Sotherly Hotels LP Prices $24.0 Million of 8.0% Senior Unsecured Notes Due 2018

  Sotherly Hotels LP Prices $24.0 Million of 8.0% Senior Unsecured Notes Due

Business Wire

WILLIAMSBURG, Va. -- September 25, 2013

S^oTHERLY Hotels Inc. (NASDAQ:SOHO) (the“Company”)  today announced that its
Operating Partnership, Sotherly Hotels LP, a Delaware limited partnership (the
“Operating Partnership”), has priced an underwritten public offering of $24.0
million of 8.0% senior unsecured notes due 2018 (the “Notes”). In addition,
the Operating Partnership has granted the underwriters a 30-day option to
purchase up to an additional $3.6 million aggregate principal amount of the
Notes solely to cover over-allotments, if any, at the public offering price,
less underwriting discounts and commissions. The Notes are expected to be
listed on the NASDAQ Global Market under the symbol "SOHOL."

The net proceeds of this offering are estimated to be approximately $22.5
million after deducting underwriting discounts and commissions and estimated
offering expenses, prior to any exercise of the underwriters’ over-allotment
option. The Company expects the Operating Partnership to use a portion of the
net proceeds from the offering to redeem 100% of the outstanding shares of the
Company’s 12% Series A Cumulative Redeemable Preferred Stock (the “Preferred
Stock”) plus any accrued but unpaid dividends and any make-whole amounts or
premium then due and payable on such Preferred Stock. The Company expects the
Operating Partnership to use the remaining net proceeds from the offering, if
any, for general corporate purposes. The offering is expected to close on
September 30, 2013, subject to customary closing conditions.

Sandler O'Neill + Partners, L.P. is acting as the sole book-runner of the
offering, and Boenning & Scattergood, Inc., Incapital LLC, J.J.B. Hilliard,
W.L. Lyons, LLC, and Ladenburg Thalmann & Co. Inc. are acting as co-managers.

The Securities and Exchange Commission (“SEC”) has declared a registration
statement (File No. 333-189821) (including a prospectus) relating to the Notes
effective. This offering is being made solely by means of a prospectus. A copy
of the final prospectus for the offering will be filed with the SEC.
Prospective investors should read the registration statement (including the
prospectus), the final prospectus relating to the offering (when available)
and the other documents the Operating Partnership has filed with the SEC for
more complete information about the Operating Partnership and this offering.
Investors may obtain these documents without charge by visiting the SEC
website at Alternatively, copies of the 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

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 disclosure includes “forward-looking statements” within the meaning of
Section27A of the Securities Act of 1933 and Section21E of the Securities
Exchange Act of 1934. 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,
increases in wages and other labor costs, energy costs and other operating
costs; the magnitude and sustainability of the economic recovery in the
hospitality industry and in the markets in which the Company operates; the
availability and terms of financing and capital and the general volatility of
the securities markets; 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 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; 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 Operating Partnership’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

About S^oTHERLY Hotels Inc.

S^oTHERLY Hotels Inc., formerly MHI Hospitality Corporation, is a self-managed
and self-administered lodging REIT focused on the acquisition, renovation,
upbranding and repositioning of upscale and upper upscale full-service hotels
in the Southern United States. Currently, the Company’s portfolio consists of
investments in ten hotel properties, nine of which are wholly-owned and
comprise 2,113 rooms. The Company also has a 25.0 percent interest in the
Crowne Plaza Hollywood Beach Resort. All of the Company’s properties operate
under the Hilton Worldwide, InterContinental Hotels Group and Starwood Hotels
and Resorts brands. S^oTHERLY Hotels Inc.  was organized in 2004 and is
headquartered in Williamsburg, Virginia. For more information, please visit


S^oTHERLY Hotels Inc.
Scott Kucinski, 757-229-5648
Director - Investor Relations
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