Document:

FORM OF APPLE REIT SEVEN, INC. 2005 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN

 Exhibit 10.4 
  
 APPLE REIT SEVEN, INC. 
  
 2005 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN 
  
 EFFECTIVE
                         2005 
  

  
 APPLE REIT SEVEN, INC.

  
 2005 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN

  
 EFFECTIVE
                        , 2005 
  
 1. Purpose. The purpose of this Apple REIT Seven, Inc. 2005 Non-Employee Directors Stock Option Plan (the
“Plan”) is to encourage ownership in Apple REIT Seven, Inc. (the “Company) by non-employee members of the Board, in order to promote long-term stockholder value and to provide non-employee members of the Board with an incentive to
continue as directors of the Company. 
  
 2. Definitions.
As used in the Plan, the following terms have the meanings indicated: 
  
 (a) “Act” means the Securities Exchange Act of 1934, as amended. 
  
 (b) “Board” means the board of directors of the Company. 
  
 (c) “Code” means the Internal Revenue Code of 1986, as amended. 
  
 (d) “Company” means Apple REIT Seven, Inc., a
Virginia corporation. 
  
 (e) “Date of
Grant” means the date as of which an Eligible Director is automatically awarded an Option pursuant to Section 7. 
  
 (f) “Disability” or “Disabled” means that the participant (i) is unable to engage in any substantial gainful activity
by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) is, by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 

  

 
months, receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the Employer.

  
 (g) “Eligible Director” means a
director described in Section 4. 
  
 (h)
“Employer” means the Company. 
  
 (i)
“Fair Market Value” means, on any given date, (i) if the Units are traded on an exchange, the closing registered sales prices of the Company Stock on such day on the exchange on which it generally has the greatest trading volume, (ii) if
the Units are traded on the over-the-counter market, the average between the closing bid and asked prices on such day as reported by NASDAQ, or (iii) if the Units are not traded on any exchange or over-the-counter market, the fair market value shall
be determined by the Board using any reasonable method in good faith. 
  
 (j) “Initial Closing” means the first closing of the Offering that will occur after the Minimum Offering is achieved. 
  

(k) “Insider” means a person subject to Section 16(b) of the Act. 
  
 (l) “Minimum Offering” means the sale of 4,761,905
Units pursuant to the Offering. 
  
 (m)
“Offering” means, collectively, (1) the sale of up to $1,000,000,000 in Units to the public and the registration of such shares with the Securities and Exchange Commission, as authorized by resolutions of the Board dated
                , 2005 (the “Initial Offering”), and (2) the issuance of any additional Units as authorized by resolutions of the Board from time to
time, which issuance occurs before the termination of this Plan (the “Additional Offerings”). 
  

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 (n) “Option” means a right to acquire Units granted under the Plan, at a price
determined in accordance with the Plan. 
  
 (o)
“Unit” means one common share and one Series A preferred share, no par value, of the Company. If the par value of the common shares or Series A preferred shares is changed, or in the event of a change in the capital structure of the
Company (as provided in Section 12), the Units resulting from such a change shall be deemed to be Units within the meaning of the Plan. 
  
 3. Administration. The Plan shall be administered by the Board. Options shall be granted as described in Section 7. However, the Board shall have
all powers vested in it by the terms of the Plan, including, without limitation, the authority (within the limitations described herein) to prescribe the form of the agreement embodying the grant of Options, to construe the Plan, to determine all
questions arising under the Plan, and to adopt and amend rules and regulations for the administration of the Plan as it may deem desirable. Any decision of the Board in the administration of the Plan, as described herein, shall be final and
conclusive. The Board may act only by a majority of its members in office, except that members thereof may authorize any one or more of their number or any officer of the Company to execute and deliver documents on behalf of the Board. No member of
the Board shall be liable for anything done or omitted to be done by him or any other member of the Board in connection with the Plan, except for his own willful misconduct or as expressly provided by statue. 
  
 4. Participation in the Plan. Each director of the Company who is not
otherwise an employee of the Employer or any subsidiary of the Company and was not an employee of the Employer or subsidiary for a period of at least one year before the Date of Grant shall be eligible to participate in the Plan. 
  

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 5. Securities Subject to the Plan. Subject to Section 12 of the Plan, there shall be reserved for
issuance under the Plan an aggregate of 45,000 Units plus 1.8% of the total number of Units issued in the Offering in excess of the Minimum Offering, which shall be authorized, but unissued Units. Units allocable to Options or portions thereof
granted under the Plan that expire or otherwise terminate unexercised may again be subjected to an Option under the Plan. 
  
 6. Non-Statutory Stock Options. All options granted under the Plan shall be non-statutory in nature and shall not be entitled to special tax
treatment under Code section 422. 
  
 7. Award, Terms,
Conditions and Form of Options. Each Option shall be evidenced by a written agreement in such form as the Board shall from time to time approve, which agreement shall comply with and be subject to the following terms and conditions: 

 
 (a) Automatic Award of Option. 
  
 (i) As of the Initial Closing, each Eligible Director shall
automatically receive an Option to purchase 5,500 Units plus 0.0125% of the number of Units in excess of the Minimum Offering sold by the Initial Closing. 
  
 (ii) As of each June 1 during the years 2006 and ending upon the termination of the Plan, each Eligible Director shall automatically
receive an Option to purchase 0.02% of the total number of Units issued and outstanding on that date. 
  
 (iii) As of the election as a director of any new person who qualifies as an Eligible Director, such Eligible Director shall automatically
receive an Option to purchase 5,500 Units. 
  
 (iv) If at any time under the Plan there are not sufficient Units available to fully permit the automatic Option grants described in this paragraph, the Option 

  

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grants shall be reduced pro rata (to zero if necessary) so as not to exceed the number of Units available. 
  
 (b) Option Exercise Price. The Option exercise price
shall be the Fair Market Value of the Units subject to the Option on the Date of Grant. 
  
 (c) Options Not Transferable. An Option shall not be transferable by the optionee otherwise than by will, or by the laws of descent
and distribution, and shall be exercised during the lifetime of the optionee only by him. An Option transferred by will or by the laws of descent and distribution may be exercised by the optionee’s personal representative within one year of the
date of the optionee’s death to the extent the optionee could have exercised the Option on the date of his death. No Option or interest therein may be transferred, assigned, pledged or hypothecated by the optionee during his lifetime, whether
by operation of law or otherwise, or be made subject to execution, attachment or similar process. 
  
 (d) Exercise of Options. In no event shall an Option be exercisable earlier than six months from the later of the Date of Grant or
the date of approval of the Plan by shareholders of the Company. Furthermore, no Option may be exercised: 
  
 (i) Before any amendment or restatement that requires shareholder approval pursuant to Section 13 of the Plan, is approved by shareholders
of the Company; 
  
 (ii) Unless at such time the
optionee is a director of the Company, except that he may exercise the Option within three years of the date he ceases to be a director of the Company if he ceased to be a director more than six months after the Date of Grant of the Option;

  

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 (iii) After the expiration of ten years from the Date of Grant; and 
  
 (iv) Except by written notice to the Company at its
principal office, stating the number of Units the optionee has elected to purchase, accompanied by payment in cash and/or by delivery to the Company of the Units (valued at Fair Market Value on the date of exercise) in the amount of the full Option
exercise price for the shares of Units being acquired thereunder. 
  
 8. Withholding. If the Company is required by law to withhold federal or state income taxes when an Option is exercised, the Company shall have the right to retain or sell without notice Units having a Fair Market Value sufficient on
such date or dates as may be determined by the Board (but not more than five business days prior to the date on which such Units would otherwise have been delivered) to cover the amount of any federal or state income tax required to be withheld or
otherwise deducted and paid with respect to such payment and the exercise of the Option, remitting any balance to the optionee; provided, however, that the optionee shall have the right to make other arrangements satisfactory to the Company or to
provide the Company with the funds to enable it to pay such tax. Notwithstanding the foregoing, the Company shall not sell Units if the Optionee is an Insider and such sale will cause the Optionee to incur a liability under Section 16(b) of the Act.

  
 9. Modification, Extension and Renewal of Options. To
the extent permitted under Code section 409A, the Board shall have the power to modify, extend or renew outstanding Options and to authorize the grant of new options in substitution therefor, provided that any such action may not enhance the rights
of the optionee without shareholder approval or have the effect of altering, enhancing or impairing any rights or obligations of any person under any Option previously granted without the consent of the optionee. 
  

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 10. Termination. The Plan shall terminate upon the earlier of: 
  
 (a) The adoption of a resolution of the Board terminating
the Plan; or 
  
 (b) The date on which the
Company’s existence terminates (provided, however, that if the existence of the Company is reinstated as permitted by law, the Plan shall continue during the effective period of any reinstatement, subject to earlier termination pursuant to
Section 10(a) above). 
  
 No termination of the Plan shall without his consent
materially and adversely affect any of the rights or obligations of any person under any Option previously granted under the Plan. 
  
 11. Limitation of Rights. 
  
 (a) No Right to Continue as a Director. Neither the Plan nor any action taken pursuant to the Plan shall constitute or be evidence
of any agreement or understanding, express or implied, that the Company will retain any person as a director for any period of time. 
  
 (b) No Shareholders Rights Under Options. An optionee shall have no rights as a shareholder with respect to Units covered by his
Option until the date of exercise of the Option, and, except as provided in Section 12, no adjustment will be made for dividends or other rights for which the record date is prior to the date of such exercise. 
  
 12. Changes in Capital Structure. 
  
 (a) In the event of a stock dividend, stock split or
combination of stock, recapitalization or merger in which the Company is the surviving corporation or other change in the Company’s capital stock (including, but not limited to, the creation or issuance to shareholders generally of rights,
options or warrants for the purchase of common shares or preferred shares of the Company), the number of units to be subject to 

  

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the Plan and to Options then outstanding or to be granted thereunder, the maximum number of units or securities which may be delivered under the Plan, the
exercise price and other relevant provisions shall be appropriately adjusted by the Board, whose determination shall be binding on all persons. If the adjustment would produce fractional units with respect to any unexercised Option, the Board may
adjust appropriately the number of units covered by the Option so as to eliminate the fractional units. 
  
 (b) If the Company is a party to a consolidation or a merger in which the Company is not the surviving corporation, a transaction that
results in the acquisition of substantially all of the Company’s outstanding stock by a single person or entity, or a sale or transfer of substantially all of the Company’s assets, the Board may take such actions with respect to
outstanding Options as the Board deems appropriate; provided, however, that any such action must comply with Code section 409A. 
  
 (g) Notwithstanding anything in the Plan to the contrary, the Board may take the foregoing actions without the consent of any optionee and
the Board’s determination shall be conclusive and binding on all persons for all purposes. 
  
 13. Amendment of the Plan. The Board (except as provided below) may suspend or discontinue the Plan or revise or amend the Plan in any respect;
provided, however, that without approval of the shareholders of the Company no revision or amendment shall increase the number of shares subject to the Plan (except as provided in Section 12) or materially increase the benefits accruing to
participants under the Plan. The Plan shall not be amended more than once every six months other than an amendment required to comply with changes in the Internal Revenue Code or regulations thereunder. Notwithstanding the foregoing, the Board may
unilaterally amend the Plan and the terms of Options granted hereunder to ensure compliance 

  

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with Rule 16b-3 of the Securities and Exchange Commission promulgated under the Act or Code section 409A. 
  
 14. Notice. All notices and other communications required or permitted
to be given under this Plan shall be in writing and shall be deemed to have been duly given if delivered personally or mailed first class, postage prepaid, as follows: (a) if the Company – at its principal business address to the attention of
the President; (b) if to any participant – at the last address of the participant know to the sender at the time the notice or other communication is sent. 
  

15. Governing Law. The terms of this Plan shall be governed by the laws of the Commonwealth of Virginia without regard to conflicts of law.
Anything in this Plan to the contrary notwithstanding, the Plan shall be interpreted and administered at all times to comply with the applicable requirements of Code section 409A and any guidance promulgated thereunder. 
  
 IN WITNESS WHEREOF, the Company has caused this Plan to be executed this
         day of                  2005. 
  

			
	APPLE REIT SEVEN, INC.
		
	By:	 	 
	 	 	 Glade M. Knight,
 Chairman of the
Board

  

 9Form of Stock Appreciation Rights Agreement

 Exhibit 10.1 
  
 CDI Corp. 
  
 STOCK APPRECIATION RIGHTS AGREEMENT 
  
 1. Grant of SAR’s. The Company hereby grants to [insert name] (the “Recipient”) [insert number] stock
appreciation rights (the “SAR’s”). This grant is subject to the terms, definitions and provisions of the Plan, which is incorporated herein by reference. In the event of a conflict between the terms of this Agreement and the Plan, the
Plan will prevail. 
  
 2. Definitions. 
  
 (a) “Board” means the Board of Directors of CDI Corp. 

 
 (b) “Cause” shall have the same meaning as is set forth in an
employment agreement, engagement agreement, “covenants and agreements” or similar document between the Recipient and the Company. If there is no such agreement or document, then Cause shall mean: 
  

	 	(i)	Recipient’s rendering services while under the influence of alcohol or illegal drugs; 

  

	 	(ii)	Recipient’s performing any act of dishonesty, other than an act with immaterial consequences, in rendering services to the Company, including, without regard to materiality,
falsification of records, expense accounts or other reports; 

  

	 	(iii)	Recipient’s conviction, whether by judgment or plea, of any crime which constitutes a felony or which constitutes a misdemeanor involving violence, fraud, embezzlement or
theft; 

  

	 	(iv)	Recipient’s violation of any law or agreement which results in the entry of a judgment or order enjoining or preventing Recipient from such activities as are essential for
Recipient to perform services for the Company; 

  

	 	(v)	Recipient’s violation of any of the Company’s policies which provide for termination of employment as a possible consequence of such violation; 

 

	 	(vi)	conduct engaged in by Recipient which is injurious (other than to an immaterial extent) to the Company; 

  

	 	(vii)	the Company’s receipt of reliable information from any source of Recipient’s entering into or intending to enter into competition with the Company; or

  

	 	(viii)	refusal to perform such duties as may be delegated or assigned to Recipient, consistent with the Recipient’s position, by his or her supervisor. 

 (c) “CDI Stock” means CDI Corp. common stock, par value $.10 per share. 
  
 (d) “Committee” means the Compensation Committee of the Board or
its successor. 
  
 (e) “Company”, as the context
requires, means CDI Corp., CDI Corp. and its subsidiaries, or the individual subsidiary of CDI Corp. which employs or retains the Recipient. 
  
 (f) “Date of Exercise” means the date on which the notice of exercise required by Section 6 below is received by the Company. 
  
 (g) “Date of Grant” means March     ,
2005. 
  
 (h) “Disability” means a physical, mental or
other impairment within the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as amended. 
  
 (i) “Exercise Price” means $            , the Fair Market Value of CDI Stock
on the Date of Grant. 
  
 (j) “Fair Market Value” means
the closing price of actual sales of CDI Stock on the New York Stock Exchange composite tape on a given date or, if there are no such sales on such date, the closing price of CDI Stock on such Exchange on the last preceding date on which there was a
sale. 
  
 (k) “Grant” means the grant of SAR’s to
the Recipient which is described in Section 1 of this Agreement. 
  
 (l) “Plan” means the CDI Corp. 2004 Omnibus Stock Plan. 
  
 (m) “Retirement” means the Recipient’s leaving the employ of the Company: 
  

	 	(i)	on or after the date that Recipient satisfies one of the following combinations of age and years of service with the Company: 

  

	 	•	 	60 years of age and 20 years of service; 

  

	 	•	 	62 years of age and 15 years of service; or 

  

	 	•	 	65 years of age and 5 years of service; or 

  

	 	(ii)	at such earlier date as may be approved by the Committee, in its sole discretion. 

  
 (n) “Termination Date” means the earliest of the following: 
  

	 	(i)	seven years following the Date of Grant; 

  

	 	(ii)	the date on which the Recipient’s employment or engagement with the Company is terminated by the Company for Cause; 

  

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	 	(iii)	the date two weeks after the date on which the Recipient’s employment or engagement with the Company is terminated through the Recipient’s resignation or by the Company
for reasons other than for Cause; or 

  

	 	(iv)	the date six months after the date on which the Recipient employment or engagement with the Company is terminated as a result of the Recipient’s death, Disability or
Retirement. 

  
 3. Value of the SARs. The SAR’s shall
entitle the Recipient, upon exercise of the SAR’s, to receive from the Company an amount, payable in shares of CDI Stock, equal to: (i) the excess of the Fair Market Value on the date of exercise over the Exercise Price, multiplied by (ii) the
number of SAR’s being exercised. The number of shares of CDI Stock payable to the Recipient will be decreased in accordance with Section 7 below regarding tax withholding. 
  
 4. Period of Exercise. No SAR’s shall be exercisable unless they have vested in accordance with Section 5 hereof. If vested, the
SAR’s may be exercised at any time after vesting until the Termination Date. No SAR’s shall be exercisable on or after the Termination Date. 
  
 5. Vesting. The SAR’s will vest at the rate of 20% per year on each of the first five anniversaries of the Date of Grant. If the Recipient’s employment
with the Company terminates as a result of death, Disability or Retirement, any then-unvested SAR’s will vest as of the date of such event. 
  
 6. Manner of Exercise. The SAR’s shall be exercisable by a written notice from the Recipient to the Company’s senior Human Resources executive, which
shall state the number of SAR’s being exercised. However, the Company may at any time hereafter notify the Recipient of a web-based or other method of exercising SAR’s, which other method may supplement or replace the previously-described
written notice as the required method of exercising the SAR’s. The SAR’s granted to the Recipient may be exercised in whole or in part. The SAR’s can only be exercised as to whole numbers of SAR’s. 
  
 7. Tax Withholding. The number of shares of CDI Stock to be delivered to the Recipient
upon exercise of the SAR’s shall be reduced by the number of shares having a Fair Market Value equal to all taxes (including, without limitation, federal, state, local or foreign income or payroll taxes) required by law to be withheld in
connection with the exercise of the SAR’s. The portion of any shares of CDI Stock withheld pursuant to the applicable tax laws shall be determined by using the Fair Market Value of CDI Stock on the last trading day immediately prior to the Date
of Exercise. 
  
 8. Nontransferablity of SAR’s. The SAR’s may not
be transferred, in whole or in part, except (a) by will or the applicable laws of descent and distribution or (b) with the prior written approval of the Committee, to the spouse or descendant of the Recipient or a trust for the benefit of the spouse
or descendants. 
  
 9. Stock Ownership Requirements. If the Recipient is
subject to any stock ownership requirements imposed by the Company, those requirements may limit the Recipient’s ability to sell or otherwise transfer some or all of the shares of CDI Stock acquired by the Recipient through the exercise of the
SAR’s. 
  

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 10. Cancellation of SAR’s and Repayment of Gains. Notwithstanding any other provision of this Agreement, if
the Committee determines that the Recipient has entered into or intends to enter into competition with the Company or any of its subsidiaries, the Committee may, in its discretion, at any time during the term of the non-competitive covenant, if any,
in the employment agreement, engagement agreement, “covenants and agreements” or similar document between the Recipient and the Company which is being violated by such competition, cancel the outstanding SAR’s granted to the Recipient
and/or require the Recipient to pay to the Company an amount equal to any gains derived from the exercise of any SAR’s previously granted to and exercised by the Recipient during the one-year period prior to the termination of the
Recipient’s employment or engagement with the Company. 
  
 11. Securities
Laws. The Committee may from time to time impose any conditions on the exercise of the SAR’s as it deems necessary or advisable to ensure that all SAR’s granted under the Plan, and the exercise thereof, satisfy Rule 16b-3 (or any
similar rule) of the Securities and Exchange Commission. Such conditions may include, without limitation, the partial or complete suspension of the right to exercise the SAR’s. The Company may also condition delivery of certificates for shares
of CDI Stock upon the prior receipt from the Recipient of any undertakings that it determines are required to ensure that the certificates are being issued in compliance with federal and state securities laws. 
  
 12. Rights Prior to Issuance of Certificates. Neither the Recipient nor any person to
whom the Recipient’s rights shall have passed by will or by the laws of descent and distribution shall have any of the rights of a shareholder with respect to any shares of CDI Stock issuable upon exercise of the SAR’s until the date of
issuance to the Recipient of a certificate for such shares. 
  
 13. SAR’s
Do Not Affect Employment Relationship. This Grant shall not confer upon the Recipient any right to continue in the employ or service of the Company, nor interfere in any way with the right of the Company to terminate the employment of the
Recipient at any time. 
  
 14. Interpretation. The Committee shall have the
sole power to interpret this Agreement and to resolve any disputes arising hereunder. 
  
 15. Acknowledgement. The Recipient acknowledges receipt of a copy of the Plan and certain information related thereto and represents that he or she is familiar with the terms and provisions thereof, and hereby accepts this Agreement
subject to all of the terms and provisions of the Plan. The Recipient has reviewed the Plan and this Agreement in their entirety, has had an opportunity to obtain the advice of independent counsel prior to executing this Agreement and fully
understands all provisions relating to this Agreement. The Recipient hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee with respect to any questions arising under the Plan or this Agreement.
In addition, by entering into this Agreement and accepting this Award, the Recipient acknowledges that: (a) the Grant is a one-time benefit and does not create any contractual or other right to receive future grants, awards or other benefits in lieu
of grants; (b) the Recipient’s participation in the Plan is voluntary; (c) this Grant is not part of normal or expected compensation for any purpose, including without limitation for calculating any benefits, severance, termination, bonuses,
retirement benefits or similar payments; and (d) the future value of CDI Stock is unknown and cannot be predicted, and the Recipient is not, and will not, rely on any representation by the Company or any of its personnel regarding the future value
of CDI Stock. 
  

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 16. Execution of this Agreement. If the Recipient does not sign and return this Agreement, the Company is not
obligated to provide the Recipient with any benefit hereunder and may refuse to issue shares of CDI Stock to the Recipient in connection with this Grant. If the Recipient receives any shares of CDI Stock in connection with this Grant but has not
signed and returned this Agreement, he or she will be deemed to have accepted and agreed to the terms set forth herein. 
  

							
	CDI CORP.	 	RECIPIENT
				
	By:	 	
	 	Signature:	 	  

	 	 	 	 	Print Name:	 	  

	 	 	 	 	Date:	 	  

	 	 	 	 	 	 	 

  

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