Document:

riii_ex4i.htm

EXHIBIT 4i
  
 CERTIFICATE OF DESIGNATION OF THE RELATIVE RIGHTS AND PREFERENCES
 OF THE
 10% CUMULATIVE CONVERTIBLE SERIES D PREFERRED STOCK 
 OF
 RENAVOTIO, INC.
  
 The undersigned, the Chief Executive Officer of Renavotio, Inc., a Nevada corporation (the “Corporation”), does hereby certify that, pursuant to the authority conferred upon the Board of Directors by the Articles of Incorporation of the Corporation, the following resolution creating a series of 10% Cumulative Convertible Series D Preferred Stock, was duly adopted on June 20, 2021:
  
 RESOLVED, that pursuant to the authority expressly granted to and vested in the Board of Directors of the Corporation by provisions of the Articles of Incorporation of the Corporation (the “Articles of Incorporation”), there hereby is created out of the shares of Preferred Stock, par value $.00001 per share, of the Corporation authorized in Article IV of the Articles of Incorporation (the “Preferred Stock”), a series of Preferred Stock of the Corporation, to be named “10% Cumulative Convertible Series D Preferred Stock,” consisting of Five Million (5,000,000) shares, which series shall have the following designations, powers, preferences and relative and other special rights and the following qualifications, limitations and restrictions:
  
 1. Designation and Rank. The designation of such series of the Preferred Stock shall be the 10% Cumulative Convertible Series D Preferred Stock, par value $.00001 per share (the “Series D Preferred Stock”). The maximum number of shares of Series D Preferred Stock shall be Five Million (5,000,000) shares. The Series D Preferred Stock shall rank senior to the common stock, par value $.00001 per share (the “Common Stock”), for purposes of liquidation preference, and senior to the Series B Preferred Stock, and the Series C Preferred Stock (hereinafter referred to as “Junior Stock”). 
  
 2. Dividends. The Series D Preferred herein will carry a non-compounding annual rate of 10% Cumulative Convertible dividend payable annually, upon liquidation, or as and if declared by the Corporation’s Board of Directors (the “Board”) to the holders of the Series D Preferred Stock (the “Holder”). The dividends will be payable in shares of Common Stock at a conversion ratio of $10.00 per share, based on the per share value of the Holders’ investment into the Series D Preferred Stock as recorded on the corporate records of the Corporation (such investment may be part of the consideration underlying the purchase order with Seacrest Sales and Marketing Corporation or similar transactions). The Holders of Series D Preferred herein also shall be entitled to participate pro rata in any dividends paid on the Common Stock on an as-if-converted basis. 
  
 3. Voting Rights. Each share of the Preferred Stock shall have voting rights only as required by law.
   
 CERTIFICATE OF DESIGNATION OF THE RELATIVE RIGHTS AND PREFERENCES
 OF THE
 10% CUMULATIVE CONVERTIBLE SERIES D PREFERRED STOCK 
 OF
 RENAVOTIO, INC.
    
 	 
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 4. Liquidation Preference
  
 (a) The Holders of Series D Preferred Stock shall have preference upon liquidation, dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary, over all holders of Common Stock and Junior Stock. Upon the occurrence of a voluntary or involuntary liquidation, dissolution or winding up of the Corporation, each Holder of Series D Preferred Sock shall be entitled to receive the amount such Holder would have received had such Holder’s shares of Series D Preferred Stock, together with accrued and unpaid dividends thereon, been converted into Common Stock immediately prior to such liquidation, dissolution or winding up of the Corporation at a value of $10.00 per share.
  
 (b) For purposes of this Section, the merger or consolidation of the Corporation with any other corporation or other entity in which the Holders of Series D Preferred Stock receive cash, securities or other property for their shares, or the sale, lease or exchange (for cash, securities or other property for equal value) of all or substantially all of the assets of the Corporation, shall not constitute a liquidation, dissolution or winding up of the Corporation, provided, however, in the event of the sale of all or substantially all the assets of the Corporation in which equal value is not received, liquidation, dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary, or a default on any financial obligation of the Corporation in excess of $1,000,000 in the aggregate shall constitute a liquidation. 
  
 5. Conversion. 
  
 (a) Optional Conversion: The Holder of Series D Preferred Stock shall be convertible into shares of Common Stock at any time at the election of each Holder. The initial conversion rate shall be at a conversion ratio of the average closing stock price of the Common stock on the last ten (10) Trading Days, based on the per share value of the Holders’ investment into the Series D Preferred Stock as recorded on the corporate records of the Corporation (such investment may be part of the consideration underlying the purchase order with Seacrest Sales and Marketing Corporation or similar transactions) (the “Conversion Rate”). For clarification and the purpose of the federal securities laws, this conversion rate is considered a variable conversion rate. Trading Day” means a day on which the principal Trading Market is open for trading. “Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE MKT, the NASDAQ Capital Market, the NASDAQ Global Market, the NASDAQ Global Select Market, the New York Stock Exchange, the OTC Pink Marketplace, the OTC Bulletin Board, the OTCQB, or the OTCQX (or any successors to any of the foregoing). 
   
 CERTIFICATE OF DESIGNATION OF THE RELATIVE RIGHTS AND PREFERENCES
 OF THE
 10% CUMULATIVE CONVERTIBLE SERIES D PREFERRED STOCK 
 OF
 RENAVOTIO, INC.
   
 	 
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 (b) Holders shall affect conversions by providing the Corporation with the form of conversion notice attached hereto as Annex A (a “Notice of Conversion”). Each Notice of Conversion shall specify the number of shares of Series D Preferred Stock to be converted, the number of shares of Series D Preferred Stock owned prior to the conversion at issue, the number of shares of Series D Preferred Stock owned subsequent to the conversion at issue and the date on which such conversion is to be effected, which date may not be prior to the date the Holder delivers such Notice of Conversion to the Corporation by facsimile (the “Conversion Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion to the Corporation is deemed delivered hereunder. The calculations and entries set forth in the Notice of Conversion shall control in the absence of manifest or mathematical error. To effect conversions, as the case may be, of shares of Series D Preferred Stock, a Holder shall not be required to surrender the certificate(s) representing such shares of Series D Preferred Stock to the Corporation unless all of the shares of Series D Preferred Stock represented thereby are so converted, in which case the Holder shall deliver the certificate representing such share of Series D Preferred Stock promptly following the Conversion Date at issue. Shares of Series D Preferred Stock converted or redeemed in accordance with the terms hereof shall be canceled and may not be reissued.
  
 (b) Mandatory Conversion. At any time on or after the second anniversary of the issuance of this Series D Preferred Stock to the Holder, the Corporation shall have the right, at its sole option, to cause the Series D Preferred Stock, in whole or, at its discretion, in part, to be automatically converted into Common Stock at the then applicable Conversion Rate. The Corporation will provide notice to all Holders of Series D Preferred Stock of the triggered automatic conversion.
  
 (c) Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of the Series D Preferred Stock. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion, the Corporation shall round down to the next whole share.
  
 (d) Transfer Taxes and Expenses. The issuance of certificates for shares of the Common Stock on conversion of this Series D Preferred Stock shall be made without charge to any Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificates, provided that the Corporation shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the Holders of such shares of Series D Preferred Stock and the Corporation shall not be required to issue or deliver such certificates unless or until the Person or Persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall have established to the satisfaction of the Corporation that such tax has been paid. The Corporation shall pay all Transfer Agent fees required for same-day processing of any Notice of Conversion.
  
 (e) Legend. Each Conversion Share will be imprinted with the following legend:
  
 “[NEITHER] THIS SECURITY [NOR THE SECURITIES INTO WHICH THIS SECURITY IS [EXERCISABLE] [CONVERTIBLE]] HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE CORPORATION. THIS SECURITY [AND THE SECURITIES ISSUABLE UPON [EXERCISE] [CONVERSION] OF THIS SECURITY] MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.”
   
 CERTIFICATE OF DESIGNATION OF THE RELATIVE RIGHTS AND PREFERENCES
 OF THE
 10% CUMULATIVE CONVERTIBLE SERIES D PREFERRED STOCK 
 OF
 RENAVOTIO, INC.
     
 	 
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 6. Lost or Stolen Certificates. Upon receipt by the Corporation of evidence satisfactory to the Corporation of the loss, theft, destruction or mutilation of any Preferred Stock Certificates representing the shares of Series D Preferred Stock, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Corporation and, in the case of mutilation, upon surrender and cancellation of the Preferred Stock Certificate(s), the Corporation shall execute and deliver new preferred stock certificate(s) of like tenor and date.
  
 7. Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Certificate of Designation shall be Cumulative Convertible and in addition to all other remedies available under this Certificate of Designation, at law or in equity (including a decree of specific performance and/or other injunctive relief), no remedy contained herein shall be deemed a waiver of compliance with the provisions giving rise to such remedy and nothing herein shall limit a Holder’s right to pursue actual damages for any failure by the Corporation to comply with the terms of this Certificate of Designation. The Corporation acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holders of the Series D Preferred Stock and that the remedy at law for any such breach may be inadequate. The Corporation therefore agrees that, in the event of any such breach or threatened breach, the Holders of the Series D Preferred Stock shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required.
  
 8. Specific Shall Not Limit General; Construction. No specific provision contained in this Certificate of Designation shall limit or modify any more general provision contained herein.
  
 9. Failure or Indulgence Not Waiver. No failure or delay on the part of a Holder of Series D Preferred Stock in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. 
  
 10. Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any Notice of Conversion, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service, addressed to the Corporation, at: 601 South Boulder Ave., Suite 600, Tulsa, OK 74119, Attention: CEO, or such other facsimile number or address as the Corporation may specify for such purposes by notice to the Holders delivered in accordance with this Section 8. Any and all notices or other communications or deliveries to be provided by the Corporation hereunder shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile number or address of such Holder appearing on the books of the Corporation, or if no such facsimile number or address appears on the books of the Corporation, at the principal place of business of such Holder, as set forth in the Purchase Agreement. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given.
   
 CERTIFICATE OF DESIGNATION OF THE RELATIVE RIGHTS AND PREFERENCES
 OF THE
 10% CUMULATIVE CONVERTIBLE SERIES D PREFERRED STOCK 
 OF
 RENAVOTIO, INC.
     
 	 
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 11. Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Certificate of Designation shall be governed by and construed and enforced in accordance with the internal laws of the State of Nevada, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the Series D Preferred Stock (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal courts sitting in Nevada (the “Nevada Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the Nevada Courts for the adjudication of any dispute hereunder and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, or such Nevada Courts are improper or inconvenient venue for such proceeding. If either party shall commence an action or proceeding to enforce any provisions of this Certificate of Designation, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorney’s fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.
  
 12. Waiver. Any waiver by the Corporation or the Holder of a breach of any provision of this Certificate of Designation shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Certificate of Designation. The failure of the Corporation or the Holder to insist upon strict adherence to any term of this Certificate of Designation on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designation. Any waiver must be in writing.
  
 13. Severability. If any provision of this Certificate of Designation is invalid, illegal or unenforceable, the balance of this Certificate of Designation shall remain in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates applicable laws governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum permitted rate of interest. 
  
 14. Assignment and Enurement. The shares of Series D Preferred Stock and any right or obligation under this Section may be assigned by any of the Parties with the prior written consent of the other Parties. The provisions hereunder enure to the benefit of and is binding upon the Parties and their respective heirs, executors, administrators, estate trustees, trustees, personal or legal representatives, successors and permitted assigns.
  
 15. Headings. The headings contained herein are for convenience only, do not constitute a part of this Certificate of Designation and shall not be deemed to limit or affect any of the provisions hereof.
   
 CERTIFICATE OF DESIGNATION OF THE RELATIVE RIGHTS AND PREFERENCES
 OF THE
 10% CUMULATIVE CONVERTIBLE SERIES D PREFERRED STOCK 
 OF
 RENAVOTIO, INC.
     
 	  

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 IN WITNESS WHEREOF, the undersigned has executed and subscribed this Amended Certificate and does affirm the foregoing as true this 20th day of June, 2021.
  
 	 	RENAVOTIO, INC.	
	 	 	 	 
		By: 	/s/ William Robinson	
	  
	  
	Name: William Robinson	 
	 	 	 Title: President
	 

   
 CERTIFICATE OF DESIGNATION OF THE RELATIVE RIGHTS AND PREFERENCES
 OF THE
 10% CUMULATIVE CONVERTIBLE SERIES D PREFERRED STOCK 
 OF
 RENAVOTIO, INC.
      
 	 
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 ANNEX A
  
 NOTICE OF CONVERSION
  
 (TO BE EXECUTED BY THE REGISTERED HOLDER IN ORDER TO CONVERT SHARES OF SERIES D PREFERRED STOCK)
  
 The undersigned hereby elects to convert the number of shares of Series D Cumulative Convertible Preferred Stock indicated below, into shares of common stock (the “Common Stock”), of Renavotio, Inc., a Nevada corporation (the “Corporation”), according to the conditions hereof, as of the date written below. If shares are to be issued in the name of a person other than undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Corporation in accordance therewith. No fee will be charged to the Holder for any conversion, except for such transfer taxes, if any.
  
 Conversion calculations:
  
 	 Date to Effect Conversion: ______________________________

	  

	 Number of shares of Preferred Stock owned prior to Conversion (including dividend shares): ________________

	  

	 Number of shares of Preferred Stock to be Converted: _______________ 

	  

	 Number of shares of Common Stock to be Issued: _________________________

   
 	 	[HOLDER]	
	 	 	 	 
		By: 		
	  
	  
	Name:	 
	 	 	 Title:
	 

   
 CERTIFICATE OF DESIGNATION OF THE RELATIVE RIGHTS AND PREFERENCES
 OF THE
 10% CUMULATIVE CONVERTIBLE SERIES D PREFERRED STOCK 
 OF
 RENAVOTIO, INC.
   
 	 
	7soho-ex1022_42.htm

Exhibit 10.22

 

SHARE EXCHANGE AGREEMENT

This Share Exchange Agreement (the “Agreement”) is made and entered into effective as of June 21, 2021 (the "Effective Date"), by and between Sotherly Hotels Inc., a Maryland Corporation (“Sotherly” or the “Company”), and Palogic Value Fund, L.P., a Delaware limited partnership (“Palogic”).

RECITALS

A.Palogic approached Sotherly about its desire to exchange certain shares of 

8.0% Series B Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share (“SOHOB”) of Sotherly; 

7.875% Series C Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share (“SOHOO”) of Sotherly; and 

8.25% Series D Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share (“SOHON”) of Sotherly

held by it for shares of Common Stock, par value $0.01 per share (“Common Stock”), of the Company.

B.The Company is willing to effect such an exchange on the terms and conditions set forth in this Agreement.

AGREEMENT

The parties hereby agree as follows:

1.Exchange.  Palogic hereby agrees to (i) transfer 100,000 shares of SOHOB, 85,000 shares of SOHOO and 35,000 shares of SOHON (the “Palogic Shares”) to the Company in exchange for 1,542,727 shares of Common Stock of the Company (the “Company Shares”), as determined in accordance with Schedule A attached hereto and incorporated herein by reference and (ii) waive any and all rights it may have to receipt of declared and unpaid dividends and any accrued and unpaid dividends payable in respect of the Palogic Shares.  The transfer of the Palogic Shares to the Company and the waiver of Palogic’s interest in the dividends and the issuance of the Company Shares to Palogic is referred to as the “Exchange” and such Exchange shall occur on the Closing Date (as defined herein), as set forth in Section 2 of this Agreement.  The parties agree and acknowledge that the foregoing economic terms of the Exchange were determined based upon arm’s-length negotiations, and that no additional consideration, financial or otherwise, is or will be provided by either party in consideration of the Exchange of the Palogic Shares and Company Shares described herein.

	
2.
	
Closing; Delivery.  The Exchange shall occur simultaneously through the transfer of the Palogic Shares by Palogic to the Company and the issuance of the Company Shares by the Company to Palogic on the Closing Date.  On the Closing Date, (a) Palogic shall direct the Depository Trust Company (“DTC”) participant through which Palogic holds its interest in the 

		
Palogic Shares to submit instructions through DTC’s Deposits and Withdrawal at Custodian (“DWAC”) program to the Company’s transfer agent and registrar, American Stock Transfer & Trust Company, LLC (the “Transfer Agent”), to transfer all of the Palogic Shares to the Company, free and clear of all liens and encumbrances, and (b) the Company shall instruct the Transfer Agent, upon receipt of the Palogic Shares, to instruct the DTC to credit the account of Palogic at Palogic’s DTC participant with the Company Shares, free and clear of all liens and encumbrances. The Company Shares shall be issued free and clear of any restrictive legends under applicable securities laws and other restrictions on transfer.  The closing of the Exchange shall occur no later than three (3) business days following the Effective Date (the “Closing Date”).  

The Company will not receive any cash proceeds as a result of the Exchange. The issuance of the Company Shares will be made by the Company pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), contained in Section 3(a)(9) of such act on the basis that the Exchange constitutes an exchange with existing holders of the Company’s securities, and no commission or other remuneration was or will be paid to any party in connection with the Exchange, including for soliciting such Exchange. 

	
3.
	
Representations, Warranties and Acknowledgements of Palogic.  In connection with the Exchange, Palogic represents, warrants and agrees that:

	
(a)
	
Existence, Power and Authorization.  Palogic is a limited partnership duly formed, validly existing and in good standing under the laws of the State of Delaware.  Palogic has full limited partnership power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby.  The execution and delivery by Palogic of this Agreement, the performance by Palogic of its obligations hereunder and the consummation by Palogic of the transactions contemplated hereby have been duly authorized by all requisite limited partnership action.  

	
(b)
	
Execution and Delivery; Enforceability.  This Agreement has been duly executed and delivered by Palogic and constitutes the valid and legally binding obligation of Palogic, enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general equitable principles (whether considered in a proceeding at law or in equity).

	
(c)
	
Title to Shares.  Palogic has valid marketable title to the Palogic Shares, free and clear of any pledge, lien, security interest, encumbrance, claim or equitable interest other than pursuant to this Agreement; and upon delivery of the Palogic Shares hereunder in the Exchange, the Company will obtain valid marketable title to the Palogic Shares, free and clear of any pledge, lien, security interest pertaining to Palogic’s property, encumbrance, claim or equitable interest, or any liability to or claims of any creditor or beneficiary of Palogic.

	
(d)
	
Securities Act Exemption. Neither Palogic nor anyone acting on behalf of Palogic has received any commission or remuneration directly or indirectly in connection with or in order to solicit or facilitate the Exchange. Palogic understands that the Exchange contemplated 

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hereby is intended to be exempt from registration by virtue of Section 3(a)(9) of the Securities Act. Palogic further understands that the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of Palogic set forth herein for purposes of qualifying for the exemption under Section 3(a)(9) of the Securities Act as well as qualifying for exemptions under applicable state securities laws.

	
(e)
	
Non-Affiliate Status.  Neither Palogic nor its general partner, nor any entity owned or controlled by Palogic or its general partner, nor any of their respective shareholders, limited partners, directors, officers or affiliates, presently is, or in the prior six (6) months has been an “Affiliate” of the Company as that term is used in Rule 144 under the Securities Act. 

	
(f)
	
Non-Distribution.  Palogic is not acquiring the Common Shares with a view to a distribution thereof as that term is used in Section 2(a)(11) of the Securities Act in a manner which would require registration under the Securities Act or any state securities laws.

	
(g)
	
Independent Analysis.  Palogic has made its own decision to engage in the Exchange based on its own due diligence review and independent analysis, which includes a review of the filings and disclosures made by the Company with the Securities and Exchange Commission and which Palogic deems to have been sufficient.  The Company did not recommend or encourage Palogic participate in the Exchange or provide any advice to Palogic.

	
(h)
	
No Legal, Tax, or Investment Advice.  Palogic has had an opportunity to review the federal, state, local, and foreign tax consequences to it of the Exchange.  Palogic understands that nothing in this Agreement or any other materials presented to Palogic in connection with the Exchange constitutes legal, tax, or investment advice.  Palogic has consulted such legal, tax, and investment advisors as Palogic, in its sole discretion, has deemed necessary or appropriate in connection with the Exchange.  Palogic acknowledges that Palogic shall be responsible for its own tax liability, if any, that may arise as a result of the Exchange.

	
(i)
	
Sophistication; Investment Intent. Palogic, through its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks associated with the Exchange, and has so evaluated the related merits and risks. Palogic is able to bear the economic risk of the Exchange and is able to bear a complete loss of its investment.  

	
4.
	
Representations and Warranties of the Company.  In connection with the Exchange, the Company represents and warrants that: 

	
(a) 
	
Execution and Delivery; Enforceability.  This Agreement has been duly executed and delivered by David R. Folsom, President and Chief Executive Officer of the Company and constitutes the valid and legally binding obligation of the Company, enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general equitable principles (whether considered in a proceeding at law or in equity).

	
(b)
	
Title to Shares.  Palogic will obtain valid marketable title to the Company Shares, free and clear of any pledge, lien, security interest pertaining to the Company’s property, 

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encumbrance, claim or equitable interest, or any liability to or claims of any creditor or beneficiary of the Company.

	
(c)
	
Information About the Company.  The Company has received all information about the Exchange it determined was necessary or appropriate to enable it to evaluate its decision to effect the Exchange. The Company acknowledges that none of such information has been provided directly or indirectly by Palogic and that they have in no event relied upon any information provided by Palogic.  The number of the Company Shares to be received in the Exchange was negotiated by Palogic and the Company.

	
(d)
	
No Legal, Tax, or Investment Advice.  The Company has had an opportunity to review the federal, state, local, and foreign tax consequences to it of the Exchange.  The Company understands that nothing in this Agreement or any other materials presented to the Company in connection with the Exchange constitutes legal, tax, or investment advice.  The Company has consulted such legal, tax, and investment advisors as the Company, in its sole discretion, have deemed necessary or appropriate in connection with the Exchange.  The Company acknowledges that it is responsible for its own tax liability, if any, that may arise as a result of the Exchange.

(e)No Material Non-Public Information.  Other than with respect to the Exchange, neither the Company nor any person acting on its behalf has provided to Palogic any information that is not publicly available or would be considered material non-public Information.  The Company acknowledges that Palogic will be relying on the foregoing representation and warranty in effecting transactions in the Company’s securities. 

 5.Legends.  The issuance of the shares of the Company Shares will be made by the Company pursuant to the exemption from the registration requirements of Section 3(a)(9) of the Securities Act and will contain no restrictive resale legend.  The Company shall cause, at its own expense, its legal counsel to deliver any opinions reasonably required by the Company’s transfer agent for the issuance of the Company Shares free from such restrictive legends. 

6.Miscellaneous.

(a)Governing Law.  This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of Delaware, without giving effect to principles of conflicts of law.  Palogic and the Company hereby submit to the exclusive jurisdiction of the courts of the State of Delaware and the federal district court sitting in the State of Delaware having subject matter jurisdiction with respect to any and all disputes arising under this Agreement or otherwise in connection with the Exchange.

 

	
(b)
	
Entire Agreement; Amendment.  Except as expressly set forth herein, this Agreement sets forth the entire agreement and understanding of the parties relating to the subject matter herein and merges all prior discussions between them.  No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, shall be effective unless in writing signed by the parties to this Agreement.

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(c)
	
Notices.  Any notice required or permitted by this Agreement shall be in writing and shall be deemed sufficient when delivered personally or sent by fax (as evidenced by sender's confirmation receipt) or two business days after being deposited in the U.S. mail, as certified or registered mail, with postage prepaid, and addressed to the party to be notified at such party's address as set forth below or as subsequently modified by written notice.

	
(d)
	
Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument.

	
(e)
	
Further Actions.  The parties agree to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement.

	
(f)
	
Survival.  The representations, warranties, covenants and agreements made herein shall survive the closing of the transactions contemplated hereby.

	
(g)
	
Expenses.  Palogic and the Company shall each bear their own expenses and legal fees incurred in preparation of this Agreement and effecting the transaction contemplated hereby; provided that Palogic shall pay the legal fees of counsel and other administrative costs of the Exchange to the Company not to exceed $30,000.

	
(h)
	
Third Party Beneficiaries.  This Agreement is not intended to, and shall not, confer any rights or remedies upon any person other than the Company and Palogic and their respective successors and permitted assigns.

	
(i)
	
Successors and Assigns.  The respective rights and obligations of Palogic and the Company under this Agreement may be assigned only with the prior written consent of the other.

	
(j)
	
Announcement.  The Company shall file a Current Report on Form 8-K describing the material terms of this Agreement and attaching this Agreement as an exhibit by not later than 5:30 p.m. (local time in New York City, New York) on the Effective Date.  Following the filing of such Current Report on Form 8-K, the Company shall be deemed to have publicly disclosed any material, non-public information that may have been provided to Palogic.   

[Signature Page Follows]

 

 

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The parties have executed this Share Exchange Agreement as of the date first set forth above.

 

	
	
PALOGIC:

 

PALOGIC VALUE FUND, L.P.

 

By:Palogic Value Management, L.P., its general

partner

By:Palogic Capital Management, LLC, its general partner

 

By:   /s/ Ryan Vardeman

Ryan Vardeman, Member

 

 

Address:  5310 Harvest Hill Road, Suite 110

Dallas, TX 75230

 

 

 

	
	
COMPANY:

 

SOTHERLY HOTELS INC.

 

 

By:  /s/ David R. Folsom

David R. Folsom

President and Chief Executive Officer

 

 

Address: 306 South Henry Street, Suite 100

Williamsburg , Virginia 23185

 

 

 

SCHEDULE A

The number of Company Shares to be issued to Palogic in the Exchange shall be determined as follows as of the Effective Date:

 

	
 
	
1.
	
The average of the average of the closing price per share for each of the SOHOB, SOHOO and SOHON over the thirty trading days prior to the Effective Date shall be the “Palogic Share Price”. 

	
 
	
2.
	
The sum of the Palogic Share Price and $3.00 (representing the average per share accrued and unpaid dividends on the three classes of Sotherly’s preferred stock) shall be the “Palogic Price”.

	
 
	
3.
	
The average closing price per share for the Common Stock over the thirty trading days prior to the Effective Date multiplied by 0.865 shall be the “Discounted Soho Share Price”.

	
 
	
4.
	
The Palogic Price divided by the Discounted Soho Share Price shall be the “Exchange Ratio”; provided, however, in no event shall the Exchange Ratio be less than 6.9 or greater than 7.1. 

	
 
	
5.
	
The aggregate number of shares of Common Stock to be issued to Palogic in connection with the Exchange shall equal the product of the number of Palogic Shares multiplied by the Exchange Ratio, rounded to the nearest whole number.

	
 
	
6.
	
No fractional shares or scrip representing fractional shares shall be issued in connection with the Exchange.

 

Attached as an exhibit to this Schedule A is the calculation of the number of Company Shares, as agreed by the parties. 

 

 

 

 

 

 

	
PX_LAST
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
DRAFT
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
EXHIBIT A
	
 

	
Start
	
 
	
5/5/2021
	
 
	
 
	
 
	
5/6/2021
	
 
	
 
	
 
	
5/7/2021
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
5/7/2021
	
 
	
 
	
 

	
End
	
 
	
6/18/2021
	
 
	
 
	
 
	
6/18/2021
	
 
	
 
	
 
	
6/18/2021
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
6/18/2021
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Security
	
 
	
 
	
SOHOO Pfd
	
 
	
 
	
SOHON Pfd
	
 
	
 
	
SOHOB Pfd
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
SOHO Equity
	
 

	
Trading Days
	
Date
	
Close
	
 
	
Date
	
Close
	
 
	
Date
	
Close
	
 
	
 
	
 
	
 
	
 
	
 
	
Date
	
Px
	
 

	
1
	
 
	
#NAME?
	
16.827
	
 
	
#NAME?
	
17.435
	
 
	
#NAME?
	
17.35
	
 
	
 
	
 
	
 
	
 
	
 
	
#NAME?
	
3.39
	
 

	
2
	
 
	
5/6/2021
	
16.795
	
 
	
5/7/2021
	
17.26
	
 
	
5/10/2021
	
17.5
	
 
	
 
	
 
	
 
	
 
	
 
	
5/10/2021
	
3.55
	
 

	
3
	
 
	
5/7/2021
	
17.1
	
 
	
5/10/2021
	
17.23
	
 
	
5/11/2021
	
16.95
	
 
	
 
	
 
	
 
	
 
	
 
	
5/11/2021
	
3.24
	
 

	
4
	
 
	
5/10/2021
	
16.95
	
 
	
5/11/2021
	
17.16
	
 
	
5/12/2021
	
17.22
	
 
	
 
	
 
	
 
	
 
	
 
	
5/12/2021
	
3.09
	
 

	
5
	
 
	
5/11/2021
	
17.8097
	
 
	
5/12/2021
	
17.36
	
 
	
5/13/2021
	
17.6
	
 
	
 
	
 
	
 
	
 
	
 
	
5/13/2021
	
3.31
	
 

	
6
	
 
	
5/12/2021
	
17.3199
	
 
	
5/13/2021
	
17.74
	
 
	
5/14/2021
	
17.055
	
 
	
 
	
 
	
 
	
 
	
 
	
5/14/2021
	
3.31
	
 

	
7
	
 
	
5/14/2021
	
17.1
	
 
	
5/14/2021
	
17.01
	
 
	
5/17/2021
	
17.15
	
 
	
 
	
 
	
 
	
 
	
 
	
5/17/2021
	
3.27
	
 

	
8
	
 
	
5/17/2021
	
16.8638
	
 
	
5/17/2021
	
17.16
	
 
	
5/18/2021
	
17.15
	
 
	
 
	
 
	
 
	
 
	
 
	
5/18/2021
	
3.31
	
 

	
9
	
 
	
5/18/2021
	
16.98
	
 
	
5/18/2021
	
17.1
	
 
	
5/19/2021
	
17.1954
	
 
	
 
	
 
	
 
	
 
	
 
	
5/19/2021
	
3.3
	
 

	
10
	
 
	
5/19/2021
	
16.8675
	
 
	
5/19/2021
	
17.25
	
 
	
5/20/2021
	
16.97
	
 
	
 
	
 
	
 
	
 
	
 
	
5/20/2021
	
3.33
	
 

	
11
	
 
	
5/20/2021
	
16.57
	
 
	
5/20/2021
	
17.6425
	
 
	
5/21/2021
	
17.11
	
 
	
 
	
 
	
 
	
 
	
 
	
5/21/2021
	
3.43
	
 

	
12
	
 
	
5/21/2021
	
16.68
	
 
	
5/21/2021
	
16.9258
	
 
	
5/24/2021
	
17.11
	
 
	
 
	
 
	
 
	
 
	
 
	
5/24/2021
	
3.45
	
 

	
13
	
 
	
5/24/2021
	
16.6215
	
 
	
5/24/2021
	
17.19
	
 
	
5/25/2021
	
17.3788
	
 
	
 
	
 
	
 
	
 
	
 
	
5/25/2021
	
3.55
	
 

	
14
	
 
	
5/25/2021
	
17.023
	
 
	
5/26/2021
	
17.625
	
 
	
5/26/2021
	
18.08
	
 
	
 
	
 
	
 
	
 
	
 
	
5/26/2021
	
3.67
	
 

	
15
	
 
	
5/26/2021
	
17.23
	
 
	
5/27/2021
	
17.357
	
 
	
5/27/2021
	
17.75
	
 
	
 
	
 
	
 
	
 
	
 
	
5/27/2021
	
3.74
	
 

	
16
	
 
	
5/27/2021
	
17.37
	
 
	
5/28/2021
	
18.2
	
 
	
5/28/2021
	
19
	
 
	
 
	
 
	
 
	
 
	
 
	
5/28/2021
	
3.72
	
 

	
17
	
 
	
5/28/2021
	
17.8
	
 
	
6/1/2021
	
19.595
	
 
	
6/1/2021
	
19.6
	
 
	
 
	
 
	
 
	
 
	
 
	
6/1/2021
	
3.9
	
 

	
18
	
 
	
6/1/2021
	
18.87
	
 
	
6/2/2021
	
20.497
	
 
	
6/2/2021
	
20.03
	
 
	
 
	
 
	
 
	
 
	
 
	
6/2/2021
	
3.98
	
 

	
19
	
 
	
6/2/2021
	
19.73
	
 
	
6/3/2021
	
20.1554
	
 
	
6/3/2021
	
20.42
	
 
	
 
	
 
	
 
	
 
	
 
	
6/3/2021
	
3.85
	
 

	
20
	
 
	
6/3/2021
	
19.65
	
 
	
6/4/2021
	
20.69
	
 
	
6/4/2021
	
20.37
	
 
	
 
	
 
	
 
	
 
	
 
	
6/4/2021
	
3.74
	
 

	
21
	
 
	
6/4/2021
	
19.47
	
 
	
6/7/2021
	
21.63
	
 
	
6/7/2021
	
20.75
	
 
	
 
	
 
	
 
	
 
	
 
	
6/7/2021
	
3.95
	
 

	
22
	
 
	
6/7/2021
	
20.6115
	
 
	
6/8/2021
	
22.645
	
 
	
6/8/2021
	
21.45
	
 
	
 
	
 
	
 
	
 
	
 
	
6/8/2021
	
4.04
	
 

	
23
	
 
	
6/8/2021
	
20.5
	
 
	
6/9/2021
	
22.475
	
 
	
6/9/2021
	
21.46
	
 
	
 
	
 
	
 
	
 
	
 
	
6/9/2021
	
4.05
	
 

	
24
	
 
	
6/9/2021
	
21.4999
	
 
	
6/10/2021
	
22.294
	
 
	
6/10/2021
	
21.5562
	
 
	
 
	
 
	
 
	
 
	
 
	
6/10/2021
	
4.03
	
 

	
25
	
 
	
6/10/2021
	
21.365
	
 
	
6/11/2021
	
21.7
	
 
	
6/11/2021
	
21.48
	
 
	
 
	
 
	
 
	
 
	
 
	
6/11/2021
	
4.04
	
 

	
26
	
 
	
6/11/2021
	
21.31
	
 
	
6/14/2021
	
21.5
	
 
	
6/14/2021
	
21.4663
	
 
	
 
	
 
	
 
	
 
	
 
	
6/14/2021
	
3.9
	
 

	
27
	
 
	
6/14/2021
	
20.95
	
 
	
6/15/2021
	
20.92
	
 
	
6/15/2021
	
21.18
	
 
	
 
	
 
	
 
	
 
	
 
	
6/15/2021
	
3.6
	
 

	
28
	
 
	
6/16/2021
	
22.12
	
 
	
6/16/2021
	
20.6703
	
 
	
6/16/2021
	
21.05
	
 
	
 
	
 
	
 
	
 
	
 
	
6/16/2021
	
3.62
	
 

	
29
	
 
	
6/17/2021
	
20.365
	
 
	
6/17/2021
	
20.51
	
 
	
6/17/2021
	
20.855
	
 
	
 
	
 
	
 
	
 
	
 
	
6/17/2021
	
3.48
	
 

	
30
	
 
	
6/18/2021
	
19.5385
	
 
	
6/18/2021
	
20
	
 
	
6/18/2021
	
19.7
	
 
	
 
	
 
	
 
	
 
	
 
	
6/18/2021
	
3.35
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
Palogic Share Price
	
 
	
 
	
 
	
 
	
 
	
 

	
Average Closing Price
	
 
	
18.53
	
 
	
 
	
 
	
19.10
	
 
	
 
	
 
	
19.00
	
 
	
 
	
 
	
18.88
	
 
	
 
	
 
	
 
	
3.61
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Multiplier
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
0.865
	
 

	
 Discounted SOHO Share Price
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
3.1195
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Palogic Share Price
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
18.88
	
 

	
Dividends
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
3.00
	
 

	
Palogic Price
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
21.88
	
 

	
Exchange Ratio
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
7.0124
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
SOHOB
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
100,000
	
 

	
SOHOO
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
85,000
	
 

	
SOHON
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
35,000
	
 

	
Palogic Shares
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
220,000
	
 

	
Company Shares
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
1,542,727

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00329-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00329-of-00352.parquet"}]]