SOHON Sotherly Hotels Inc

Item 1.01Entry into a Material Definitive Agreement.

As previously reported by Sotherly Hotels Inc. (“the Company”) on a Current Report on Form 8-K filed with the Securities and Exchange Commission on November 30, 2021 (the “Original Form 8-K”), Raleigh Hotel Associates, LLC, a Delaware limited liability company and an affiliate of the Company (the “Seller”), entered into a real estate sale agreement (the “Sale Agreement”) to sell the DoubleTree by Hilton Raleigh-Brownstone University hotel located in Raleigh, North Carolina (the “Hotel”) to CS Acquisition Vehicle, LLC, a Delaware limited liability company (the “Buyer”).  As also previously reported by the Company, on February 28, 2022, the Seller and the Buyer entered into a First Amendment to the Sale Agreement pursuant to which: (i) the due diligence period expired effective upon the execution of the First Amendment; (ii) the Buyer’s earnest money deposit in the amount of $800,000 in cash was required to be deposited with the escrow agent no later than March 2, 2022; and (iii) the closing date was set for no later than May 2, 2022, subject to extension by the Buyer for up to 30 days in exchange for an additional cash deposit of $800,000.  The Buyer exercised that option to extend the closing for an additional 30 days, to June 1, 2022, in exchange for the required cash deposit of $800,000.

On May 23, 2022, the Seller and the Buyer entered into a Second Amendment to the Sale Agreement pursuant to which: (i) the closing date was extended to June 10, 2022; (ii) the earnest money currently held in escrow in the amount of $1.6 million is required to be released to the Seller; and (iii) the Buyer is required to make an additional earnest money deposit of $1.4 million with the escrow agent no later than May 25, 2022, which amount is then required to be released to the Seller within one business day.

As reported on the Original Form 8-K, the closing of the sale of the Hotel remains subject to various customary closing conditions, including the accuracy of representations and warranties through closing, and conditions related to the termination of Hotel agreements and leases.