8-K

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): June 1, 2017

SOTHERLY HOTELS INC.

SOTHERLY HOTELS LP

(Exact name of Registrant as Specified in Its Charter)

Maryland (Sotherly Hotels Inc.) Delaware (Sotherly Hotels LP)	001-32379 (Sotherly Hotels Inc.) 001-36091 (Sotherly Hotels LP)	20-1531029 (Sotherly Hotels Inc.) 20-1965427 (Sotherly Hotels LP)
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
410 W. Francis Street Williamsburg, Virginia		23185
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: (757) 229-5648

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))

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 June 1, 2017, Sotherly Hotels Inc. (“Sotherly” or the “Company”), a Maryland corporation and the sole general partner of Sotherly Hotels LP, a Delaware limited partnership, entered into a Commercial Unit Purchase Agreement and a related addendum (collectively, the “Agreement”) to purchase the commercial unit of the planned Hyde Beach House Resort & Residences (the “Planned Hotel”), a condominium hotel under development in Hollywood, Florida, for a price of $5.10 million from 4000 South Ocean Property Owner, LLLP (the “Seller”).  In connection with the Agreement, the Company also entered into a Pre-Opening Services Agreement whereby the Seller has agreed to pay the Company $0.75 million in connection with certain pre-opening activities, prior to the closing under the agreement.  In connection with the closing under the Agreement, the Company has agreed to purchase inventories consistent with the management and operation of the Planned Hotel and the related condominium association for an additional amount; to enter into a lease agreement for the parking garage and poolside cabanas associated with the Planned Hotel; and to enter into a management agreement relating to the operation and management of the Planned Hotel condominium association.  The Company anticipates that the closing of the transaction under the Agreement and the execution of related agreements will take place in the second quarter of 2019, once construction of the Planned Hotel has been substantially completed.  The closing of the transaction is subject to various closing conditions as described in the Agreement.

Item 7.01Regulation FD Disclosure.

On June 7, 2017, the Company issued a press release announcing the acquisition of the Hotel commercial unit.  A copy of the press release is attached to the Current Report on Form 8-K as Exhibit 99.1 and incorporated by reference herein.

In accordance with General Instructions B.2 and B.6 of Form 8-K, the information included in this Item 7.01 (including Exhibit 99.1 hereto), shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number	Description
99.1	Press Release of Sotherly Hotels Inc. dated June 7, 2017.

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: June 7, 2017	SOTHERLY HOTELS INC.
	By:	/s/ David R. Folsom
		David R. Folsom
		President and Chief Operating Officer
	SOTHERLY HOTELS LP
		by its General Partner,
		SOTHERLY HOTELS INC.
	By:	/s/ David R. Folsom
		David R. Folsom
		President and Chief Operating Officer

Exhibit Index

Exhibit Number	Description
99.1	Press Release of Sotherly Hotels Inc. dated June 7, 2017.

EX-99.1

Exhibit 99.1

WEDNESDAY, JUNE 7, 2017

SOTHERLY HOTELS INC. ENTERS INTO AGREEMENT TO PURCHASE

CONDO HOTEL COMMERCIAL UNIT

Williamsburg, Virginia – June 7, 2017 – Sotherly Hotels Inc. (NASDAQ: SOHO) (the “Company”) today announced that the Company has entered into an agreement (the “Agreement”) to purchase the commercial unit of the planned Hyde Beach House Resort & Residences (the “Planned Hotel”) under development in Hollywood, Florida for $5.10 million. The Agreement includes the purchase of the hotel commercial unit, which consists of the designated lobby and front desk areas, offices, and other spaces. In addition, the Company will enter into a lease for the parking garage and poolside cabanas of the Planned Hotel, as well as an agreement to operate and manage the condominium association.  The Agreement also includes a Pre-Opening Services Agreement whereby the Seller has agreed to pay the Company $0.75 million in connection with certain pre-opening activities.

The Hyde Beach House Resort & Residences is a new development in Hollywood, Florida slated to open in the second quarter of 2019. The Planned Hotel is located adjacent to the Company’s Crowne Plaza Hollywood Beach Resort and directly across from the Hyde Resort & Residences.

The 342-unit condominium-hotel consists of 265 use-restricted units and 77 residences that feature one, two and three bedroom layouts. The property will feature luxury amenities that include an expansive pool deck with infinity edge pool, Sports Club and Aqua Club offering watersports on the Intracoastal Waterway.

Drew Sims, Chief Executive Officer of the Company, commented, “This transaction represents the final phase of a value creation strategy we have envisioned since we initially commenced our investment into the South Florida market. Once completed, this will be a unique complex that offers a tremendous variety of product offerings and amenities for our guests while providing the ability to fully implement and take advantage of operational efficiencies and sales and marketing synergies.

About Sotherly Hotels Inc.

Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the Southern United States. Currently, the Company’s portfolio consists of investments in eleven hotel properties, comprising 2,838 rooms, and an interest in the Hyde Resort & Residences, a luxury condo hotel. Most of the Company’s properties operate under the Hilton Worldwide, InterContinental Hotels Group and Marriott International, Inc. brands. Sotherly Hotels Inc. was organized in 2004 and is headquartered in Williamsburg, Virginia. For more information, please visit www.sotherlyhotels.com.

Contact at the Company:

Scott Kucinski

Vice President – Operations and Investor Relations

Sotherly Hotels Inc.

410 West Francis Street

Williamsburg, Virginia 23185

(757) 229-5648