Litt wrote that the firm is deeply troubled by its private conversations with management regarding the company's financials in June of 2017. The firm met with CEO Ross Bierkan and COO/CFO Leslie Hale and they had “no credible response to our questions about discrepancies brought to light in the company's S-4 registration statement/joint proxy statement ,” he alleged.

Specifically, the disclosures regarding RLJ's expected EBITDA for 2017 and 2018 supplied to FelCor on February 12, 2017 are inconsistent with the guidance RLJ provided 10 days later when it announced full year 2016 results. The proxy contains expectations that are $14 million above what was disclosed when RLJ provided 2017 guidance to the investment community. While the proxy was subsequently updated by the company following our private letter, no other formal response has been given.

Litt also wrote that RLJ's disclosed estimates of FelCor's 2017 and 2018 EBITDA are substantially below the guidance FelCor provided investors, as well as the EBITDA FelCor provided to its Board. “There has been no meaningful explanation for this discrepancy,” he wrote. He also noted that:

… management denied they gave any guidance regarding second quarter results at NAREIT, yet analyst reports and earnings estimates reflected there are further changes to 2017 estimates which are not reflected in the Proxy that investors are being asked to rely upon when voting on the merger.

His final point in the letter: The RLJ Board is in need of relevant capital markets and REIT experience, coupled with capital allocation and operating expertise, in order to reverse the dismal share price and ultimately place the company on a path to value creation.