Sotherly Hotels (NASDAQ: SOHO) to delist preferreds after cash conversions

Rhea-AI Filing Summary

Sotherly Hotels Inc. plans to voluntarily delist all Series B, C and D preferred shares from Nasdaq, move them to an OTC trading platform, and continue SEC reporting as a REIT. The company has already undergone a change of control and most preferred holders chose cash conversion.

The operating partnership also entered a one-year consulting agreement with KWC Management, LLC effective February 12, 2026, paying an annual asset management fee of $650,000 plus expenses. Following designation of March 20, 2026 as the Change in Control Conversion Date, holders of Series B, C and D preferred tendered shares for cash totaling $22,164,952, $23,005,385 and $13,647,549, respectively, which were paid and the shares cancelled on March 25, 2026.

Positive

• None.

Negative

• Preferred stock delisting and deregistration: All Series B, C and D preferred shares are being voluntarily delisted from Nasdaq, with Form 25 deregistration under Section 12(b), which is likely to reduce trading liquidity for remaining preferred holders.

Insights

REIT capital markets analyst

Sotherly is delisting its preferreds from Nasdaq after large cash redemptions.

Sotherly Hotels Inc. will remove its Series B, C and D preferred stock listings from Nasdaq, file Form 25 around April 7, 2026, and expects the last Nasdaq trading day around April 17, 2026. Trading is expected to continue on an OTC platform while SEC reporting and REIT status are maintained.

The filing confirms substantial cash redemptions tied to a change of control. Holders of 1,188,042 Series B, 1,202,415 Series C and 820,066 Series D shares exercised Change of Control Conversion Rights, receiving $22,164,952, $23,005,385 and $13,647,549, respectively, with the shares cancelled on March 25, 2026.

The consulting agreement with KWC Management, LLC adds an annual asset management fee of $650,000 plus reimbursed expenses for designated assets, initially through February 11, 2027. For investors in the preferred securities, the combination of cash redemptions and delisting meaningfully reshapes liquidity and the remaining investor base.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 24, 2026

SOTHERLY HOTELS INC.

SOTHERLY HOTELS LP

(Exact name of Registrant as Specified in Its Charter)

Maryland (Sotherly Hotels Inc.)		001-32379 (Sotherly Hotels Inc.)		20-1531029 (Sotherly Hotels Inc.)
Delaware (Sotherly Hotels LP)		001-36091 (Sotherly Hotels LP)		20-1965427 (Sotherly Hotels LP)
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

20 Huling Ave Memphis, Tennessee		38103
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: (901) 346-8800

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
8.0% Series B Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value		SOHOB		The Nasdaq Stock Market LLC
7.875% Series C Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value		SOHOO		The Nasdaq Stock Market LLC
8.25% Series D Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value		SOHON		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Sotherly Hotels Inc. ☐    Sotherly Hotels LP ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Sotherly Hotels Inc. ☐    Sotherly Hotels LP ☐

Item 1.01 Entry into a Material Definitive Agreement.

On March 24, 2026, Sotherly Hotels, LP, a Delaware limited partnership (the “Operating Partnership”), entered into a consulting agreement effective February 12, 2026 (the “Consulting Agreement”) with KWC Management, LLC, a Delaware limited liability company and an affiliate of the Operating Partnership (“KWC”). Pursuant to the Consulting Agreement, KWC is responsible for providing consultation and management services to the Operating Partnership, as more particularly described in the Consulting Agreement (the “Services”), for the assets listed on Exhibit A thereto (the “Assets”).

The Consulting Agreement has an initial term of twelve (12) months until February 11, 2027 (the “Initial Term”), following which it shall renew for successive one-year terms unless terminated by either party upon thirty (30) days written notice to the non-cancelling party. Notwithstanding the foregoing, in the event of a sale of the Assets, the Consulting Agreement shall terminate immediately upon the closing of such sale; provided the Operating Partnership shall use commercially reasonable efforts to provide written notice of the proposed sale at least thirty (30) days prior to the anticipated closing date of such sale.

Pursuant to the Consulting Agreement, the Operating Partnership will pay an annual asset management fee (the “Asset Management Fee”) in the amount approved by the Operating Partnership as part of its annual budget approval process. For the Initial Term, the Asset Management Fee shall be at the annualized rate of Six Hundred Fifty Thousand Dollars ($650,000) per year, payable in equal monthly installments in advance on the first day of each calendar month. The fee for any partial month at the commencement or expiration of the current term shall be prorated on a per diem basis based on a 365-day year. The Operating Partnership will also pay reasonable out-of-pocket expenses incurred in connection with KWC’s the performance of the Services within thirty (30) days after receipt of an invoice detailing such amounts and accompanied by reasonable supporting documentation.

The foregoing descriptions of the Consulting Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the form of Consulting Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and are incorporated herein by reference.

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

On March 27, 2026, Sotherly Hotels Inc. (the “Company”), a real estate investment trust, provided notice to The Nasdaq Stock Market LLC (“Nasdaq”) that its Board of Directors approved the voluntarily withdrawal of the listing of all of the Company’s shares of 8.0% Series B Cumulative Redeemable Perpetual Preferred Stock, 7.875% Series C Cumulative Redeemable Perpetual Preferred Stock and 8.25% Series D Cumulative Redeemable Perpetual Preferred Stock (collectively, the “Preferred Stock”) from Nasdaq.

The Company expects to file a Form 25 with the Securities and Exchange Commission (the “SEC”) on or about April 7, 2026 for the delisting of the Preferred Stock from Nasdaq and the deregistration of the Preferred Stock under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company expects that the last day of trading for the Preferred Stock on Nasdaq will be on or about April 17, 2026.

A copy of the press release regarding this action is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 8.01 Other Events.

As previously disclosed, pursuant to the Agreement and Plan of Merger dated October 24, 2025 (the “Merger Agreement”) by and among the Company, KW Kingfisher LLC (“Parent”), and Parent’s wholly-owned subsidiary, Sparrows Nest LLC (“Merger Sub”), whereby the Merger Sub merged with and into the Company, with the Company being the surviving entity (the “Merger”) on February 27, 2026, the Company posted to its corporate website, and provided, the holders of the Company Preferred Stock (the “Preferred Stockholders”), a notice of Change of Control (as defined in the Articles) informing the Preferred Stockholders of the Change of Control and describing the resulting Change of Control Conversion Right (as defined in the Articles). The Company has designated March 20, 2026 as the Change in Control Conversion Date (as defined in the Articles).

As previously disclosed, pursuant to the Merger Agreement and the Articles Supplementary (the “Articles”) of the Preferred Stock, on February 27, 2026, the Company posted to its corporate website, and provided, the holders of the Preferred Stock (the “Preferred Stockholders”), a notice of Change of Control (as defined in the Articles) informing the Preferred Stockholders of the Change of Control and describing the resulting Change of Control Conversion Right

(as defined in the Articles). The Company designated March 20, 2026 as the Change in Control Conversion Date (as defined in the Articles). As a result, holders of 1,188,042 shares of the Series B Preferred Stock, 1,202,415 shares of the Series C Preferred Stock and 820,066 shares of the Series D Preferred Stock, each exercised their Change of Control Conversion Right, and on March 25, 2026, the Company cancelled the respective tendered shares of the Series B Preferred Stock, Series C Preferred Stock and Series D Preferred Stock in exchange for payment of $22,164,952, $23,005,385 and $13,647,549, respectively.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.		Description of Exhibit
10.1		Consulting Agreement dated March 24, 2026, by and between Sotherly Hotels LP and KWC Management, LLC.
99.1		Press Release of Sotherly Hotels Inc. dated March 27, 2026.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

* Certain portions of this exhibit have been omitted in accordance with Item 601(b)(10)(iv) of Regulation S-K. The registrant agrees to furnish supplementally an unredacted copy of this exhibit to the Securities and Exchange Commission upon its request.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned hereunto duly authorized.

Date: March 27, 2026				SOTHERLY HOTELS INC.
				By:		/s/ Zach Schmidt
						Zach Schmidt Chief Executive Officer
				SOTHERLY HOTELS LP
						by its General Partner,
						SOTHERLY HOTELS INC.
				By:		/s/ Zach Schmidt
						Zach Schmidt Chief Executive Officer

Exhibit 99.1

Sotherly Hotels Inc. Announces Intention to List on OTC Market Platform, Voluntarily Delist from Nasdaq and Continue SEC Reporting

3/27/2026

Sotherly Hotels Inc. (the “Company” or “Sotherly”), a real estate investment trust, announced today that its Board of Directors has approved the voluntary withdrawal of the listing of the Company’s shares of 8.0% Series B Cumulative Redeemable Perpetual Preferred Stock, 7.875% Series C Cumulative Redeemable Perpetual Preferred Stock and 8.25% Series D Cumulative Redeemable Perpetual Preferred Stock (collectively, the “Preferred Stock”) from The Nasdaq Stock Market LLC (“Nasdaq”).

The Company expects to file a Form 25 with the Securities and Exchange Commission (the “SEC”) on or about April 7, 2026 for the delisting of the Preferred Stock from Nasdaq and the deregistration of the Preferred Stock under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company expects that the last day of trading for the Preferred Stock on Nasdaq will be on or about April 17, 2026.

The Company’s status as a real estate investment trust for U.S. federal income tax purposes will not be affected by the transition, and the Company intends to continue operating as a REIT.

The Company believes that this transition is in the best interests of the Company and its stockholders in light of the closing on February 12, 2026 of the transactions contemplated by that certain Agreement and Plan of Merger, by and among the Company, KW Kingfisher LLC, a Delaware limited liability company (the “Parent”), and Sparrows Nest LLC, a Maryland limited liability company. As a result of the Merger, all of the Company’s outstanding Common Stock was acquired by the Parent and holders of over 80% of the outstanding shares of Preferred Stock opted to receive cash consideration for the conversion of their respective Preferred Shares pursuant to change of control conversion rights set out in the Merger Agreement and Articles Supplementary of the Preferred Stock.

About Sotherly Hotels Inc.

Sotherly Hotels Inc. (Nasdaq: SOHO) is an externally-managed and externally-administered lodging real estate investment trust, or REIT, that was formed in August 2004 to own, acquire, renovate and reposition full-service, primarily upscale and upper-upscale hotel properties located in primary markets in the mid-Atlantic and southern United States. Sotherly owns ten full-service, primarily upscale and upper-upscale hotels located in seven states with an aggregate of 2,786 hotel rooms, and interests in one condominium hotels and their associated rental programs. For more information on Sotherly, please visit the Sotherly website at www.sotherlyhotels.com.

Cautionary Statement Regarding Forward-Looking Statements

This Press Release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are intended to be covered by the safe harbor provisions for forward-looking statements contained therein. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause Sotherly’s actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements, which are based on certain assumptions and describe Sotherly’s current strategies, expectations and future plans, are generally identified by the use of words such as “intend,” “plan,” “may,” “should,” “will,” “project,” “anticipate,” “believe,” “expect,” “continue,” and similar expressions, whether in the negative or affirmative, but the absence of these words does not necessarily mean that a statement is not forward looking. All statements regarding Sotherly’s trading platforms and business plans are forward-looking statements. Readers should specifically consider the various factors identified in this Press Release and the reports filed by Sotherly with the SEC, including, but not limited to those discussed in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of Sotherly’s Annual Report on Form 10-K for the year ended December 31, 2024 and Sotherly’s subsequent periodic reports filed with the SEC that could cause actual results to differ.

Forward-looking statements are not historical facts but instead express only management’s beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of the management’s control. It is possible that actual results and outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements. All forward-looking statements included in this Press Release are made as of the date hereof and are based on information available at that time. Except as required by law, Sotherly assumes no obligation to update any forward-looking statement to reflect events or circumstances that occur after the date the forward-looking statements were made.

FAQ

What consulting agreement did Sotherly Hotels (SOHO) enter into in March 2026?

Sotherly’s operating partnership entered a consulting agreement with KWC Management, LLC effective February 12, 2026. KWC will provide asset management services for designated properties for an initial 12-month term, earning a $650,000 annual fee plus reimbursed out-of-pocket expenses, payable monthly in advance.

Which Sotherly Hotels preferred stocks are being delisted from Nasdaq?

Sotherly plans to delist its 8.0% Series B, 7.875% Series C and 8.25% Series D Cumulative Redeemable Perpetual Preferred Stock from Nasdaq. The company expects to file Form 25 around April 7, 2026, with the last Nasdaq trading day around April 17, 2026.

Will Sotherly Hotels (SOHO) continue SEC reporting and REIT status after delisting?

Yes. Sotherly states its status as a real estate investment trust for U.S. federal income tax purposes will not change. The company intends to continue operating as a REIT and to continue SEC reporting while transitioning preferred share trading to an OTC market platform.

How many Sotherly Hotels preferred shares were converted after the change of control?

After designating March 20, 2026 as the Change in Control Conversion Date, holders converted 1,188,042 Series B, 1,202,415 Series C and 820,066 Series D preferred shares. These tendered shares were cancelled on March 25, 2026 in exchange for cash payments under the change of control provisions.

What cash amounts did Sotherly Hotels pay for preferred share conversions?

On March 25, 2026, Sotherly paid $22,164,952 for converted Series B preferred, $23,005,385 for Series C, and $13,647,549 for Series D. These payments correspond to holders exercising their Change of Control Conversion Rights, after the company’s merger with KW Kingfisher LLC’s subsidiary.

Why is Sotherly Hotels (SOHO) transitioning its preferred shares off Nasdaq?

Sotherly states the transition is in the best interests of the company and stockholders following the February 12, 2026 merger transaction. As a result of that merger, all common stock was acquired by the parent and most preferred holders chose cash conversion of their shares.

Filing Exhibits & Attachments

3 documents

Press Releases

• EX-99.1 EX-99.1 7.1 KB

Agreements & Contracts

• EX-10.1 EX-10.1 36.5 KB

Other Documents

• EX-101 XBRL TAXONOMY EXTENSION SCHEMA 55.4 KB