DEF 14A

 Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

 Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

On behalf of the board of directors and management of Sotherly Hotels Inc. (the “Company” or “Sotherly”), I cordially invite you to attend the 2024 Annual Meeting of Stockholders (the “Annual Meeting”) to be held at the Williamsburg Community Building, 401 North Boundary Street, Williamsburg, Virginia 23185, on Tuesday, April 30, 2024 at 9:00 a.m., local time. The attached Notice of Annual Meeting and Proxy Statement describe the formal business to be transacted at the Annual Meeting. Directors and officers of the Company, as well as a representative of FORVIS, LLP, certified public accountants, are expected to be present to respond to any appropriate questions that you may have.

You will be asked to: (i) elect seven (7) Company directors; (ii) ratify the appointment of FORVIS, LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024; and (iii) hold an advisory and non-binding vote to approve executive compensation (“Say-on-Pay”). The board of directors has approved each of these proposals and its unanimous recommendations related to each are contained in the accompanying materials.

Your vote is important. Regardless of the number of shares you own and regardless of whether you plan to attend the Annual Meeting, I encourage you to read the enclosed proxy statement carefully and sign and return your enclosed proxy card, or follow the instructions to vote by internet or telephone, as promptly as possible because a failure to do so could cause a delay in the Annual Meeting and additional expense to the Company. A postage-paid return envelope is provided for your convenience. This will not prevent you from voting in person, but it will assure that your vote will be counted if you are unable to attend the Annual Meeting. If you do decide to attend the Annual Meeting and feel for whatever reason that you want to change your vote at that time, you will be able to do so. If you are planning to attend the Annual Meeting, please let us know by marking the appropriate box on the proxy card.

NOTICE IS HEREBY GIVEN that the 2024 Annual Meeting of Stockholders (the “Annual Meeting”) of Sotherly Hotels Inc. (the “Company” or “Sotherly”), will be held at Williamsburg Community Building, 401 North Boundary Street, Williamsburg, Virginia 23185, on Tuesday, April 30, 2024 at 9:00 a.m., local time, for the following purposes:

2. To ratify the appointment of FORVIS, LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024;

3. To hold an advisory and non-binding vote to approve executive compensation (“Say-on-Pay”); and

4. To transact such other business as may properly come before the Annual Meeting and any adjournments thereof.

The board of directors is not aware of any other business to come before the Annual Meeting. Stockholders of record at the close of business on March 1, 2024 are the stockholders entitled to notice of and to vote at the Annual Meeting and any adjournments thereof. To obtain directions to attend the Annual Meeting and vote in person, please call Investor Relations at (757) 229-5648.

YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES YOU OWN. WE ENCOURAGE YOU TO VOTE BY PROXY SO THAT YOUR SHARES WILL BE REPRESENTED AND VOTED AT THE ANNUAL MEETING EVEN IF YOU CANNOT ATTEND. ALL STOCKHOLDERS OF RECORD CAN VOTE BY WRITTEN PROXY CARD, BY TELEPHONE AT 1-800-690-6903, OR OVER THE INTERNET AT WWW.PROXYVOTE.COM. HOWEVER, IF YOU ARE A STOCKHOLDER WHOSE SHARES ARE NOT REGISTERED IN YOUR OWN NAME, YOU WILL NEED ADDITIONAL DOCUMENTATION FROM YOUR RECORD HOLDER TO VOTE IN PERSON AT THE ANNUAL MEETING. PURSUANT TO A NEW YORK STOCK EXCHANGE (“NYSE”) RULE APPLICABLE TO NYSE-MEMBER BROKERS, IF YOUR SHARES ARE HELD BY YOUR BROKER AND YOU DO NOT GIVE YOUR BROKER VOTING INSTRUCTIONS, YOUR SHARES WILL NOT BE VOTED IN CONNECTION WITH MATTERS DEEMED BY THE NYSE TO BE “DISCRETIONARY.” SUCH MATTERS INCLUDE, BUT ARE NOT LIMITED TO, THE ELECTION OF DIRECTORS AND MATTERS RELATING TO EXECUTIVE COMPENSATION.

The proxy statement and annual report to security holders are available on our website at www.sotherlyhotels.com.

IMPORTANT: PLEASE READ THE PROXY STATEMENT AND THEN PROMPTLY INDICATE YOUR VOTING INSTRUCTIONS: (1) BY TELEPHONE BY CALLING 1-800-690-6903; (2) OVER THE INTERNET AT WWW.PROXYVOTE.COM; OR (3) BY COMPLETING, SIGNING AND DATING THE ENCLOSED PROXY CARD AND RETURNING IT WITHOUT DELAY IN THE ENCLOSED ENVELOPE.

This Proxy Statement is furnished in connection with the solicitation of proxies by the board of directors (the “Board”) of Sotherly Hotels Inc. (the “Company”, “Sotherly”, “we”, “us” or “our”), which is the sole general partner of Sotherly Hotels LP (the “Operating Partnership”), to be used at the 2024 Annual Meeting of Stockholders which will be held at Williamsburg Community Building, 401 North Boundary Street, Williamsburg, Virginia 23185, on Tuesday, April 30, 2024 at 9:00 a.m., local time (the “Annual Meeting”). The accompanying Notice of Annual Meeting of Stockholders and this Proxy Statement are being mailed to stockholders on or about March 27, 2024.

All properly executed written proxies that are delivered pursuant to this proxy statement will be voted on all matters that properly come before the Annual Meeting for a vote. If your signed proxy specifies instructions with respect to matters being voted upon, your shares will be voted in accordance with your instructions. If no instructions are specified, your shares will be voted (a) “FOR ALL” Proposal I (election of directors); (b) “FOR” Proposal II (ratification of the Company’s independent registered public accounting firm for fiscal year 2024); (c) “FOR” Proposal III (approval, on an advisory and non-binding basis, of the compensation of the Company’s executive officers whose compensation is disclosed in this proxy statement (“Say-on-Pay”)); and (d) in the discretion of the proxy holders, as to any other matters that may properly come before the Annual Meeting. Your proxy may be revoked at any time prior to being voted by: (i) filing with the Company’s Corporate Secretary (Anthony E. Domalski, at 306 S Henry Street, Suite 100, Williamsburg, Virginia 23185) written notice of such revocation; (ii) submitting a duly executed proxy bearing a later date; or (iii) attending the Annual Meeting and giving the Corporate Secretary notice of your intention to vote in person. Voting by telephone, Internet or mail will not prevent you from later revoking that proxy and voting in person at the Annual Meeting.

The record date is the close of business on March 1, 2024 (the “Record Date”) for the determination of stockholders who are entitled to notice of, and to vote at, the Annual Meeting. On the Record Date, there were 19,849,165 shares of the Company’s common stock, $0.01 par value, outstanding. Each stockholder of record on the Record Date is entitled to one vote for each share held.

The presence in person or by proxy of at least thirty-three and one-third percent of the outstanding shares of common stock entitled to vote is necessary to constitute a quorum at the Annual Meeting. Shares represented by proxies received by the Company but marked as abstentions, if any, will be included in the calculation of the number of shares considered to be present at the meeting. Proxies received by the Company that reflect “broker non-votes” (i.e., proxies relating to shares held by brokers or other nominees as to which instructions have not been received from the beneficial owners or persons entitled to vote such shares and with respect to which, on one or more but not all matters, the broker or nominee does not have discretionary voting power to vote such shares) will be counted for purposes of determining whether a quorum is present for the transaction of business at the Annual Meeting. In the event there are not sufficient votes for a quorum or to ratify any proposals at the time of the Annual Meeting, the Annual Meeting may be adjourned to another date, time or place, not later than 120 days after the original record date of March 1, 2024, without notice other than announcement at the meeting, in order to permit the further solicitation of proxies.

We need your vote. Our stockholders are always encouraged to review the proxy materials and vote their shares. Under New York Stock Exchange (“NYSE”) Rule 452, brokers who are voting with respect to shares held in street name have the discretion to vote such shares on routine matters but not on non-routine matters (so called “discretionary” matters), which include the election of directors and matters relating to executive compensation. For purposes of Proposals I and III, proxies received by the Company that reflect abstentions and broker non-votes, if any, will not be counted as votes cast and will have no effect on the result of the vote, although they will be considered present for the purpose of determining the presence of a quorum.

As to the election of directors, the enclosed proxy enables a stockholder to vote “FOR ALL” the election of the nominees proposed by the Board, or to withhold authority to vote for the nominee being proposed. Directors are elected by a plurality of votes of the shares present in person or represented by proxy at a meeting and entitled to vote in the election of directors.

As to the ratification of the independent registered public accounting firm and the advisory vote to approve executive compensation, which are submitted as Proposals II and III respectively, a stockholder may: (i) vote “FOR” the proposal; (ii) vote “AGAINST” the proposal; or (iii) “ABSTAIN” with respect to the proposal.

Unless otherwise required by law, Proposal II shall be determined by a majority of votes cast affirmatively or negatively without regard to proxies marked “ABSTAIN” as to that matter. Unless otherwise required by law, Proposals III and all other matters, shall be determined by a majority of votes cast affirmatively or negatively without regard to (a) broker non-votes or (b) proxies marked “ABSTAIN” as to that matter.

While the Board intends to carefully consider the stockholder votes resulting from Proposal III, the final vote will not be binding on us and is advisory in nature. It will be up to our Nominating, Corporate Governance and Compensation Committee (the “NCGC Committee”) and Board to determine whether and how to implement the vote on Proposal III.

The following table sets forth the beneficial ownership, as of March 15, 2024, of (i) shares of the Company's common stock for each person or group known to us to be holding more than 5.0% of the number of shares of common stock outstanding, (ii) shares of common stock for each director and named executive officer, and (iii) for the directors and named executive officers of the Company as a group. None of the named executive officers has pledged any of their common shares as collateral. As of March 15, 2024, the Company had outstanding 19,849,165 shares of its common stock, $0.01 par value per share. The table shows the number of shares of common stock and number of partnership interests or units in the Operating Partnership the person “beneficially owns,” as determined by the rules of the Securities and Exchange Commission (the "Commission"). The Operating Partnership is controlled by the Company as its sole general partner. The Operating Partnership is obligated to redeem each unit at the request of the holder thereof for the cash value of one share of common stock or, at the Company’s option, one share of common stock.

* Represents less than 1% of the number of shares of common stock of the Company.

(1)

Unless otherwise indicated, the named stockholders have sole voting power with respect to all shares shown as being beneficially owned by them. Includes all restricted stock awards, including those that will vest at a later date.

(3)

Includes 793,937 shares held by the family limited partnership of Andrew M. Sims. Includes 67,969 shares held in the Company’s Employee Stock Ownership Plan (the “ESOP”) and allocated to Mr. Sims subject to the terms of the ESOP. Includes 45,000 shares of unvested restricted common stock granted under the 2022 Long-Term Incentive Plan (the "2022 Plan") pursuant to Mr. Sims' current employment agreement with us that vest in equal amounts of 15,000 shares on March 31, 2025, March 31, 2026, and March 31, 2027.

(4)

Based on information set forth in a Schedule 13G filed with the Securities and Exchange Commission on January 8, 2024, Rollins Capital Partners, LP, Rollins Capital LLC, Rollins Capital Management LLC, and John A. Wright have shared voting and dispositive power over 1,097,000 shares. The address of each of Rollins Capital Partners, LP, Rollins Capital LLC, Rollins Capital Management LLC, and John A. Wright is 600 Congress Street, 14th Floor, Austin, Texas 78701.

(5)

Includes 30,000 shares of unvested restricted common stock granted under the 2013 Long-Term Incentive Plan pursuant to Mr. Folsom’s current employment agreement with us that vest upon the earlier of December 31, 2024 or certain other conditions. Includes 69,694 shares held by the David R. Folsom Revocable Trust. Includes 67,969 shares held in the Company’s ESOP and allocated to Mr. Folsom subject to the terms of the ESOP. Includes 22,800 shares of unvested restricted common stock granted under the 2022 Plan pursuant to Mr. Folsom's current employment agreement with us that vest in equal amounts of 7,600 shares on March 31, 2025, March 31, 2026, and March 31, 2027.

(6)

Includes 67,969 shares held in the Company’s ESOP and allocated to Mr. Domalski subject to the terms of the ESOP. Includes 20,400 shares of unvested restricted common stock granted under the 2022 Plan pursuant to Mr. Domalski's

The following table sets forth the beneficial ownership, as of March 15, 2024, of shares of each class of our preferred stock that is issued and outstanding for each director and named executive officer.

* Represents less than 1% of the number of shares of the relevant class of the Company’s stock.

Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s directors and executive officers and the beneficial owners of more than 10.0% of the common stock to file reports of ownership and changes in ownership of equity securities of the Company with the Commission and to furnish the Company with copies of such reports. To the best of our knowledge, all of the filings by the Company’s directors and executive officers were made on a timely basis during the 2023 fiscal year. We are not aware of any beneficial owners of more than 10.0% of our common stock other than as disclosed in the Principal Holders Table.

The directors of the Company are elected by the stockholders annually. The Board currently consists of seven (7) members. Each director’s term of office expires at the Annual Meeting. Each of the individuals named below has been nominated for election by holders of our common stock to the Board at the Annual Meeting to hold office until the 2025 annual meeting of stockholders and until their successors are elected and qualified.

David R. Folsom, Andrew M. Sims, Maria L. Caldwell, G. Scott Gibson IV, Walter S. Robertson III, Herschel J. Walker, and General Anthony C. Zinni (the “Nominees”), have been nominated by the Board, as recommended by our NCGC Committee, for terms of one (1) year each.

The persons named as proxies in the enclosed proxy card intend to vote “FOR ALL” the election of the Nominees, unless the proxy card is marked to indicate that such authorization is expressly withheld. Should one or more of the Nominees withdraw or be unable to serve (which the Board does not expect) or should any other vacancy occur in the Board, it is the intention of the persons named in the enclosed proxy card to vote “FOR ALL” the election of such persons as may be recommended by the NCGC Committee and the Board. If there are no substitute nominees, the size of the Board may be reduced.

Directors are elected by a plurality of votes of the shares present in person or represented by proxy at a meeting and entitled to vote in the election of directors. For purposes of the election of directors, abstentions and broker non-votes, if any, will not be counted as votes cast and will have no effect on the result of the vote, although they will be considered present for the purpose of determining the presence of a quorum. If your shares are held by your broker and you do not give your broker voting instructions, your shares will not be voted on Proposal I.

The principal business experience of each Nominee and executive officer of the Company is set forth below. The biographical information below also includes, for each Nominee, the particular experience, qualifications, attributes or skills that led the Board to nominate such Nominee to serve as a director of the Company.

David R. Folsom is Sotherly’s President and Chief Executive Officer. He was appointed to the position of President in January 2011 and to the position of Chief Executive Officer in January 2020. Mr. Folsom was appointed as a director in 2011. As Chief Executive Officer, Mr. Folsom is responsible for developing and implementing Sotherly’s strategic business plan and managing all aspects of the Sotherly’s business. Prior to his appointment as Chief Executive Officer, Mr. Folsom served as Sotherly’s Chief Operating Officer since 2006. Prior to joining Sotherly, Mr. Folsom was Vice President of Paragon Real Estate, a Cleveland-based early stage real estate venture focusing on distressed multi-family assets in 2005. From 2001 to 2005, he was an investment banker with BB&T Capital Markets, where he served in the Real Estate Securities Group and Debt Capital Markets Groups. While at BB&T, Mr. Folsom participated in over 70 equity, debt and preferred stock underwritings, as well as financial advisory transactions across many industries. He was a member of the lead underwriting team that took Sotherly public in 2004. Mr. Folsom served as a commissioned officer in the U.S. Marine Corps, is a graduate of the U.S. Naval Academy and received a master of business administration degree from Georgetown University. In 2012, Mr. Folsom also acted as an adjunct professor at the College of William and Mary. He is also a director of The Sotherly Foundation, a charitable foundation established by Sotherly to provide assistance to veterans.

The Board concluded that Mr. Folsom has the relevant professional experience and skills to serve as director of the Sotherly because of his current positions as President and Chief Executive Officer of Sotherly, his past experience as Chief Operating Officer of Sotherly, as well as his past investment banking and real estate financing experience.

Andrew M. Sims is Sotherly’s Chairman of the Board and has served in such capacity since its inception in August 2004. In addition, Mr. Sims served as Sotherly’s Chief Executive Officer from our inception through December 31, 2019, and as President from our inception through December 31, 2010. He served as President of MHI Hotels Services LLC, which does business as Chesapeake Hospitality (“Chesapeake Hospitality”) from 1995 until August 2004 after serving for seven years as Vice President of Finance and Development. As President of Chesapeake Hospitality, Mr. Sims oversaw company operations as well as the areas of accounting and finance, marketing, development and franchise relations. Mr. Sims has a bachelor of science degree in commerce from Washington & Lee University.

The Board concluded that Mr. Sims has the relevant professional experience and skills to serve as director of Sotherly because he has spent over forty years in the hospitality industry and has experience operating, developing and owning hotel properties. Mr. Sims has held several positions in hotel management, including President of the hotel management company, Chesapeake Hospitality. Most recently, while he served as Chief Executive Officer, Mr. Sims developed and expanded our hotel portfolio and managed franchise, banking and third party service-provider relations. Mr. Sims’ employment agreement with Sotherly provides that Sotherly must nominate him to serve as a director and, subject to his election as a director, serve as Chairman of the Board.

Maria L. Caldwell became a director of Sotherly in 2019 and is a member of Sotherly’s Audit Committee. Ms. Caldwell is the Chief Legal Officer and Director of Compliance Services of the National Association of State Boards of Accountancy (NASBA), a 110-year-old non-profit corporation that serves as a forum for the 55 boards of accountancy charged with regulating the CPA profession, and has served in that capacity and others since 2003. From 1996 to 1999 Ms. Caldwell served as the General Counsel for Sirrom Capital Corporation, where she managed Sirrom’s initial public offering, numerous follow-on public equity and debt offerings, and an aggregate of over $300 million in private loan closings. In addition, she developed and managed the corporate governance program, managed SEC reporting and investor relations, and advised Sirrom’s board on a range of matters. Ms. Caldwell has also practiced law with both Bass, Berry & Sims and Gibson, Dunn & Crutcher in the areas of securities law, mergers and acquisitions, real estate, and corporate law. Ms. Caldwell is a current member of the Tennessee Bar and a former member of the State Bar of California. She received a juris doctor degree from Duke University School of Law and a bachelor of arts degree in economics from Fairfield University.

The Board concluded that Ms. Caldwell has the relevant professional experience and skills to serve as director of Sotherly because of her 22 years of experience as general counsel of publicly traded and international non-profit companies, including broad transactional, functional and regulatory experience in real estate acquisition and financing, as well as public equity and debt offerings.

G. Scott Gibson IV, Ph.D., became a director of Sotherly in 2017 and is chair of Sotherly’s Audit Committee. Mr. Gibson joined the faculty of the William and Mary Mason School of Business in 2005, where he is currently the K. Dane Brooksher Professor of Business. From 2001 until 2005, he was a professor at the Cornell University School of Hotel Administration, where he continues as an online executive education instructor. Since 2005, he has served on the editorial board of Cornell Hotel and Restaurant Administration Quarterly. His research interests include hospitality financing strategies, real estate investment trusts, investor targeting, and conflicts of interest in the delegated investment management industry. His research has appeared in leading hospitality, real estate, and finance journals and in the financial press, including the Wall Street Journal, Financial Times, New York Times, Barons, Business Week, and Bloomberg. He was a professor at the University of Minnesota Carlson School of Management from 1996 to 2001. Prior to his academic career, he worked as an analyst with Fidelity Investments from 1987 to 1988 and as a credit team leader serving Fortune 500 clientele with HSBC Bank from 1988 to 1991. He has a bachelor of science degree in finance from Boston College and a doctor of philosophy in finance from Boston College.

The Board concluded that Mr. Gibson has the relevant professional experience and skills to serve as director of Sotherly because of his academic career focusing on the hospitality and REIT sectors for over 17 years, including extensive published research in these fields.

Walter S. Robertson III is Managing Director and Director of Strategic Development for Brockenbrough, an independent financial services firm. He is primarily responsible for leading client development, client relations, and marketing efforts for the firm's clients. Walter also sits on the firm's five person executive committee and has over 45 years investment experience. Prior to joining Brockenbrough in 2016, Walter served as President and Chief Operating Officer of Sterne Agee and Leach, Inc. He also served as CEO, COO and President of the Private Client Group at BB&T/Scott & Stringfellow from 2001-2012. From 1998 to 2001, Walter served as a Senior Executive Officer, a member of the Executive Committee, and a member of the Board of BB&T Insurance, Inc. Walter holds a B.A. in History from Washington and Lee University. Additionally, Walter has served on dozens of business, philanthropic and institutional Boards as a Director and leader. He currently sits on the Board of the Colonial Williamsburg Foundation, The Boys and Girls Club of Richmond Foundation, The American Civil War Museum, St. Christopher's School, and Westminster Canterbury Foundation.

The Board concluded that Mr. Robertson has the relevant professional experience and skills to serve as director of Sotherly because of his extensive experience and executive positions at well-known and respected financial firms.

Herschel J. Walker became a director of Sotherly in 2015 and is a member of Sotherly’s NCGC Committee. Mr. Walker is the founder of H. Walker Enterprises, LLC and its subsidiary, Renaissance Man Food Services, LLC, a certified Minority Business Entity, and has served as Chief Executive Officer of each business since 2002. As Chief Executive Officer of H. Walker Enterprises, Mr. Walker oversees a broad line of products on a national level. He is also a recognized motivational speaker on a variety of business related topics for Fortune 500 companies and regional chapters of the National Minority Supplier Development Council. Mr. Walker played football for the University of Georgia from 1980 to 1982, where he was a three-time All American and a recipient of the Heisman Trophy. In 1999, he was inducted into the College Football Hall of Fame. During Mr. Walker’s professional football career from 1983 to 1997, he played for the New Jersey Generals, Dallas Cowboys, Minnesota Vikings, Philadelphia Eagles, and New York Giants, and was selected to the USFL All-Star team in 1985 and the NFL Pro-Bowl in 1987 and 1988. In addition to his football career, Mr. Walker was a member of the two-man U.S. bobsled team for the 1992 Winter Olympics, and is undefeated in professional mixed martial arts. In 2022, Mr. Walker was inducted into the prestigious Horatio Alger Association of Distinguished Americans, a nonprofit educational organization honoring achievements of outstanding individuals and encouraging youth to pursue their dreams.

The Board concluded that Mr. Walker has the relevant professional experience and skills to serve as director of Sotherly because of his significant work ethic and accomplishments across many disciplines, including the successful leadership of H. Walker Enterprises.

General Anthony C. Zinni became a director of Sotherly in December 2004 upon completion of its initial public offering and is a member of Sotherly’s NCGC Committee. General Zinni served as a director at BAE Systems from 2001 to 2014, and served as Chief Executive Officer on an interim basis during 2009. General Zinni also served as a director of DynCorp International from 2006-2008 and served as the Executive Vice President of DynCorp International, from July 2008-December 2008. He retired from the U.S. Marine Corps after 39 years of service in October 2000. During his military career, General Zinni served as the Commanding General, First Marine Expeditionary Force from 1994 to 1996, and as Commander-in-Chief, U.S. Central Command from 1997 to 2000. General Zinni has participated in numerous humanitarian operations and Presidential diplomatic missions. In November 2001, General Zinni was appointed senior adviser and U.S. envoy to the Middle East by Secretary of State Colin Powell. Since November 2000, General Zinni has consulted in the areas of defense, military, national security, foreign policy and regional issues. Since 2008, he has served as a professor at Cornell University. In 2008, he also served as a professor at Duke University. General Zinni received a bachelor of arts degree in economics from Villanova University. He also earned a master of arts degree in international relations from Salve Regina College, a master of science degree in management and supervision from Central Michigan University, and honorary doctorate degrees from both the College of William and Mary and the Marine Maritime Academy.

The Board concluded that General Zinni has the relevant professional experience and skills to serve as director of Sotherly because he is a skilled and experienced leader who has a strong background in corporate governance. General Zinni’s leadership experience includes almost forty years in the U.S. Marine Corps and, more recently, as a director and executive officer of BAE Systems and DynCorp International, two large global security and defense public companies. General Zinni has served on four private company boards in addition to his public company board involvement.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR ALL” THE ELECTION OF THE ABOVE NOMINEES.

Anthony E. Domalski, age 62, is Sotherly’s Vice President, Secretary, and Chief Financial Officer, the latter being a position to which he was appointed as of January 1, 2013. Prior to this role, Mr. Domalski served as Sotherly’s Chief Accounting Officer since May 2005. He joined Sotherly in May 2005 and was appointed an officer by the Board in July 2006. A certified public accountant, he is responsible for financial analysis, cash management, investment, risk management and financial and tax reporting. From 2001 to 2005, Mr. Domalski served as Chief Financial Officer for SwissFone, Inc., a Washington, D.C. based telecommunications company, where he assisted in a management-led buyout of the U.S. international wholesale division from Swisscom, AG. Prior to his tenure at SwissFone, Inc., Mr. Domalski held several other senior financial positions in the telecommunications and hospitality industry and spent nine years at a local public accounting firm. Mr. Domalski is a member of the American Institute of Certified Public Accountants. Mr. Domalski received a bachelor of science degree in accounting and finance from the University of Maryland.

Scott M. Kucinski, age 42, is Sotherly’s Executive Vice President and Chief Operating Officer, a position to which he was appointed as of January 1, 2020. Mr. Kucinski joined the Company in 2004 as Development Analyst, and since 2014 has served as the Company’s Vice President – Operations and Investor Relations. In that role, he has helped oversee the Company’s corporate operations activities including capital markets transactions, acquisitions and dispositions, asset management, investor relations, and compliance matters. Mr. Kucinski received a bachelor of arts degree from Washington and Lee University and holds a masters of business administration degree from the Mason School of Business at the College of William and Mary.

Below is the Board Diversity Matrix showing the composition of the Company’s board of directors as March 15, 2024:

The Board conducts its business through meetings of the Board and through its committees. The Board has two (2) standing committees: the NCGC Committee and an Audit Committee. During the fiscal year ended December 31, 2023, the Board held four (4) regular meetings and zero (0) special meetings. No incumbent director of the Company attended fewer than 75% of the total meetings of the Board and committee meetings on which such Board member served during this period. All of the Company’s directors, except for directors Stein and Gibson, attended the Company’s 2023 annual meeting of stockholders either in person or videophonically.

All of the members of the Audit Committee and the NCGC Committee and a majority of the Board must meet the test of “independence” as defined by the listing standards of the NASDAQ® Stock Market ("NASDAQ"). The NASDAQ standards provide that to qualify as an “independent” director, in addition to satisfying certain bright-line criteria, the Board has a responsibility to make an affirmative determination that a director has no relationship with the Company (either directly or as a partner, stockholder or officer of an organization that has a relationship with the Company) that would interfere with the exercise of independent judgment. The Board has determined that each of directors Caldwell, Gibson, Stein, Walker and Zinni, as well as director nominee Robertson, satisfies the bright-line criteria and that none has a relationship with the Company that would interfere with such person’s ability to exercise independent judgment as a member of the Board. Therefore, we believe that each of such directors is independent under the NASDAQ rules.

The NCGC Committee is currently comprised of directors Stein, Walker and Zinni. Director Edward S. Stein is not standing for re-election to the board of directors and his term as director of the Company will expire at the conclusion of the 2024 Annual Meeting. The Company anticipates that director nominee Walter S. Robertson III will begin serving on the NCGC Committee subject to his election to the board of directors. All members of the NCGC Committee are independent in accordance with the listing standards of the NASDAQ. This standing committee determines the salary for the Chairman of the Board, the President and Chief Executive Officer, the Executive Vice President and Chief Operating Officer, the Vice President and Chief Financial Officer, and the General Counsel. The purpose of the NCGC Committee is to make recommendations to the Board regarding corporate governance policies and practices, recommend criteria for membership on the Board, make recommendations to the Board of potential director nominees, make recommendations to the Board concerning the membership, size and responsibilities of each of the committees, develop general policies relating to compensation and benefits, determine compensation for, and evaluate the performance of, our executive officers and administer our 2022 Plan. The NCGC Committee met one (1) time during fiscal year 2023. The NCGC Committee has adopted a written charter that was reviewed and approved on October 30, 2023 and sets forth the specific functions and responsibilities of the committee. The NCGC Committee reviews and assesses the adequacy of its written charter on an annual basis. The NCGC Committee charter is available on our website at www.sotherlyhotels.com.

The Audit Committee, a standing committee, is currently comprised of directors Gibson, Caldwell and Stein. The Board has determined that G. Scott Gibson, chairman of the Audit Committee, qualifies as an “audit committee financial expert” as defined in Item 407(d)(5) of Regulation S-K. Director Edward S. Stein is not standing for re-election to the board of directors and his term as director of the Company will expire at the conclusion of the 2024 Annual Meeting. The Company anticipates that director nominee Walter S. Robertson III will begin serving on the Audit Committee subject to his election to the board of directors. All members of the Audit Committee are independent in accordance with the listing standards of the NASDAQ. The Audit Committee meets with the Company's independent registered public accounting firm to discuss the annual audit and any related matters. The Audit Committee is further responsible for internal controls over financial reporting. The Audit Committee met eleven (11) times in fiscal year 2023. The Audit Committee has adopted a written charter that was reviewed and approved on October 30, 2023 and sets forth the specific functions and responsibilities of the committee. The Audit Committee charter is available on our website at www.sotherlyhotels.com.

The Chief Financial Officer has responsibility for the day-to-day risk management functions of the Company and reports directly to the Audit Committee regarding issues related to risk management for the Audit Committee’s review and assessment. The Audit Committee meets with the Chief Financial Officer to review and discuss the Company’s risk management and related policies and procedures. The Audit Committee meets as often as and to the extent that the Audit Committee deems necessary or appropriate, but at least annually in connection with the audit of each fiscal year’s financial statements.

Additionally, the charters of the Board’s committees delegate to the committees various elements of the Board’s risk oversight responsibility. For example, our Audit Committee is responsible for periodically inquiring of management, our internal audit consultants and the independent auditors about the Company’s major financial and operational risks or exposures (including cyber-related risks); discussing the steps management has taken to monitor and control such exposures; and discussing guidelines and policies with respect to risk assessment and risk management. Our NCGC Committee oversees risks associated with our corporate governance guidelines; our executive compensation plans and arrangements; and our code of business conduct, including compliance with listing standards for independent directors, committee assignments and conflicts of interest. All these risks are discussed with the entire Board as often as and to the extent that the committees deem necessary or appropriate.

For the fiscal year ended December 31, 2023, the Audit Committee: (i) reviewed and discussed the audited financial statements with management, (ii) discussed with the Company’s independent registered public accounting firm, FORVIS, LLP, all matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”) and the

Commission, and (iii) received the written disclosures and letter from FORVIS, LLP required by the applicable requirements of the PCAOB regarding FORVIS, LLP’s communications with the Audit Committee concerning independence and discussed with FORVIS, LLP its independence. Based on the foregoing review and discussions, the Audit Committee recommended to the Board that the audited financial statements be included in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2023 for filing with the Commission.

The Board is responsible for assembling for stockholder consideration a group of nominees that, taken together, have the experience, qualifications, attributes and skills appropriate for functioning effectively as a board. The NCGC Committee works with the Board to determine the appropriate characteristics, skills and experience for the Board as a whole and its individual members with the objective of having a board with diverse backgrounds and experience and makes recommendations to the Board of potential nominees. When recommending candidates, the NCGC Committee assesses the Board’s size and composition; corporate governance policies; applicable listing standards and laws; individual director performance, expertise and willingness to serve actively; the number of other public and private company boards on which a director candidate serves; consideration of director nominees proposed or recommended by stockholders and related policies and procedures; and other appropriate factors. Characteristics expected of all directors include integrity, high personal and professional ethics, strong professional reputation and record of achievement, constructive and collegial personal attributes, sound business judgment and the ability and commitment to devote sufficient time and energy to board service. There are no minimum qualifications that the NCGC Committee has established for a candidate recommended to the Board by the NCGC Committee. The NCGC Committee does not have a diversity policy; however, the NCGC Committee seeks to include on the Board a complementary mix of individuals with diverse backgrounds and skills reflecting the broad set of challenges that the Board confronts. In evaluating the suitability of individual Board members, the NCGC Committee takes into account many factors, including general understanding of marketing and finance; understanding of our business; education and professional background; personal accomplishment; diversity of viewpoint; business expertise; and industry knowledge. The Board, through the NCGC Committee, evaluates each individual in the context of the Board as a whole, with the objective of recommending a group that can best perpetuate the success of our business and represent stockholder interests through the exercise of sound judgment using its diversity of experience. The NCGC Committee evaluates each incumbent director to determine whether such person should be nominated to stand for re-election, based on the types of criteria outlined above as well as the director’s contributions to the Board during the current term.

In recommending candidates to the Board, the NCGC Committee will consider nominees recommended by stockholders so long as the recommendation is submitted to our corporate secretary within the timeframe required to request a proposal that will be included in the proxy materials for our next annual meeting of stockholders. However, the NCGC Committee may, in its sole discretion, reject any such recommendation for any reason.

Andrew M. Sims’ employment agreement with us provides that we must nominate him to serve as a director. The nomination right provided for under Andrew M. Sims’ employment agreement is subject to the determination of the NCGC Committee, in connection with each annual or special meeting of stockholders at which directors will be elected, that the nominee satisfies the standards established by the committee for service on the Board. If Andrew M. Sims fails to be nominated to our Board or is involuntarily removed from our Board, unless for cause or vote by the stockholders, he, David R. Folsom, and Anthony E. Domalski each will receive, among other things, a severance payment equal to three (3) times his respective combined salary base and actual bonus compensation for the preceding fiscal year. Andrew M. Sims is not independent under the corporate governance standards of the NASDAQ.

The Board believes that its procedures comply with the requirements of the NASDAQ and provide adequate assurance that nominations are approved by independent directors.

Our Board remains committed to maintaining strong corporate governance and appropriate independent oversight of management. The Board has given careful consideration to our Company’s leadership structure and has determined that our Company and our stockholders are best served by separating the roles of Chairman and Chief Executive Officer. Currently, Andrew M. Sims serves as Chairman of the Board as an officer of the Company, and David R. Folsom serves as the Company’s President and Chief Executive Officer. Mr. Sims, as Chairman, provides guidance to the Chief Executive Officer; presides over meetings of the Board and sets the agenda for meetings of the Board; and advises the Company on strategic matters and major transactions, including acquisitions, dispositions, franchising and branding decisions, as well as capital market transactions. Mr. Folsom, as President and Chief Executive Officer, manages the day-to-day operations of the Company and sets and implements the Company policy and strategy established by the Board. Mr. Sims has significant experience as Chairman, including serving as the Chairman of the Board since the Company’s initial public offering in 2004, and Mr. Folsom has significant experience as a senior executive, including serving as the Company’s Chief Operating Officer from 2006 until 2019 and its President since 2011. In the view of the Board, this structure (i) ensures that the Board’s agenda reflects our strategic challenges and opportunities; (ii) ensures that the Board is presented with information required for it to fulfill its responsibilities; (iii) ensures that Board meetings are as productive and effective as possible; (iv) promotes coordinated leadership and direction for the Board and executive management; and (v) allows for a clear focus for the chain of command to execute the Company’s strategic initiatives and business plan. The Board believes that this leadership structure is also appropriate given the size of the Company.

The Board and its committees oversee the effectiveness of management policies and decisions, including the execution of key strategic initiatives. Each of the Board’s committees is composed entirely of independent directors. Consequently, independent directors directly oversee such critical matters as the compensation of executive management, including the compensation of Andrew M. Sims and David R. Folsom, the selection and evaluation of directors and the development and implementation of corporate governance programs. The independent directors conduct annual performance reviews of the Chairman and the Chief Executive Officer, assessing the Company’s financial and non-financial performance and the quality and effectiveness of senior leadership. In addition, the NCGC Committee oversees the processes by which Andrew M. Sims and David R. Folsom are evaluated. The Board believes that the Company’s corporate governance documents, which are available on the Company’s website, help ensure that strong and independent directors will continue to play the central oversight role necessary to maintain the Company’s commitment to the highest quality corporate governance. Pursuant to these governance principles, independent Board members meet as often as and to the extent that the independent directors deem necessary or appropriate at executive sessions without management present.

Our Board has designated Edward S. Stein, the chairman of the NCGC Committee, to serve as the lead independent director. Director Stein is not standing for re-election to the board of directors and his term as director of the Company will expire at the conclusion of the 2024 Annual Meeting. The Company anticipates that director nominee Walter S. Robertson III will begin serving as chairman of the NCGC Committee and as lead independent director, subject to his election to the board of directors. The lead independent director serves as chairman of meetings of the independent directors. The lead independent director, a separate and independent position from the chairman, calls meetings, supervises the conduct of meetings of the independent directors, records the minutes and reports meeting results and any decisions of the independent directors to our chairman and facilitates communication between the independent directors, the chairman and management. The position currently held by Edward S. Stein ensures effective corporate governance for our Company.

The NCGC Committee consists of Mr. Stein, Mr. Zinni, and Mr. Walker. None of the members of our NCGC Committee is or has been one of our employees or officers. None of our executive officers currently serves, or during the past fiscal year has served, as a member of the Board or compensation committee of another entity that has one or more executive officers serving on our Board or our NCGC Committee.

The Board does not have a formal process for stockholders to send communications to the Board. In view of the infrequency of stockholder communications to the Board, the Board does not believe that a formal process is necessary. Written communications received by our Company from stockholders are shared with the full Board no later than the next regularly scheduled Board meeting. The Board encourages, but does not require, directors to attend the annual meeting of stockholders.

Our insider trading policy prohibits the Company’s directors, officers, key employees and their respective family members from trading any interest or position relating to the future price of Company securities, such as a put, call or short sale.

The NCGC Committee is responsible for developing our policies relating to compensation and benefits, determining compensation for, and evaluating the performance of, certain of our executive officers, and administering the 2022 Plan. The NCGC Committee determines and approves compensation for our Chairman and our Chief Executive Officer, and approves compensation for our Chief Financial Officer as determined by our Chief Executive Officer. These three (3) individuals are our most highly paid executive officers and we refer to these three (3) executive officers as our named executive officers.

The NCGC Committee reviews and approves, at least annually, corporate goals and objectives relevant to the compensation of the Chairman and the CEO. The NCGC Committee also:

•

At least annually, either as the NCGC Committee or together with the other independent directors, as directed by the Board, in light of the corporate goals and objectives and the performance evaluations: (i) determines and approves the compensation of the Chairman and the CEO, including individual elements of salary, bonus, supplemental retirement, incentive and equity compensation; and (ii) approves the compensation for the CFO and the COO based on recommendations from the Chairman and the CEO;

•

Reviews, as the NCGC Committee considers appropriate in setting named executive officer compensation, the Company’s performance’s and relative stockholder return, compensation at comparable companies, past years’ compensation to the Company’s named executive officers and other relevant factors; and

•

Reviews and approves all employment agreements and amendments, separation and severance agreements and other compensatory contracts, arrangements, perquisites and payments with respect to the Chairman and CEO, and reviews and makes recommendations to the Board regarding all such agreements, contracts, arrangements, perquisites and payments with respect to other executive officers.

In any deliberations or voting to determine the compensation of the Chairman or the CEO, neither the Chairman nor the CEO may be present; however, in any deliberations regarding the compensation of other executive officers, the NCGC Committee may elect to invite the Chairman or the CEO to be present but not vote.

The NCGC Committee’s principal objective in establishing compensation policies is to develop and administer a comprehensive program designed to attract and retain outstanding managers. The NCGC Committee’s guidelines for compensation of our named executive officers are designed to provide fair and competitive levels of total compensation while linking elements of compensation with performance. A further objective of our compensation policies is to provide incentives and reward named executive officers for their contribution to our Company. To that end, the NCGC Committee believes executive compensation packages provided by us to the named executive officers should include cash compensation that rewards performance as measured against established goals. The NCGC Committee takes into account our named executive officers’ existing ownership of the Company’s common stock and allocations of common stock made to the executives’ participant accounts pursuant to the Company’s ESOP, which the NCGC Committee believes aligns the interests of our named executive officers with that of our stockholders and encourages a focus on long-term value creation.

It was favorably noted by the NCGC Committee that our stockholders approved our executive compensation program at the 2023 annual meeting. Holders of approximately 5.4 million shares of our common stock, or approximately 88.2% of the total votes cast (without regard to broker non-votes or abstentions), voted for the advisory vote approving executive compensation. The NCGC Committee generally considered the results of the 2023 advisory vote on executive compensation and considered these voting results as supportive of the NCGC Committee’s general executive compensation practices.

The NCGC Committee has not retained or obtained the advice of a compensation consultant.

Elements of compensation for our named executive officers consist principally of base salary, cash performance bonuses, and non-discretionary allocations pursuant to the Company’s ESOP. In determining each element of compensation for each named executive officer, the NCGC Committee primarily considers the following elements:

For 2023, executive compensation included four main components: (i) annual base salary; (ii) cash bonus (iii) stock awards; and (iv) non-discretionary allocations pursuant to the Company’s ESOP.

The following table summarizes the primary components and rationale of the Company’s compensation philosophy and the pay elements that support that philosophy.

The original base salary amounts of the named executive officers were provided for in their respective employment agreements and are subject to adjustment pursuant to the terms of those agreements. In setting base salaries, and annually considering adjustments, the NCGC Committee uses an evaluation process considering the named executive officer’s position, level and scope of responsibility and an evaluation of base salaries and other benefits of other executive officers of comparable companies, including an analysis of our Company’s current operating results. The 2023 annual base salaries for the named executive officers are provided in the Summary Compensation Table.

For 2024, the NCGC Committee approved annual base salaries for Mr. Sims, Mr. Folsom, and Mr. Domalski of $559,316, $553,723, and $394,160, respectively.

Under our employment agreements with the named executive officers, each named executive officer is eligible to receive a cash bonus in target amounts between 25%-35% of base salary. The NCGC Committee has reviewed these agreements and has determined in the best interests of the Company to structure a cash bonus plan that may award above or below the 25%-35% target range indicated in the agreements subject to consideration of the following:

For 2023, the NCGC Committee approved cash bonuses for Mr. Sims, Mr. Folsom, and Mr. Domalski of $95,000, $70,000, and $50,000, respectively. The NCGC Committee has determined that for 2024, the annual target bonus for which each of our named executive officers is eligible to receive will be an amount between 25%-35% of each such executive's base salary, pursuant to each executive's employment agreement.

The Company sponsors and maintains the Sotherly Hotels Inc. ESOP and related trust for the benefit of its eligible employees. Employees who are at least 21 years old with at least one year of service during which the employee has completed at least 1,000 hours of service with the Company are eligible to participate. On December 29, 2016, the Company entered into a loan agreement with the ESOP pursuant to which the ESOP may borrow up to $5,000,000 from the Company to purchase shares of the Company’s common stock (“ESOP Loan”). Between January 3, 2017 and February 23, 2017, the ESOP purchased 682,500 shares of the Company’s common stock in the open market. In accordance with the ESOP Loan documents, the common stock purchased by the ESOP serves as collateral for the ESOP Loan. The ESOP Loan will be repaid principally from discretionary contributions by the Company to the ESOP over a period ending no later than December 29, 2036. The interest rate on the ESOP Loan is 2.5% and the ESOP Loan documents provide that the ESOP Loan may be repaid over a shorter period, without penalty for prepayments. Shares purchased by the ESOP are held in a suspense account for allocation among participants as contributions are made to the ESOP by the Company.

Contributions to the ESOP and shares released from the suspense account in an amount proportional to the repayment of the ESOP Loan will be allocated among ESOP participants on the basis of compensation in the year of allocation. Participants will generally be 100% vested in their ESOP account balances upon completion of five years of credited service. A participant’s interest in his or her account under the ESOP will also fully vest in the event of termination of service due to normal retirement, death, or disability. Distributions of vested ESOP account balances will be made in cash, provided that the participant will have the right to request a stock distribution, subject to the Company’s governing documents and applicable law. The Company contributions to the ESOP are discretionary, subject to the ESOP Loan documents and tax law limits. Pursuant to generally accepted accounting principles, we are required to record compensation expense each year in an amount equal to the fair market value of the shares released or committed to be released from the suspense account.

The following table sets forth the cash and non-cash compensation awarded to or earned by Andrew M. Sims, David R. Folsom, and Anthony E. Domalski during the past three (3) fiscal years.

(1)

Includes a (i) cash bonus of $95,000 and (ii) the aggregate dollar value of a stock award of 23,715 shares of common stock calculated by multiplying the closing market price of our common stock of $1.345 on January 18, 2024, the date of the award, as reported on the NASDAQ, by the number of shares of stock awarded.

(2)

Includes a (i) cash bonus of $70,000 and (ii) the aggregate dollar value of a stock award of 44,955 shares of common stock calculated by multiplying the closing market price of our common stock of $1.345 on January 18, 2024, the date of the award, as reported on the NASDAQ, by the number of shares of stock awarded.

(3)

Includes a (i) cash bonus of $50,000 and (ii) the aggregate dollar value of a stock award of 24,900 shares of common stock calculated by multiplying the closing market price of our common stock of $1.345 on January 18, 2024, the date of the award, as reported on the NASDAQ, by the number of shares of stock awarded.

(4)

Represents the aggregate dollar value of a stock award of 75,000 shares of common stock calculated by multiplying the closing market price of our common stock of $1.8427 on January 23, 2023, the date of the grant, as reported on the NASDAQ, by the number of shares of stock awarded (pursuant to Mr. Sims current employment agreement with the Company dated as of January 1, 2020 (as amended on January 23, 2023, the "Sims Employment Agreement"), the Company issued 75,000 restricted shares of common stock to Mr. Sims on January 23, 2023, which vest as described in the section titled "Stock Awards Granted" below).

(5)

Represents the aggregate dollar value of (i) a stock award of 11,681 shares of common stock calculated by multiplying the closing market price of our common stock of $2.02 on January 21, 2022, the date of the grant, as reported on the NASDAQ, by the number of shares of stock awarded; and (ii) a deferred stock award of 72,816 shares of common stock calculated by multiplying the closing market price of our common stock of $2.02 on January 21, 2022, the date of the conditional award, as reported on the NASDAQ, by the number of shares of stock awarded.

(6)

Represents the aggregate dollar value of a stock award of 38,000 shares of common stock calculated by multiplying the closing market price of our common stock of $1.8427 on January 23, 2023, the date of the grant, as reported on the NASDAQ, by the number of shares of stock awarded (pursuant to Mr. Folsom's current employment agreement with the Company dated as of January 1, 2020 (as amended on January 23, 2023, the "Folsom Employment Agreement"), the Company issued 38,000 restricted shares of common stock to Mr. Folsom on January 23, 2023, which vest as described in the section titled "Stock Awards Granted" below).

(7)

Represents the aggregate dollar value of a stock award of 26,431 shares of common stock calculated by multiplying the closing market price of our common stock of $1.89 on January 12, 2023, the date of the grant, as reported on the NASDAQ, by the number of shares of stock awarded.

(8)

Represents the aggregate dollar value of (i) a stock award of 34,076 shares of common stock calculated by multiplying the closing market price of our common stock of $2.02 on January 21, 2022, the date of the grant, as reported on the NASDAQ, by the number of shares of stock awarded; and (ii) a deferred stock award of 48,246 shares of common stock

(9)

Represents the aggregate dollar value of a stock award of 34,000 shares of common stock calculated by multiplying the closing market price of our common stock of $1.8427 on January 23, 2023, the date of the grant, as reported on the NASDAQ, by the number of shares of stock awarded (pursuant to Mr. Domalski's current employment agreement with the Company dated as of January 1, 2020 (as amended on January 23, 2023, the "Domalski Employment Agreement"), the Company issued 34,000 restricted shares of common stock to Mr. Domalski on January 23, 2023, which vest as described in the section titled "Stock Awards Granted" below).

(10)

Represents the aggregate dollar value of (i) a stock award of 8,375 shares of common stock calculated by multiplying the closing market price of our common stock of $2.02 on January 21, 2022, the date of the grant, as reported on the NASDAQ, by the number of shares of stock awarded; and (ii) a deferred stock award of 32,675 shares of common stock calculated by multiplying the closing market price of our common stock of $2.02 on January 21, 2022, the date of the conditional award, as reported on the NASDAQ, by the number of shares of stock awarded.

(11)

Includes the Company contributions to the 401(k) plan in the amount of $13,200 for each of Andrew M. Sims, David R. Folsom, and Anthony E. Domalski in 2023. Includes insurance premiums paid by our Company for life insurance policies for the named executive officers in the amount of approximately $0 for Mr. Sims, $4,899 for Mr. Folsom, and $2,685 for Mr. Domalski in 2023. Includes insurance premiums paid by our Company for health insurance policies for the named executive officers in the amount of approximately $25,019 for Mr. Sims, $25,019 for Mr. Folsom, and $32,993 for Mr. Domalski in 2023. Includes insurance premiums paid by our Company for long-term disability insurance policies for the named executive officers in the amount of approximately $11,268 for Mr. Sims, $6,975 for Mr. Folsom, and $5,259 for Mr. Domalski in 2023. Includes ESOP allocation in the amount of $26,895 for each of Andrew M. Sims, David R. Folsom, and Anthony E. Domalski in 2023, which represents the dollar value of the ESOP share allocation multiplied by the closing market price of our common stock of $1.49 on December 31, 2023, the effective date of the allocation.

(12)

Includes the Company contributions to the 401(k) plan in the amount of $12,200 for each of Andrew M. Sims, David R. Folsom, and Anthony E. Domalski in 2022. Includes insurance premiums paid by our Company for life insurance policies for the named executive officers in the amount of approximately $0 for Mr. Sims, $4,899 for Mr. Folsom, and $2,685 for Mr. Domalski in 2022. Includes insurance premiums paid by our Company for health insurance policies for the named executive officers in the amount of approximately $26,377 for Mr. Sims, $26,377 for Mr. Folsom, and $39,020 for Mr. Domalski in 2022. Includes insurance premiums paid by our Company for long-term disability insurance policies for the named executive officers in the amount of approximately $10,381 for Mr. Sims, $6,294 for Mr. Folsom, and $4,819 for Mr. Domalski in 2022. Includes ESOP allocation in the amount of $19,383 for each of Andrew M. Sims, David R. Folsom, and Anthony E. Domalski in 2022, which represents the dollar value of the ESOP share allocation multiplied by the closing market price of our common stock of $1.80 on December 31, 2022, the effective date of the allocation

(13)

Includes the Company contributions to the 401(k) plan in the amount of $8,700 for each of Andrew M. Sims, David R. Folsom, and Anthony E. Domalski in 2021. Includes insurance premiums paid by our Company for life insurance policies for the named executive officers in the amount of approximately $0 for Mr. Sims, $4,899 for Mr. Folsom, and $2,685 for Mr. Domalski in 2021. Includes insurance premiums paid by our Company for health insurance policies for the named executive officers in the amount of approximately $26,377 for Mr. Sims, $39,033 for Mr. Folsom, and $39,033 for Mr. Domalski in 2021. Includes insurance premiums paid by our Company for long-term disability insurance policies for the named executive officers in the amount of approximately $9,699 for Mr. Sims, $6,921 for Mr. Folsom, and $3,855 for Mr. Domalski in 2021. Includes ESOP allocation in the amount of $26,423 for each of Andrew M. Sims, David R. Folsom, and Anthony E. Domalski in 2021, which represents the dollar value of the ESOP share allocation multiplied by the closing market price of our common stock of $2.09 on December 31, 2021, the effective date of the allocation.

No other compensation has been awarded to, earned by or paid to any of our named executive officers which is required to be reported in the above tables.

For 2023, Andrew M. Sims received $543,025 in base cash salary, pursuant to the terms of his employment agreement. For 2023, David R. Folsom received $537,595 in base cash salary, pursuant to the terms of his employment agreement. For 2023, Anthony E. Domalski received $382,680 in base cash salary, pursuant to the terms of his employment agreement.

The NCGC Committee awarded cash bonuses to the named executive officers for fiscal year 2023 of $95,000, $70,000, and $50,000 to Andrew M. Sims, David R. Folsom, and Anthony E. Domsalski, respectively. In making its decisions, the NCGC Committee considered the factors described above under the caption “Cash Bonus Plan.”

The NCGC Committee may, in connection with the entry into employment agreements and modifications to existing employment agreement and pursuant to the 2022 Plan, grant restricted stock awards to our named executive officers. The NCGC Committee met on January 12, 2023 and determined to (i) extend the term of the employment agreements for each of our named executive officers until December 31, 2027 and (ii) provide the named executive officers with restricted stock awards, in recognition for their performance during the COVID-19 pandemic. The NCGC Committee also took into account the Company's financial results for the 2022 fiscal year as compared to the 2021 fiscal year, each executive's compensation relative to compensation offered at comparable companies based on publicly available data and the need to offer competitive compensation to retain key executives.

Pursuant to the amendment, dated January 23, 2023, to the Sims Employment Agreement, the Company issued 75,000 restricted shares of common stock to Mr. Sims on January 23, 2023, which vest in equal amounts of 15,000 shares over a five-year period on March 31 of each year, commencing March 31, 2023 and ending March 31, 2027.

Pursuant to the amendment, dated January 23, 2023, to the Folsom Employment Agreement, the Company issued 38,000 restricted shares of common stock to Mr. Folsom on January 23, 2023, which vest in equal amounts of 7,600 shares over a five-year period on March 31 of each year, commencing March 31, 2023 and ending March 31, 2027.

Pursuant to the amendment, dated January 23, 2023, to the Domalski Employment Agreement, the Company issued 34,000 restricted shares of common stock to Mr. Domalski on January 23, 2023, which vest in equal amounts of 6,800 shares over a five-year period on March 31 of each year, commencing March 31, 2023 and ending March 31, 2027.

On January 18, 2024 the NCGC Committee approved stock awards of our Company's common stock of 23,715, 44,955, and 24,900 to Mr. Sims, Mr. Folsom, and Mr. Domalski respectively, as a non-cash bonus for service during 2023, pursuant to the 2022 Plan.

The Company has not granted any stock option awards to the named executive officers. The following table sets forth information with respect to the vesting of the named executive officers' restricted common stock during 2023.

Our current employment agreements with our named executive officers, provide for each executive’s annual salary and possible additional compensation in the form of cash bonus and restricted stock awards. Each current executive will receive customary benefits, including a term life insurance policy of $1.0 million and disability insurance in an amount so that each executive will receive monthly payments equal to one-half of each executive’s monthly salary payment in the event of disability. As described below, the current employment agreements provide our executives with severance benefits if such executive’s employment ends under certain circumstances including a change in control. We believe that the current employment agreements will benefit us by helping to retain Mr. Sims, Mr. Folsom, and Mr. Domalski and by allowing such executives to focus on their duties without the distraction of the concern for their personal situation in the event of a possible change in control of our Company.

Our current employment agreements with Mr. Sims, Mr. Folsom, and Mr. Domalski contain provisions providing for substantial payments to these executives in the event of a change of control of our Company. Specifically, if we terminate these executive’s employment without cause or the executive resigns with good reason, which includes a failure to nominate Andrew M. Sims to our Board or his involuntary removal from our Board, unless for cause or by vote of the stockholders, or if there is a change of control, each of these executives is entitled to the following:

The Folsom Employment Agreement also provides that the complete liquidation or dissolution of the Company constitutes a change in control. In the event that the Company elects not to renew the Mr. Folsom’s employment agreement, Mr. Folsom is entitled to receive the following: (i) any accrued but unpaid salary and bonuses; (ii) a severance payment equal to Mr. Folsom’s combined salary and actual bonus compensation for the preceding fiscal year, to be paid within five (5) days of Mr. Folsom’s last day of employment; and (iii) payment of the full premium (including administrative fee) for continuing health insurance coverage under COBRA or any similar state law for a period of two (2) years following the expiration of his employment agreement.

The NCGC Committee met on January 12, 2023 and determined to (i) extend the term of the employment agreements for each of our named executive officers until December 31, 2027 and (ii) provide the named executive officers with restricted stock awards, in recognition for their performance during the COVID-19 pandemic.

The following table indicates the cash amounts, accelerated vesting and other payments and benefits that the named executive officers would be entitled to receive under various circumstances pursuant to the terms of their respective employment agreements. The table assumes that termination of the named executive officer from the Company under the scenario shown occurred on December 31, 2023.

(1)

This column assumes that termination occurred on December 31, 2023 and therefore uses 2022 salary and bonus compensation amounts in its calculations, as provided for in the respective employment agreements. This column assumes that there was neither salary nor annual performance bonus earned but unpaid as of December 31, 2023. For Mr. Folsom, these amounts include stock awards that were awarded in lieu of cash salary. Amounts shown are lump-sum payments.

(2)

Reflects accelerated vesting of 60,000 unvested shares of Mr. Folsom's restricted common stock awards. For purposes of this table, the market value per share of common stock is assumed to be the closing market price per common share of $1.49 on December 31, 2023.

(3)

Reflects accelerated vesting of 30,000 unvested shares of Mr. Folsom’s restricted common stock awards. For purposes of this table, the market value per share of common stock is assumed to be the closing market price per common share of $1.49 on December 31, 2023.

(4)

Reflects accelerated vesting of 60,400 unvested shares of Mr. Folsom’s restricted common stock awards. For purposes of this table, the market value per share of common stock is assumed to be the closing market price per common share of $1.49 on December 31, 2023.

(5)

Reflects accelerated vesting of 27,200 unvested shares of Mr. Folsom's restricted common stock awards. For purposes of this table, the market value per share of common stock is assumed to be the closing market price per common share of $1.49 on December 31, 2023.

(6)

This amount represents the lump-sum dollar value of five years of payments for the respective executive’s life, health and disability insurance, using 2023 payments as an estimate and assuming no changes in the cost of these payments.

For fiscal year 2023, there were no pension benefits or nonqualified deferred compensation.

Our CEO to median employee pay ratio is calculated in accordance with Item 402(u) of Regulation S-K. The annual total compensation for fiscal year 2023 for our CEO was $815,069, and for the median employee was $355,547. The resulting ratio of our CEO’s pay to the pay of our median employee for fiscal year 2023 is 2.29 to 1.00. Our methodology for calculating the CEO pay ratio is explained below.

•

CEO Pay Ratio. We calculated our CEO's annual total compensation in the same manner as the median employee. Finally, we divided our CEO's annual total compensation by the median employee's total compensation to determine the pay ratio.

As described in greater detail in “Director and Executive Compensation – Principles and Objective of the Compensation Plan,” the Company’s executive compensation program reflects our commitment to aligning pay with performance. We provide a competitive total compensation package with payouts dependent upon the degree to which performance measures are met or exceeded. We regularly review our performance measures to ensure that they provide a balanced assessment of overall Company performance. The metrics that the Company uses for both our long-term and short-term incentive awards are selected based on an objective of incentivizing the Company’s named executive officers to increase value for our stockholders and not all of those metrics are presented in the Pay versus Performance table. Moreover, the Company generally seeks to incentivize long-term performance and therefore does not specifically align the Company’s performance measures with compensation that is actually paid (as computed in accordance with Item 402(v) of Regulation S-K) for a particular year.

(1)

The CEO for 2021, 2022, and 2023 is David R. Folsom. The other NEOs for such years are Andrew M. Sims and Anthony E. Domalski. The values reflected in these columns reflect the total compensation as set forth in the Summary Compensation Table above.

(3)

The following table provides a reconciliation from Summary Compensation Table Total for Non-CEO NEOs to Compensation Actually Paid to Non-CEO NEOs, in which "Fair Value" means fair value calculated in accordance with FASB ASC 718.

(4)

Reflects the cumulative TSR of the Company for the year ended December 31, 2021, the two years ended December 31, 2022, and the three years ended December 31, 2023, assuming a $100 investment at the closing price on December 31, 2020 and the reinvestment of all dividends.

The Company was not required to prepare an accounting restatement that required recovery of erroneously awarded compensation pursuant to the Company's compensation recovery policy at any time during or after the last completed fiscal year.

Policies and Practices Related to the Grant of Certain Equity Awards Close in Time to the Release of Material Nonpublic Information

The Company does not grant stock option awards to its executives and, therefore, does not have any policies or practices in place for such awards. The Company did not grant any stock option awards in 2023.

The NCGC Committee oversees risks associated with our executive compensation plans and arrangements. The Company does not believe that the executive compensation plan is reasonably likely to cause a material adverse impact on the Company for several reasons. First, our named executive officers own significant amounts of common stock in the Company, and continue to receive additional shares of common stock pursuant to the Company’s ESOP, which we believe aligns the interests of our executives with that of our stockholders and encourages a focus on long-term value creation. Second, we have historically offered cash incentive bonuses in targeted amounts of 25%-35% of base salary subject to the consideration of performance metrics that are designed to reflect benefits to the Company. We have never granted stock options.

The accounting and tax treatment of compensation generally has not been a factor in determining the amounts of compensation for our executive officers. However, the NCGC Committee and management have considered the accounting and tax impact of various program designs to balance the potential cost to the Company with the benefit/value to the executive.

While an exception exists for certain contracts in place as of November 2, 2017, only the first $1 million in compensation paid to our named executive officers generally is deductible. Therefore, the NCGC Committee retains flexibility to provide compensation under the plan to executives consistent with the Company’s compensation programs, even if such compensation would not be fully deductible.

The following table sets forth the cash and non-cash compensation awarded to certain of our independent, non-employee directors for their service during the year ended December 31, 2023.

(1)

Represents the aggregate dollar value of (i) a restricted stock award of 3,000 shares calculated by multiplying the closing market price of our common stock of $1.89 per share on January 12, 2023, the date of the grant, as reported on the NASDAQ, by the number of shares of stock awarded.

(2)

(3)

(4)

(5)

The NCGC Committee reviews the level of compensation of our non-employee directors on an annual basis. To determine how appropriate the current level of compensation for our non-employee directors is, the NCGC Committee has historically obtained data from a number of different sources including publicly available data describing director compensation in peer companies.

We have resumed compensating our independent, non-employee directors for their services as directors through a mixture of cash and equity-based compensation. Eligible independent, non-employee directors receive annual compensation of $20,000, plus a fee of $750 (plus out-of-pocket expenses) for attendance in person at each meeting of the Board, and $750 for each committee meeting attended in person. Directors who attend meetings telephonically receive a fee of $375. Directors who are also officers or employees of our Company do not receive separate compensation for service as a director. Directors Edward S. Stein and G. Scott Gibson IV each receive an additional $6,500 per year for their services as chairs of the NCGC Committee and Audit Committee, respectively.

On an annual basis, the NCGC Committee awards restricted stock to certain independent, non-employee directors pursuant to the 2022 Plan. On January 18, 2024, directors Caldwell, Gibson, Walker, and Zinni received an incentive stock award of 3,000 shares that will vest on December 31, 2024. Also on January 18, 2024, director Stein received an incentive stock award of 750 shares that will vest on April 30, 2024. On January 12, 2023, each of our independent directors received an incentive stock award of 3,000 shares that became fully vested on December 31, 2023. Also on January 12, 2023, our independent directors received the following vested stock awards in lieu of cash compensation for service during 2022: (i) director Caldwell received a stock award of 7,014 shares; (ii) director Gibson received a stock award of 8,819 shares; (iii) director Stein received a stock award of 9,236 shares; (iv) director Walker received a stock award of 6,389 shares; and (v) director Zinni received a stock award of 6,389 shares. Although distributions are paid on all restricted stock, whether or not vested, at the same rate and on the same date as on shares of our common stock, these holders will be prohibited from selling such shares until they vest. To date, the stock awards to our independent directors have been restricted until the last day of the fiscal year in which they were granted, with the following exceptions: (i) the 2,250 unrestricted shares granted to Mr. Walker in 2016; (ii) the 2,250 unrestricted shares granted to Mr. Gibson in 2018; (iii) the 2,250 unrestricted shares granted to Ms. Caldwell in 2020; and (iv) the stock awards in lieu of cash compensation as described above and reported in previous years.

We have established the 2022 Plan for the purpose of recruiting and retaining our and our affiliates’ executive officers, employees, non-employee directors and consultants. The 2022 Plan authorizes the issuance of options to purchase shares of common stock and the grant of stock awards, deferred shares, performance shares and performance units.

Administration of the 2022 Plan is carried out by the NCGC Committee. The NCGC Committee may delegate a portion of its authority under the 2022 Plan to one or more officers.

Our officers and employees and those of our Operating Partnership and other subsidiaries are eligible to participate in the 2022 Plan. Our non-employee directors, and other persons that provide consulting services to us and our subsidiaries, are also eligible to participate in the 2022 Plan.

In accordance with our Audit Committee charter and procedures established by the Audit Committee, our Audit Committee or another independent body of our Board is responsible for reviewing and approving the terms and conditions of all related party transactions. Any transaction, in which the amount involved exceeds $120,000, and in which a director or executive officer of our Company or a member of the immediate family of a director or officer has a direct or indirect material interest, would need to be approved by our Audit Committee or another independent body of our Board prior to our Company entering into such transaction. The procedures for review and approval of certain relationships and related transactions are contained in our Audit Committee charter which is available on our website at www.sotherlyhotels.com.

All new related party transactions that were not previously approved were reviewed and approved by our Audit Committee or another independent body of our Board in 2023, unless otherwise indicated.

Our Town Hospitality, LLC (“Our Town”) is currently the management company for each of our ten wholly-owned hotels, as well the manager of our rental programs at the Hyde Resort & Residences and the Hyde Beach House Resort & Residences. As of March 15, 2024, an affiliate of Andrew M. Sims, our Chairman; an affiliate of David R. Folsom, our President and Chief Executive Officer; and Andrew M. Sims Jr., our Vice President - Operations & Investor Relations, beneficially owned approximately 71.0%, 7.0%, and 15.0%, respectively, of the total outstanding ownership interests of Our Town. Mr. Sims, Mr. Folsom, and Mr. Sims Jr. serve as directors of Our Town.

On September 6, 2019, we entered into a master agreement with Our Town and the former majority equity holder of Our Town related to the management of certain of our hotels, as amended on December 13, 2019 (as amended, the “OTH Master Agreement”). On December 13, 2019, and subsequent dates we entered into a series of individual hotel management agreements for the management of our hotels. The hotel management agreements for each of our ten wholly-owned hotels and the two rental programs are each referred to as an “OTH Hotel Management Agreement” and, together, the “OTH Hotel Management Agreements”.

•

expires on March 31, 2035, or earlier if all of the OTH Hotel Management Agreements expire or are terminated prior to that date. The OTH Master Agreement shall be extended beyond 2035 for such additional periods as an OTH Hotel Management Agreement remains in effect;

•

sets an incentive management fee for each of the hotels managed by Our Town equal to 10% of the amount by which gross operating profit, as defined in the OTH Hotel Management Agreements, for a given year exceeds the budgeted gross operating profit for such year; provided, however, that the incentive management fee payable in respect of any such year shall not exceed 0.25% of the gross revenues of the hotel included in such calculation;

•

provides a mechanism and establishes conditions on which the Company will offer Our Town the opportunity to manage hotels acquired by the Company in the future, pursuant to a negotiated form of single facility management agreement, with the caveat that the Company is not required to offer the management of future hotels to Our Town; and

Each of the OTH Hotel Management Agreements has an initial term ending March 31, 2035. Each of the OTH Hotel Management Agreements may be extended for up to two additional periods of five years subject to the approval of both parties with respect to any such extension. The agreements provide that Our Town will be the sole and exclusive manager of the hotels as the agent of the respective TRS Lessee, at the sole cost and expense of the TRS Lessee, and subject to certain operating standards. Each OTH Hotel Management Agreement may be terminated in connection with a sale of the related hotel. In connection with a termination upon the sale of the hotel, Our Town will be entitled to receive a termination fee equal to the lesser of the management fee paid with respect to the prior twelve months or the management fees paid for that number of months prior to the closing date of the hotel sale equal to the number of months remaining on the current term of the OTH Hotel Management Agreement. Upon the sale of a hotel, no termination fee will be due in the event the Company elects to provide Our Town with the opportunity to manage another comparable hotel and Our Town is not precluded from accepting such opportunity. Our Town is required to qualify as an eligible independent contractor in order to permit the Company to continue to operate as a real estate investment trust.

Pursuant to the management agreements for the Hyde Resort & Residences and the Hyde Beach House Resort & Residences, Our Town manages the rental of individually owned condominium units pursuant to rental agreements entered into with individual condominium unit owners. We have also entered into an Association Sub Management and Assignment Agreement with Our Town for the management and operation of the condominium association responsible for the operation of the Hyde Beach House Resort & Residences, and a Rental Sales Management Agreement pursuant to which Our Town agreed to manage the marketing and negotiation of rental agreements with individual condominium unit owners.

The base management fee for each of our hotels is a percentage of the gross revenues of the hotel and is due monthly. The applicable percentages of gross revenue for the base management fee for each of our wholly-owned hotels managed by Our Town are shown below:

For the years ended December 31, 2023 and 2022, base management fees earned by Our Town under the contract were approximately $4.5 million and $4.1 million, respectively, and the incentive management fees earned by Our Town were approximately $0.2 million and $0.3 million, respectively.

On December 13, 2019, we entered into a sublease agreement (the “Sublease”) with Our Town pursuant to which Our Town subleases 2,245 square feet of office space from Sotherly for a period of 5 years, with a 5-year renewal subject to approval by Sotherly, on terms and conditions similar to the terms of the prime lease entered into by Sotherly and the third-party owner of the property. For the years ended December 31, 2023 and 2022, the Company received rent income from Our Town of approximately $24,755 and $159,734, respectively.

We purchase employee medical benefits through a self-insurance arrangement sponsored by Our Town (or its affiliate). Our Town provides medical insurance for its employees working exclusively at our hotels and we pay Our Town the actual costs, net of employee contributions, of providing medical insurance for those employees. For the years ended December 31, 2023 and 2022, we paid approximately $3.2 million and $3.2 million (net of employee co-payments), respectively, for the employer portion of the plan covering those employees that work exclusively for our properties under our management agreements with Our Town. Additionally, Our Town's policy is to rebate 70% of our pro rata share of any annual surplus in its self-insured health plan back to the Company and retain the remaining 30%.

Effective as of June 24, 2013, and following the approval by a committee consisting of Sotherly’s independent directors, we hired Robert E. Kirkland IV and Ashley S. Kirkland as employees of the Company. Ashley S. Kirkland is the daughter of our Chairman. Robert E. Kirkland IV and Ashley S. Kirkland are married. Effective as of September 30, 2014, and following the approval by a committee consisting of Sotherly’s independent directors, we hired Andrew M. Sims Jr. as an employee of the Company. Andrew M. Sims Jr. is the son of our Chairman. Neither Robert E. Kirkland IV, Ashley S. Kirkland, nor Andrew M. Sims, Jr. is, or was, an executive officer of Sotherly or the Operating Partnership. Ashley S. Kirkland terminated her employment effective January 31, 2022. For the year ended December 31, 2023, Robert E. Kirkland IV, Ashley S. Kirkland, and Andrew M. Sims Jr. received approximately $380,285, $0, and $275,527, respectively, in total compensation. For the year ended December 31, 2022, Robert E. Kirkland IV, Ashley S. Kirkland, and Andrew M. Sims Jr. received approximately $349,561, $8,699, and $211,642, respectively, in total compensation. Robert E. Kirkland IV serves as General Counsel, Ashley S. Kirkland served as Corporate Counsel and Compliance Officer, and Andrew M. Sims Jr. serves as Vice President – Operations & Investor Relations.

Kirkland and Sims Jr. Employment Agreements – On January 1, 2020, the Company entered into an employment agreement with Mr. Kirkland (the "Kirkland Agreement"), and on January 23, 2023, the Company entered into an employment agreement with Mr. Sims Jr. (the "Sims Jr. Agreement"). Each of the Kirkland Agreement and the Sims Jr. Agreement has an initial term ending on December 31, 2027. Thereafter, the term of each of the Kirkland Agreement and the Sims Jr. Agreement will be automatically extended for an additional year, on the anniversary of the commencement date of the agreement, unless either party gives one hundred eighty (180) days prior written notice that the term will not be extended. The Kirkland Agreement and Sims Jr. Agreement provide for Mr. Kirkland's and Mr. Sims Jr.'s annual salary and possible additional compensation in the form of a cash bonus and stock awards. For the 12-month period ending December 31, 2023, Mr. Kirkland received a salary of $253,050. For each of the remaining five years under the term of the agreement, Mr. Kirkland's salary is subject to review and adjustment by the NCGC Committee. The Kirkland Agreement provides for a restricted stock grant of 17,500 restricted shares of the Company's common stock. The shares were issued on January 23, 2023 and will vest in equal amounts of 3,500 shares over a five-year period on March 31 of each year commencing March 31, 2023 and ending March 31, 2027. For the 12-month period ending December 31, 2023, Mr. Sims Jr. received a salary of $176,719. For each of the remaining four years under the term of the agreement, Mr. Sims Jr.'s salary is subject to review and adjustment by the NCGC Committee. The Sims Jr. Agreement provides for a restricted stock grant of 12,500 restricted shares of the Company's common stock. The shares were issued on January 23, 2023 and will vest in equal amounts of 2,500 shares over a five-year period on March 31 of each year commencing March 31, 2023 and ending March 31, 2027.

In addition, pursuant to the Kirkland Agreement and the Sims Jr. Agreement, Mr. Kirkland and Mr. Sims Jr. are entitled to receive:

An annual cash performance bonus in a target amount between 25% and 35% of salary for that calendar year, based upon the attainment of quantitative performance goals set forth in a performance plan established by the NCGC Committee by January 31 of each year; and

Customary benefits, including a term life insurance policy of $1 million and disability insurance in an amount such that, upon the occurrence of any event causing disability, Mr. Kirkland and Mr. Sims Jr. shall be entitled to receive the one-half of the monthly payments as would have been made under their respective employment agreements.

Mr. Kirkland and Mr. Sims Jr. will be entitled to receive benefits under their respective agreements if the Company terminates their employment without cause or if they resign with good reason or if there is a change in control of the Company during the term of the agreement. Under these scenarios, Mr. Kirkland and Mr. Sims Jr. are entitled to receive the following:

payment of the executive’s life, health and disability insurance coverage for a period of five (5) years following termination (provided, however, that such right terminates if the executive accepts other employment that would reasonably be expected to provide such insurance);

Our Audit Committee has approved the engagement of FORVIS, LLP (“FORVIS”) as our independent registered public accounting firm for fiscal year ended December 31, 2024, subject to ratification by our stockholders. A representative of FORVIS is expected to be present at the Annual Meeting to respond to stockholders’ appropriate questions and will have the opportunity to make a statement if the representative so desires. If the stockholders fail to ratify the appointment, the Audit Committee will reconsider its selection. FORVIS was the Company’s independent registered public accounting firm for the fiscal year ended December 31, 2023. Dixon Hughes Goodman LLP ("DHG") was the Company's independent registered public accounting firm for the fiscal year ended December 31, 2021. The Company was notified that DHG merged with BKD LLP ("BKD") on June 1, 2022, and the combined practice now operates under the name FORVIS, LLP. This change is a result of the merger and is not attributable to DHG's resignation or dismissal. The Company's audit engagement team did not change as a result of the merger.

The reports of FORVIS on the Company's and the Operating Partnership's financial statement for the fiscal years ended December 31, 2023 and December 31, 2022 did not contain an adverse opinion, nor was the report qualified or modified as to uncertainty, audit scope, or accounting principles. During the two fiscal years ended December 31, 2023 and December 31, 2022:

•

there were no “disagreements” (as that term is defined in Item 304(a)(1)(iv) of Regulation S-K promulgated by the Securities and Exchange Commission and the related instructions) between FORVIS and the Company on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which, if not resolved to the satisfaction of FORVIS, would have caused FORVIS to make reference to the subject matter of the disagreements in its reports on the Company’s financial statements for those years;

•

neither the Company nor anyone on its behalf consulted FORVIS regarding the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered with respect to the Company’s financial statements;

Audit Fees. The aggregate fees billed by FORVIS for professional services rendered for the audit of the Company’s annual consolidated financial statements, for the review of the consolidated financial statements included in the Company’s quarterly reports on Form 10-Q and for audits of acquisitions, consents and the review of Company filings with the Securities and Exchange Commission for the fiscal years ended December 31, 2023 and December 31, 2022 were $404,000 and $407,500, respectively.

Audit-Related Fees. The aggregate fees billed by FORVIS for fees associated with audit services not required by statute or regulation and services related to the audit of the annual financial statements and to the review of the quarterly financial statements for the fiscal years ended December 31, 2023 and December 31, 2022 were $0 and $0, respectively.

Tax Fees. The aggregate fees billed by FORVIS for professional services rendered for tax compliance, tax advice or tax planning for the years ended December 31, 2023 and December 31, 2022 were $57,980 and $51,200, respectively.

All Other Fees. The aggregate fees billed by FORVIS for professional services rendered for services or products other than those listed under the captions “Audit Fees,” “Audit-Related Fees,” and “Tax Fees” for the years ended December 31, 2023 and December 31, 2022 were $0 and $0, respectively.

It is the Audit Committee’s policy to pre-approve all audit and non-audit services prior to the engagement of the Company’s independent auditor to perform any service. All of the services listed above for 2023 and 2022 were approved by the Audit Committee prior to the service being rendered.

You may vote “FOR” or “AGAINST” this proposal or “ABSTAIN” from voting on this proposal.

Ratification of the appointment of the independent registered public accounting firm requires the affirmative vote of a majority of the votes cast by the stockholders of the Company at the Annual Meeting. For purposes of this proposal, abstentions will not be counted as votes cast and will have no effect on the result of the vote, although they will be considered present for the purpose of determining the presence of a quorum.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF FORVIS, LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE 2024 FISCAL YEAR

As required pursuant to Section 14A of the Securities Exchange Act of 1934, as amended, the Company is presenting this proposal which gives you as a stockholder the opportunity to approve or not approve, on an advisory and non-binding basis, our pay program for named executive officers. On April 30, 2019, at the Company’s annual meeting of stockholders, in a non-binding advisory vote of the Company’s stockholders regarding the frequency of holding future advisory votes on executive compensation, the proposed frequency that received the majority of votes cast was every one year. In light of this result, the Company will hold a non-binding advisory vote on executive compensation every year until the next required vote on the frequency of stockholder votes on executive compensation. The Company anticipates holding a vote on the frequency of stockholder votes on executive compensation at its annual meeting of stockholders in 2025.

As described in detail under the heading “Director and Executive Compensation,” our executive compensation programs are designed to attract, incentivize and retain our named executive officers, who are critical to our success. Pursuant to these programs, the Company seeks to compensate the named executive officers for achieving strategic business goals. Please read “Director and Executive Compensation” for additional details about our executive compensation programs including information about the fiscal year 2023 compensation of our named executive officers.

Accordingly, we will ask our stockholders to vote on the following proposed resolution at the Annual Meeting:

“RESOLVED, that the Company’s stockholders approve, on an advisory and non-binding basis, the compensation of the named executive officers, as disclosed in the Company’s Proxy Statement for the 2024 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission.”

You may vote “FOR” or “AGAINST” this proposal or “ABSTAIN” from voting on this proposal.

Approval of the proposal requires the affirmative vote of the holders of a majority of the votes cast by the stockholders of the Company at the Annual Meeting. For purposes of this advisory vote, abstentions and broker non-votes will not be counted as votes cast and will have no effect on the result of the vote, although they will be considered present for the purpose of determining the presence of a quorum. If your shares are held by your broker and you do not give your broker voting instructions, your shares will not be voted on Proposal III. While our Board intends to carefully consider the stockholder vote resulting from the proposal, the final vote will not be binding on us and is advisory in nature.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” PROPOSAL III.

Stockholder Proposals for the 2025 Annual Meeting. Stockholders interested in presenting a proposal for consideration at the Company’s annual meeting of stockholders in 2025 may do so by following the procedures prescribed in Rule 14a-8 under the Securities Exchange Act of 1934, as amended, and the Company’s bylaws. To be eligible for inclusion in the proxy statement, a stockholder proposal must be received by the Company’s Corporate Secretary no later than November 27, 2024, which is 120 calendar days prior to the anniversary of the mailing of this proxy statement. Any such proposal should be mailed to the Company at 306 S. Henry Street, Suite 100, Williamsburg, Virginia 23185.

Stockholders interested in presenting a proposal or nominating a candidate for election as a director at the Company’s 2025 annual meeting of stockholders outside the procedures prescribed in Rule 14a-8 (e.g., a proposal to be presented at the annual meeting of stockholders in 2025 but not included in the Company’s proxy statement) must do so in accordance with the advance notice provisions of the Company’s bylaws, and the nomination or proposal must be received by the Company’s Corporate Secretary no earlier than November 27, 2024 and no later than December 27, 2024 to be considered timely, which is 120 and 90 calendar days, respectively, prior to the anniversary of the mailing of this proxy statement. In addition, stockholders who intend to solicit proxies in support of director nominations other than the Company's nominees must also comply with the additional requirements of Rule 14a-19(b). Any such proposal should be mailed to the Company at 306 S. Henry Street, Suite 100, Williamsburg, Virginia 23185.

The Board is not aware of any business to come before the Annual Meeting other than those matters described above in this Proxy Statement. However, if any other matters should properly come before the Annual Meeting, it is intended that proxies in the accompanying form will be voted in respect thereof in accordance with the judgment of the person or persons voting the proxies.

The cost of soliciting proxies will be borne by the Company. The Company will reimburse brokerage firms and other custodians, nominees and fiduciaries for reasonable expenses incurred by them in sending proxy materials to the beneficial owners of Company common stock. In addition to solicitations by mail, directors, officers and regular employees of the Company may solicit proxies personally or by telephone without additional compensation.

The Company’s 2023 Annual Report to Stockholders accompanies this proxy statement. Such Annual Report is not to be treated as a part of the proxy solicitation material or as having been incorporated herein by reference. A copy of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 will be furnished without charge to stockholders as of the Record Date upon written request to the Corporate Secretary, Sotherly Hotels Inc., 306 South Henry Street, Suite 100, Williamsburg, Virginia 23185.

SCAN TO VIEW MATERIALS & VOTE SOTHERLY HOTELS INC. 306 S HENRY STREET WILLIAMSBURG, VA 23185 VOTE BY INTERNET - www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717 TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. For Withhold For Al All All Except The Board of Directors recommends you vote FOR the following: 1. Election of Directors Nominees 01) David R. Folsom 02) Andrew M. Sims 03) Maria L. Caldwell 04) G. Scott Gibson IV 05) Walter S. Robertson III 06) Herschel J. Walker 07) Gen. Anthony C. Zinni The Board of Directors recommends you vote FOR proposals 2 and 3. For Against Abstain 2. To ratify the appointment of FORVIS, LLP as independent registered public accounting firm for the Company for the fiscal year ending December 31, 2024. 3. An advisory and non-binding vote to approve executive compensation. NOTE: The election of the directors of the nominees listed above is for terms to expire at the 2025 Annual Meeting of Stockholders. Should the undersigned be present and elect to vote at the Annual Meeting, or at any adjournments thereof, and after notification to the Corporate Secretary of the Company at the Annual Meeting of the undersigned's decision to terminate this proxy, the power of said attorneys and proxies shall be deemed terminated and of no further force and effect. The undersigned may also revoke this proxy by filing a subsequently dated proxy or by written notification to the Corporate Secretary of the Company of his or her decision to terminate this proxy. The undersigned acknowledges receipt from the Company prior to the execution of this proxy of an annual report, a Notice of Annual Meeting of Stockholders and a proxy statement for the Annual Meeting. Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. 0000625464_1 R1.0.0.6 Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date

ANNUAL MEETING OF STOCKHOLDERS OF SOTHERLY HOTELS INC. April 30, 2024 IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDERS MEETING TO BE HELD ON APRIL 30, 2024 The proxy statement and annual report to security holders are available on our website at www.sotherlyhotels.com. Please sign, date and mail your proxy card in the envelope provided as soon as possible. Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement, Annual Report/10K is/are available at www.proxyvote.com SOTHERLY HOTELS INC. ANNUAL MEETING OF STOCKHOLDERS This proxy is solicited by the Board of Directors. April 30, 2024 The undersigned hereby appoints the board of directors of Sotherly Hotels Inc. (the "Company"), or its designee, with full powers of substitution, to act as attorneys and proxies for the undersigned, to vote all shares of common stock of the Company which the undersigned is entitled to vote at the 2024 Annual Meeting of Stockholders (the "Annual Meeting"), to be held at the Williamsburg Community Building, 401 North Boundary Street, Williamsburg, Virginia 23185 on Tuesday, April 30, 2024, at 9:00 a.m., local time, and at any and all adjournments thereof, in the following manner: THIS SIGNED PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE PROPOSITIONS STATED, TO THE EXTENT PERMISSIBLE. IF ANY OTHER BUSINESS IS PRESENTED AT THE ANNUAL MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE ANNUAL MEETING. Continued and to be signed on reverse side 0000625464_2 R1.0.0.6


	Series B Preferred Stock		Series C Preferred Stock		Series D Preferred Stock
Name of Beneficial Owner	Shares Owned	Percent of Class(1)	Shares Owned	Percent of Class(2)	Shares Owned	Percent of Class(3)
Andrew M. Sims	1,500	*	1,500	*	1,500	*
David R. Folsom	1,450	0	0	0	0	0
Edward S. Stein	0	0	0	0	0	0
Anthony E. Domalski	0	0	0	0	0	0
General Anthony C. Zinni	0	0	0	0	0	0
G. Scott Gibson IV	0	0	0	0	0	0
Herschel J. Walker	0	0	0	0	0	0
Maria L. Caldwell	0	0	0	0	0	0
All executive officers and directors as a group (9 persons)	2,950	*	1,500	*	1,500	*


Board Diversity Matrix (as of March 15, 2024)
	Female	Male	Non-Binary	Did Not Disclose Gender
Total Number of Directors	7
Part I: Gender Identity
Directors	1	6	0	0
Part II: Demographic Background
African American or Black	0	1	0	0
Alaskan Native or Native American	0	0	0	0
Asian	0	0	0	0
Hispanic or Latinx	0	0	0	0
Native Hawaiian or Pacific Islander	0	0	0	0
White	1	5	0	0
Two or More Races or Ethnicities	0	0	0	0
LGBTQ+	0	0	0	0
Did Not Disclose Demographic Background	0	0	0	0


Philosophy Component	Rationale/Commentary	Pay Element
Compensation should be designed to attract and retain outstanding managers	The principal objective of the Company’s executive compensation plan has been and is to achieve the Company’s business objectives by attracting, retaining and motivating talented executive officers by providing incentives and economic security.	All elements (salary, annual cash bonus, ESOP allocations, restricted stock awards, health and welfare benefits, change in control severance agreements)
Compensation should provide fair and competitive levels of total compensation	To attract and reduce the risk of losing the services of valuable executive officers but avoid the expense of excessive pay, compensation should be competitive. The NCGC Committee assesses the competitiveness of the Company's compensation to its executive officers by comparison to compensation of executive officers at similar public companies, based on available proxy statement data and other data, or by reviewing publicly available third-party surveys to understand developments in compensation in the lodging sector.	All elements
Elements of compensation should be linked with performance	Performance-based pay aligns the interest of management with the Company’s stockholders. Performance-based compensation motivates and rewards individual efforts and Company success. The executive officers were historically eligible to receive a cash bonus in target amounts between 25%-35% of their base salary, subject to consideration of the performance metrics described under the heading “Cash Bonus Plan”.	Cash bonus/stock awards
Compensation should align the interests of our executive officers with those of our stockholders	The Company’s executive compensation is designed to reward favorable total stockholder returns, both in an absolute amount and relative to the Company’s peers, taking into consideration the Company’s competitive position within the real estate industry and each executive’s long-term contributions to the Company. The NCGC Committee takes into account significant existing equity ownership positions of our named executive officers.	Non-discretionary ESOP allocations, restricted stock awards
Compensation should provide incentives and reward named executive officers for their contribution to our Company	The Company strives to provide a rewarding and professionally challenging work environment for its executive officers. The Company believes that executive officers who are motivated and challenged by their duties are more likely to achieve the individual and corporate performance goals. The Company’s executive compensation plan should reflect this work environment and reward the executive officers for meeting or exceeding performance expectations.	All elements


Name and Principal Position	Year	Salary ($)	Bonus ($)		Stock Awards ($)		All Other Compensation ($)		Total ($)
Andrew M. Sims, Chairman	2023	543,025	126,897	(1)	138,203	(4)	76,382	(11)	884,506
	2022	507,789	165,000		—		68,341	(12)	741,129
	2021	462,242	0		170,684	(5)	71,199	(13)	704,126

David R. Folsom, President and CEO	2023	537,595	130,464	(2)	70,023	(6)	76,987	(11)	815,069
	2022	502,711	110,000		49,955	(7)	69,153	(12)	731,818
	2021	480,285	0		166,290	(8)	85,976	(13)	732,552

Anthony E. Domalski, Vice President, CFO and Secretary	2023	382,680	83,491	(3)	62,652	(9)	81,032	(11)	609,855
	2022	357,849	80,000		—		78,107	(12)	515,956
	2021	340,250	0		82,921	(10)	80,697	(13)	503,868


	Stock awards
Name	Number of shares of stock that have not vested (#)			Market value of shares that have not vested ($)
Andrew M. Sims, Chairman		60,000	(1)		89,400	(5)
David R. Folsom, President and CEO		30,000 30,400	(2) (3)		44,700 45,296	(5) (5)
Anthony E. Domalski, Vice President, CFO and Secretary		27,200	(4)		40,528	(5)


Name of Beneficial Owner(1)	Number of Shares of Common Stock		Percent of Class(2)
Andrew M. Sims	1,560,846	(3)	8.2
Rollins Capital Partners, LP; Rollins Capital LLC; Rollins Capital Management LLC; and John A. Wright	1,097,000	(4)	5.5
David R. Folsom	626,424	(5)	3.2
Anthony E. Domalski	277,919	(6)	1.4
General Anthony C. Zinni	107,164	(7)	*
Edward S. Stein	89,051	(8)	*
G. Scott Gibson IV	73,093	(9)	*
Herschel J. Walker	53,573	(10)	*
Maria L. Caldwell	45,190	(11)	*
All executive officers and directors as a group (8 persons)	2,697,322		14.6


Name	Position with the Company	Age as of the Annual Meeting	History of Service as a Director
David R. Folsom	Director, President and Chief Executive Officer	59	2011 - present
Andrew M. Sims	Chairman of the Board of Directors	67	2004 - present
Maria L. Caldwell	Director	60	2019 - present
G. Scott Gibson IV	Director	58	2017 - present
Walter S. Robertson III	Director Nominee	70	None
Herschel J. Walker	Director	62	2015 - present
Anthony C. Zinni	Director	80	2004 - present


	Stock Awards
Name	Number of Shares Acquired on Vesting (#)	Value Realized on Vesting ($)(1)
Andrew M. Sims, Chairman	15,000	29,925

David R. Folsom, President and CEO	7,600	15,162

Anthony E. Domalski, CFO	6,800	13,566


Name and Termination Scenario	Cash Payment(1) ($)	Acceleration of Vesting of Long- Term Equity Incentive Awards ($)		Excise Tax Gross-Up Payments	Other Benefits ($)		Total ($)
Andrew M. Sims, Chairman
Upon Death	—	—		—	—		—
Upon Disability	—	—		—	—		—
By Company For Cause or By Executive Without Good Reason	—	—		—	—		—
By Company Without Cause or By Executive for Good Reason (including Change in Control)	2,018,367	89,400	(2)	—	181,434	(6)	2,289,201

David R. Folsom, President and CEO
Upon Death	—	44,700	(3)	—	—		44,700
Upon Disability	—	44,700	(3)	—	—		44,700
By Company For Cause or By Executive Without Good Reason	—	—		—	—		—
By Company Without Cause or By Executive for Good Reason (including Change in Control)	1,987,997	89,996	(4)	—	184,462	(6)	2,262,455
Non-Renewal of Agreement by Company	662,666	—			50,038	(7)	712,703

Anthony E. Domalski, Vice President, CFO and Secretary
Upon Death	—	—		—	—		—
Upon Disability	—	—		—	—		—
By Company For Cause or By Executive Without Good Reason	—	—		—	—		—
By Company Without Cause or By Executive for Good Reason (including Change in Control)	1,313,547	40,528	(5)	—	204,688	(6)	1,558,763


Year	Summary Compensation Table Total for PEO(1)	Compensation Actually Paid to PEO(2)	Average Summary Compensation Table for Non-PEO NEOs(1)	Average Compensation Actually Paid to Non-PEO NEOs(3)	Value of Initial Fixed $100 Investment Based On	Net Income
Year	Summary Compensation Table Total for PEO(1)	Compensation Actually Paid to PEO(2)	Average Summary Compensation Table for Non-PEO NEOs(1)	Average Compensation Actually Paid to Non-PEO NEOs(3)	Total Shareholder Return(4)	Net Income
2023	$815,069	$781,896	$747,145	$713,342	$59.60	$3,941,421
2022	$731,818	$723,154	$628,542	$627,842	$72.40	$32,536,521
2021	$732,552	$720,252	$603,997	$601,947	$83.60	$(26,221,474)


Name	Fees Earned or Paid in Cash ($)		Stock Awards ($)		Total ($)
Maria L. Caldwell	$	26,750	$	5,670 (1)	$	32,420
G. Scott Gibson IV	$	35,875	$	5,670 (2)	$	41,545
Edward S. Stein	$	33,250	$	5,670 (3)	$	38,920
Herschel J. Walker	$	21,875	$	5,670 (4)	$	27,545
Anthony C. Zinni	$	23,375	$	5,670 (5)	$	29,045


Hotel Name	Commencement Date	Initial Term (through March 2035) & Renewals
Hotel Ballast Wilmington, Tapestry Collection by Hilton	January 1, 2020	2.50%
The DeSoto	January 1, 2020	2.50%
DoubleTree by Hilton Philadelphia Airport	January 1, 2020	2.50%
Hotel Alba Tampa, Tapestry Collection by Hilton	January 1, 2020	2.50%
DoubleTree by Hilton Jacksonville Riverfront	January 1, 2020	2.50%
DoubleTree by Hilton Laurel	January 1, 2020	2.50%
Georgian Terrace	January 1, 2020	2.50%
The Whitehall	January 1, 2020	2.50%


Hotel Name	Commencement Date	Year 1	Year 2	Year 3	Years 4-5 & Renewals
DoubleTree Resort by Hilton Hollywood Beach	April 1, 2020	2.00%	2.25%	2.50%	2.50%
Hyde Resort & Residences	April 1, 2020	2.00%	2.25%	2.50%	2.50%
Hyde Beach House Resort & Residences	April 1, 2020	2.00%	2.25%	2.50%	2.50%
Hyatt Centric Arlington	November 15, 2020	2.00%	2.25%	2.50%	2.50%


BY ORDER OF THE BOARD OF DIRECTORS

	/S/ Anthony E. Domalski
	Anthony E. Domalski
	Corporate Secretary