WYNDHAM WORLDWIDE CORPORATION

We expect Corporate expenses of approximately $75 million to $85 million during 2011. The increase in
expenses primarily reflects continued investment in information technology and data security enhancements in
response to the increasingly aggressive global threat from cyber-criminals.
Interest Expense/Interest Income/Provision for Income Taxes
Interest expense increased $53 million during 2010 compared with 2009 as a result of:
k an $18 million increase in interest incurred on our long-term debt facilities, primarily related to our May
2009, February 2010 and September 2010 debt issuances, partially offset by the early extinguishment of
our term loan facility;
k our termination of an interest rate swap agreement related to the early extinguishment of our term loan
facility during the first quarter of 2010, which resulted in the reclassification of a $14 million unrealized
loss from accumulated other comprehensive income to interest expense on our Consolidated Statement of
Operations;
k $14 million of costs incurred for the repurchase of a portion of our 3.50% convertible notes during the
third and fourth quarters of 2010;
k a $5 million decrease in capitalized interest primarily due to lower development of vacation ownership
inventory at our vacation ownership business; and
k an additional $2 million of costs, which are included within interest expense on our Consolidated
Statement of Operations, recorded during the first quarter of 2010 in connection with the early extinguishment
of our term loan and revolving foreign credit facilities.
Interest income decreased $2 million during 2010 compared with 2009 due to decreased interest earned on
invested cash balances as a result of lower rates earned on investments.
Our effective tax rate declined from 40.6% during 2009 to 32.7% during 2010 primarily due to the benefit
derived from the current utilization of certain cumulative foreign tax credits, which we were able to realize based on
certain changes in our tax profile, as well as the settlement of the IRS examination.
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