The Hawks fell into a early hole to start the game, as Perryville went on a 9-0 run. Kelly didn't score until 3:40 left in the first quarter. The Pirates led 11-2 with two minutes to play in the quarter and 13-4 after the first.
Tyler Bauwens could not be stopped in the paint in the first quarter and had eight points for Perryville to jump start the offense.
Perryville kept up the offensive and defensive pressure in the second quarter, outscoring Kelly 16-9 and led 29-13 at halftime.
"We played the best we have all year in the first two quarters," said Perryville head coach Joel Roth. "We had good defensive continuity and the guys moved the ball well on the offensive end."
Kelly had some good looks on the offensive end early in the game, but shots were not falling for the Hawks.
"We didn't shoot well in the first half," said Kelly head coach Cory Johnson. "We didn't force any shots and had open looks. We just didn't seem comfortable on our home court. I thought we seemed more comfortable at the Christmas tournament."
The Hawks came out of the locker room on fire to start the third quarter. Kelly went on a 11-0 run to start the quarter and trailed 29-24 with five minutes to play.
Kelly outscored Perryville 21-10 in the third quarter and cut the lead down to 39-34 heading into the fourth quarter. After a slow start shooting the basketball in the first half, the Hawks hit three 3-pointers in the third, to turn the momentum heading into the fourth.
With 4:20 in the fourth, Kelly trailed 45-37 when they started a late rally. A couple of 3-pointers by the Hawks cut into the Pirate lead and Kelly trailed 49-47 with 1:20 to play in regulation.
Tyler Thurman tied the game for the Hawks, as he got free in the paint and hit a lay-up at 54 seconds. Rick Dunn of Perryville responded with a short jumper along the baseline and the Pirates led 51-49 with 21 seconds to play.
Perryville hit a free throw to go up three, but missed a one-and-one opportunity with 12 seconds left giving the Hawks one last chance.
With 1.8 seconds left in the fourth, Thurman hit a fall-away 3-pointer to tie the game at 52-52 and send it into overtime.
"I give a lot of credit to Kelly," said Roth, "after a slow first half, they didn't quit and got back into the game. We played harder in the first half than they did, but they took it to us in the second half."
In the four minute overtime, the key statistic for Perryville (6-5) was that they went 14-for-16 from the free-throw line to seal the 68-64 win.
All but two points in the overtime came from the free-throw line for the Pirates. Michael Fritsche went 7-for-8 from the charity stripe to lead Perryville in the extra quarter.
"We came through from the free-throw line in overtime," said Roth. "The guys kept their composure and were steady from the line. We made up for the misses we had early in the game."
Fritsche went 12-for-17 from the foul line in the game and finished with 22 points. Dunn ended his night for the Pirates with 20 points and seven rebounds.
Kelly had issues trying to stop Bauwens all night down in the post. Bauwens finished with 18 points and nine rebounds for the Pirates.
"We got beat on defense in the post tonight," said Johnson. "Our help defense was awful. Perryville's post guy (Bauwens) just did what he wanted to down low. He just scored at will."
Thurman hit five 3's for Kelly and led the team with 19 points. Dallas Tew had 14 points and five rebounds, while Spencer Ayers had 11 points and led the Hawks with nine rebounds.
The Hawks hit nine 3's on the night, eight coming in the second half.
"I am not upset with our effort," said Johnson. "The kids played hard and gave maximum effort. We just need to find an identity as a team and go with it."
Kelly (7-6) is off until Tuesday when the Hawks travel to Scott County Central (8-3) at 6 p.m.