Sotherly Hotels Inc. Announces Closing of Offering of Series D Cumulative Redeemable Perpetual Preferred Stock
April 18 2019 - 9:27AM
Sotherly Hotels Inc.
(NASDAQ: SOHO)
(the “Company”) today announced it has closed its previously
announced underwritten public offering of 1,080,000 shares of its
8.25% Series D Cumulative Redeemable Perpetual Preferred Stock (the
“Series D Preferred Stock”) for total gross proceeds of $27,000,000
before underwriting discounts and commissions and expenses payable
by the Company. The Company has granted the underwriters a 30-day
option to purchase up to an additional 162,000 shares of Series D
Preferred Stock to cover over-allotments, if any, at the public
offering price of $25.00 per share of the Series D Preferred Stock.
The Series D Preferred Stock has been approved for listing on the
NASDAQ under the symbol “SOHON” and trading is expected to commence
within 30 days of closing of the offering.
The Company contributed the net proceeds from
the offering to Sotherly Hotels LP, its operating partnership,
which intends to use the net proceeds to redeem in full the
operating partnership’s 7.25% Senior Unsecured Notes due 2021 and,
to the extent there are any remaining net proceeds, for general
corporate purposes, including potential future acquisitions of
hotel properties.
Sandler O'Neill + Partners, L.P. acted as active
book-runner for the offering. Janney Montgomery Scott acted as
passive book-runner. Boenning & Scattergood, Inc. and American
Capital Partners, LLC acted as co-managers. The offering was
conducted as a public offering under the Company’s and the
Operating Partnership’s jointly filed shelf registration statement
on Form S-3 filed with the Securities and Exchange Commission
(“SEC”) (File Nos. 333-220369 and 333-220369-01), which was
declared effective by the SEC on September 20, 2017. The
offering was made only by means of a prospectus supplement and
accompanying base prospectus. Copies of the prospectus supplement
and the accompanying base prospectus can be obtained from Sandler
O'Neill + Partners, L.P. at 1251 Avenue of the Americas, 6th Floor,
New York, New York 10020, Attention: Prospectus Department, or by
calling toll-free 1-866-805-4128, or by email at
syndicate@sandleroneill.com.
This press release shall not constitute an offer
to sell or the solicitation of any offer to buy, nor shall there be
any sale of these securities in any state or jurisdiction in which
such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
state or jurisdiction.
This press release includes “forward-looking
statements” within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Although the Company
believes that the expectations and assumptions reflected in the
forward-looking statements are reasonable, these statements are not
guarantees of future performance and involve certain risks,
uncertainties and assumptions which are difficult to predict and
many of which are beyond the Company's control.
Therefore, actual outcomes and results may
differ materially from what is expressed, forecasted or implied in
such forward-looking statements. Factors which could have a
material adverse effect on the Company's future results,
performance and achievements, include, but are not limited to:
national and local economic and business conditions that affect
occupancy rates and revenues at the Company's hotels and the demand
for hotel products and services; risks associated with the hotel
industry, including competition and new supply of hotel rooms,
increases in wages, energy costs and other operating costs; risks
associated with adverse weather conditions, including hurricanes;
the availability and terms of financing and capital and the general
volatility of the securities markets; the Company’s intent to
repurchase shares from time to time; risks associated with the
level of the Company's indebtedness and its ability to meet
covenants in its debt agreements and, if necessary, to refinance or
seek an extension of the maturity of such indebtedness or modify
such debt agreements; management and performance of the Company's
hotels; risks associated with maintaining the Company's system of
internal controls; risks associated with the conflicts of interest
of the Company’s officers and directors; risks associated with
redevelopment and repositioning projects, including delays and cost
overruns; supply and demand for hotel rooms in the Company's
current and proposed market areas; risks associated with the
Company's ability to maintain its franchise agreements with its
third party franchisors; the Company's ability to acquire
additional properties and the risk that potential acquisitions may
not perform in accordance with expectations; the Company's ability
to successfully expand into new markets; legislative/regulatory
changes, including changes to laws governing taxation of REITs; the
Company’s ability to maintain its qualification as a REIT; and the
Company's ability to maintain adequate insurance coverage. These
risks and uncertainties are described in greater detail in the
Company's registration statement, under “Risk Factors” in the
Company's Annual Report on Form 10-K and subsequent reports filed
with the SEC. The Company undertakes no obligation to and does not
intend to publicly update or revise any forward-looking statement,
whether as a result of new information, future events or otherwise.
Although the Company believes its current expectations to be based
upon reasonable assumptions, it can give no assurance that its
expectations will be attained or that actual results will not
differ materially.
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
twelve hotel properties, comprising 3,156 rooms, and an interest in
the Hyde Resort & Residences, a luxury condo hotel. Most of the
Company’s properties operate under the Hilton Worldwide, Hyatt
Hotels Corporation, 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 Sotherly Hotels Inc.410 West Francis
StreetWilliamsburg, Virginia 23185 (757) 229-5648
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