Exhibit 10.1
 

VOTING AGREEMENT

This VOTING AGREEMENT (this “Agreement”), dated as of April 13, 2016, is entered
into by and among Apple REIT Ten, Inc., a Virginia corporation (the “Company”),
Apple Hospitality REIT, Inc., a Virginia corporation (“Parent,” and collectively
with the Company, the “Apple REITs” or individually, an “Apple REIT”), and Glade
M. Knight (the “Company Securityholder”).
 
WHEREAS, the Apple REITs and 34 Consolidated, Inc., a Virginia corporation and
wholly-owned subsidiary of Parent (“Merger Sub”), are entering into an Agreement
and Plan of Merger, dated as of April 13, 2016 (as it may be amended or
otherwise modified from time to time, the “Merger Agreement”), pursuant to which
the Company will merge with and into Merger Sub (the “Merger”), with Merger Sub
continuing as the Surviving Corporation in the Merger (all capitalized terms
used but not defined herein shall have the meanings set forth in the Merger
Agreement);
 
WHEREAS, as the date hereof, the Company Securityholder is the beneficial and
record owner of, and has the sole or shared right to vote and dispose of, all
the issued and outstanding Series B Convertible Preferred Shares, no par value,
of the Company (the “Series B Convertible Shares”) and 8,042,857 Parent Common
Shares, no par value, as more particularly described on Schedule 1 hereto; and
 
WHEREAS, as a condition to its willingness to enter into the Merger Agreement,
each of the Apple REITs has required that the Company Securityholder agree, and
the Company Securityholder is willing to agree, to the matters set forth herein.
 
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree, intending to be legally bound hereby, as
follows:
 
SECTION 1.                          Disposition of Series B Shares
 
During the period from the date hereof through the earlier of (i) the date on
which the Merger is consummated or (ii) the date on which the Merger Agreement
is terminated according to its terms (such period hereinafter referred to as the
“Term”), the Company Securityholder shall not, directly or indirectly, (a) sell,
sell short, transfer (including by gift), pledge, encumber, assign or otherwise
dispose of, or enter into any contract, option or other agreement or
understanding with respect to the sale, transfer, pledge, encumbrance,
assignment or other disposition of, any Series B Convertible Shares or any other
Company Shares or Parent Common Shares that the Company Securityholder may
beneficially own during the Term (collectively, with the Series B Convertible
Shares, the “Subject Shares”), (b) grant any proxies or powers of attorney for
any Subject Shares with respect to any matters described in paragraphs (a) and
(b) of Section 2 hereof (other than a proxy directing the holder thereof to vote
the Subject Shares in a manner required by paragraphs (a) and (b) of Section 2
hereof), (c) deposit any Subject Shares into a voting trust or enter into a
voting agreement or other arrangement with respect to any Subject Shares with
respect to any of the matters described in paragraphs (a) and (b) of Section 2
hereof, or tender any Subject Shares in a transaction other than a transaction
contemplated by the Merger Agreement, or (d) take any action which is intended
to have the effect of preventing or disabling the Company Securityholder from
performing his obligations under this Agreement; provided, however, that nothing
herein shall prevent (i) the sale, transfer, pledge, encumbrance, assignment or
other disposition of any of such Subject Shares, provided that the purchaser,
transferee, pledgee or assignee thereof agrees in writing with the Apple REITs,
prior to such sale, transfer, pledge, encumbrance, assignment or other
disposition, to be bound by the terms of this Agreement or (ii) the assignment
of certain benefits by the Company Securityholder pursuant to agreements entered
into before the date hereof with respect to Series B Convertible Shares as to
which the Company Securityholder is not the sole beneficial owner.
 
 
 

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SECTION 2.                          Voting
 
During the Term, the Company Securityholder shall:
 
(a) be present, in person or represented by proxy, at each meeting (whether
annual or special and whether or not an adjourned or postponed meeting) of the
shareholders of either Apple REIT, however called, so that all of such Company
Securityholder’s Subject Shares may be counted for purposes of determining the
presence of a quorum at each such Apple REIT shareholders’ meeting; and
 
(b) cast or cause to be cast all votes attributable to the Subject Shares at any
annual or special meeting of shareholders of either Apple REIT, including any
adjournments or postponements thereof, or in connection with any written consent
or other vote of the shareholders of an Apple REIT, in favor of (i) with respect
to a shareholders’ meeting of the Company, approval and adoption of the Merger
Agreement (including any amendments or modifications of the terms of the Merger
Agreement approved by the boards of directors of the Company, upon the
recommendation of the Company Special Committee, that would not materially
adversely affect the Company Securityholder in his capacity as beneficial owner
of the Subject Shares), the related Plan of Merger, approval of the Merger, each
of the other actions contemplated in the Merger Agreement and the other
transactions contemplated by the Merger Agreement and any actions required in
furtherance thereof, (ii) with respect to a shareholders’ meeting of Parent,
approval of the issuance of the Parent Common Shares to be issued in the Merger,
(iii) approval and adoption of any proposal to adjourn or postpone such Apple
REIT shareholders’ meeting to a later date if there are not sufficient votes for
the foregoing matters to be approved at each such meeting on the date on which
the Apple REIT shareholders’ meetings are held and (iv) at each such meeting,
and at any adjournment or postponement thereof, vote against: (A) any action or
agreement that would reasonably be expected to frustrate the purposes of,
impede, hinder, interfere with, or prevent or delay the consummation of the
transactions contemplated by the Merger Agreement and (B) any Acquisition
Proposal (other than the Merger) and any action required in furtherance thereof.
 
(c) The Company Securityholder will retain the right to vote his Subject Shares,
in his sole discretion, on all matters other than those described in paragraphs
(a) and (b) of this Section 2, and the Company Securityholder may grant proxies
and enter into voting agreements or voting trusts for his Subject Shares in
respect of such other matters, in each case so long as such other arrangements
do not interfere with or prevent the Company Securityholder from complying with
his obligations under this Agreement.
 
 
 

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(d) The Company Securityholder constitutes and appoints each Apple REIT, from
and after the date hereof until the earlier to occur of the Effective Time and
the termination of this Agreement pursuant to Section 16 (at which point such
constitution and appointment shall automatically be revoked), as such Company
Securityholder’s attorney, agent and proxy (each such constitution and
appointment, an “Irrevocable Proxy”), with full power of substitution, to vote
and otherwise act with respect to all of the Subject Shares of such Apple REIT
at any annual, special or other meeting of the shareholders of such Apple REIT,
and at any adjournment or adjournments or postponement thereof, and in any
action by written consent of the shareholders of such Apple REIT, on the matters
and in the manner specified in Section 2(b); provided, however, that the
foregoing shall only be effective if the Company Securityholder fails to be
counted as present and to vote all of the Subject Shares of each such Apple REIT
in accordance with paragraphs (a) and (b) of this Section 2.  EACH SUCH PROXY
AND POWER OF ATTORNEY IS IRREVOCABLE AND COUPLED WITH AN INTEREST AND, TO THE
EXTENT PERMITTED UNDER APPLICABLE LAW, SHALL BE VALID AND BINDING ON ANY PERSON
TO WHOM THE COMPANY SECURITYHOLDER MAY TRANSFER ANY OF HIS SUBJECT SHARES IN
BREACH OF THIS AGREEMENT.  The Company Securityholder hereby revokes all other
proxies and powers of attorney with respect to any or all of the Subject Shares
that may have heretofore been appointed or granted with respect to the matters
covered by Section 2(b), and no subsequent proxy or power of attorney shall be
given (and if given, shall not be effective) by the Company Securityholder with
respect thereto on the matters covered by Section 2(b).  All authority herein
conferred or agreed to be conferred by the Company Securityholder shall survive
the death or incapacity of the Company Securityholder and any obligation of the
Company Securityholder under this Agreement shall be binding upon the heirs,
personal representatives, successors and assigns of the Company
Securityholder.  It is agreed that no Apple REIT will use the Irrevocable Proxy
granted by the Company Securityholder unless the Company Securityholder fails to
comply with Section 2(a) or (b) and that, to the extent an Apple REIT uses any
such Irrevocable Proxy, it will only vote the Subject Shares subject to such
Irrevocable Proxy with respect to the matters specified in, and in accordance
with the provisions of, Section 2(b).
 
SECTION 3.                          Waiver of Appraisal Rights
 
The Company Securityholder hereby waives any rights of appraisal or rights to
dissent from the Merger, and agrees to prevent the execution of any rights of
appraisal and dissenters’ rights relating to the Merger that the Company
Securityholder may have directly or indirectly by virtue of the ownership of the
Subject Shares.

SECTION 4.                          Additional Shares
 
Without limiting any provisions of the Merger Agreement, in the event of any
stock dividend, stock split, recapitalization, reclassification, combination or
exchange of shares of capital stock of either Apple REIT on, of or affecting any
Subject Shares, then the terms of this Agreement shall apply to the shares of
capital stock or other such securities of such Apple REIT held by the Company
Securityholder immediately following the effectiveness of such event.
 
 
 

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SECTION 5.                          Representations and Warranties of the
Company Securityholder
 
The Company Securityholder represents and warrants to the Apple REITs as
follows:
 
(a) The Company Securityholder has the legal capacity, power, authority and
right (contractual or otherwise) to execute and deliver this Agreement and to
perform his obligations hereunder.
 
(b) This Agreement has been duly executed and delivered by the Company
Securityholder and constitutes a valid and binding obligation of the Company
Securityholder enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, moratorium or other similar laws relating to creditors’
rights and general principles of equity.
 
(c) The execution and delivery of this Agreement does not, and the consummation
of the transactions herein contemplated will not, conflict with or violate any
law, regulation, court order, judgment or decree applicable to the Company
Securityholder or the Subject Shares, or conflict with or result in any breach
of or constitute a default (or an event that with notice or lapse of time or
both would become a default) or give rise to any right of termination,
cancellation or acceleration under any contract or agreement to which the
Company Securityholder is a party or by which the Company Securityholder is
bound or affected or under which the Subject Shares are bound by or are
otherwise subject to, which conflict, violation, breach or default would
materially and adversely affect the Company Securityholder’s ability to perform
any of his obligations under this Agreement.
 
(d) Subject to any required filings under the Securities Exchange Act of 1934,
as amended (the “1934 Act”), the Company Securityholder is not required to give
any notice or make any report or other filing with any governmental or
regulatory authority in connection with the execution or delivery of this
Agreement or the performance of the Company Securityholder’s obligations
hereunder and no waiver, consent, approval or authorization of any governmental
or regulatory authority or any other person or entity is required to be obtained
by the Company Securityholder for the performance of the Company
Securityholder’s obligations hereunder, other than where the failure to make
such filings, give such notices or obtain such waivers, consents, approvals or
authorizations would not materially and adversely affect the Company
Securityholder’s ability to perform his obligations under this Agreement.
 
(e) The Series B Convertible Shares, Company Units and Parent Common Shares set
forth opposite the name of the Company Securityholder on Schedule 1 hereto are,
as of the date hereof, the only Subject Shares owned beneficially or of record
by the Company Securityholder or over which the Company Securityholder exercises
voting control.  The Company Securityholder is the sole record and beneficial
owner of the Subject Shares as set forth on Schedule 1 hereto.
 
 
 

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SECTION 6.                          Further Assurances
 
During the Term, the Company Securityholder shall make such filings as may be
required under the 1934 Act and, upon the request of either Apple REIT, execute
and deliver such documents and take such actions as such Apple REIT may
reasonably deem necessary to effectuate the purposes of this Agreement.
 
SECTION 7.                          Descriptive Headings
 
The descriptive headings herein are inserted for convenience only and are not
intended to be part of or to affect the meaning or interpretation of this
Agreement.
 
SECTION 8.                          Counterparts
 
This Agreement may be executed in counterparts, each of which when so executed
and delivered shall be an original, but all of such counterparts shall together
constitute one and the same instrument.
 
SECTION 9.                          Entire Agreement; Assignment
 
This Agreement (i) constitutes the entire agreement and supersedes all prior
agreements and understandings, both written and oral, among the parties hereto
with respect to the subject matter hereof and (ii) shall not be assigned by the
Company Securityholder, by operation of law or otherwise.  The Company
Securityholder agrees that this Agreement and the obligations of the Company
Securityholder hereunder shall attach to any Subject Shares and shall be binding
upon any Person to which legal or beneficial ownership of such Subject Shares
shall pass, whether by operation of law or otherwise, including in breach of
this Agreement.
 
SECTION 10.                        Governing Law; Consent to Jurisdiction;
Waiver of Jury Trial
 
(a) This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Virginia without regard to the principles of
conflicts of laws thereof.
 
(b) The Company Securityholder hereby submits and consents to non-exclusive
personal jurisdiction in any action, suit or proceeding arising out of this
Agreement or the transactions contemplated hereby in a federal court located in
the Commonwealth of Virginia or in a Virginia state court.  Any process,
summons, notice or document delivered by mail to the address set forth on
Schedule 1 hereto shall be effective service of process for any action, suit or
proceeding in any Virginia state court or any federal court located in the
Commonwealth of Virginia with respect to any matters to which the Company
Securityholder has submitted to jurisdiction in this Section 10.  The Company
Securityholder irrevocably and unconditionally waives any objection to the
laying of venue of any action, suit or proceeding arising out of this Agreement
or the transactions contemplated hereby in any Virginia state court or any
federal court located in the Commonwealth of Virginia, and hereby irrevocably
and unconditionally waives and agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been
brought in an inconvenient forum.  THE COMPANY SECURITYHOLDER IRREVOCABLY WAIVES
TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING WITH RESPECT TO THIS AGREEMENT.
 
 
 

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SECTION 11.                        Specific Performance
 
The parties hereto agree that if any of the provisions of this Agreement were
not performed in accordance with their specific terms or were otherwise
breached, irreparable damage would occur, no adequate remedy at law would exist
and damages would be difficult to determine, and that the parties hereto shall
be entitled to specific performance of the terms hereof, in addition to any
other remedy at law or equity.
 
SECTION 12.                        Parties in Interest
 
This Agreement shall be binding upon and inure solely to the benefit of each
party hereto, and nothing in this Agreement, express or implied, is intended to
or shall confer upon any other Person or Persons any rights, benefits or
remedies of any nature whatsoever under or by reason of this Agreement.
 
SECTION 13.                       Amendment; Waivers
 
This Agreement shall not be amended, altered or modified except by an instrument
in writing duly executed by each of the parties hereto; provided that no such
written agreement shall be binding on an Apple REIT unless approved by the
Company Special Committee or the Parent Board, as applicable.  No delay or
failure on the part of any party hereto in exercising any right, power or
privilege under this Agreement shall impair any such right, power or privilege
or be construed as a waiver of any default or any acquiescence thereto.  No
single or partial exercise of any such right, power or privilege shall preclude
the further exercise of such right, power or privilege, or the exercise of any
other right, power or privilege.  No waiver shall be valid against any party
hereto, unless made in writing and signed by the party against whom enforcement
of such waiver is sought, and then only to the extent expressly specified
therein.
 
SECTION 14.                        Severability
 
Any term or provision of this Agreement that is invalid or unenforceable in any
jurisdiction shall, as to that jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without rendering invalid or unenforceable
the remaining terms and provisions of this Agreement or affecting the validity
or enforceability of any of the terms or provisions of this Agreement in any
other jurisdiction.  If any provision of this Agreement is so broad as to be
unenforceable, the provision shall be interpreted to be only so broad as is
enforceable.

SECTION 15.                       Capacity of Company Securityholder
 
The Company Securityholder has executed this Agreement solely in his capacity as
a securityholder of each Apple REIT and not in his capacity as an officer,
director, employee or manager of either Apple REIT.  Without limiting the
foregoing, nothing in this Agreement shall limit or affect any actions taken by
the Company Securityholder in his capacity as an officer, director or employee
of either Apple REIT in connection with the exercise of either Apple REIT’s
rights under the Merger Agreement.
 
 
 

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SECTION 16.                        Termination
 
This Agreement shall terminate immediately upon the expiration of the
Term.  None of the representations, warranties, covenants or agreements in this
Agreement shall survive the termination of this Agreement; provided, however,
that nothing contained herein shall release the Company Securityholder from any
liability arising from any willful and material breach of any of his
representations, warranties, covenants or agreements in this Agreement.
 

 
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this
Voting Agreement, or have caused this Voting Agreement to be duly executed and
delivered in their names and on their behalf, as of the date first written
above.
 
APPLE REIT TEN, INC.

 
By:
/s/ David Buckley                                        

 
Name:
David Buckley

 
Title:
Executive Vice President

APPLE HOSPITALITY REIT, INC.

 
By:
/s/ Bryan Peery                                        

 
Name:
Bryan Peery

 
Title:
Executive Vice President

/s/ Glade M. Knight                                        
GLADE M. KNIGHT

 
 

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Schedule 1

 
Number of Series
B Convertible Shares
Number of Series B Convertible Shares as to which Glade M. Knight is Sole
Beneficial Owner
   Company
   Units*
Apple REIT Ten, Inc.
 
     
Name of Record and Beneficial Owner
 
     
Glade M. Knight
 
480,000
300,991
    90,920

 
Number of Parent Common Shares
Number of Parent Common Shares as to which Glade M. Knight is Sole Beneficial
Owner
Apple Hospitality REIT, Inc.
 
   
Name of Record and Beneficial Owner
 
   
Glade M. Knight
 
8,246,742
8,042,857

_______________
*Sole record and beneficial owner

Any process, summons, notice or document delivered by mail pursuant to Section
10 hereof to the beneficial or record holder set forth on this Schedule 1, shall
be delivered to:
 
Apple Hospitality REIT, Inc.
814 E. Main Street
Richmond, Virginia   23219
Attention:                       Glade M. Knight
Tel:                       (804) 344-8121
Fax:                       (804) 344-8129
 
With a copy to:

Hogan Lovells US LLP
555 Thirteenth Street, NW
Washington, D.C. 20004
Attention:                      Paul D. Manca
Tel:                      (202) 637-5821
Fax:                      (202) 637-5910

 

 
 

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