Sotherly Hotels Inc. Enters Material Definitive Agreement

TL;DR

SOHO signed a big deal, expect financial moves.

AI Summary

Sotherly Hotels Inc. (SOHO) announced on October 24, 2025, that it entered into a material definitive agreement. This filing also details the creation of a direct financial obligation or an obligation under an off-balance sheet arrangement for the registrant. The company is a Real Estate Investment Trust (REIT) and operates in the Hotels & Motels sector.

Why It Matters

This filing indicates a significant new agreement for Sotherly Hotels, which could impact its financial obligations and future operations.

Risk Assessment

Risk Level: medium — Entering into material definitive agreements and creating financial obligations can introduce new risks related to the terms and execution of these arrangements.

Key Players & Entities

• Sotherly Hotels Inc. (company) — Registrant
• SOTHERLY HOTELS LP (company) — Related Entity
• October 24, 2025 (date) — Agreement Date
• October 27, 2025 (date) — Filing Date

FAQ

Key Financial Figures

• $0.01 — nge on which registered Common Stock, $0.01 par value SOHO The Nasdaq Stock Mar
• $2.25 — t to receive an amount in cash equal to $2.25 per share, without interest (the " Per
• $4,000,000 — ays Parent the Company Termination Fee ($4,000,000) (as described below), or due to certai
• $8,000,000 — to pay the Company a termination fee of $8,000,000 (the " Parent Termination Fee ") upon t
• $25,000,000 — credit in the principal amount of up to $25,000,000 (the " Revolving Commitment "). The Not
• $350 m — to Parent in an aggregate amount up to $350 million, subject to the terms and conditi
• $65 million — with the Closing, up to an aggregate of $65 million pursuant to a mezzanine debt and equity
• $47 million — ity contributions in an amount equal to $47 million pursuant to an equity commitment letter

Filing Documents

• soho-20251024.htm (8-K) — 144KB
• soho-ex2_1.htm (EX-2.1) — 904KB
• soho-ex10_1.htm (EX-10.1) — 166KB
• soho-ex99_1.htm (EX-99.1) — 48KB
• 0001193125-25-250648.txt ( ) — 1622KB
• soho-20251024.xsd (EX-101.SCH) — 63KB
• soho-20251024_htm.xml (XML) — 12KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. Agreement and Plan of Merger On October 24, 2025, Sotherly Hotels Inc., a Maryland corporation (the " Company "), KW Kingfisher LLC, a Delaware limited liability company (" Parent "), and Sparrows Nest LLC, a Maryland limited liability company (" Merger Sub ," together with the Parent, " Parent Parties "), entered into an Agreement and Plan of Merger (the " Merger Agreement "). The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, Merger Sub will be merged with and into the Company, with the Company continuing as the surviving entity in such merger (the " Merger ," and such surviving entity, the " Surviving Company "). Defined terms used herein but not defined shall have the meaning set forth in the Merger Agreement. Upon completion of the Merger, the Surviving Company will survive as a wholly owned subsidiary of Parent and the separate existence of the Merger Sub will cease, and Sotherly Hotels LP, a Delaware limited partnership (the " Operating Partnership ") will become an indirect subsidiary of Parent. The consummation of the Merger and the other transactions contemplated by the Merger Agreement were unanimously approved and declared advisable by the board of directors of the Company (the " Company Board ") and the Special Committee of the Company Board. Merger Consideration Pursuant to the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Merger (the " Effective Time "), (A) each share of common stock, par value $0.01 per share, of the Company (the " Company Common Stock ") issued and outstanding immediately before the Effective Time (other than Cancelled Shares) will be automatically converted into the right to receive an amount in cash equal to $2.25 per share, without interest (the " Per Company Share Merger Consideration ," and in the aggregate, the " Merger Consideration "); (B) each share of the Comp

01 Regulation FD Disclosure

Item 7.01 Regulation FD Disclosure. On October 27, 2025 the Company issued a press release announcing the execution of the Merger Agreement. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The information contained in Item 7.01 of this report, including the information in Exhibit 99.1 attached to this report, is furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. Furthermore, the information in Item 7.01 of this report, including the information in Exhibit 99.1 attached to this report, shall not be deemed to be incorporated by reference in the filings of the registrant under the Securities Act of 1933, as amended.

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits. Exhibit Number Description 2.1* Agreement and Plan of Merger, dated as of October 24, 2025, by and among Sotherly Hotels Inc., KW Kingfisher LLC, and Sparrows Nest LLC. 10.1* Promissory Note, dated as of October 24, 2025, by and among Sotherly Hotels Inc. and Kemmons Wilson Hospitality Partners II, LP. 99.1 Press Release of Sotherly Hotels Inc. dated October 27, 2025. 104 Cover Page Interactive Data File (embedded within the Inline XBRL document). * Certain schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of such schedules and exhibits, or any section thereof, to the SEC upon its request. Additional Information and Where to Find It In connection with the proposed transaction, the Company plans to file relevant materials with the SEC, including a proxy statement on Schedule 14A. Promptly after filing its definitive proxy statement with the SEC, the Company will mail the definitive proxy statement and a proxy card to each stockholder entitled to vote at the special meeting relating to the proposed transaction. INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO CAREFULLY READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO AND ANY DOCUMENTS INCORPORATED BY REFERENCE THEREIN) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE TRANSACTION THAT THE COMPANY WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND THE PARTIES TO THE TRANSACTION. The definitive proxy statement, the preliminary proxy statement, and any other relevant materials in connection with the transaction (when they become available) and any other documents filed by the Company with the SEC, may be obtained free of charge at the SEC's website at www.sec.gov or by accessing the Investor Relations section of the Company's website at ht

View Full Filing

View this 8-K filing on SEC EDGAR