Sotherly Hotels Inc. 8-K

What Happened
Sotherly Hotels Inc. (the Company) filed an 8‑K on March 27, 2026 reporting three material actions: (1) it notified Nasdaq of the Board’s approval to voluntarily withdraw the listing of its Series B, C and D preferred stock and expects to file Form 25 on or about April 7, 2026 with last trading around April 17, 2026; (2) Sotherly Hotels, LP (the Operating Partnership) entered a Consulting Agreement with KWC Management, LLC effective February 12, 2026 (executed March 24, 2026) for management services; and (3) following the February 27, 2026 merger/Change of Control, holders exercised Change of Control conversion rights and the Company cancelled preferred shares in exchange for cash payments on March 25, 2026.

Key Details

• Consulting agreement: Sotherly Hotels, LP and KWC Management, LLC; initial 12‑month term through Feb 11, 2027 with automatic one‑year renewals unless timely terminated.
• Consulting fee: Asset management fee set at an annualized $650,000 for the initial term, payable monthly in advance; reimburses reasonable out‑of‑pocket expenses.
• Delisting timetable: Notice to Nasdaq filed March 27, 2026; Form 25 expected on/around April 7, 2026; last Nasdaq trading day expected on/around April 17, 2026.
• Preferred conversions & payments: Holders tendered and the Company cancelled 1,188,042 Series B, 1,202,415 Series C and 820,066 Series D shares and paid $22,164,952 (B), $23,005,385 (C) and $13,647,549 (D) respectively — total cash paid ≈ $58,817,886 on March 25, 2026.

Why It Matters
These actions materially affect holders of the Company’s preferred stock: the voluntary delisting and expected deregistration will reduce liquidity and public trading access for the Series B, C and D preferred shares. The company has already settled Change of Control conversion rights, reducing preferred share counts and paying roughly $58.8 million in cash. Separately, the new consulting agreement with KWC establishes a paid management relationship (initially $650k/year) for specified assets, which could affect operating oversight and fees for the Operating Partnership. Investors should note the merger/Change of Control context behind the conversions and monitor the Form 25 filing and any related press releases for further details.