Meadows Operating Company for total purchase
consideration for the transaction of approximately $190,188. In this merger,
Patriot acquired the paired share structure utilized by Patriot and Old
Wyndham, the Bay Meadows Racecourse facility in San Mateo, California, and
land adjacent to the racecourse.

  In February 1999, Patriot and Old Wyndham sold their interest in the Bay
Meadows Racecourse. Patriot and Old Wyndham received cash proceeds of
approximately $3,446 after payment of legal costs and other closing costs.
Patriot and Old Wyndham recognized an estimated impairment loss on assets held
for sale of $42,278 related to the racecourse facility in 1998. In addition,
on September 3, 1999, Wyndham sold certain land located in San Mateo,
California and received cash proceeds of $3,480. These funds were placed in a
restricted trust account in order to facilitate a tax-deferred, like-kind
exchange through the acquisition of a suitable hotel property. The net gain on
the sale of the racecourse and land was approximately $38, net of impairment.

 Wyndham Hotel Corporation

  On January 5, 1998, Patriot consummated its merger with Wyndham Hotel
Corporation for total consideration of $982,000. The consideration consisted
of: 21,954,137 paired shares; 4,860,876 shares of Series A Convertible
Preferred Stock of Patriot; cash of approximately $339,000; and the assumption
of $59,063 in debt. In connection with the merger, which was accounted for
using the purchase method of accounting, goodwill of $323,959 was recognized.
In this merger, Patriot acquired ownership of ten Wyndham hotels, fourteen
ClubHouse hotels, 52 management and franchise contracts, the Wyndham and
ClubHouse proprietary brand names, and the Wyndham hotel management company.

 WHG Casinos & Resorts, Inc. and related transactions

  On January 16, 1998, a subsidiary of Wyndham merged with and into WHG
Casinos & Resorts Inc., with WHG being the surviving corporation ("WHG
merger"). As a result of the WHG merger, Wyndham acquired the 570-room Condado
Plaza Hotel & Casino, a 50% interest in the partnership that owns the 389-room
El San Juan Hotel & Casino and a 23.3% interest in the partnership that owns
the 751-room El Conquistador Resort & Country Club, all of which are located
in Puerto Rico. In addition, Wyndham acquired a 62% interest in Williams
Hospitality Group, Inc., the management company for the three hotels and the
Las Casitas Village at the El Conquistador. A total of 5,004,690 paired shares
were issued in connection with the WHG merger and approximately $21,300 of
debt was assumed, resulting in total purchase consideration of approximately
$159,400.

  In connection with the WHG merger, which was accounted for using the
purchase method of accounting, goodwill of $22,578 was recognized.

  Effective March 1, 1998, Patriot acquired from unaffiliated third parties a
40% interest in the El San Juan Hotel & Casino, an aggregate 68.62% equity
interest in the El Conquistador and a 38% interest in Williams Hospitality
Group, Inc. for approximately $31,000 in cash, issuance of 1,818,182 paired
shares valued at approximately $49,227 and the assumption of approximately
$169,572 of debt.

                                     F-18
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  On July 13, 1998, Patriot acquired the remaining minority interests held by
a third party in entities that own the El Conquistador and the El San Juan
Hotel & Casino for a total purchase price of approximately $3,890. Wyndham
owns the controlling general partner interest in the partnerships that own the
El San Juan Hotel & Casino and the El Conquistador. Wyndham also holds voting
control of Williams Hospitality Group, Inc. Therefore, the operating results
of these entities have been consolidated with those of Wyndham for financial
reporting purposes.

 Arcadian International Limited

  In April 1998, Patriot announced the completion of its acquisition of
Arcadian International. The total transaction cost was approximately
(Pounds)185,900 (approximately $308,700 U.S. based on exchange rates at the
time of closing). As a result of the transaction, Patriot acquired ten owned
hotels located throughout England; one owned hotel in Jersey; five owned and
managed Malmaison Hotels; two resorts under development in Tuscany, Italy and
Paris, France; and the proprietary Malmaison brand name. Patriot also acquired
Arcadian's 50% partnership interest in the redevelopment of the luxury Great
Eastern Hotel in London, to be branded as a flagship Wyndham Hotel and
operated by Wyndham once the development has been completed. The Arcadian
acquisition was financed through a short term financing agreement and the
assumption of debt.

  In connection with the Arcadian acquisition which was accounted for using
the purchase method of accounting, goodwill of $54,405 was recognized.

  During 1999, as a part of management's strategy to exit from the European
market for its non-branded assets, the Company recorded a restructuring charge
of $97,885 primarily for the write-down of assets to estimated fair value,
including goodwill of $28,394. The restructuring charge also included $9,547
associated with staffing reductions and other exit costs necessary to reduce
the Company's infrastructure in Arcadian International, its management
division in Europe. In 1999, the Company sold 11 hotels for a purchase price
of (Pounds)75,000 (approximately $119,940 based on exchange rates at the time
of closing). As a result of the sale, the Company recorded a loss on the sale
of $8,320, net of restructuring charges.

 Interstate Hotels Company

  On June 2, 1998, Interstate Hotels Company merged with and into Patriot with
Patriot being the surviving company ("Interstate merger") for total
consideration of approximately $2,068,812 which consisted of 28,825,875 paired
shares, cash of approximately $525,385, approximately $787,117 in debt assumed
or refinanced by Patriot and approximately $73,351 to pay other transaction-
related costs. In connection with the repayment of debt assumed in the
Interstate merger, Patriot incurred certain prepayment penalties and wrote off
the remaining balance of unamortized deferred financing costs associated with
such debt of approximately $11,553, net of minority interest. Such amount has
been reported as an extraordinary item in the consolidated financial
statements.

  In connection with the Interstate merger, which was accounted for using the
purchase method of accounting, goodwill of $254 was recognized.

  As a result of the Interstate merger, Patriot acquired controlling interest
in, or ownership of, 42 hotels representing over 12,000 rooms; leases for 84
hotels representing over 10,100 rooms and management or service agreements for
82 hotels representing over 20,400 rooms located throughout the United States
and in Canada, the Caribbean and Russia.

                                     F-19
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  On May 27, 1998, Patriot, Old Wyndham and Interstate entered into a
settlement agreement, as amended, with Marriott International, Inc.
("Marriott") which addressed certain claims asserted by Marriott in connection
with Patriot's then proposed merger with Interstate. The settlement agreement
provided for the dismissal of litigation brought by Marriott, and allowed
Patriot's merger with Interstate to close. In addition to dismissal of the
Marriott litigation, the settlement agreement provides for the re-branding of
ten Marriott hotels under the Wyndham name, the assumption by Marriott of the
management of ten Marriott hotels formerly managed by Interstate for the
remaining term of the Marriott franchise agreement, and the spin-off by
Patriot of the third-party management business.

  Effective June 18, 1999, Patriot distributed approximately 92% of the shares
of Interstate Hotel Corporation ("New Interstate") in the form of a dividend
to shareholders. Shareholders of record on June 7, 1999 received one share of
New Interstate stock for every thirty shares of Patriot common stock, Patriot
series A preferred stock, Old Wyndham series A and B preferred stock, Patriot
common and preferred OP units, and Old Wyndham class A and C preferred OP
units. The remaining 8% is owned equally by Wyndham and Marriott.

  As a result of the spin-off, the Company now an approximate 55% non-
controlling interest in the subsidiary of New Interstate which now operates
the third-party management business that Patriot acquired from Interstate.

 SF Hotel Company, L.P.

  On June 5, 1998, Patriot acquired all of the partnership interests in SF
Hotel Company, L.P. for approximately $298,915 ("Summerfield acquisition").
The total purchase consideration for the Summerfield acquisition consisted of
approximately 3,223,795 OP units, 1,397,281 paired shares, cash of
approximately $165,514 and the assumption of debt in the amount of $17,083. In
addition, the purchase price is subject to future adjustment based on (i) the
market price of the paired shares through the end of 1998 and (ii) achievement
of certain performance criteria through 2000 for managed hotels which were not
open for business (or had recently opened) as of the date of acquisition,
(iii) fulfillment of the Company's obligation to develop seven hotels. As a
result of the Summerfield acquisition, Patriot acquired four Summerfield
Suites(R) hotels, leasehold and management interests in 24 Summerfield
Suites(R), Sierra Suites(R) and Sunrise Suites hotels and management contracts
and franchise interests for 12 additional Summerfield Suites(R) and Sierra
Suites(R) hotels. In addition, Patriot acquired the development contracts for
several additional hotels. Estimated obligations related to these future
purchase price adjustments are approximately $61,000, part of which is payable
in 2000 and part in 2001.

  In connection with the Summerfield acquisition which was accounted for using
the purchase method of accounting, goodwill of $45,207 was recognized. In
connection with the repayment of debt assumed in the Summerfield acquisition,
Patriot incurred certain repayment penalties and wrote off the remaining
balance of unamortized deferred financing costs associated with such debt of
approximately $291, net of minority interest. Such amount has been reported as
an extraordinary item in consolidated financial statement.

  Effective January 15, 1999, an additional 1,311,709 OP units valued at
approximately $8,969 were issued in connection with the Summerfield
transaction as additional consideration pursuant to the purchase agreement in
satisfaction of the 1998 Summerfield adjustment.

  Effective February 8, 2000, the Company paid an additional $32,825 as
additional consideration pursuant to the purchase agreement with SF Hotel
Company L.P.

 Gencom American Hospitality and CHC International Inc.

  On June 30, 1998, the hospitality-related business of CHC International,
Inc. ("CHCI") merged with and into Wyndham with Wyndham being the surviving
company. As a result of the CHCI merger, Wyndham acquired

                                     F-20
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

the remaining 50% investment in GAH-II, L.P., seventeen leases, sixteen
management contracts related to the Patriot hotels leased by CHC Lease
Partners, eight third party management contracts, two third-party asset
management contracts, the Grand Bay proprietary brand name and certain other
hospitality management assets. The aggregate purchase price of the 17
leasehold interests was approximately $52,721, which is reflected as a cost of
acquiring leaseholds in the accompanying financial statements for the year
ended December 31, 1998. The merger was funded through a combination of
preferred shares and the assumption of debt.

  On July 30, 1999, a wholly-owned subsidiary of Wyndham merged with Gencom
Interest, Inc. As a result of the merger, Wyndham acquired the remaining
34.52% interest in the Omni Baltimore hotel, and 421,161 shares of Wyndham
class A common stock owned by Gencom Interest, Inc. The total purchase
consideration for the merger was approximately $6,043 which consisted of
1,336,276 shares of Wyndham class A common stock.

  In addition, on September 30, 2000 and September 30, 2002, the Company may
be obligated to pay the CHCI stockholders and a subsidiary of the Company may
be obligated to pay a Gencom-related entity additional consideration, in each
case based upon the performance of certain specified assets.

 Other

  In July 1998, Old Wyndham acquired an approximate 49% limited partnership
interest in a partnership with affiliates of Don Shula's Steakhouse, Inc. for
$1,500 in cash and 156,272 of Preferred OP units of the Wyndham Partnership
which were valued at approximately $3,500.

  During 1998, Patriot also re-acquired the leasehold interests for nine of
its hotels from the lessees and purchased certain license agreements for an
aggregate purchase price of approximately $11,686, which is reflected as a
cost of acquiring leaseholds in the accompanying statements of operations. The
Company issued 118,812 paired shares valued at $3,000 and paid cash of $8,686.

  During 1999, the Company acquired the remaining minority interests in 9
hotel assets. The acquisition of these interests was financed through cash of
approximately $4,230, additional mortgage indebtedness totaling $49,800, and
the sale of an additional 10% interest in another hotel.

5. Investments in and Mortgage Notes Receivable and Other Receivables from
   Unconsolidated Subsidiaries:

  In 1995 and 1996, Patriot acquired an approximate 99% non-controlling
interest in PAH Ravina, and PAH Windwatch, respectively.

  As part of the financing for the acquisition of the Crowne Plaza Ravinia
Hotel, Patriot advanced $40,500 to PAH Ravinia, which is evidenced by two
mortgage notes consisting of a $36,000 first mortgage note and a $4,500 second
mortgage note. The principal amount of both notes is due December 31, 2002.
Interest at an annual rate equal to 10.25% and 12.5% on the first and second
mortgage notes, respectively, is payable monthly. The mortgage notes are
collateralized by deeds of trust on the Crowne Plaza Ravinia Hotel. On June
30, 1999, Wyndham obtained a secured mortgage note with Bear Stearns (See Note
7). As a result, $22,934 in net proceeds were used to pay-down the first
mortgage. As part of the financing for the acquisition of the Wyndham
Windwatch Hotel, Patriot advanced PAH Windwatch $31,400 which is evidenced by
a first lien mortgage note. The principal amount of the note is due on
December 31, 2002. Interest at an annual rate equal to 9% is payable monthly.
The mortgage note is collateralized by a deed of trust on the Wyndham
Windwatch Hotel.

                                     F-21
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  On June 15, 1999, the Company acquired the 1% controlling interest in both
hotels for approximately $156. As such, the hotels are now consolidated in the
accompanying financial statements, and the mortgage notes have been eliminated
upon consolidation.

6. Restructuring charges:

  During 1999, the Company recorded a restructuring charge of $285,267 as a
result of the termination of the paired share structure (See Note 13) and
management's decision to streamline its organization and focus on its core
brands and strategic assets. The restructuring activities (shown below in
tabular format) primarily relate to: (1) the termination of the paired share
structure, resulting in the write-down of the unamortized intangible asset,
and elimination of job responsibilities, resulting in the costs to sever
employees in New York and Dallas, (2) the exiting of the European market for
its non-branded assets, resulting in the write-down of assets held for sale to
estimated fair value, the write-down of goodwill, the reduction in the
European workforce, lease abandonments, and other costs necessary to reduce
the infrastructure in Arcadian International, (3) the exiting of the limited
service hotel sector, resulting in a write-down of those assets held for sale
and the write-off of management contracts, (4) the closure of the Phoenix
division office, resulting in the costs to sever employees and lease
abandonments, (5) the closure of the Wichita division office, resulting in the
costs to sever employees, and (6) the elimination of certain brands, resulting
in the write-down of those tradename intangible assets.

  The Company expects the plans associated with these costs to be
substantially completed during the first half of 2000 with many of the costs
associated with the reduction in workforce being incurred and paid in 1999.
The total number of employees terminated was 177.

<TABLE>
<CAPTION>
                                   Cash/Non-   Restructuring Accrued Balance at
    Description                      Cash         Charge          12/31/99
    -----------                  ------------- ------------- ------------------
<S>                              <C>           <C>           <C>
Organizational Restructuring
Write-down of intangible
 assets........................  Non-cash        $ (83,094)       $   --
Severance packages.............  Cash/non-cash      (4,675)          (500)
Downsizing European division
Write-down of assets held for
 sale..........................  Non-cash          (69,491)           --
Write-down of intangible
 assets........................  Non-cash          (28,394)           --
Severance packages.............  Cash               (3,578)        (2,458)
Lease cancellations and
 commitments...................  Cash               (1,907)        (1,907)
Other exit costs...............  Cash               (4,062)        (2,408)
Exiting limited service market
 sector
Write-down of assets held for
 sale..........................  Non-cash          (63,328)           --
Write-down of intangible
 assets........................  Non-cash           (8,834)           --
Closing the Phoenix division
 office
Severance packages.............  Cash               (2,006)          (312)
Lease cancellations and other
 commitments...................  Cash                 (492)          (321)
Closing of the Wichita division
 office
Severance packages.............  Cash               (1,872)        (1,872)
Elimination on certain hotel
 brand
Write-down of intangible
 assets........................  Non-cash          (12,821)           --
Other
Other exit costs...............  Cash                 (713)           --
Effect of foreign currency
 translation...................                        --               8
                                                 ---------        -------
  Total........................                  $(285,267)       $(9,770)
                                                 =========        =======
</TABLE>


                                     F-22
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

7. Line of Credit Facility, Term Loans, Mortgage and Other Notes and Capital
Lease Obligations:

  Outstanding borrowings under the line of credit facilities, term loans,
various mortgage and other notes and capital lease obligations consist of the
following:

<TABLE>
<CAPTION>
                                                           December 31,
                                                       ----------------------
                                                          1999        1998
                                                       ----------  ----------
   <S>                                                 <C>         <C>
   Line of credit facilities.......................... $  270,000  $  875,587
   Term Loans.........................................  1,300,000   1,799,500
   Increasing Rate Loans..............................    650,000         --
   Mortgage notes payable to Bears Stearns and Lehman
    Brothers..........................................    581,000         --
   Paine Webber Mortgage Financing....................        --      298,000
   El Conquistador and Condado Financing..............    168,167     170,000
   Royal Bank of Scotland and Coutts Consortium Fi-
    nancing...........................................     31,670      97,140
   Other mortgage debt................................    609,690     520,836
   Unsecured financing................................      5,633      66,753
   Capital lease obligations..........................     27,396      29,705
                                                       ----------  ----------
                                                       $3,643,556  $3,857,521
                                                       ----------  ----------
   Less current portion of debt.......................   (130,177) (1,274,918)
                                                       ----------  ----------
   Long term debt..................................... $3,513,379  $2,582,603
                                                       ==========  ==========
</TABLE>

 Credit Facility and Term Loans

  In connection with the Interstate merger, the Company closed on the
commitment from The Chase Manhattan Bank and Chase Securities, Inc. and Paine
Webber Real Estate Securities, Inc. to increase Patriot's existing credit
facilities to an aggregate of $2,700,000 (an increase of $1,450,000 from the
prior $1,250,000 credit package). The increased credit facilities included the
$900,000 revolving credit facility ("Credit Facility") and a series of
unsecured term loans in the aggregate amount of up to $1,800,000 (the "Term
Loans"). Proceeds from the Credit Facility were used to fund certain mergers,
as well as to refinance certain outstanding indebtedness. Interest rates were
based on the Company's leverage ratio and varied from 1.5% to 2.5% over LIBOR.

  The Term Loans and the Credit Facility, along with accrued interest and
fees, were repaid in full on June 30, 1999 with proceeds from the new credit
facility and the $1 billion equity investment. As a result of this repayment,
the Company incurred an extraordinary loss on early extinguishment of debt of
$9,838, net of minority interest and income tax effects.

 New Credit Facility and Term Loans

  Concurrent with the closing of the $1 billion equity investment, Wyndham
closed on a new $2,450,000 credit facility which consists of a $1,300,000 term
loan with a seven-year term, a $500,000 revolving credit facility with a five-
year term, and a $650,000 increasing rate loan facility with a five-year term.
The proceeds, net of closing costs and fees of approximately $41,125 for the
term loan and the revolving credit facility, and approximately $17,875 for the
increasing rate loan facility, were used to retire existing indebtedness. At
December 31, 1999, $270,000 was drawn on the new revolving credit facility.
Additionally, the Company had outstanding letters of credit totaling $27,039
as of December 31, 1999.

  Interest rates are based upon LIBOR plus spreads varying from 2.75% to 3.50%
per annum for the term loan, and 1.25% to 2.75% per annum for the revolving
credit facility, based both on Wyndham's leverage ratio, as defined, and
whether any increasing rate loans are outstanding. If any of the increasing
rate loan facility remains outstanding, the applicable margins shall be
increased by 0.25%. The term loan and the revolving credit

                                     F-23
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

facility are guaranteed by the domestic subsidiaries of Wyndham and are
secured by pledges of equity interests held by Wyndham and its subsidiaries.
Wyndham's ability to borrow under its revolving credit facility is subject to
Wyndham's compliance with a number of customary financial and other covenants,
including total leverage and interest coverage ratios.

  Interest rates for the increasing rate loans are based on LIBOR rates (less
statutory reserves), plus 3.50% through September 30, 1999, and increasing
0.50% every three months, with a cap of LIBOR plus 4.75%. The lender under the
increasing rate loans receives the benefit of the same guarantees and pledges
of security provided under the new term loan and revolving credit facility.

  The weighted average interest rate incurred under these borrowings was 9.33%
for the period ended December 31, 1999.

 Bear Stearns & Lehman Brothers

  Effective June 30, 1999, Wyndham also closed on a $346 million mortgage loan
with Bear, Stearns Funding, Inc., which is secured by twenty-five properties
having an aggregate net book value of $703,343 as of December 31, 1999. The
loan matures on July 1, 2004 and bears interest at the LIBOR rate plus 3.25%
per annum. Proceeds from the mortgage debt were used to retire existing
mortgage indebtedness. On November 5, 1999, the loan was modified to bear
interest at the LIBOR rate plus spreads of 0.82% through 4.50%.

  Additionally, effective June 30, 1999, Wyndham closed on a $235 million
mortgage loan with Lehman Brothers Holdings Inc., which is secured by ten
properties having an aggregate net book value of $324,429 as of December 31,
1999. The mortgage loan has a three-year term, with a one-year extension
option, and bears interest at the LIBOR rate plus 3.50% per annum, plus an
additional 1.75% on the principal amount payable at maturity. Proceeds from
this mortgage loan were used to retire existing mortgage indebtedness.

  At December 31, 1999, the LIBOR rate was 5.82% and averaged 5.25% during the
twelve-month period ended December 31, 1999.

 Paine Webber Mortgage Financing

  Patriot entered into a short-term financing arrangements with an affiliate
of Paine Webber Real Estate Securities, Inc. ("Paine Webber Real Estate")
whereby such affiliate loaned under three separate agreements a total of
$298,000. The loans bear interest at a rate equal to or greater than 30-day
LIBOR plus spreads of 1.75% through 2.75% and were to mature April 15, 1999.
The loans were amended February 15, 1999, to increase spreads to 2.75% through
5.0% and extend the loans through June 30, 1999. The proceeds of the Paine
Webber mortgage financing were used by Patriot to fund or acquire four
mortgage loans to certain partnerships affiliated with members of CHC Lease
Partners, the acquisition of the Wyndham Emerald Plaza located in San Diego
California and the Arcadian acquisition.

  Effective June 30, 1999, the loans, including accrued interest, were repaid
in full with proceeds from the new credit facility and the $1 billion equity
investment.

 El Conquistador and Condado Hotel and Casino Financing

  In August 1998, the Company refinanced certain debt related to the El
Conquistador and the Condado Hotel & Casino. Proceeds of $145,000 from the
refinancing were used to repay outstanding indebtedness of approximately
$139,350, to pay legal and closing costs and to establish certain reserves,
including interest

                                     F-24
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

reserves, required by the loan agreements. The loans are secured by mortgages
on the properties which have an aggregate net book value of $318,467 as of
December 31, 1999. The loans bear interest at a rate of LIBOR plus 2.25% and
were extended to June 30, 1999.

  On June 25, 1999, Wyndham entered into an agreement with Citicorp Real
Estate, Inc. to extend $90,000 of mortgage debt related to the El Conquistador
Partnership, L.P., which was set to mature on June 30, 1999. Per the terms of
the extension agreement, the interest rate was amended such that the loan
bears interest at the LIBOR rate plus 2.75% through December 31, 1999 and then
LIBOR plus 3.25% through maturity on June 30, 2000.

  Additionally, on June 29, 1999, Wyndham refinanced $55,000 of debt on the
Condado Hotel & Casino with The Bank of Nova Scotia. Principal payments on the
loan are due in monthly amounts of $306 beginning on July 22, 1999 through
maturity on July 22, 2004 at which time a balloon payment of $36,972 is due.
The interest rate on the first $50,000 is based upon LIBOR spreads varying
from 2.50% to 3.25% per annum, and on amounts over $50,000 is based upon LIBOR
spreads varying from 3.00% to 3.75% per annum, based on a ratio of earnings to
total debt service, as defined.

  Additionally, the Company has a term loan agreement with the Government
Development Board for Puerto Rico (GDB). As of December 31, 1999, the loan had
an outstanding balance of $25,000. The loan bears interest at a rate of LIBOR
plus 0.09% and matures February 2006. The Company is required to deposit 50%
of available cash flow, as defined per the loan agreement with GDB, to a
maximum of $1,667 plus any prior year requirements. The loan is secured
through a second lien mortgage on the property.

  The weighted average interest rate incurred under these borrowings was 7.73%
for the period ended December 31, 1999.

 Royal Bank of Scotland and Coutts Consortium Debt Obligations

  In connection with the Arcadian transaction, the Company assumed debt
obligations to the Royal Bank of Scotland and Coutts Consortium. On August 12,
1999, Wyndham renegotiated its debt obligations to both the Royal Bank of
Scotland and Coutts & Company. In connection with the sale of the 11 hotels,
the debt with the Royal Bank of Scotland of $62,865 as of December 1, 1999 was
repaid in full with the sales proceeds of the hotels. See Note (4).

  The Company has debt obligations of approximately $31,670 as of December 31,
1999 to the Coutts Consortium, which bears interest at Sterling Libor plus
2.0% and matures December 31, 2003. The debt is secured by first lien
mortgages encumbering 5 Malmaison hotels, which have an aggregate net book
value of $85,382 as of December 31, 1999.

 Unsecured financing

  The Company, through the Operating Partnerships and other subsidiaries, is
obligated under notes with various banks and financial institutions that as of
December 31, 1999, had an outstanding balance of $5,633. These notes are
unsecured and bear interest at rates ranging from 5.5% to 10.5% per annum. The
notes mature from 2000 through 2006. The weighted average interest rate
incurred under these borrowings was 6.68% for the period ended December 31,
1999.

                                     F-25
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


 Other Mortgage Debt

  The Company, through the Operating Partnerships and other subsidiaries, is
obligated under other mortgage notes with various banks and financial
institutions that, as of December 31, 1999, had outstanding balances totaling
$609,690. These notes are collateralized by mortgage liens on the property and
equipment of 27 hotels which have an aggregate net book value of $1,219,904 as
of December 31, 1999. The notes bear interest at rates ranging from Italian
Ribor to Libor plus 3.5% per annum and maturity dates in 2000 through 2023.
The weighted average interest rate incurred under these borrowings was 8.05%
during the year ended December 31, 1999.

  Under the terms of the related loan agreements and capital lease
obligations, principal amortization and balloon payment requirements at
December 31, 1999 are as follows for each of the next five years:

<TABLE>
<CAPTION>
     Year                                                               Amount
     ----                                                             ----------
     <S>                                                              <C>
     2000............................................................ $  130,177
     2001............................................................    162,719
     2002............................................................    324,945
     2003............................................................     44,579
     2004............................................................  1,379,056
     2005 and thereafter.............................................  1,602,080
                                                                      ----------
                                                                      $3,643,556
                                                                      ==========
</TABLE>

8. Derivatives:

  The Company enters into interest rate swap and cap agreements to modify the
interest characteristics of its outstanding debt. These agreements involve the
exchange of amounts based on a variable interest rate for amounts based on
fixed interest rates over the life of the agreement without an exchange of the
notional amount upon which the payments are based. The differential to be paid
or received as interest rates change, is accrued and recognized as an
adjustment to interest expense related to the debt using a method which
approximates the effective interest method (the accrual accounting method).
The related amount payable to or receivable from counterparties is included in
accrued expenses or other assets.

  The Company also enters into interest rate cap agreements that are designed
to limit its exposure to increasing interest rates and are designated as
hedges of its outstanding debt. An interest rate cap entitles the Company to
receive a payment from the counterparty equal to the excess if any, of the
hypothetical interest expense (strike price) on a specified notional amount at
a current market interest rate over an amount specified in the agreement. The
only amount the Company is obligated to pay the counterparty is the initial
premium. The cost of the agreements (the initial premium) is included in other
assets and amortized to interest expense ratably during the life of the
agreement.

  The fair value of interest rate swap and cap agreements and changes in the
fair value as a result of changes in market interest rates are not recognized
in the financial statements. The unrealized gain on these derivative
instruments was approximately $14,553 at December 31, 1999, which represents
the net proceeds Wyndham would receive if the derivatives were sold.

  The Company paid $6,514, $2,331, and $587 of net incremental interest
expense related to the interest rate swap arrangements in 1999, 1998, and
1997, respectively.

                                     F-26
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  The following tables represent the derivatives in place as of December 31,
1999:

 Interest Rate Swaps

<TABLE>
<CAPTION>
          Notional
            Amount                      Rate                                             Maturity
          --------                      -----                                            --------
        <S>                             <C>                                              <C>
           $19,988                      5.31%                                            01/03/00
          $400,000                      5.91%                                            02/07/00
           $72,000                      5.80%                                            12/15/00
           $31,000                      5.42%                                            03/30/01
          $375,000                      6.26%                                            11/01/02
          $125,000                      5.56%                                            11/01/02
          $250,000                      5.84%                                            06/01/03

 Interest Rate Caps

<CAPTION>
          Notional
            Amount                      Rate                                             Maturity
          --------                      -----                                            --------
        <S>                             <C>                                              <C>
        $1,500,000                      7.00%                                            04/03/00
           $19,475                      6.75%                                            03/30/01
           $38,000                      7.83%                                            10/11/01
           $27,680                      7.10%                                            07/03/04
           $42,760                      8.10%                                            07/03/04
           $42,760                      9.70%                                            07/03/04
           $18,990                      6.50%                                            07/03/04
           $28,425                      8.50%                                            08/01/04
          $180,000                      6.60%(1)                                         11/04/04
</TABLE>
--------
(1) If on a reset date LIBOR is equal to or less than 5.1%, then the floor
    rate is 5.65%

 Treasury Rate Lock Agreements

  Patriot previously entered into three treasury interest rate lock agreements
to protect against the possibility of rising interest rates. Under the rate
lock agreements, Patriot receives or makes payments based on the difference
between specified interest rates, 6.06%, 6.07% and 5.62%, and the actual 10-
year U.S. Treasury interest rate on a principal amount of $525,000. Patriot
settled the entire $525,000 in treasury interest rate locks resulting in a
$49,334 one-time charge to earnings in 1998.

                                     F-27
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


9. Computation of Earnings Per Share:

   Basic and diluted earnings per share have been computed as follows:

 Basic and Diluted Earnings per Share

<TABLE>
<CAPTION>
                                Year Ended               Year Ended            Year Ended
                             December 31, 1999       December 31, 1998     December 31, 1997
                          ------------------------  ---------------------  -------------------
                             Basic     Diluted(2)     Basic    Diluted(2)   Basic   Diluted(2)
                          -----------  -----------  ---------  ----------  -------  ----------
                                     (in thousands, except per share amounts)
<S>                       <C>          <C>          <C>        <C>         <C>      <C>
(Loss) income before
 extraordinary item.....  $(1,062,131) $(1,062,131) $(126,406) $(126,406)  $   362   $   362
Adjustment for equity
 forwards(1)............      (19,372)     (39,322)   (21,151)  (188,392)      --        --
Preferred stock
 dividends..............      (50,190)     (50,190)    (7,956)    (7,956)      --        --
Excess consideration
 paid to redeem
 preferred stock........         (115)        (115)       --         --        --        --
                          -----------  -----------  ---------  ---------   -------   -------
(Loss) income
 (attributable)
 available to common
 shareholders before
 extraordinary item.....   (1,131,808)  (1,151,758)  (155,513)  (322,754)      362       362
Extraordinary loss......       (9,838)      (9,838)   (31,817)   (31,817)   (2,534)   (2,534)
                          -----------  -----------  ---------  ---------   -------   -------
Net loss................  $(1,141,646) $(1,161,596) $(187,330) $(354,571)  $(2,172)  $(2,172)
                          ===========  ===========  =========  =========   =======   =======
Weighted average number
 of shares outstanding..      161,255      161,255    137,764    137,764    64,260    64,260
                          ===========  ===========  =========  =========   =======   =======
Loss per share:
  Loss before
   extraordinary item...  $     (7.02) $     (7.14) $   (1.13) $   (2.34)  $  0.01   $  0.01
  Extraordinary loss....        (0.06)       (0.06)     (0.23)     (0.23)    (0.04)    (0.04)
                          -----------  -----------  ---------  ---------   -------   -------
Net loss income.........  $     (7.08) $     (7.20) $   (1.36) $   (2.57)  $ (0.03)  $ (0.03)
                          ===========  ===========  =========  =========   =======   =======
</TABLE>
--------
(1) The adjustment relates to the mark-to-market adjustment for the UBS
    Transaction and the Nations Transaction (see Note 10), which can be
    settled in cash or stock, at the Company's option. At December 31, 1998,
    the PaineWebber Transaction could be settled only in stock, therefore only
    the guaranteed return portion is adjusted in the earnings per share
    calculation. There was no mark-to-market adjustment for the PaineWebber
    Transaction, which was accounted for by the Reverse Treasury Method in
    1998.
(2) For 1999, the dilutive effect of unvested stock grants of 803, the option
    to purchase common stock of 59 and preferred stock of 64,367 were not
    included in the computation of diluted earnings per share for the year
    ended December 31, 1999 because they are anti-dilutive. For 1998 the
    dilutive effect of unvested stock grants of 880, the option to purchase
    common stock of 753, shares issued in connection with forward equity
    contracts of 2,507 and 6,613 of preferred shares were not included in the
    computation of diluted earnings per share for the year ended December 31,
    1998 because they are anti-dilutive. For 1997, the dilutive effect of
    unvested stock grants of 804 and the option to purchase common stock of
    1,017 were not included in the computation of diluted earnings per share
    for the year ended December 31, 1997 because they are anti-dilutive. See
    Note 13 for a discussion of the impact of SFAS No. 123 ("Accounting for
    Stock-Based Compensation") on earnings per share.

                                     F-28
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

10. Commitments and Contingencies:

 Office Lease

  The Company has entered into agreements to lease office space for its
corporate headquarters and other regional offices. In general, the agreements
provide for monthly payments of rent plus reimbursement for certain other
costs as specified per each agreement and are accounted for as operating
leases for financial reporting purposes. The leases have terms from 5 to 10
years and expire between 2003 and 2007. Annual rental payments of $3,484,
$3,125 and $127 for 1999, 1998 and 1997, respectively, are reflected in
general and administrative expense in the accompanying financial statements.
Future five-year minimum lease payments under these lease agreements are as
follows:

<TABLE>
<CAPTION>
      Year                                                           Rent Amount
      ----                                                           -----------
      <S>                                                            <C>
      2000.......................................................... $    1,875
      2001..........................................................      1,875
      2002..........................................................      1,875
      2003..........................................................      1,763
      2004..........................................................      1,725
      2005 and thereafter...........................................      4,744
                                                                     ----------
                                                                     $   13,857
                                                                     ==========

 Hotel and Ground Leases

  The Company leases both land and hotels under agreements with terms ranging
from one to 100 years. The Company has incurred rent expense totaling
$117,420, $110,108, and $4,117 for 1999, 1998 and 1997, respectively. Future
five year minimum lease payments under these lease agreements are as follows:

<CAPTION>
      Year                                                           Rent Amount
      ----                                                           -----------
      <S>                                                            <C>
      2000.......................................................... $   60,197
      2001..........................................................     60,206
      2002..........................................................     60,169
      2003..........................................................     60,216
      2004..........................................................     59,637
      2005 and thereafter...........................................    742,728
                                                                     ----------
                                                                     $1,043,153
                                                                     ==========
</TABLE>

 Employment Agreements

  The Company has entered into employment agreements with each of its
executive officers. Generally, the agreements provide for annual base
compensation with any increases during the terms of the agreements to be
approved by the Compensation Committee of the Board of Directors, as
applicable.

 Future Earnout Obligations

  In connection with the CHCI Merger and the Gencom Acquisition, Wyndham and a
subsidiary of Wyndham may be obligated to pay CHCI shareholders and a Gencom
related entity additional purchase consideration, in each case based on the
performance of certain specified assets.

                                     F-29
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  In connection with the Wyndham merger, certain descendants of Mr. and Mrs.
Trammell Crow, and various corporations, partnerships, trusts, and other
entities beneficially owned or controlled by such person, (collectively, the
"Crow Family Members") and certain Wyndham senior executives retained the
right to receive additional consideration on April 30, 2000 based on a formula
pertaining to the performance of Wyndham Riverfront New Orleans and Wyndham
Garden LaGuardia as set forth in the Omnibus Purchase and Sale Agreement dated
April 14, 1997. Based on the performance of such properties as of December 31,
1999, the additional consideration would be $10,758 and $8,677 respectively.

  In connection with the Summerfield transaction, Patriot may be obligated to
pay in cash or OP units additional purchase consideration if certain
performance criteria are met based on (i) the average market price of the
paired shares through December 31, 1998 and (ii) the achievement of certain
performance criteria through the year 2000 for managed hotels which were not
open for business (or had recently opened) as of the date of acquisition,
(iii) fulfillment of the Company's obligation to develop seven hotels.
Payments under these obligations have been made in 1999 and 2000 of $8,969 and
$32,825 respectively.

  Pursuant to the joint venture agreement related to the Wyndham Chicago
Hotel, the agreement provides for an earn-out payment payable based on the net
operating income from the hotel for the year ended December 31, 2001, as
calculated per the agreement.

 Forward Equity Transactions

  The Company was party to transactions with three counterparties involving
the sale of an aggregate of 13.3 million paired shares with related purchase
price adjustment mechanisms. The Company's aggregate obligation under the
forward equity transactions was approximately $335,800 million at June 30,
1999. Effective June 30, 1999, the Company settled in full all of the forward
equity transactions in cash with part of the proceeds of the $1 billion equity
investment. The 100.7 million shares owned or held by the counterparties were
retired effective June 30, 1999.

 Contingencies

  On June 29, 1992, an action for trademark infringement was filed in the New
York Supreme Court, County of New York, Index No. 17474/92 titled Wyndham
Hotel Company, John Mados, and Suzanne Mados et al v. Wyndham Hotel Company.
Ltd. It is based upon the Madoses' alleged use of the mark WYNDHAM in
connection with the Wyndham Hotel located in Manhattan, New York City, and
operated by the Madoses since 1966 pursuant to a lease agreement entered into
by the Madoses on June 1, 1957. The case was tried in May 1996, and an order
and partial judgement was entered in March 1998. The order enjoins us from
using the name and mark "Wyndham" in connection with the advertising,
promoting, managing or operating a hotel in Manhattan, New York City, and
places restrictions on Wyndham's use of the name and mark "Wyndham" in all
other areas of New York outside of Manhattan. In November 1998, an order was
issued clarifying the original order and a final judgment was entered. In
December 1998, Wyndham appealed that judgment to the New York Supreme Court,
Appellate Division, First Department. In January 1999, Wyndham moved for a
stay of the injunction pending appeal which motion was granted by the
Appellate Division, First Department on February 4, 1999. On May 18, 1999 the
Appellate Division, First Department rendered a decision and order affirming
the
final judgment. On May 24, 1999, Wyndham filed a motion for permission to
appeal that decision to the Court of Appeals of the State of New York. In July
1999, Wyndham received notice that the Court of Appeals of the State of New
York would not hear the appeal.


                                     F-30
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

  Patriot and Old Wyndham have disclosed various matters relating to Patriot
and Old Wyndham in their Form 8-K filed with the Securities and Exchange
Commission on November 9, 1998, including, without limitation, an assertion by
UBS AG, London Branch ("UBS") that Patriot and Old Wyndham are in default
under the terms of a forward contract by and among Patriot, Old Wyndham and
UBS. Patriot and Old Wyndham also have disclosed various matters in their
Joint Annual Report on Form 10-K, filed with the Securities and Exchange
Commission on March 26, 1999, and in registration statements on Form S-3
(filed on April 28, 1999) and Form S-4 (filed on April 14, 1999).

  On or about January 12, 1999, a purported class action lawsuit was filed on
behalf of the shareholders of Patriot and Wyndham in the Delaware Chancery
Court. The lawsuit, captioned Fraschilla v. Paul A. Nussbaum, et al., No.
16895NC, named as defendants certain persons who then were directors of
Patriot, as well as certain other individuals and entities alleged to be
investors in the Company (the "Investors"). The lawsuit alleged that the
director defendants breached their fiduciary duties to Patriot's shareholders
with respect to Patriot's financial condition and breached their fiduciary
duties to Patriot's shareholders by "effectively selling control" of Patriot
to the Investors for inadequate consideration and without having adequately
considered or explored all other alternatives to this sale or having taken
steps to maximize stockholder value. The lawsuit also alleged that the
Investors aided and abetted the director defendants in their purported
breaches of fiduciary duty. The plaintiffs sought monetary damages from the
director defendants as well as an injunction preventing the consummation of
the proposed transaction with the Investors. On January 19, 1999, three nearly
identical purported class action lawsuits were filed in the same court on
behalf of different purported class representatives: (i) Sybil R. Meisel and
Steven Langsam, Trustees, No. 16905NC; (ii) Crandon Capital Partners, No.
16906NC; and (iii) Robert A. Staub, No. 16907NC. All of the actions were
consolidated into the Fraschilla action. In September 1999, the parties
entered into a Stipulation of Settlement to settle these lawsuits. Pursuant to
the Stipulation of Settlement, Wyndham agreed that it would make the rights
offering it previously announced it may make, no later than December 17, 1999,
and to hold this offering open for a period of not less than 30 days. On
November 1, 1999, the Delaware Chancery Court approved the amended Stipulation
of Settlement along with class counsels' fee request of $1,125,000 and entered
an order and final judgment dismissing all of these lawsuits (the "Order").
The Order became final on or about December 2, 1999. Currently, Wyndham is
seeking recovery for costs incurred in the defense and settlements of these
lawsuits from its directors and officers insurance carriers.

  On February 3, 1999, McNeill Investment Company, Inc. filed a lawsuit
against Patriot in the United States District Court for the Western District
of Pennsylvania. In the lawsuit, captioned McNeill Investment Company, Inc. v.
Patriot American Hospitality, Inc., No. 99-165, the plaintiff alleges that
Patriot breached its obligations under a registration rights agreement that
Patriot became obligated under through its merger transaction with Interstate
Hotels Corporation. The plaintiff claims approximately $9 million in damages.
The case presently is in the early discovery stage. Wyndham intends to defend
the suit vigorously.

                                     F-31
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

  On May 7, 1999, Doris Johnson and Charles Dougherty filed a lawsuit in the
Northern District of California against Patriot, Wyndham, their respective
operating partnerships and Paine Webber Group, Inc. This action, Johnson v.
Patriot American Hospitality, Inc., et al., No. C-99-2153, was commenced on
behalf of all former holders of Bay Meadows stock during a class period from
June 2, 1997 to the date of filing. The action asserts securities fraud claims
and alleges that the purported class members were wrongfully induced to tender
their shares as part of the Patriot/Bay Meadows merger based on a fraudulent
prospectus. The action further alleges that defendants continued to defraud
stockholders about their intentions to acquire numerous hotels and saddle the
Company with massive debt during the class period. Three other actions against
the same defendants subsequently were filed in the Northern District of
California: (i) Ansell v. Patriot American Hospitality, Inc., et al., No. C-
99-2239 (filed May 14, 1999), (ii) Sola v. Paine Webber Group, Inc., et al.,
No. C-99-2770 (filed June 11, 1999), and (iii) Gunderson v. Patriot American
Hospitality, Inc., et al., No. C-99-3040 (filed June 23, 1999). Another action
with substantially identical allegations, Susnow v. Patriot American
Hospitality, Inc., et al., No. 3-99-CV1354-T (filed June 15, 1999) also
subsequently was filed in the Northern District of Texas. The complaints in
these actions seek unspecified damages but assert that the defendants are
liable for the diminution in value of Patriot stock held by class members
during the class period. By order of the Judicial Panel on Multidistrict
Litigation, these actions along with certain actions identified below have
been consolidated in the Northern District of California for consolidated
pretrial purposes. To date, none of the defendants have been required to
answer, move or otherwise respond to the complaints, and no discovery has been
taken. Wyndham intends to defend the suits vigorously.

  On or about June 22, 1999, a lawsuit captioned Levitch v. Patriot American
Hospitality, Inc., et al., No. 3-99-CV1416-D, was filed in the Northern
District of Texas against Patriot, Wyndham, James D. Carreker and
Paul A. Nussbaum. This action asserts securities fraud claims and alleges
that, during the period from January 5, 1998 to December 17, 1998, the
defendants defrauded shareholders by issuing false statements about the
Company. The complaint was filed on behalf of all shareholders who purchased
Patriot Wyndham stock during that period. Three other actions, Gallagher v.
Patriot American Hospitality, Inc., et al., No. 3-99-CV1429-L, filed on
June 23, 1999, David Lee Meisenburg, et al. v. Patriot American Hospitality,
Inc., Wyndham International, Inc., James D. Carreker, and Paul A. Nussbaum
Case No. 3-99-CV1686-X, filed July 27, 1999 and Deborah Szekely v. Patriot
American Hospitality, Inc., et al., No. 3-99-CV1866-D, filed on or about
August 27, 1999, allege substantially the same allegations. The complaints in
these actions seek unspecified damages but assert that the defendants are
liable for the diminution in value of Patriot stock held by class members
during the class period. By order of the Judicial Panel on Multidistrict
Litigation, these actions have been consolidated with certain other
stockholder actions and transferred to the Northern District of California for
consolidated pre-trial purposes. To date, none of the defendants have been
required to answer, move or otherwise respond to the complaints, and no
discovery has been taken. Wyndham intends to defend the suits vigorously.

  Wyndham has received a draft complaint which threatens to assert claims on
behalf of Golden Door, LLC, Golden Springs, LLC, Golden Door, Inc., Deer
Springs Ranch, LLC, Deborah Szekely and Sarah Livia Brightwood. The potential
plaintiffs appear to be the same as the plaintiffs who filed the action
referenced above, Deborah Szekely v. Patriot American Hospitality, Inc., et
al., No. 3-99-CV1866-D, however the allegations of the complaints are not the
same. The draft complaint purports to assert claims against Patriot, Wyndham
and their respective operating partnerships for securities fraud under the
California securities code, common law fraud, breach of fiduciary duty and
deceit in connection with the purchase by Patriot of the Golden Door Spa in
February 1998. The draft complaint seeks compensatory damages for the alleged
lost value of the potential plaintiff's stock and other unspecified damages.
Although the Company has received a draft complaint, to date no complaint has
been filed.

                                     F-32
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

  Patriot American and PAH Stanley Ranch ("PAH") are engaged in a dispute with
Carneros Valley Investors involving a contract which calls for a purchase
price of $14 million with an additional $5 million to be paid if PAH gets
approval for a development in the Napa Valley. PAH did not get approval for
this development. In September, 1999, Carneros Valley Investors filed a
complaint in the Superior Court of California, San Francisco, which alleges
that Patriot owes it $5 million and alleges that it acted negligently,
fraudulently and in bad faith in attempting to get the approval for the
development. The complaint has been amended to allege fraud, allegedly
entitling the plaintiff to rescission of the sale. Patriot has answered the
complaint, but to date, no discovery has been taken. Wyndham intends to defend
the suit vigorously.

  Patriot, IHC/Jacksonville Corporation and IHC Realty Partnership are parties
to a dispute with another limited partner of the Partnership relating to a
proposed hotel development in Jacksonville, Florida. The case is captioned C&M
Investors Limited v. Patriot American Hospitality, Inc. et al., originally
filed in the Florida Circuit Court, Fourth Judicial Circuit, in and for Duval
County, Florida, but later removed and now pending in the United States
District Court, Middle District of Florida, Jacksonville Division, Civil
Action No. 98-1236-Civ. J 20B. Wyndham plans to vigorously defend this
lawsuit.

  On September 17, 1999, Starwood Hotels & Resorts Worldwide Inc. ("Starwood")
filed a lawsuit against Fred J. Kleisner, Richard Mahoney and Wyndham in the
United States District Court for the Southern District of New York. In the
lawsuit, captioned Starwood Hotels & Resorts Worldwide Inc. v. Fred J.
Kleisner et al, No. 99 Civ. 9811, the plaintiff alleged that Wyndham
tortiously interfered with alleged employment contracts between Starwood and
Kleisner and Mahoney, respectively, that the defendants misappropriated trade
secrets belonging to Starwood, that the defendants tortiously interfered with
Starwood's prospective business relationships and that the defendants are
unfairly competing with Starwood. The complaint sought injunctive relief and
other damages.

  On November 12, 1999, Wyndham, Kleisner, Mahoney (the "Wyndham Defendants")
and Starwood entered into a Settlement Agreement and Mutual Release (the
"Settlement Agreement") under the terms of which all claims against the
Wyndham Defendants were dismissed with prejudice and the Wyndham Defendants
paid no damages. Under the Settlement Agreement, Wyndham agreed to
restrictions on its ability to hire and solicit for employment certain
Starwood employees until July 2000.

11. Related Party Transactions:

 Acquisition and sale of interests from and to officers and affiliates

  In connection with the CHCI Merger, Mr. Karim Alibhai, an executive officer
at the time, and current independent director, received 156,863 OP units of
the Operating Partnerships valued at approximately $5,000 and entities
affiliated with Mr. Alibhai received 85,600 shares of Old Wyndham Series A
Preferred Stock and 85,600 shares of Old Wyndham Series B Preferred Stock with
an aggregate value of approximately $3,946. These units and shares were issued
in consideration of Mr. Alibhai's ownership interests in CHCI and its
affiliates. In
addition, Mr. Sherwood M. Weiser, a director of Old Wyndham received 394,397
shares of Old Wyndham Series A Preferred Stock and 394,398 shares of Old
Wyndham Series B Preferred Stock valued at $18,182 in connection with the CHCI
Merger as consideration for his ownership interest in CHCI and its affiliates.
Additionally 65,485 paired shares were issued as part of the consideration for
the transaction of which Mr. Weiser received 43,403 Paired Shares with an
approximate value of $994.

  During 1998, Patriot sold its interest in four hotel assets; Orange
Courtyard Hotel in Orange, Connecticut, California, St. Louis Courtyard Hotel
in St. Louis, Missouri, Pittsburgh Residence in Pittsburgh, Pennsylvania and
the Westborough Courtyard in Westborough, Massachusetts, collectively
hereinafter referred to as the Fine Transaction, for a net purchase price of
approximately $32,500. The assets were sold to an affiliate of Mr. Milton
Fine, an independent director of the Company. No gain or loss was recognized
as a result of this transaction.

                                     F-33
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  Effective January 15, 1999, in connection with the Summerfield transaction
an additional 1,311,709 OP units valued at approximately $8,969 were issued as
additional consideration pursuant to the purchase agreement. Of the OP units
issued, Mr. Rolf E. Ruhfus, a director of the Company received 327,993 of the
OP units issued with an approximate value of $2,243.

  On June 15, 1999, the Company acquired the controlling 1% interest in Crowne
Plaza Ravinia and Wyndham Windwatch for $156, from former senior executive
officers of the Company, and Mr. Paul Nussbaum, a current director of the
Company.

  In connection with the merger with Gencom Interests Inc., on July 30, 1999,
Mr. Alibhai, a director of the Company, received 400,883 shares of Wyndham
class A common stock. These shares were issued in consideration of Mr.
Alibhai's ownership interests in Gencom Interests Inc. and valued at
approximately $1,813 at the date of merger.

 Notes receivable from affiliates, officers and employees

  The Company has provided funding to certain affiliated hotels as working
capital and has made advances to certain officers. As of December 31, 1999,
notes receivable from affiliated hotels totaled $22,530 and notes receivable
from officers, directors and employees totaled $11,753. As of December 31,
1998, notes receivable from affiliated hotels totaled $35,766 and notes
receivable from officers and employees totaled $3,554. These amounts are
included in notes and other receivables in the accompanying financial
statements.

  Additionally, in connection with the Wyndham merger, Patriot assumed notes
receivable from Senior Executive Officers of the merged company. As of
December 31, 1999, these promissory notes had an outstanding balance of
$16,167, including accrued interest. The notes bear interest at 6% per annum
and are secured by the pledge of shares of the Company held by the note
obligators. The balance of the notes including principal and accrued interest
are due and payable in one payment in April 2002 for three of the notes. The
fourth note is payable in April 2004. These notes are classified in
shareholders' equity for financial accounting purposes.

 Other

  During 1998, the Company made payments totaling $3,423 to Wyndham Travel
Management Ltd, an entity owned by Lucy Billingsley (the daughter of Mr.
Trammell Crow), for travel services provided to Wyndham. During 1999, only
$371 was paid to such entity as Wyndham changed its travel agency during 1999.

  The Company made rent payments totaling $1,417 and $1,492 related to an
agreement with an affiliate of Mr. Harlan Crow to lease office space for the
Company's corporate headquarters in Dallas, Texas in 1999 and
1998 respectively. During 1999, the affiliate of Mr. Crow sold its interest in
the building. In addition, the Company made rent payments totaling $153 and
$81 for office space in the Company's Wichita divisional office to an entity
affiliated with Mr. Ruhfus, in 1999 and 1998, respectively.

  The Company, in connection with the Wyndham merger, assumed a service
agreement with ISIS 2000, an entity affiliated with members of the Crow family
and senior executive officers of the Company, to provide centralized
reservations and property management services to all Wyndham branded hotels as
well as other hotels owned by the Company. On May 7, 1999, Patriot exercised
its option to purchase ISIS 2000, for a cash payment of $3,073. The service
fees incurred by the Company in 1999, prior to the acquisition, were $1,985.
Fees for the year ended December 31, 1998 totaled $4,368; no such fees were
incurred in 1997.

  In addition, the Company has a service contract with the Kinetic Group, an
entity affiliated with a member of the Crow Family, and senior executive
officers of the Company, to provide the Company with management information
services. Fees paid for the year ended December 31, 1999 and 1998 totaled
$6,134 and $5,467, respectively.

                                     F-34
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  In 1999 and 1998, the Company incurred lease expenses in the aggregate
amount of $3,150 and $455, respectively, for lease obligations to entities
owned in whole or in part by Mr. Ruhfus.

  In 1999 and 1998, the Company paid $88 and $598, respectively, as a
consulting fee to Mr. Ruhfus.

  The Company has made insurance premium payments to Wynright Insurance
("Wynright"), an entity owned by Crow Family Members and senior executive
officers of the Company, with respect to certain insurance policies maintained
for the benefit of the Company. Such payments totaled $730,000 in 1998. No
such payments were made in 1999.

  Certain directors have an ownership interest in several hotels managed by
the Company. As of December 31, 1999, the Company is owed approximately $5,930
for management fees, services fees, and reimbursements from 15 hotels in which
Mr. Alibhai has an ownership interest and approximately $1,406 for management
fees for 2 hotels in which Mr. Weiser has an ownership interest.

  On February 26, 1999, the Company and Paul A. Nussbaum entered into a
Separation Agreement (the "Separation Agreement") whereby Mr. Nussbaum
resigned his position as Chairman of the Board of Directors and Chief
Executive Officer of Patriot. Pursuant to the Separation Agreement, Mr.
Nussbaum will remain as a Director of Wyndham.

  In accordance with terms of the Separation Agreement, the Company will pay
severance of $3,200 reduced by interest payments made by the Company on a loan
to Mr. Nussbaum from NationsBank through June 30, 1999. The severance amount
was to be paid as follows: $2,000 payable on the earlier of the consummation
of the $1 billion equity investment or January 1, 2000 and the remaining
$1,200 payable in twelve monthly installments commencing with the first day of
the month next following the date of the $2,000 payment. On June 30, 1999, the
Company paid Mr. Nussbaum $1,750, net of $250 of interest payments made by the
Company on the loan. In addition, on June 30, 1999, the Company made the first
monthly installment of $100. As of December 31, 1999, Mr. Nussbaum is owed
$500 of severance under the terms of the agreement.

  Additionally, Mr. Nussbaum's outstanding unvested options to purchase shares
vested and will remain fully exercisable for the period of their respective
terms. Mr. Nussbaum elected to exchange his options on a Black Scholes neutral
basis for new options with an exercise price equal to the fair market value of
a share on the election date. On June 1, 1999, Mr. Nussbaum exchanged
3,078,406 options at varying prices from $11.18 to $33.58 for 1,154,448
options at $5.1875. Mr. Nussbaum will also receive 250,000 shares equally over
a three-year period, of which 83,334 have vested as of December 31, 1999.
Additionally any restrictions were lifted from existing shares held by Mr.
Nussbaum.

  As a condition to receiving the second and third installments of the shares,
Mr. Nussbaum has agreed to provide non-exclusive consulting services to
Wyndham for a period of two years following the resignation date.
Additionally, Mr. Nussbaum will receive other amounts as provided for in the
Separation Agreement.

  In 1999, Wyndham amended its management contract for the Wyndham Anatole
Hotel to provide that the owners of the hotel may terminate the management
contract following the first annual meeting of Wyndham stockholders after the
completion of the $1 billion equity investment if Mr. Nussbaum continues on
the Board of Directors of Wyndham. Mr. Nussbaum has delivered a letter to
Wyndham stating that he would not stand for re-election to the Board of
Directors if it would result in a termination of the management contract.
Additionally, the owners of the Wyndham Anatole Hotel may terminate the
management contract if James D. Carreker ceases to be an executive officer of
Wyndham.


                                     F-35
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

12. Minority Interest in the Operating Partnerships:

  Pursuant to the Operating Partnerships' respective limited partnership
agreements, the common limited partners of the Operating Partnerships,
including certain affiliates of Patriot, received rights (the "Redemption
Rights") that enable them to cause the Operating Partnerships to redeem each
pair of OP units (consisting of one OP unit of the Patriot Partnership and the
one OP unit of the Wyndham Partnership) in exchange for cash equal to the
value of a paired share (or, at the Company's election, the Company may
purchase each pair of OP units offered for redemption for one share of common
stock). In the case of the Wyndham Partnership's Class A preferred OP units
and Class C preferred OP units described below, each of these preferred OP
units may be redeemed for cash equal to the value of a share (or, at Wyndham's
election, Wyndham may purchase each preferred OP unit offered for redemption
for one share of common stock). The Redemption Rights generally may be
exercised at any time after one year following the issuance of the OP units.
The number of shares of common stock issuable upon exercise of the Redemption
Rights will be adjusted for share splits, mergers, consolidations or similar
pro rata transactions which would have the effect of diluting the ownership
interests of the limited partners of the Operating Partnerships or the
shareholders of the Company.

  On June 30, 1999, the third party limited partners in both the Patriot
Partnership and the Wyndham Partnership were offered an opportunity to
exchange their limited partnership interests for Wyndham class A common stock.
As a result, an additional 15,097,354 shares of Wyndham class A common stock
were issued in exchange for limited partnership units in the Operating
Partnerships. The effect of the exchange of certain limited partners interest
for Wyndham class A common stock, resulted in an adjustment to the basis of
certain assets in accordance with Emerging Issues Task Force ("EITF") 95-7.
This adjustment in reflected in the accompanying balance sheet as a reduction
in the basis of the Company's investment in real estate and related
improvements of $37,150, investment in unconsolidated subsidiaries of $2,562
and goodwill and intangibles of $78,433.

  As of December 31, 1999, the Patriot Partnership had a total of 179,317,058
OP Units outstanding of which 178,147,092 OP Units were held by Patriot and
1,169,966 OP Units were held by minority partners, which represent the
minority interest in the Patriot Partnership. The Wyndham Partnership had a
total of 176,996,594 OP Units outstanding as of December 31, 1999, of which
175,826,628 OP Units were held by Wyndham International and 1,169,966 OP Units
were held by minority partners which represent the minority interest in the
Wyndham Partnership.

13. Shareholders' Equity:

 Capital Stock

  On June 30, 1999, Wyndham and Patriot completed a $1 billion equity
investment and related restructuring (the "Restructuring") of the two
companies in accordance with the terms of the Securities Purchase Agreement
and related Restructuring Plan between the Wyndham and Patriot and the
investors.

  As required by the Restructuring Plan, Wyndham and Patriot each effectuated
a one-for-twenty reverse stock split (the "Reverse Stock Splits") of their
respective common stock. In addition, the Amended and Restated Certificate of
Incorporation of Wyndham was also further amended and restated (the "Wyndham
Charter Amendment") so that each share of Wyndham common stock, par value
$0.01 per share, issued and outstanding immediately prior to the effectiveness
of the Wyndham Charter Amendment was automatically converted into one share of
Wyndham class A common stock, par value $0.01 per share.

                                     F-36
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  Under the terms of the Agreement and Plan of Merger (the "Merger
Agreement"), dated as of March 26, 1999, by and among Patriot, Wyndham and
Wyndham International Acquisition Subsidiary, Inc. ("Acquisition Sub"),
Acquisition Sub was merged with and into Patriot (the "Merger"). As a result
of the Merger, Patriot became a wholly-owned subsidiary of Wyndham. Each
outstanding share of common stock of Acquisition Sub was converted into one
share of the common stock of Patriot, $0.01 par value per share ("Patriot
Common Stock"). Pursuant to the Merger Agreement each share of Patriot common
stock was then converted into 19 shares of Wyndham common stock.

  Prior to the Restructuring, the shares of common stock of Wyndham and shares
of common stock of Patriot were "paired" pursuant to a pairing agreement and
traded together as a single unit. The pairing agreement between the companies
was terminated as part of the Restructuring. The end result of the Reverse
Stock Splits, the Wyndham Charter Amendment and the Merger was to convert each
previously outstanding paired share into one share of Wyndham class A common
stock.

  The Company has the authority to issue 750,000,000 shares of class A common
stock, 750,000,000 shares of class B common stock, par value $0.01 per share,
and 150,000,000 shares of preferred stock, par value $0.01.

  Effective June 30, 1999, Wyndham completed a $1 billion equity investment
with a group of investors. Pursuant to the terms of this investment, Wyndham
issued 9.55 million shares of series B preferred stock in exchange for gross
proceeds of $955,000. On July 1, 1999, the remaining $45,000 was funded
through the transfer of one of the investor's loan receivable from PAH Realty
Company, LLC, a subsidiary of Patriot, which is secured by a mortgage on the
Battery March Hotel, to Wyndham for the purchase of 450,000 shares of series B
preferred stock. Wyndham has incurred approximately $77,571 in costs
attributable to the equity investment. This series B preferred stock has the
following terms, among others:

  .  dividends payable quarterly, on a cumulative basis, at a rate of 9.75%
     per year;

  .  for the first six years, the dividends are structured to ensure an
     aggregate fixed cash dividend payment of $29,250 per year, so long as
     there is no redemption or conversion of the series B preferred stock;
     therefore, for that period, dividends are payable partly in cash and
     partly in additional shares of series B preferred stock, with the cash
     component initially equal to 30% for the first dividend and declining
     over the period to approximately 19.8% for the final dividend in year
     six;

  .  for the next four years, dividends are payable in cash or additional
     shares of series B preferred stock as determined by the Board of
     Directors; and, after year 10, dividends are payable solely in cash;

  .  if any dividends are paid on the Wyndham class A common stock,
     additional dividends will be paid in the amount that would have been
     paid on the shares of Wyndham class A common stock into which the series
     B preferred stock is then convertible;

  .  if a change in control or a liquidation of Wyndham occurs within six
     years following the investment, any dividends remaining for the six
     years will be accelerated and paid;

  .  not redeemable by Wyndham for six years, except that up to $300 million
     of the series B preferred stock may be redeemed during the 170 day
     period following the closing of the investment;

  .  voting with the Wyndham common stock on an as-converted basis on matters
     submitted to the common stockholders and voting as a separate class on
     specified matters, with special rules applying to the election of
     directors; and

  .  convertible, at the holder's option, into a number of shares of Wyndham
     class B common stock equal to $100.00 divided by the conversion price,
     initially equal to $8.59 but subject to potential downward adjustments.


                                     F-37
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

  The investors will also have preemptive rights for the first five years
following their investment as long as they own more than 15% of the Wyndham
common stock.

  As noted above, for a period of 170 days following the completion of the
investment, Wyndham may redeem up to $300 million of the series B preferred
stock at a redemption price of $102.00 per share (102% of the stated amount)
plus all accrued dividends.

  In the fall of 1999, Wyndham issued to the holders of its class A common
stock and holders of OP units in the Operating Partnerships rights to
subscribe for up to $300 million of series A preferred stock, with the
proceeds from the offering to be used to redeem a portion of the series B
preferred stock. The rights offering was completed December 13, 1999 with the
issuance by Wyndham of 55,992 shares of series A preferred stock in exchange
for gross proceeds of $5,599. Wyndham has incurred approximately $1,151 in
costs attributable to the issuance of this stock. Wyndham used these proceeds
to redeem 55,992 shares of series B preferred stock at a redemption price of
$102.00 per share and accrued dividends of $2.0583 per share, or an aggregate
of $5,826 in cash. The series A preferred stock, generally has the same
economic terms as the series B preferred stock but has no voting rights,
except as required by law and except for a limited right to elect two
directors if dividends are in arrears for six quarterly periods.

 Shareholders Rights Agreement

  Wyndham is party to a Shareholder Rights Agreement dated as of June 29, 1999
(the "Rights Agreement"). Pursuant to the Rights Agreement, the Board of
Directors of Wyndham declared (a) for each outstanding share of common stock
of Wyndham outstanding on July 9, 1999 (the "Record Date"), a dividend
distribution of one preferred stock purchase right (a "Right"), and (b) for
each outstanding share of Wyndham series A or series B preferred stock
outstanding on the Record Date, a dividend distribution of a number of Rights
equal to the number of shares of common stock into which each such share is
convertible. In addition, Rights will automatically attach to each share of
common stock, series A preferred stock and series B preferred issued between
the Record Date and the Distribution Date (as defined in the Rights
Agreement). Each Right entitles the registered holder thereof to purchase from
Wyndham one one-thousandth of a share of series C participating preferred
stock, par value $0.01 per share, at a cash exercise price of $35.00, subject
to adjustment. The Rights may only become exercisable under certain
circumstances involving actual or potential acquisitions of beneficial
ownership of 15% or more of the class A common stock, subject to certain
exceptions. The Rights will expire in June 2009 unless earlier exercised or
redeemed.

 Dividends and Stock Splits

  On December 23, 1997, Patriot declared a $0.2981 per common share dividend
to holders of record on January 5, 1998. Patriot paid dividends of $0.2446 per
common share for each of the first three quarters of 1997. In addition, in
connection with the Cal Jockey Merger, Patriot also declared a special
dividend of $0.0559 per common share payable to holders of record on June 27,
1997, which was paid on June 30, 1997. Concurrent with each of the dividend
declarations, the Operating Partnerships authorized distributions in the same
amount on outstanding OP units.

  On October 5, 1998, Patriot made a significant capital contribution to Old
Wyndham to facilitate an acquisition by Old Wyndham. This contribution
resulted in a "deemed distribution" for tax purposes to Patriot's
shareholders of common stock of $0.7081 per share. No cash was actually
distributed to the shareholders. However, for tax purposes the distribution is
treated by shareholders as though cash was received and then contributed to
Wyndham.


                                     F-38
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

  On May 4, 1998, Patriot declared a $0.2981 per common share dividend to
holders of record on May 20, 1998 and on July 28, 1998, Patriot declared a
$0.2981 per common share dividend to holders of record on August 10, 1998.

  On December 22, 1998, Patriot declared a stock dividend of $0.44 cents per
share of share common stock for the fourth quarter of 1998. The dividend was
paid on January 25, 1999 to shareholders of record on December 30, 1998. Each
shareholder received the option to receive the dividend in the form of
additional paired shares or shares of Series B Cumulative Perpetual Preferred
Stock, par value $.01 per share, of Patriot. Pursuant to the merger of a
wholly-owned subsidiary of Old Wyndham with Patriot on June 30, 1999, each
outstanding share of Patriot series B preferred stock was converted into $25
per share and $1.61 of accrued dividends, or an aggregate of $14,862 in cash.

Stock Incentive Plans

  The Company has adopted certain employee incentive programs for the purpose
(i) attracting and retaining employees, directors and others, (ii) providing
incentives to those deemed important to the success of the Company and (iii)
associating the interests of these individuals with the interests of the
Company and its shareholders through opportunities for increased stock
ownership. Certain of the stock options and restricted stock grants issued
under the incentive stock programs vested and became non-forfeitable with
consummation of the $1 billion equity investment.

  The 1997 Incentive Plans. Prior to their amendment in 1999, the 1997
Incentive Plans provided for the award of stock options, stock awards or
performance shares to each eligible employee and director of Patriot and Old
Wyndham. Under each 1997 Incentive Plan, the aggregate number of paired shares
available for grants of awards was the sum of (i) 3,000,000 paired shares plus
(ii) 10% of any future net increase in the total number of shares of paired
common stock.

  Under the 1997 Incentive Plans, each independent director could elect to
take all or a portion of his/her fees in the form of deferred paired share
units. Prior to the amendment in 1999, the independent directors of Patriot
and Old Wyndham were automatically granted a non-qualified stock option,
immediately exercisable in full, to acquire 10,000 paired shares at an
exercise price per paired share equal to the fair market value of a paired
share on the date of grant. Option terms were fixed by the Compensation
Committees of Patriot and Old Wyndham and may not exceed ten years from the
date of grant.

  On June 29, 1999, the 1997 Incentive Plans were amended, as a result of
Patriot's merger into Wyndham. As part of the merger, Wyndham assumed
Patriot's obligations under each existing option to purchase shares of Patriot
common stock that was outstanding immediately prior to the merger. The assumed
options did not terminate in connection with the merger and continue to have,
and be subject to, the same terms and conditions set forth in the stock option
plans and agreements in effect immediately prior to the merger. All references
to Patriot in the assumed options are now deemed to be references to Wyndham
and each option is exercisable for one share of Wyndham class A common stock.

 Stock Grant Awards

  During 1997, pursuant to the Incentive Plans, the Board of Directors awarded
547,867 paired shares of common stock to certain officers of Patriot and Old
Wyndham. In 1999, an additional 121,053 shares were
awarded to an officer of the Company. The Company recorded a total of $611 and
$12,897 (the aggregate value of the common stock based on the market price at
the date of the award) as unearned stock compensation in

                                     F-39
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

1999 and 1997, respectively, which is being amortized over the vesting periods
of one to five years. For 1999, 1998 and 1997, $5,850, $7,622 and $4,686,
respectively, of amortization of stock compensation related to stock grants
and is included in general and administrative expense in the accompanying
consolidated financial statements.

  During 1999 and 1998, pursuant to the 1997 Incentive Plans, the Board of
Directors awarded 1,036,332 and 331,755 restricted awards, respectively, to
certain officers of the Company. The Company has recorded and $10,004 and
$1,613 in 1999 and 1998, respectively, related to the restricted awards and
such amount is included in general and administrative expense in the
accompanying consolidated financial statements.

  Upon the consummation of the $1 billion equity investment, certain of the
stock grants and restricted awards issued under the incentive stock programs
fully vested. The deferred compensation expense of $6,987 has been fully
recognized in general and administrative expense in 1999, as a result of the
accelerated vesting of these certain awards.

 Stock Option Awards

  As of December 31, 1999, pursuant to the incentive plans of the Company has
authorized the grant of options for up to 15,796,404 shares with exercise
prices of $2.6875 to $30.40 per share. As of December 31, 1999, 2,928,904
options were vested. During 1999, no options were exercised. During 1998, a
total of 1,299,250 shares were issued pursuant to exercise of options (at
exercises prices ranging from $11.18 to 17.82) resulting in net proceeds of
$15,274. During 1997, a total of 338,604 shares were issued pursuant to
exercise of options (at prices ranging from $5.13 to $13.28) resulting in net
proceeds of $2,307.

 Wyndham Stock Option Exchange Program

  In connection with the stock option exchange program in 1998, all optionees,
other than the directors and the top two executive officers, were given the
opportunity to exchange certain options for new options which have a Black-
Scholes value equal to the old options, but were for fewer shares, at the then
current stock price with the same term as the remaining term of the old
options.

 SFAS No. 123 "Accounting for Stock-Based Compensation"

  Pro forma information regarding net income and earnings per share is
required by SFAS No. 123, which also requires that the information be
determined as if the Company had accounted for their compensatory employee
stock options under the fair value method of that Statement. The fair value
for these options was estimated at the date of grant using a Black-Scholes
option pricing model with the following weight-average assumptions for 1999,
1998 and 1997, respectively: risk-free interest rates of 5.78%, 5.31% and
6.61%; and dividend yields of 0%, 6%, 6% for 1999, 1998 and 1997; volatility
factors of the expected market price of the Company's common stock of 0.596,
0.735 and 0.389 and a weighted average expected life of the options of 4
years, 4 years and 4 years.

  The Black-Scholes option valuation model was developed for use in estimating
the fair market value of traded options which have no vesting restrictions and
are fully transferable. In addition, option valuation models require the input
of highly subjective assumptions including the expected stock price
volatility. Because the Company's employee stock options have characteristics
significantly different from those of traded options, and because changes in
the subjective input assumptions can materially affect the air value estimate,
in management's

                                     F-40
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)

opinion, the existing models do not necessarily provide a reliable single
measure of the fair value of its employee stock options that have vesting
periods and are non-transferable.

  For purposes of pro forma disclosures, the estimated fair value of the
options is amortized to expense over the options' vesting period. The
Company's pro forma information is as follows:

<TABLE>
<CAPTION>
                                                 1999        1998      1997
                                              -----------  ---------  -------
   <S>                                        <C>          <C>        <C>
   Basic
   Pro forma net loss attributable to common
    shareholders............................. $(1,146,361) $(185,566) $(4,949)
   Pro forma loss per share:................. $     (7.11) $   (1.35) $ (0.08)
   Diluted
   Pro forma net loss attributable to common
    shareholders............................. $(1,166,311) $(352,807) $(4,949)
   Pro forma loss per share:................. $     (7.23) $   (2.56) $ (0.09)
</TABLE>

  A summary of the Company's stock option activity, and related information
for the years ended December 31 is as follows:

<TABLE>
<CAPTION>
                                1999                1998                1997
                         ------------------- ------------------- -------------------
                            # of    Weighted    # of    Weighted    # of    Weighted
                         Underlying Average  Underlying Average  Underlying Average
                          Options   Exercise  Options   Exercise  Options   Exercise
                          (000's)    Price    (000's)    Price    (000's)    Price
                         ---------- -------- ---------- -------- ---------- --------
<S>                      <C>        <C>      <C>        <C>      <C>        <C>
Outstanding, beginning
 of year................    7,717    $19.28     6,241    $20.82    1,584     $11.54
Granted.................   11,450      4.69     3,997     17.50    4,692      24.51
Exercised...............      --        --       (578)    11.38       (6)     12.89
Forfeited...............   (4,757)    22.04    (1,943)    23.48      (29)     12.85
                           ------    ------    ------    ------    -----     ------
Outstanding, end of
 year...................   14,410      6.57     7,717     19.28    6,241      20.82
                           ======              ======              =====
Exercisable at end of
 year...................    3,996    $10.77     3,746    $10.75      972     $14.89
Weighted average fair
 value of options
 granted during year....             $ 0.95              $ 7.70              $ 4.28
</TABLE>

  Exercise prices for options outstanding as of December 31, 1999 ranged from
$2.6875 to $30.40. The weighted average remaining contractual life of those
options was 8.5 years. Exercise prices for options outstanding as of December
31, 1998 ranged from $7.55 to $33.58. The weighted average remaining
contractual life of those options was eight years. Exercise prices for options
as of December 31, 1997 ranged from $11.18 to $33.58. The weighted average
remaining contractual life of those options was nine years.

                                     F-41
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


14. Income Taxes:

  The income tax provision of Wyndham for the years ended December 31, 1999,
1998 and 1997 respectively consists of the following:

<TABLE>
<CAPTION>
                                                         1999      1998    1997
                                                       --------  --------  ----
   <S>                                                 <C>       <C>       <C>
   Current:
     Federal.......................................... $ 15,500  $ 25,272  $199
     State............................................    3,475     4,948   130
                                                       --------  --------  ----
   Total current......................................   18,975    30,220   329
                                                       --------  --------  ----
   Deferred:
     Federal..........................................  546,983   (11,982)  136
     State............................................   (1,447)   (1,535)   16
                                                       --------  --------  ----
   Total deferred.....................................  545,536   (13,517)  152
                                                       --------  --------  ----
       Total income tax expense....................... $564,511  $ 16,703  $481
                                                       ========  ========  ====
</TABLE>

  The reason for the difference between total tax expense and the amount
computed by applying the statutory Federal income tax rate of 35% to income
before income taxes is as follows:

<TABLE>
<CAPTION>
                                                        1999       1998    1997
                                                      ---------  --------  ----
   <S>                                                <C>        <C>       <C>
   Tax at statutory rate............................. $(171,967) $(50,661) $127
   State income taxes................................     2,028     3,413   118
   Valuation allowance...............................     7,625    17,866   --
   Assets held for sale..............................       --      7,573   --
   Goodwill..........................................    34,387     5,330   --
   Lease buyout costs................................       --     20,033   --
   REIT Income not taxed.............................       --     22,835   --
   One time Charge C-Corp Conversion.................   675,000       --    --
   Minority interest and other.......................    17,438    (9,686)  236
                                                      ---------  --------  ----
       Total income tax expense...................... $ 564,511  $ 16,703  $481
                                                      =========  ========  ====
</TABLE>

                                     F-42
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. On January 1, 1999,
Patriot, previously a REIT (non-taxable entity), converted to a C-corporation
and is now a subsidiary of Wyndham. Upon the conversion of the REIT to a C-
corporation, Wyndham recognized a deferred tax liability of $675,000 which was
recognized in continuing operations as a tax provision. Significant components
of Wyndham's deferred tax assets and liabilities for the year ended December
31, 1999 and 1998, respectively are as follows:

<TABLE>
<CAPTION>
                                                            1999       1998
                                                          ---------  ---------
   <S>                                                    <C>        <C>
   Deferred tax assets:
     Net operating losses................................ $  67,292  $  21,221
     Disposition of assets...............................     1,641        887
     Other non-current assets............................    31,224      8,569
                                                          ---------  ---------
       Total deferred tax assets.........................   100,157     30,677
     Valuation allowance.................................   (25,491)   (17,866)
                                                          ---------  ---------
         Net deferred asset..............................    74,666  $  12,811
                                                          =========  =========
   Deferred tax liabilities:
     Depreciation........................................  (662,482)   (64,666)
     Management contracts and tradenames.................   (65,277)   (70,319)
     Other non-current liabilities.......................    (3,071)    (1,289)
                                                          ---------  ---------
       Total deferred tax liabilities....................  (730,830)  (136,274)
                                                          ---------  ---------
         Net deferred income tax liability............... $(656,164) $(123,463)
                                                          =========  =========
</TABLE>

  As of December 31, 1999, Wyndham and certain affiliated subsidiaries have
net operating loss carryforwards for federal income tax purposes of
approximately $107,053 from 1999 and $85,324 from 1998 which are available to
offset future taxable income, if any, through 2018 and 2019, respectively.

15. Employee Benefit Plans:

  The Company sponsors 401(K) retirement savings plans. Employees who are over
21 years of age and have completed one year of service are eligible to
participate in the plans. The Company matches 50% of employee contributions up
to 4% of an employee's salary. The aggregate expense under the plans totaled
$506 and $511 for 1999 and 1998 respectively. No plans were in effect prior to
1998.

  The Company maintains a self-insured group health plan through a Voluntary
Employee Benefit Association referred to hereinafter as VEBA. The plan is
funded to the limits provided by the Internal Revenue Service, and liabilities
have been recorded for estimated incurred but unreported claims. Aggregate and
stop loss insurance exists at amounts which limit exposure to the Company. The
Company has recognized expense related to the plan of $2,415 and $2,313 for
1999 and 1998, respectively. No plan such as this was in effect prior to 1998.

16. Fair Value of Financial Instruments:

  SFAS No. 107 requires disclosures about the fair value for all financial
instruments, whether or not recognized, for financial statement purposes.
Disclosures about fair value of financial instruments are based on pertinent
information available to management as of December 31, 1999. Considerable
judgment is necessary to interpret market data and develop estimated fair
value. Accordingly, the estimates presented herein are not necessarily
indicative of the amounts that could be realized on disposition of the
financial instruments. The use of different market assumptions and/or
estimation methodologies may have a material effect on the estimated fair
value amounts.

                                     F-43
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  Management estimates the fair value of (i) accounts receivable, accounts
payable and accrued expenses approximate carrying value due to the relatively
short maturity of these instruments; (ii) the notes receivable approximate
carrying value based upon effective borrowing rates for issuance of debt with
similar terms and remaining maturities; and (iii) the borrowings under the
Credit Facility, Term Loan and various other mortgage notes approximate
carrying value because these borrowings accrue interest at floating interest
rates based on market or accrue interest at fixed rates which approximate
market rates.

  The Company manages its debt portfolio by using interest rate caps and swaps
to achieve an overall desired position of fixed and floating rates. The fair
value of interest rate hedge contracts is estimated based on quotes from the
market makers of these instruments and represents the estimated amounts the
Company would expect to receive or pay to terminate the contracts. Credit and
market risk exposures are limited to the net interest differentials. The
estimated unrealized net gain on the these instruments was approximately
$14,553 at December 31, 1999, which represents the amount the Company would
receive to terminate the agreements based on current market rates.

17. Segment Reporting:

  The Company classifies its business into proprietary owned brands and non-
proprietary brand hotel divisions, under which it manages the business.

  Among its proprietary branded hotels, the Company is positioned in the
luxury segment under the Wyndham Luxury Resorts brand; in the upscale segment
under Wyndham(TM); and in mid-priced segment under the ClubHouse brand.
Additionally, the Company offers proprietary branded all-suite accommodations
through its upscale Summerfield Suites(R) brand and its mid-priced Sierra
Suites(R) brand. Other proprietary hotel brands owned and developed by the
Company include Malmaison and Grand Heritage(R).

 Description of reportable segments

  The Company has six reportable segments: Wyndham hotel properties, resort
properties, all suite properties, non-proprietary branded properties and other
proprietary branded hotel properties and other.

  .  Wyndham hotel properties include Wyndham Hotels, Wyndham Gardens and
     Wyndham Grand Heritage. The Wyndham hotel properties are full-service
     properties that generally offer a full range of meeting and conference
     facilities and banquet space. Facilities generally include restaurants
     and lounge areas, gift shops and recreational facilities, including
     swimming pools. Full-service hotels generally provide a significant
     array of guest services, including room service, valet services and
     laundry.

  .  Resort properties include Wyndham Resorts, Wyndham Luxury Resort
     properties and other resort properties. Resorts are designed to offer
     unique destinations which appeal to today's sophisticated vacation
     traveler and to blend with their environment, enhancing the natural
     surroundings with design that fits the locale. Each resort's
     recreational activities are of the highest caliber and are designed to
     capitalize on the natural attractions of the location. Many offer a
     combination of golf, tennis, skiing, health spa, hiking and other
     sports.

  .  All suite properties include the Summerfield and Sierra Suite
     properties. The Summerfield and Sierra Suite properties generally target
     the business travelers who usually anticipate a one to two week stay.
     The suites generally have limited public space and offer limited food
     and beverage service. However, the suites provide guests with larger
     rooms and workspace.

                                     F-44
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  .  Non-proprietary branded properties include all properties which are not
     Wyndham hotel properties, resort properties, all suite properties or
     other proprietary branded properties. The properties consist of non
     Wyndham branded assets such as: Crowne Plaza(R), Radisson(R), Hilton(R),
     Hyatt(R), Four Points by Sheraton(R), Holiday Inn(R), DoubleTree(R),
     Embassy Suites(R), Marriott(R), Courtyard by Marriott(R), and
     independents.

  .  Other proprietary branded hotel properties include Malmaison, Grand
     Heritage, ClubHouse and hotels acquired in the Arcadian Acquisition.

  .  Other includes participating lease revenues, racecourse facility revenue
     and expenses, management fee and service fee income, interest and other
     income, general and administrative costs, interest expense, depreciation
     and amortization and other one-time charges. General and administrative
     costs, interest expenses and depreciation and amortization are not
     allocated to each reportable segment; therefore, they are reported in
     the aggregate within this segment.

 Measurement of segment profit or loss and segment assets

  The Company evaluates performance based on the operating income or loss from
each business segment. The accounting policies of the reportable segments are
the same as those described in the summary of significant accounting policies.

  The following tables represent summarized financial data by reportable
segments.

 Factors management used to identify the reportable segments

  The Company's reportable segments are determined by brand affiliation and
type of property. The reportable segments are each managed separately due to
the specific characteristics of each segment.

<TABLE>
<CAPTION>
                                                             Non-        Other
       Year ended         Wyndham                Suite    proprietary proprietary
   December 31, 1999       Hotels    Resorts   properties   branded     branded    Other(1)      Total
   -----------------     ---------- ---------- ---------- ----------- ----------- -----------  ----------
<S>                      <C>        <C>        <C>        <C>         <C>         <C>          <C>
Total revenue........... $  568,584 $  520,813  $138,900  $1,085,080   $ 95,669   $    86,289  $2,495,335
Operating income
 (loss).................    149,688    120,254    27,059     259,616     27,405    (1,067,611)   (483,589)
Segment assets..........  1,522,041  1,022,187   262,595   2,858,620    190,789     1,147,258   7,003,490
Capital additions.......     56,618     19,089    73,065      20,270     18,778        46,896     234,716
--------
(1) Operating income (loss) for 1999 includes $285,267 of restructuring
    charges and $70,912 of impairment loss on assets held for sale.

<CAPTION>
                                                             Non-        Other
       Year ended         Wyndham                Suite    proprietary proprietary
   December 31, 1998       Hotels    Resorts   properties   branded     branded    Other(2)      Total
   -----------------     ---------- ---------- ---------- ----------- ----------- -----------  ----------
<S>                      <C>        <C>        <C>        <C>         <C>         <C>          <C>
Total revenue........... $  610,523 $  315,674  $ 74,333  $  761,154   $ 80,998   $   213,659  $2,056,341
Operating income
 (loss).................    153,723     76,349    14,690     183,703     26,492      (576,963)   (122,006)
Segment assets..........  1,461,037    900,431   245,578   2,906,527    297,609     1,604,488   7,415,670
Capital additions.......    635,853    544,060   204,292   1,930,121    296,769        16,264   3,627,359
</TABLE>
--------
(2) Operating income (loss) for 1998 includes unusual items related to the
    treasury rate lock settlement of $49,334 and the cost of reacquiring
    leaseholds of $64,407.

                                     F-45
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


<TABLE>
<CAPTION>
                                                         Non-        Other
       Year ended        Wyndham             Suite    proprietary proprietary
  December 31, 1997(3)    Hotels  Resorts  properties   branded     branded   Other(4)    Total
  --------------------   -------- -------- ---------- ----------- ----------- --------  ----------
<S>                      <C>      <C>      <C>        <C>         <C>         <C>       <C>
Total revenue........... $ 10,711 $ 30,334    $--      $115,223     $ 9,595   $169,172  $  335,035
Operating income
 (loss).................    2,388    6,628     --        29,947       1,436    (42,272)     (1,873)
Segment assets..........  435,452  348,013     --       795,679      47,999    880,710   2,507,853
Capital additions.......  366,280  311,378     --       577,788      25,287    125,946   1,406,679
</TABLE>
--------
(3) Total revenue and operating income (loss) for the reportable segments is
    reported for the six months ended December 31, 1997. Prior to July 1,
    1997, revenue and operating income (loss) related to the operations of the
    hotel properties was reported by the third party lessees who operated the
    properties pursuant to participating leases.
(4) Operating income (loss) for 1997 includes unusual items related to the
    cost of reacquiring leaseholds of $54,499.

  The following table represents revenue and long-lived asset information by
geographic area as of and for the period ending December 31, 1999 and 1998.
Revenues are attributed to the United States and its territories and Europe
based on the location of hotel properties. The hotel properties in Europe were
acquired on April 6, 1998 with the Arcadian acquisition. Prior to this date,
all of the Company's business was attributed to hotel properties located in
the United States and its territories.

<TABLE>
<CAPTION>
     1999                                      United States  Europe    Total
     ----                                      ------------- -------- ----------
     <S>                                       <C>           <C>      <C>
     Revenues.................................  $2,419,318   $ 76,017 $2,495,335
     Segment assets...........................   6,778,228    225,262  7,003,490
</TABLE>

<TABLE>
<CAPTION>
     1998                                      United States  Europe    Total
     ----                                      ------------- -------- ----------
     <S>                                       <C>           <C>      <C>
     Revenues.................................  $2,034,949   $ 21,392 $2,056,341
     Segment assets...........................   7,157,617    258,053  7,415,670
</TABLE>

18. Non-cash Investing and Financing Activities:

  In connection with the Cal Jockey Merger, the acquisition of management
companies, hotel properties and other operations assets, the Company issued
common stock, preferred stock, options and OP units in exchange for net assets
as follows:

<TABLE>
<CAPTION>
                                                     1999      1998      1997
                                                    ------- ---------- --------
     <S>                                            <C>     <C>        <C>
     Wyndham International......................... $99,338 $1,698,542 $449,415
</TABLE>

                                     F-46
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


19. Quarterly Financial Information (unaudited):

<TABLE>
<CAPTION>
                                                      1999       1998      1997
                                                    ---------  --------  --------
<S>                                                 <C>        <C>       <C>
First Quarter:
  Total revenue.................................... $ 673,850  $349,807  $ 35,388
  Income before extraordinary item................. $     572  $ 37,128  $ 11,348
  Net income....................................... $     572  $ 18,412  $ 11,348
  Net income per share:
    Basic.......................................... $   (0.05) $   0.17  $   0.21
    Diluted........................................ $   (0.13) $   0.16  $   0.21
  Weighted average number of shares:
    Basic..........................................   154,990   109,549    53,248
    Diluted........................................   154,990   117,090    54,613
Second Quarter:
  Total revenue(4)................................. $ 651,153  $465,463  $ 37,730
  (Loss) income before extraordinary item(3)....... $(867,392) $(14,411) $ 11,818
  Net (loss) income................................ $(877,230) $(26,254) $ 11,818
  Net (loss) income per share:
    Basic.......................................... $   (5.71) $  (0.21) $   0.22
    Diluted........................................ $   (5.76) $  (0.21) $   0.21
  Weighted average number of shares:
    Basic..........................................   155,687   132,804    53,382
    Diluted........................................   155,687   132,804    55,029
Third Quarter:
  Total revenue.................................... $ 579,281  $603,850  $ 81,638
  (Loss) income before extraordinary item(1)........$.(44,565).$(58,158) $(24,470)
  Net (loss) income................................ $ (44,565) $(59,415) $(27,004)
  Net (loss) income per share:
    Basic.......................................... $   (0.41) $  (0.40) $  (0.38)
    Diluted........................................ $   (0.41) $  (1.02) $  (0.38)
  Weighted average number of shares:
    Basic..........................................   166,954   154,510    71,706
    Diluted........................................   166,954   154,510    71,706
Fourth Quarter:
  Total revenue.................................... $ 593,826  $630,259  $180,279
  (Loss) income before extraordinary item (2),
   (4)............................................. $(150,746) $(90,968) $  1,666
  Net (loss) income................................ $(150,746) $(90,968) $  1,666
  Net (loss) income per share:.....................
    Basic.......................................... $   (1.05) $  (0.65) $   0.02
    Diluted........................................ $   (1.05) $  (1.01) $   0.02
  Weighted average number of shares:
    Basic..........................................   167,192   154,139    78,346
    Diluted........................................   167,192   154,139    80,915
</TABLE>
--------
(1) Loss (income) before extraordinary item for the third quarter includes the
    cost the Treasury Lock Settlement, a non-recurring expense of $49,225.
(2) Loss (income) before extraordinary item for the fourth quarter of 1998
    includes impairment in value of assets held for sale of $51,081.
(3) Loss (income) before extraordinary item for the second quarter of 1999
    includes a restructuring charge of $185,382 and income tax provision
    includes a reorganization charge of $675,000.
(4) In the second quarter of 1999, $2,775 of gains on the sale of assets were
    reclassified from revenue, and netted against expense for financial
    statement presentation.
(5) Loss (income) before extraordinary item for the fourth quarter of 1999
    includes the following:
    A restructuring charge of $95,979
    Impairment in value of assets held for sale of $70,912

                                     F-47
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


20. Pro Forma Results of Operations (unaudited):

  The following unaudited pro forma results of operations of Wyndham are
presented as if (i) the merger and acquisition of the WHG Casinos and Resorts
and related third party minority interests consummated in January 1998 and the
acquisition of the remaining minority interests completed in March and July
1998, the acquisition included the Condado Plaza Hotel & Casino, El San Juan
Hotel and Casino and the El Conquistador Hotel and Casino and the management
company for the three resorts, located in San Juan, Puerto Rico, the
acquisition of the Buena Vista Hotel located in Orlando, Florida in January
1998, and the acquisition of the Golden Door Spa located in Escondido,
California in June 1998; (ii) the acquisition of Arcadian International
Limited and the Malmaison Group including 10 hotels, land held for
developments and the proprietary Malmaison brand in April 1998; (iii) the
merger of Interstate Hotels Company with and into Patriot and the related
financing in June 1998; (iv) the acquisition of the partnership interests in
SF Hotel Company, L.P. in June 1998, which included four hotels, 24 management
and leasehold interests, 12 management contracts and the proprietary brand
names Summerfield Suites, Sierra Suites and Sunrise Sierra Suites; (v) the
merger of the hospitality related businesses of CHC International with and
into Wyndham in June 1998 including the remaining 50% interest in GAH-II,
L.P., the remaining 17 leases and 16 management contracts related to Patriot
Hotels leased by CHC Lease Partners, 10 management and asset management
contracts and the Grand Bay proprietary brand name (vi) the $1 billion equity
investment, (vii) the restructuring of Patriot and Old Wyndham (viii) the new
debt financing, and (ix) the Interstate spin-off which occurred in 1999 and
1998 had occurred on January 1, 1998. The 1999 historical financial statements
represent in all material respects the effect of the above transactions as if
they had occurred as of the beginning of the period. As such no pro forma
financial statements have been presented.

  The following unaudited pro forma financial information is not necessarily
indicative of what actual results of operations of Wyndham would have been
assuming such transactions had been completed as of January 1, 1998, nor do
they purport to represent the results of operations for future periods.

<TABLE>
<CAPTION>
                                                                       1998
                                                                    ----------
     <S>                                                            <C>
     Total revenue................................................. $2,317,759
     Net loss: .................................................... $ (108,812)
     Basic loss per share: ........................................ $    (1.26)
                                                                    ==========
     Diluted loss per share........................................ $    (1.26)
                                                                    ==========
     Weighted average number of shares............................. $  165,663
                                                                    ==========
</TABLE>

21. Subsequent Events:

  In January 2000, Wyndham acquired the remaining interests in Wyndham Chicago
from Oxford Blackpoint Company II, LLC, for approximately $20,626.

  In March 2000, Wyndham sold its Sierra Suites(R) hotel brand, properties and
related assets to Sierra Suites Hotel Company, L.P., an entity affiliated with
Mr. Rolf Ruhfus, a director of Wyndham, for approximately $53,000. The
transaction includes the sale by Wyndham of one owned and three leased
properties, seventeen franchise and management contracts for Sierra Suites(R)
and nine contracts for Summerfield Suites.

                                     F-48
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

                  NOTES TO FINANCIAL STATEMENTS--(Continued)
                 (dollars in thousands, except share amounts)


  In March 2000, the Company entered into three additional interest rate
hedges for a total notional amount of $1.5 billion. The hedges are structured
such that each hedge has a series of trigger levels in which the hedge can
become ineffective for any reset period that the 1-month LIBOR rises above the
trigger level. If LIBOR resets below the trigger level, the hedge becomes
effective again. The Company paid approximately $34.3 million in premiums,
which will be amortized over the terms of the contracts, to enter into these
transactions. The hedges are as follows:

<TABLE>
<CAPTION>
   Hedge                       Notional Amount  Terms      Rate    Trigger Level
   -----                       --------------- -------- ---------- -------------
   <S>                         <C>             <C>      <C>        <C>
   Interest Rate Swap.........  $700 million    5 years 6.1%-6.75%   7.0%-8.5%
   Interest Cap...............  $250 million    3 years      4.75%        7.5%
   Interest Corridor..........  $550 million    3 years      5.25%        7.5%

  In addition, the Company shortened the terms of three existing hedges and
received net proceeds of approximately $6.8 million. The hedges were as
follows:

<CAPTION>
                                               Original  Revised
   Hedge                       Notional Amount Maturity  Maturity      Rate
   -----                       --------------- -------- ---------- -------------
   <S>                         <C>             <C>      <C>        <C>
   Interest Rate Swap.........  $375 million   11/01/02    3/01/02       6.26%
   Interest Rate Swap.........  $125 million   11/01/02    3/01/02       5.56%
   Interest Rate Swap.........  $250 million   06/01/03    3/01/02       5.84%
</TABLE>

  On March 27, 2000, the Company announced that its Board of Directors has
named president Fred J. Kleisner to the additional position of chief executive
officer. He succeeds James D. Carreker, who will remain as chairman.
Additionally, Wyndham accepted the resignations of two senior officers, Anne
L. Raymond, executive vice president and chief investment officer, and Stanley
M. Koonce, Jr. executive vice president and chief administrative officer.
David Johnson, president of the Wyndham hotel division, has been named
executive vice president, sales and marketing.

                                     F-49
<PAGE>

                     REPORT OF INDEPENDENT ACCOUNTANTS ON
                         FINANCIAL STATEMENT SCHEDULE

Board of Directors and Shareholders
Wyndham International, Inc.

  Our audit of the consolidated financial statements referred to in our report
dated February 15, 2000 appearing in the 1999 Annual Report to Shareholders of
Wyndham International Inc. (which report and consolidated financial statements
are included in this Annual Report on Form 10-K) also included an audit of the
financial statement schedules listed in Item 14(a) of this Form 10-K. In our
opinion, this financial statement schedule presents fairly, in all material
respects, the information set forth therein when read in conjunction with the
related consolidated financial statements.

/s/ PricewaterhouseCoopers LLP
Dallas, Texas
February 15, 2000

                                     F-50
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

            SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION
                            As of December 31, 1999

<TABLE>
<CAPTION>
                                                      Costs Capitalized            Gross Amounts
                                                         Subsequent             at Which Carried at
                                   Initial Cost        to Acquisition           Close of Period(a)
                               --------------------- ------------------- ---------------------------------
                                         Buildings
                                            and                                   Buildings and
  Description     Encumbrances   Land   Improvements  Land  Improvements   Land   Improvements    Total
  -----------     ------------ -------- ------------ ------ ------------ -------- ------------- ----------
<S>               <C>          <C>      <C>          <C>    <C>          <C>      <C>           <C>

Wyndham Brand
Properties:
Wyndham Atlanta
Downtown
Atlanta,
Georgia.........    $ 24,241   $  3,500  $   12,712  $  --    $ 19,838   $  3,500  $   32,550   $   36,050
Wyndham
Arlington
Arlington,
Texas...........         --         --       63,045     --          91        --       63,136       63,136
Wyndham Bel Age
Hotel
Los Angeles,
California......          (d)     5,653      32,212     --         107      5,653      32,319       37,972
Wyndham Bristol
Palace Hotel
Toronto,
Canada..........         --       3,048      15,503     --         --       3,048      15,503       18,551
Wyndham Boston
Boston,
Massachusetts...         --         --       33,900   7,458     42,178      7,458      76,078       83,536
Wyndham Boston
Andover
Andover,
Massachusetts...         --       2,318      33,245     --       3,305      2,318      36,550       38,868
Wyndham Boston
Westborough
Westborough,
Massachusetts...         --       1,500      41,968     --         129      1,500      42,097       43,597
Wyndham Buena
Vista Palace
Resort & Spa
Orlando,
Florida.........      48,205        --      144,264     --       1,556        --      145,820      145,820
Wyndham Buttes
Resort
Tempe, Arizona..          (d)       --       55,297     --         165        --       55,462       55,462
Wyndham Canal
Place
New Orleans,
Louisiana.......         --      12,750      86,141     --         847     12,750      86,988       99,738
Wyndham City
Centre
Washington
District of
Columbia........         --       3,675      30,569     --          91      3,675      30,660       34,335
Wyndham Colorado
Springs
Colorado
Springs,
Colorado........         --       1,783      53,252     --          (5)     1,783      53,247       55,030
Wyndham Emerald
Plaza
San Diego,
California......          (d)     5,551      60,462      17        195      5,568      60,657       66,225
Wyndham Resort &
Spa
Fort Lauderdale,
Florida.........         --       2,134      16,448      23      9,192      2,157      25,640       27,797
Wyndham Franklin
Plaza
Philadelphia,
Pennsylvania....          (d)     4,878      62,793     --         242      4,878      63,035       67,913
Wyndham
Greenspoint
Houston, Texas..      39,697      1,930      39,815      20      1,976      1,950      41,791       43,741
Wyndham Harbour
Island
Tampa, Florida..          (f)       --       22,836     --       3,120        --       25,956       25,956
<CAPTION>
                    Accumulated   Year    Date of
  Description     Depreciation(c) Built Acquisition
  -----------     --------------- ----- -----------
<S>               <C>             <C>   <C>

Wyndham Brand
Properties:
Wyndham Atlanta
Downtown
Atlanta,
Georgia.........     $    (495)   1999     1998
Wyndham
Arlington
Arlington,
Texas...........        (2,738)   1985     1998
Wyndham Bel Age
Hotel
Los Angeles,
California......        (1,884)   1984     1997
Wyndham Bristol
Palace Hotel
Toronto,
Canada..........          (867)   1974     1998
Wyndham Boston
Boston,
Massachusetts...          (775)   1999     1998
Wyndham Boston
Andover
Andover,
Massachusetts...        (1,542)   1985     1998
Wyndham Boston
Westborough
Westborough,
Massachusetts...        (1,827)   1985     1998
Wyndham Buena
Vista Palace
Resort & Spa
Orlando,
Florida.........        (7,680)   1977     1998
Wyndham Buttes
Resort
Tempe, Arizona..        (3,513)   1986     1997
Wyndham Canal
Place
New Orleans,
Louisiana.......           --     1984     1999
Wyndham City
Centre
Washington
District of
Columbia........        (2,019)   1969     1997
Wyndham Colorado
Springs
Colorado
Springs,
Colorado........        (2,331)   1989     1998
Wyndham Emerald
Plaza
San Diego,
California......        (3,462)   1991     1997
Wyndham Resort &
Spa
Fort Lauderdale,
Florida.........        (2,179)   1961     1996
Wyndham Franklin
Plaza
Philadelphia,
Pennsylvania....        (3,813)   1979     1997
Wyndham
Greenspoint
Houston, Texas..        (4,031)   1985     1996
Wyndham Harbour
Island
Tampa, Florida..        (2,698)   1986     1998
</TABLE>

                                      F-51
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999
<TABLE>
<CAPTION>
                                                      Costs Capitalized            Gross Amounts
                                                         Subsequent             at Which Carried at
                                   Initial Cost        to Acquisitions          Close of Period(a)
                               --------------------- ------------------- ---------------------------------
                                         Buildings
                                            and                                   Buildings and
  Description     Encumbrances   Land   Improvements  Land  Improvements   Land   Improvements    Total
  -----------     ------------ -------- ------------ ------ ------------ -------- ------------- ----------
<S>               <C>          <C>      <C>          <C>    <C>          <C>      <C>           <C>

Wyndham Miami
Beach Resort
Miami, Florida..         --      13,000      54,875     --         248     13,000      55,123       68,123
Wyndham Gateway-
Miami Airport
Miami, Florida..         --       2,561      23,009     --         (85)     2,561      22,924       25,485
Wyndham Myrtle
Beach Resort &
Golf Club
Myrtle Beach,
South Carolina..         --       5,644      26,470      61      5,411      5,705      31,881       37,586
Wyndham
Northwest
Chicago
Chicago,
Illinois........          (e)     1,212      52,025     --          76      1,212      52,101       53,313
Wyndham
Peachtree
Conference
Center
Peachtree City
(Atlanta),
Georgia.........      36,353      3,059      21,915      33      4,848      3,092      26,763       29,855
Wyndham Richmond
Airport
Richmond,
Virginia........          (g)       --        4,262     --       2,800        --        7,062        7,062
Wyndham Toledo
Toledo, Ohio....         --         --       16,082     --      (8,124)       --        7,958        7,958
Wyndham
Riverfront Hotel
New Orleans,
Louisiana.......         --       2,774      28,023     --           6      2,774      28,029       30,803
Wyndham Roanoke
Airport
Roanoke,
Virginia........         --       1,653      27,693     --          20      1,653      27,713       29,366
Wyndham Syracuse
East Syracuse,
New York........      10,214      1,150      29,236     --         570      1,150      29,806       30,956
Wyndham At
Valley Forge
Valley Forge,
Pennsylvania ...         --       2,619      41,997     --       3,709      2,619      45,706       48,325
Wyndham
Washington D.C.
Washington
District of
Columbia........         --       4,750      40,439     --         148      4,750      40,587       45,337
Wyndham
Westshore Hotel
Tampa, Florida..         --       1,448      31,565     --        (217)     1,448      31,348       32,796
Wyndham
Windwatch
Haupauge, New
York............         --       6,471      21,831     270       (258)     6,741      21,573       28,314
Wyndham Rose
Hall Resort &
Country Club
Montego Bay,
Jamaica.........         --       5,610      55,467     --          99      5,610      55,566       61,176
Wyndham El San
Juan Hotel &
Casino
San Juan, Puerto
Rico............      42,000     22,337      34,244     --      16,717     22,337      50,961       73,298
Wyndham El
Conquistador
Resort & Club
Fajardo, Puerto
Rico............     115,000     20,256     190,607     --      10,697     20,256     201,304      221,560
<CAPTION>
                    Accumulated   Year    Date of
  Description     Depreciation(c) Built Acquisition
  -----------     --------------- ----- -----------
<S>               <C>             <C>   <C>

Wyndham Miami
Beach Resort
Miami, Florida..        (2,423)   1962     1998
Wyndham Gateway-
Miami Airport
Miami, Florida..        (1,478)   1976     1997
Wyndham Myrtle
Beach Resort &
Golf Club
Myrtle Beach,
South Carolina..        (2,156)   1974     1997
Wyndham
Northwest
Chicago
Chicago,
Illinois........        (3,038)   1983     1997
Wyndham
Peachtree
Conference
Center
Peachtree City
(Atlanta),
Georgia.........        (2,937)   1984     1995
Wyndham Richmond
Airport
Richmond,
Virginia........        (1,234)   1997     1998
Wyndham Toledo
Toledo, Ohio....          (933)   1985     1997
Wyndham
Riverfront Hotel
New Orleans,
Louisiana.......        (1,635)   1996     1997
Wyndham Roanoke
Airport
Roanoke,
Virginia........        (1,209)   1983     1998
Wyndham Syracuse
East Syracuse,
New York........        (1,272)   1977     1998
Wyndham At
Valley Forge
Valley Forge,
Pennsylvania ...        (1,929)   1985     1998
Wyndham
Washington D.C.
Washington
District of
Columbia........        (1,785)   1983     1998
Wyndham
Westshore Hotel
Tampa, Florida..        (2,026)   1984     1997
Wyndham
Windwatch
Haupauge, New
York............        (1,983)   1989     1996
Wyndham Rose
Hall Resort &
Country Club
Montego Bay,
Jamaica.........        (3,106)   1972     1998
Wyndham El San
Juan Hotel &
Casino
San Juan, Puerto
Rico............        (2,818)   1983     1998
Wyndham El
Conquistador
Resort & Club
Fajardo, Puerto
Rico............       (10,886)   1993     1998
</TABLE>

                                      F-52
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999
<TABLE>
<CAPTION>
                                                        Costs Capitalized            Gross Amounts
                                                           Subsequent             at Which Carried at
                                     Initial Cost        to Acquisition           Close of Period(a)
                                 --------------------- ------------------- ---------------------------------
                                           Buildings
                                              and                                   Buildings and
  Description       Encumbrances   Land   Improvements  Land  Improvements   Land   Improvements    Total
  -----------       ------------ -------- ------------ ------ ------------ -------- ------------- ----------
<S>                 <C>          <C>      <C>          <C>    <C>          <C>      <C>           <C>

Wyndham Casa
Marina Resort &
Beach House
Key West,
Florida.........        30,270     15,158      85,078     --       1,022     15,158      86,100      101,258
Wyndham Reach
Resort
Key West,
Florida.........        24,754     10,029      24,947     --       1,127     10,029      26,074       36,103
Wyndham Garden
Hotel--Billerica
Boston,
Massachusetts...        16,411      3,333      17,779     --         --       3,333      17,779       21,112
Wyndham Garden
Hotel-Brookfield
Brookfield,
Illinois........            (e)     1,787      17,564     --         --       1,787      17,564       19,351
Wyndham Garden
Hotel-Charlotte
Charlotte, North
Carolina........            (e)       792      17,535     --         --         792      17,535       18,327
Wyndham Garden
Hotel-Commerce
Los Angeles,
California......           --       2,116      26,497     --         --       2,116      26,497       28,613
Wyndham Garden--
Denver Tech
Denver,
Colorado........           --       3,663      12,713     --         (36)     3,663      12,677       16,340
Wyndham Garden
Hotel-Market
Center
Dallas, Texas...           --         967      12,796     --          11        967      12,807       13,774
Wyndham Garden
Hotel-Park
Central
Dallas, Texas...           --       4,523         --      --       9,845      4,523       9,845       14,368
Wyndham Garden
Hotel-
Indianapolis
Indianapolis,
Indiana.........            (d)       513      15,497     --         --         513      15,497       16,010
Wyndham Garden
Hotel-KC.
Airport
Kansas City,
Missouri........           --         970       7,993     --         937        970       8,930        9,900
Wyndham Garden
Hotel-Knoxville
Knoxville,
Tennessee.......         4,414        825       6,467     --         848        825       7,315        8,140
Wyndham Garden
Hotel-LaGuardia
Airport
New York, New
York............           --       1,800      16,443     --           7      1,800      16,450       18,250
Wyndham Garden
Hotel-Las
Colinas
Las Colinas,
Texas...........            (d)     1,884      16,963     --           6      1,884      16,969       18,853
Wyndham Garden-
Midtown
Atlanta, Georgia..          (e)     2,322      13,785      26        781      2,348      14,566       16,914
Wyndham Garden
Hotel-Novi
Detroit,
Michigan........            (d)       555      10,401     --           6        555      10,407       10,962
Wyndham Garden
Hotel-Omaha
Omaha,
Nebraska........         5,463        710      10,086     --         839        710      10,925       11,635
Wyndham Garden
Hotel-Overland
Park
Overland Park,
Kansas..........           --         769       3,532     --           5        769       3,537        4,306
<CAPTION>
                      Accumulated   Year    Date of
  Description       Depreciation(c) Built Acquisition
  -----------       --------------- ----- -----------
<S>                 <C>             <C>   <C>

Wyndham Casa
Marina Resort &
Beach House
Key West,
Florida.........          (3,748)   1980     1998
Wyndham Reach
Resort
Key West,
Florida.........          (1,127)   1978     1998
Wyndham Garden
Hotel--Billerica
Boston,
Massachusetts...            (296)   1999     1999
Wyndham Garden
Hotel-Brookfield
Brookfield,
Illinois........            (983)   1990     1998
Wyndham Garden
Hotel-Charlotte
Charlotte, North
Carolina........            (981)   1989     1998
Wyndham Garden
Hotel-Commerce
Los Angeles,
California......          (1,483)   1991     1998
Wyndham Garden--
Denver Tech
Denver,
Colorado........             (85)   1999     1999
Wyndham Garden
Hotel-Market
Center
Dallas, Texas...            (716)   1968     1998
Wyndham Garden
Hotel-Park
Central
Dallas, Texas...            (317)   1998     1998
Wyndham Garden
Hotel-
Indianapolis
Indianapolis,
Indiana.........            (867)   1990     1998
Wyndham Garden
Hotel-KC.
Airport
Kansas City,
Missouri........            (469)   1992     1998
Wyndham Garden
Hotel-Knoxville
Knoxville,
Tennessee.......            (381)   1989     1998
Wyndham Garden
Hotel-LaGuardia
Airport
New York, New
York............            (959)   1988     1997
Wyndham Garden
Hotel-Las
Colinas
Las Colinas,
Texas...........            (990)   1986     1997
Wyndham Garden-
Midtown
Atlanta, Georgia..        (1,424)   1987     1996
Wyndham Garden
Hotel-Novi
Detroit,
Michigan........            (607)   1988     1997
Wyndham Garden
Hotel-Omaha
Omaha,
Nebraska........            (584)   1991     1998
Wyndham Garden
Hotel-Overland
Park
Overland Park,
Kansas..........            (198)   1971     1998
</TABLE>

                                      F-53
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999
<TABLE>
<CAPTION>
                                                      Costs Capitalized             Gross Amounts
                                                         Subsequent              at Which Carried at
                                   Initial Cost        to Acquisition            Close of Period(a)
                               --------------------- -------------------- ---------------------------------
                                         Buildings
                                            and                                    Buildings and
  Description     Encumbrances   Land   Improvements  Land   Improvements   Land   Improvements    Total
  -----------     ------------ -------- ------------ ------  ------------ -------- ------------- ----------
<S>               <C>          <C>      <C>          <C>     <C>          <C>      <C>           <C>

Wyndham Garden
Hotel-Pleasanton
Pleasonton,
California......          (d)     1,568      12,845     --            6      1,568      12,851       14,419
Wyndham Garden
Hotel-Richardson
Richardson,
Texas...........          (d)       530       8,048     --          664        530       8,712        9,242
Wyndham Garden
Hotel-Schaumburg
Schaumburg,
Illinois........          (d)     1,613      14,464     --          --       1,613      14,464       16,077
Wyndham Garden
Hotel-West Port
St. Louis,
Missouri........         --         862       9,273     --          734        862      10,007       10,869
Wyndham Garden
Hotel-Vinnings
Atlanta,
Georgia.........       9,675      1,700      22,853     --          --       1,700      22,853       24,553
Wyndham Garden
Hotel-Wichita
Wichita,
Kansas..........       3,049        960       5,978     --          839        960       6,817        7,777
Wyndham Garden
Hotel-Wood Dale
Chicago,
Illinois........          (d)     2,266      12,939     --            7      2,266      12,946       15,212
Wyndham Grand
Heritage-
AmbassadorWest
Chicago,
Illinois........         --       2,059      11,856     --        1,663      2,059      13,519       15,578
Wyndham Grand
Heritage-Bourbon
Orleans
New Orleans,
Louisiana.......      13,007      1,942      14,209     171       1,280      2,113      15,489       17,602
Wyndham Grand
Heritage-
Fairmount
San Antonio,
Texas...........         --         --        2,957     --          139        --        3,096        3,096
Wyndham Grand
Heritage-Mayfair
St. Louis,
Missouri........         --         250       7,559       3         954        253       8,513        8,766
Wyndham Grand
Heritage-
Pickwick Hotel
San Francisco,
California......         --       2,000      11,922      22       5,297      2,022      17,219       19,241
Wyndham Grand
Heritage-
Tutwiler
Birmingham,
Alabama.........         --       1,444       8,124     (26)       (582)     1,418       7,542        8,960
Wyndham Grand
Heritage-Tremont
House
Boston,
Massachusetts...         --       1,776      14,066      18       9,959      1,794      24,025       25,819
Wyndham Grand
Heritage-Union
Station
Nashville,
Tennessee.......         --         --        7,512     --          720        --        8,232        8,232
Wyndham Luxury
Resorts:
Carmel Valley
Ranch
Carmel,
California......         --       4,430      14,704     334      10,888      4,764      25,592       30,356
Grand Bay Hotel
Coconut Grove
Miami, Florida..         --       3,066      28,442   1,237      (4,571)     4,303      23,871       28,174
<CAPTION>
                    Accumulated   Year    Date of
  Description     Depreciation(c) Built Acquisition
  -----------     --------------- ----- -----------
<S>               <C>             <C>   <C>

Wyndham Garden
Hotel-Pleasanton
Pleasonton,
California......          (736)    1985    1997
Wyndham Garden
Hotel-Richardson
Richardson,
Texas...........          (466)    1996    1998
Wyndham Garden
Hotel-Schaumburg
Schaumburg,
Illinois........          (809)    1985    1998
Wyndham Garden
Hotel-West Port
St. Louis,
Missouri........          (536)    1997    1998
Wyndham Garden
Hotel-Vinnings
Atlanta,
Georgia.........        (1,279)    1985    1998
Wyndham Garden
Hotel-Wichita
Wichita,
Kansas..........          (354)    1985    1998
Wyndham Garden
Hotel-Wood Dale
Chicago,
Illinois........          (816)    1986    1997
Wyndham Grand
Heritage-
AmbassadorWest
Chicago,
Illinois........          (885)    1924    1997
Wyndham Grand
Heritage-Bourbon
Orleans
New Orleans,
Louisiana.......        (1,828)   1800s    1995
Wyndham Grand
Heritage-
Fairmount
San Antonio,
Texas...........          (365)    1906    1995
Wyndham Grand
Heritage-Mayfair
St. Louis,
Missouri........          (773)    1925    1996
Wyndham Grand
Heritage-
Pickwick Hotel
San Francisco,
California......        (1,306)    1928    1996
Wyndham Grand
Heritage-
Tutwiler
Birmingham,
Alabama.........          (738)    1913    1996
Wyndham Grand
Heritage-Tremont
House
Boston,
Massachusetts...        (2,038)    1925    1996
Wyndham Grand
Heritage-Union
Station
Nashville,
Tennessee.......          (561)    1986    1997
Wyndham Luxury
Resorts:
Carmel Valley
Ranch
Carmel,
California......        (1,718)    1987    1997
Grand Bay Hotel
Coconut Grove
Miami, Florida..        (1,739)    1983    1997
</TABLE>

                                      F-54
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999

<TABLE>
<CAPTION>
                                                      Costs Capitalized             Gross Amounts
                                                         Subsequent              at Which Carried at
                                   Initial Cost        to Acquisition            Close of Period(a)
                               --------------------- -------------------- ---------------------------------
                                         Buildings
                                            and                                    Buildings and
  Description     Encumbrances   Land   Improvements  Land   Improvements   Land   Improvements    Total
  -----------     ------------ -------- ------------ ------  ------------ -------- ------------- ----------
<S>               <C>          <C>      <C>          <C>     <C>          <C>      <C>           <C>

The Boulders
Scottsdale,
Arizona.........         --      13,188     121,700     --           74     13,188     121,774      134,962
The Lodge at
Ventana Canyon
Tucson,
Arizona.........      28,489     13,287      23,332     --         (211)    13,287      23,121       36,408
The Peaks Resort
& Spa
Telluride,
Colorado........         --       5,141      13,997    (200)        673      4,941      14,670       19,611
Summerfield and
Sierra Suites:
Summerfield-
Denver South
Denver,
Colorado........         --       1,072       8,183      18          28      1,090       8,211        9,301
Summerfield-
Hanover
Whippany, New
Jersey..........         --       2,223      18,585     --           36      2,223      18,621       20,844
Summerfield-
Morristown
Morristown, New
Jersey..........         --       3,050      20,920     --           47      3,050      20,967       24,017
Summerfield-
Seattle Downtown
Seattle,
Washington......         --       1,515      24,276      16         487      1,531      24,763       26,294
Summerfield-
Waltham
Waltham,
Massachusetts...         --       2,639      16,351     --           34      2,639      16,385       19,024
Summerfield-
Miami
Miami, Florida..         --       3,327      10,913     --           17      3,327      10,930       14,257
Sierra Fair Oaks
Fairfax,
Virginia........         --         758       3,982     --          --         758       3,982        4,740
Malmaison:
Malmaison
Edinburgh
Edinburgh,
United Kingdom..          (h)     2,674       7,747     (78)      1,163      2,596       8,910       11,506
Malmaison
Glasgow
Glasgow, United
Kingdom.........          (h)     2,859       8,056     (84)        682      2,775       8,738       11,513
Malmaison
Manchester
Manchester,
United Kingdom..          (h)     5,332       9,859    (156)      7,208      5,176      17,067       22,243
Malmaison
Newcastle
Newcastle,
United Kingdom..          (h)     3,672      12,183    (108)      1,971      3,564      14,154       17,718
Malmaison Leeds
Leeds, United
Kingdom.........          (h)       --       10,315     564       7,697        564      18,012       18,576
ClubHouse Inns:
ClubHouse-
Nashville
Airport
Nashville,
Tennessee.......         --         907       5,526     --          --         907       5,526        6,433
<CAPTION>
                    Accumulated   Year    Date of
  Description     Depreciation(c) Built Acquisition
  -----------     --------------- ----- -----------
<S>               <C>             <C>   <C>

The Boulders
Scottsdale,
Arizona.........       (10,323)   1985     1997
The Lodge at
Ventana Canyon
Tucson,
Arizona.........        (1,970)   1985     1997
The Peaks Resort
& Spa
Telluride,
Colorado........        (1,286)   1992     1997
Summerfield and
Sierra Suites:
Summerfield-
Denver South
Denver,
Colorado........          (437)   1997     1998
Summerfield-
Hanover
Whippany, New
Jersey..........          (799)   1997     1998
Summerfield-
Morristown
Morristown, New
Jersey..........          (869)   1997     1998
Summerfield-
Seattle Downtown
Seattle,
Washington......        (2,645)   1985     1996
Summerfield-
Waltham
Waltham,
Massachusetts...          (752)   1997     1998
Summerfield-
Miami
Miami, Florida..           (64)   1999     1999
Sierra Fair Oaks
Fairfax,
Virginia........           (55)   1999     1999
Malmaison:
Malmaison
Edinburgh
Edinburgh,
United Kingdom..          (444)   1994     1998
Malmaison
Glasgow
Glasgow, United
Kingdom.........          (430)   1997     1998
Malmaison
Manchester
Manchester,
United Kingdom..          (621)   1998     1998
Malmaison
Newcastle
Newcastle,
United Kingdom..          (680)   1997     1998
Malmaison Leeds
Leeds, United
Kingdom.........          (213)   1998     1998
ClubHouse Inns:
ClubHouse-
Nashville
Airport
Nashville,
Tennessee.......          (309)   1988     1998
</TABLE>

                                      F-55
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999

<TABLE>
<CAPTION>
                                                                Costs Capitalized             Gross Amounts
                                                                   Subsequent              at Which Carried at
                                             Initial Cost        to Acquisition            Close of Period(a)
                                         --------------------- -------------------- ---------------------------------
                                                   Buildings
                                                      and                                    Buildings and
  Description               Encumbrances   Land   Improvements  Land   Improvements   Land   Improvements    Total
  -----------               ------------ -------- ------------ ------  ------------ -------- ------------- ----------
<S>                         <C>          <C>      <C>          <C>     <C>          <C>      <C>           <C>

ClubHouse Inn-
Albuquerque
Albuquerque, New
Mexico..........                   --         990       5,793     --          --         990       5,793        6,783
ClubHouse Inn-
Atlanta
(Norcross)
Atlanta,
Georgia.........                 4,405        785       9,691     --          --         785       9,691       10,476
ClubHouse-
Overland Park
Overland Park,
Kansas..........                 4,713        830       7,397     --          --         830       7,397        8,227
ClubHouse Inn
Savannah
Savannah,
Georgia.........                   --         925       4,555     --          105        925       4,660        5,585
ClubHouse Inn -
Topeka
Topeka, Kansas..                   --         390       5,312     --          --         390       5,312        5,702
ClubHouse Inn-
Valadosta
Valadosta,
Georgia.........                   --         825       5,588     --          --         825       5,588        6,413
ClubHouse Inn &
Conference
Center
Nashville,
Tennessee.......                   --       1,582      12,337     --          --       1,582      12,337       13,919
Non-Proprietary
Branded
Properties:
Marriott Albany
Albany, New
York............                   --       4,000      68,856     --           40      4,000      68,896       72,896
Marriott Atlanta
North Central
Atlanta,
Georgia.........                   --         --       36,462     --          240        --       36,702       36,702
Marriott Houston
Greenspoint
North
Houston, Texas..                   --       3,600      44,211     --          110      3,600      44,321       47,921
Marriott
Minneapolis
Southwest
Minnetonka,
Minnesota.......                   --       2,968      36,933     --          182      2,968      37,115       40,083
Marriott
Harrisburg
Harrisburg, Pennsylvania..      19,475      3,400      38,304     --          273      3,400      38,577       41,977
Marriott Indian
River Plantation
Stuart,
Florida.........                   --       6,800      48,606    (480)        (97)     6,320      48,509       54,829
Marriott Troy
Troy, Michigan..                    (d)     1,790      29,220      19       2,114      1,809      31,334       33,143
Marriott
Philadelphia
West
West
Conshohocken,
Pennsylvania....                   --       2,500      67,279     --           93      2,500      67,372       69,872
Marriott
Pittsburgh
Airport
Pittsburgh,
Pennsylvania....                14,534      3,000      54,780     --           63      3,000      54,843       57,843
Marriott San
Diego Mission
Valley
San Diego,
California......                   --       8,000      40,743     --           68      8,000      40,811       48,811
<CAPTION>
                              Accumulated   Year    Date of
  Description               Depreciation(c) Built Acquisition
  -----------               --------------- ----- -----------
<S>                         <C>             <C>   <C>

ClubHouse Inn-
Albuquerque
Albuquerque, New
Mexico..........                    (324)   1987     1998
ClubHouse Inn-
Atlanta
(Norcross)
Atlanta,
Georgia.........                    (542)   1988     1998
ClubHouse-
Overland Park
Overland Park,
Kansas..........                    (414)   1988     1998
ClubHouse Inn
Savannah
Savannah,
Georgia.........                    (260)   1989     1998
ClubHouse Inn -
Topeka
Topeka, Kansas..                    (297)   1986     1998
ClubHouse Inn-
Valadosta
Valadosta,
Georgia.........                    (313)   1988     1998
ClubHouse Inn &
Conference
Center
Nashville,
Tennessee.......                    (690)   1991     1998
Non-Proprietary
Branded
Properties:
Marriott Albany
Albany, New
York............                  (3,048)   1985     1998
Marriott Atlanta
North Central
Atlanta,
Georgia.........                  (1,583)   1975     1998
Marriott Houston
Greenspoint
North
Houston, Texas..                  (1,918)   1981     1998
Marriott
Minneapolis
Southwest
Minnetonka,
Minnesota.......                  (1,601)   1988     1998
Marriott
Harrisburg
Harrisburg, Pennsylvania..        (1,631)   1980     1998
Marriott Indian
River Plantation
Stuart,
Florida.........                  (2,187)   1987     1998
Marriott Troy
Troy, Michigan..                  (3,710)   1990     1995
Marriott
Philadelphia
West
West
Conshohocken,
Pennsylvania....                  (2,916)   1991     1998
Marriott
Pittsburgh
Airport
Pittsburgh,
Pennsylvania....                  (2,412)   1987     1998
Marriott San
Diego Mission
Valley
San Diego,
California......                  (1,755)   1988     1998
</TABLE>

                                      F-56
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999

<TABLE>
<CAPTION>
                                                          Costs Capitalized            Gross Amounts
                                                             Subsequent             at Which Carried at
                                       Initial Cost        to Acquisition           Close of Period(a)
                                   --------------------- ------------------- ---------------------------------
                                             Buildings
                                                and                                   Buildings and
  Description         Encumbrances   Land   Improvements  Land  Improvements   Land   Improvements    Total
  -----------         ------------ -------- ------------ ------ ------------ -------- ------------- ----------
<S>                   <C>          <C>      <C>          <C>    <C>          <C>      <C>           <C>

Marriott St.
Louis West
St.
Louis, Missouri..         16,314      1,800      48,251     --         188      1,800      48,439       50,239
Marriott Tyson's
Corner
Tyson's Corner,
Virginia........             --       3,650      64,333     --       5,668      3,650      70,001       73,651
Marriott Warner
Center
Woodland Hills,
California......          49,163      6,250     100,063     --          45      6,250     100,108      106,358
Courtyard by
Marriott
Beachwood, Ohio..            --       1,510       7,553     --        (859)     1,510       6,694        8,204
Crowne Plaza
Ravinia
Atlanta, Georgia..           --       2,996      34,798     --       3,328      2,996      38,126       41,122
Doubletree Hotel
Anaheim
Orange, California..      13,419      2,464      23,297     --         470      2,464      23,767       26,231
Doubletree Hotel
Corporate Woods
Overland Park,
Kansas..........          21,831      3,317      38,088     --         363      3,317      38,451       41,768
Doubletree Hotel
Post Oak
Houston, Texas..          29,642      4,441      43,672     --         982      4,441      44,654       49,095
Doubletree Hotel
St. Louis
St. Louis,
Missouri........          13,319      2,160      18,300     --         469      2,160      18,769       20,929
Doubletree Hotel
Allen Center
Houston, Texas..          11,115      2,280      24,707     --       2,053      2,280      26,760       29,040
Doubletree Guest
Suites
Glenview, Illinois..          (e)     3,237      19,709     --      (2,336)     3,237      17,373       20,610
Doubletree Hotel
Westminster
Westminster
(Denver),
Colorado........              (d)     1,454       9,973      15      1,125      1,469      11,098       12,567
Doubletree Hotel
Tallahassee
Tallahassee,
Florida.........              (d)     2,127       7,779     --       2,999      2,127      10,778       12,905
Doubletree Hotel
Des Plaines
Des Plaines
(Chicago),
Illinois........              (d)     1,903       5,555     --       3,323      1,903       8,878       10,781
Doubletree Hotel
Minneapolis,
Minnesota.......             --       1,650      15,895     --       1,338      1,650      17,233       18,883
Doubletree Hotel
Tulsa,
Oklahoma........           9,203      1,428      18,596     --          55      1,428      18,651       20,079
Doubletree Park
Place
Minneapolis,
Minnesota.......             --       2,188      13,531     --       3,660      2,188      17,191       19,379
Doubletree Miami
Airport
Miami, Florida..              (d)     3,808       7,052     --       2,696      3,808       9,748       13,556
<CAPTION>
                        Accumulated   Year    Date of
  Description         Depreciation(c) Built Acquisition
  -----------         --------------- ----- -----------
<S>                   <C>             <C>   <C>

Marriott St.
Louis West
St.
Louis, Missouri..           (2,100)   1990     1998
Marriott Tyson's
Corner
Tyson's Corner,
Virginia........            (2,971)   1981     1998
Marriott Warner
Center
Woodland Hills,
California......            (4,346)   1986     1998
Courtyard by
Marriott
Beachwood, Ohio..             (533)   1986     1997
Crowne Plaza
Ravinia
Atlanta, Georgia..          (4,217)   1986     1995
Doubletree Hotel
Anaheim
Orange, California..        (1,568)   1984     1997
Doubletree Hotel
Corporate Woods
Overland Park,
Kansas..........            (2,554)   1982     1997
Doubletree Hotel
Post Oak
Houston, Texas..            (2,963)   1982     1997
Doubletree Hotel
St. Louis
St. Louis,
Missouri........            (1,238)   1984     1997
Doubletree Hotel
Allen Center
Houston, Texas..            (2,289)   1978     1996
Doubletree Guest
Suites
Glenview, Illinois..        (1,287)   1988     1997
Doubletree Hotel
Westminster
Westminster
(Denver),
Colorado........            (1,082)   1980     1996
Doubletree Hotel
Tallahassee
Tallahassee,
Florida.........              (914)   1977     1996
Doubletree Hotel
Des Plaines
Des Plaines
(Chicago),
Illinois........              (748)   1969     1996
Doubletree Hotel
Minneapolis,
Minnesota.......            (1,350)   1986     1997
Doubletree Hotel
Tulsa,
Oklahoma........            (1,604)   1982     1996
Doubletree Park
Place
Minneapolis,
Minnesota.......            (1,229)   1981     1997
Doubletree Miami
Airport
Miami, Florida..              (831)   1975     1996
</TABLE>

                                      F-57
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999
<TABLE>
<CAPTION>
                                                      Costs Capitalized            Gross Amounts
                                                         Subsequent             at Which Carried at
                                   Initial Cost        to Acquisition           Close of Period(a)
                               --------------------- ------------------- ---------------------------------
                                         Buildings
                                            and                                   Buildings and
  Description     Encumbrances   Land   Improvements  Land  Improvements   Land   Improvements    Total
  -----------     ------------ -------- ------------ ------ ------------ -------- ------------- ----------
<S>               <C>          <C>      <C>          <C>    <C>          <C>      <C>           <C>

Embassy Suites
Chicago,
Illinois........      40,853        --       82,017     --         --         --       82,017       82,017
Embassy Suites
Schaumburg,
Illinois........          (d)     2,001      29,350     --       2,691      2,001      32,041       34,042
Embassy Suites
Hunt Valley,
Maryland........         --         529      13,872       6        314        535      14,186       14,721
Embassy Suites
Phoenix North
Phoenix,
Arizona.........          (d)     2,028      40,160     --          41      2,028      40,201       42,229
Hyatt Newporter
Newport Beach,
California......         --         --       15,611     --         296        --       15,907       15,907
Hyatt Regency
Lexington,
Kentucky........         --         --       11,958     --       1,224        --       13,182       13,182
Hilton Cleveland
South
Independence,
Ohio............          (d)     2,760      12,264      29      1,277      2,789      13,541       16,330
Hilton Gateway
Newark
Newark, New
Jersey..........          (d)     1,740      31,262     --          50      1,740      31,312       33,052
Hilton Columbus
Columbus,
Georgia.........          (d)       570      13,132     --         --         570      13,132       13,702
Hilton Del Mar
Del Mar (San
Diego),
California......          (d)     1,900      11,435      20        537      1,920      11,972       13,892
Hilton Greenwood
Village (Denver
South)
Greenwood
Village,
Colorado........         --       1,800      42,003     --         --       1,800      42,003       43,803
Hilton Dania
Dania, Florida..         --       2,651      24,748     --       2,108      2,651      26,856       29,507
Hilton
Huntington
Melville, New
York............          (d)     3,000      49,435     --          10      3,000      49,445       52,445
Hilton
Parsipanny
Parsipanny, New
Jersey..........          (e)     5,350      87,775     --          36      5,350      87,811       93,161
Hilton Melbourne
Airport
Melbourne,
Florida.........          (e)     1,502       6,391     --      (5,734)     1,502         657        2,159
Holiday Inn San
Angelo
San Angelo,
Texas...........         --         428       3,982      11        197        439       4,179        4,618
Holiday Inn
Aristocrat
Dallas, Texas...         --         144       7,806       2        244        146       8,050        8,196
Holiday Inn
Lennox
Atlanta,
Georgia.........         --         --       10,090     --        (477)       --        9,613        9,613
<CAPTION>
                    Accumulated   Year    Date of
  Description     Depreciation(c) Built Acquisition
  -----------     --------------- ----- -----------
<S>               <C>             <C>   <C>

Embassy Suites
Chicago,
Illinois........        (3,613)   1991     1998
Embassy Suites
Schaumburg,
Illinois........        (1,354)   1984     1998
Embassy Suites
Hunt Valley,
Maryland........        (1,661)   1985     1995
Embassy Suites
Phoenix North
Phoenix,
Arizona.........        (1,771)   1985     1998
Hyatt Newporter
Newport Beach,
California......        (1,762)   1962     1996
Hyatt Regency
Lexington,
Kentucky........        (1,338)   1977     1996
Hilton Cleveland
South
Independence,
Ohio............        (1,591)   1980     1995
Hilton Gateway
Newark
Newark, New
Jersey..........        (1,378)   1971     1998
Hilton Columbus
Columbus,
Georgia.........          (578)   1982     1998
Hilton Del Mar
Del Mar (San
Diego),
California......        (1,270)   1989     1996
Hilton Greenwood
Village (Denver
South)
Greenwood
Village,
Colorado........        (1,850)   1982     1998
Hilton Dania
Dania, Florida..        (1,134)   1988     1998
Hilton
Huntington
Melville, New
York............        (2,178)   1988     1998
Hilton
Parsipanny
Parsipanny, New
Jersey..........        (3,868)   1981     1998
Hilton Melbourne
Airport
Melbourne,
Florida.........          (329)   1986     1997
Holiday Inn San
Angelo
San Angelo,
Texas...........          (501)   1984     1995
Holiday Inn
Aristocrat
Dallas, Texas...          (964)   1925     1995
Holiday Inn
Lennox
Atlanta,
Georgia.........        (1,117)   1987     1996
</TABLE>

                                      F-58
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999
<TABLE>
<CAPTION>
                                                      Costs Capitalized             Gross Amounts
                                                         Subsequent              at Which Carried at
                                   Initial Cost        to Acquisition            Close of Period(a)
                               --------------------- -------------------- ---------------------------------
                                         Buildings
                                            and                                    Buildings and
  Description     Encumbrances   Land   Improvements  Land   Improvements   Land   Improvements    Total
  -----------     ------------ -------- ------------ ------  ------------ -------- ------------- ----------
<S>               <C>          <C>      <C>          <C>     <C>          <C>      <C>           <C>

Holiday Inn
Northwest
Houston, Texas..         --         333       2,324       4         378        337       2,702        3,039
Holiday Inn
Northwest Plaza
Austin, Texas...         --       1,424       9,323      15         213      1,439       9,536       10,975
Holiday Inn
Select--Farmers
Branch
Farmers Branch
(Dallas),
Texas...........         --       3,045      15,786      33       1,955      3,078      17,741       20,819
Holiday Inn
Westlake
Beachwood,
Ohio............         --       2,843      14,218     --       (1,811)     2,843      12,407       15,250
Holiday Inn
Brentwood
Brentwood,
Tennessee.......         --       1,080      22,342     --            4      1,080      22,346       23,426
Holiday Inn
San Francisco,
California......         --         --       18,807     --          113        --       18,920       18,920
Omni Inner
Harbour Hotel
Baltimore,
Maryland........         --       1,129      49,491     --      (14,771)     1,129      34,720       35,849
Radisson
Burlington
Burlington,
Vermont.........          (e)       935      28,453     --           11        935      28,464       29,399
Radisson Hotel &
Suites
Dallas, Texas...         --       1,011       8,276      10         308      1,021       8,584        9,605
Radisson
Englewood
Englewood, New
Jersey..........         --         --       26,320     --          --         --       26,320       26,320
Radisson Suite
Hotel
Kansas City,
Kansas..........         --         914      10,341     --       (8,249)       914       2,092        3,006
Radisson Hotel
Lisle,
Illinois........          (e)     1,995      24,726     --          --       1,995      24,726       26,721
Radisson New
Orleans
New Orleans,
Louisiana.......         --       2,463      23,630      43       1,096      2,506      24,726       27,232
Radisson
Northbrook
Northbrook,
Illinois........         --       1,437      10,968      16         312      1,453      11,280       12,733
Radisson
Overland Park
Overland Park,
Kansas..........         --       1,296       5,377      14         578      1,310       5,955        7,265
Radisson
Riverwalk
Jacksonville,
Florida.........         --       2,400      16,965    (388)        486      2,012      17,451       19,463
Radisson Plaza
Hotel
San Jose Airport
San Jose,
California......          (e)     1,438      40,474     --          --       1,438      40,474       41,912
<CAPTION>
                    Accumulated   Year    Date of
  Description     Depreciation(c) Built Acquisition
  -----------     --------------- ----- -----------
<S>               <C>             <C>   <C>

Holiday Inn
Northwest
Houston, Texas..          (311)   1982     1995
Holiday Inn
Northwest Plaza
Austin, Texas...        (1,148)   1984     1995
Holiday Inn
Select--Farmers
Branch
Farmers Branch
(Dallas),
Texas...........        (2,051)   1979     1995
Holiday Inn
Westlake
Beachwood,
Ohio............        (1,010)   1980     1997
Holiday Inn
Brentwood
Brentwood,
Tennessee.......          (984)   1989     1998
Holiday Inn
San Francisco,
California......        (1,302)   1964     1997
Omni Inner
Harbour Hotel
Baltimore,
Maryland........        (3,387)   1968     1997
Radisson
Burlington
Burlington,
Vermont.........        (1,254)   1975     1998
Radisson Hotel &
Suites
Dallas, Texas...        (1,027)   1986     1995
Radisson
Englewood
Englewood, New
Jersey..........        (1,159)   1989     1998
Radisson Suite
Hotel
Kansas City,
Kansas..........          (564)   1931     1995
Radisson Hotel
Lisle,
Illinois........        (1,089)   1987     1998
Radisson New
Orleans
New Orleans,
Louisiana.......        (2,900)   1924     1995
Radisson
Northbrook
Northbrook,
Illinois........          (948)   1976     1997
Radisson
Overland Park
Overland Park,
Kansas..........          (481)   1974     1997
Radisson
Riverwalk
Jacksonville,
Florida.........        (1,158)   1979     1997
Radisson Plaza
Hotel
San Jose Airport
San Jose,
California......        (1,783)   1985     1998
</TABLE>

                                      F-59
<PAGE>

                          WYNDHAM INTERNATIONAL, INC.

      SCHEDULE III--REAL ESTATE AND ACCUMULATED DEPRECIATION--(Continued)
                            As of December 31, 1999
<TABLE>
<CAPTION>
                                                      Costs Capitalized            Gross Amounts
                                                         Subsequent             at Which Carried at
                                   Initial Cost        to Acquisition           Close of Period(a)
                               --------------------- ------------------- ---------------------------------
                                         Buildings
                                            and                                   Buildings and
  Description     Encumbrances   Land   Improvements  Land  Improvements   Land   Improvements    Total
  -----------     ------------ -------- ------------ ------ ------------ -------- ------------- ----------
<S>               <C>          <C>      <C>          <C>    <C>          <C>      <C>           <C>

Radisson Suites
Town & Country
Houston, Texas..          (d)       655       9,725       7        198        662       9,923       10,585
Radisson Hotel
Beachwood,
Ohio............       5,437      2,226      11,129     --      (1,146)     2,226       9,983       12,209
Radisson Hotel
Akron, Ohio.....         --       1,136       5,678     --        (820)     1,136       4,858        5,994
Ramada Hotel
San Francisco,
California......         --         --       15,853     --         133        --       15,986       15,986
Sheraton Four
Points
Blacksburg,
Virginia........         --         470      16,651     --          10        470      16,661       17,131
Sheraton Four
Points
Saginaw,
Michigan........                     73        ,451                 11         81        ,762         ,543
WestCoast Valley
River Inn
Eugene, Oregon..         --       1,754      15,839      19      1,005      1,773      16,844       18,617
Fort Magruder
Inn and
Conference
Center
Williamsburg,
Virginia........         --       2,192      22,499     --           4      2,192      22,503       24,695
Park Shore
Honolulu
Honolulu,
Hawaii..........         --         --       24,339     --         560        --       24,899       24,899
Santa Maria
Key West,
Florida.........       4,000      5,341         --       81        --       5,422         --         5,422
Le Mannoir de
Gressey
Seine et Maine
Near Paris......       7,793      1,209       7,181     --         --       1,209       7,181        8,390
Regency
San Juan, Puerto
Rico............         --       4,910       4,208     --         805      4,910       5,013        9,923
Condado
San Juan, Puerto
Rico............      53,167      5,700      72,982     --       7,578      5,700      80,560       86,260
Other:
Golden Door Spa
Escondido,
California......       4,000      5,800       3,000     --         --       5,800       3,000        8,800
Canal Place
Retail Mall and
Garage
New Orleans,
Louisiana.......         --         --       38,129     --         375        --       38,504       38,504
                    --------   --------  ----------  ------   --------   --------  ----------   ----------
                    $773,625   $457,450  $4,435,949  $9,123   $204,201   $466,573  $4,640,150   $5,106,723
                    ========   ========  ==========  ======   ========   ========  ==========   ==========
<CAPTION>
                    Accumulated   Year    Date of
  Description     Depreciation(c) Built Acquisition
  -----------     --------------- ----- -----------
<S>               <C>             <C>   <C>

Radisson Suites
Town & Country
Houston, Texas..        (1,200)   1986     1995
Radisson Hotel
Beachwood,
Ohio............          (789)   1968     1997
Radisson Hotel
Akron, Ohio.....          (399)   1989     1997
Ramada Hotel
San Francisco,
California......        (1,103)   1962     1997
Sheraton Four
Points
Blacksburg,
Virginia........          (734)   1971     1998
Sheraton Four
Points
Saginaw,
Michigan........           808)   1984     1995
WestCoast Valley
River Inn
Eugene, Oregon..        (1,577)   1973     1996
Fort Magruder
Inn and
Conference
Center
Williamsburg,
Virginia........          (991)   1975     1998
Park Shore
Honolulu
Honolulu,
Hawaii..........        (1,652)   1968     1997
Santa Maria
Key West,
Florida.........           --     1951     1998
Le Mannoir de
Gressey
Seine et Maine
Near Paris......        (8,452)   1993     1999
Regency
San Juan, Puerto
Rico............          (220)   1963     1998
Condado
San Juan, Puerto
Rico............        (5,216)   1959     1998
Other:
Golden Door Spa
Escondido,
California......          (132)   1954     1998
Canal Place
Retail Mall and
Garage
New Orleans,
Louisiana.......           --     1984     1999
                  ---------------
                     $(273,272)
                  ===============
</TABLE>

                                      F-60
<PAGE>

                           WYNDHAM INTERNATIONAL INC.

                             NOTES TO SCHEDULE III
                                 (in thousands)

<TABLE>
<CAPTION>
                                          Year Ended   Year Ended   Year Ended
                                         December 31, December 31, December 31,
                                             1999         1998         1997
                                         ------------ ------------ ------------
<S>                                      <C>          <C>          <C>
(a)Reconciliation of Real Estate
  Balance at beginning of period........  $4,995,837   $1,863,568   $  597,494
  Additions during period:
    Acquisitions........................     267,975    2,967,790    1,209,052
    Improvements........................     166,574      164,479       57,022
  Deductions during period
    Sale of properties..................    (269,493)         --           --
    Basis adjustments in accordance with
     the purchase method of accounting
     due to the exchange of OP
     units and acquisition of third
     party's minority interest..........     (54,170)         --           --
                                          ----------   ----------   ----------
  Balance at end of period..............  $5,106,723   $4,995,837   $1,863,568
                                          ==========   ==========   ==========
(b)Reconciliation of Accumulated Depre-
 ciation:
    Balance at beginning of period......  $  132,809   $   41,041   $   12,048
  Additions during period
    Depreciation for the period.........     151,184       91,768       28,993
  Deductions during period
    Sale of properties..................     (10,721)         --           --
                                          ----------   ----------   ----------
  Balance at the end of period .........  $  273,272   $  132,809   $   41,041
                                          ==========   ==========   ==========
</TABLE>

(c) Depreciation is computed on buildings and improvements based upon a useful
    life of 35 years.

(d) Hotel secures mortgage indebtedness of $346,000

(e) Hotel secures mortgage indebtedness of $235,000

(f) Hotel is encumbered by a capital lease obligation of $19,233

(g) Hotel is encumbered by a capital lease obligation of $4,238

(h) Hotel secures mortgage indebtedness of $31,670

                                      F-61