SOHON Sotherly Hotels Inc

Item 1.01 Entry into a Material Definitive Agreement.

On June 21, 2021, Sotherly Hotels Inc., a Maryland corporation (the “Company”), and the sole general partner of Sotherly Hotels LP, a Delaware limited partnership (the “Operating Partnership”) entered into a Share Exchange Agreement (the “Agreement”) with Palogic Value Fund, L.P., a Delaware limited partnership (“Palogic”).  Pursuant to the Agreement, Palogic agreed to exchange 100,000 shares of the Company’s 8.0% Series B Cumulative Redeemable Perpetual Preferred Stock, 85,000 shares of the Company’s 7.875% Series C Cumulative Redeemable Perpetual Preferred Stock, and 35,000 shares of the Company’s 8.25% Series D Cumulative Redeemable Perpetual Preferred Stock (the “Palogic Shares”), together with all of Palogic’s rights to receive accrued and unpaid dividends on those Palogic Shares, for 1,542,727 shares of the Company’s common stock, par value $0.01 per share (the “Company Shares”). Closing of the transactions contemplated by the Agreement is expected to occur by June 24, 2021.

The Company Shares will be issued in reliance on the exemption from registration set forth in Section 3(a)(9) of the Securities Act of 1933, as amended, for securities exchanged by an issuer with an existing security holder in a transaction where no commission or other remuneration was be paid or given directly or indirectly for soliciting such an exchange.

The foregoing information is a summary of the Agreement, does not purport to be complete, and is qualified in its entirety by reference to the full text of the Agreement attached as Exhibit 10.22 hereto.