Document:

Exchange Agreement, dated May 2, 2008

 Exhibit 10.1 
 EXCHANGE AGREEMENT 
 THIS EXCHANGE AGREEMENT (this “Agreement”), is
made and entered into as of this 2nd day of May, 2008, by and between Veri-Tek International, Corp., a Michigan corporation (the “Company”), the individuals listed on Schedule A hereto (each individual, a
“Holder,” and collectively the “Holders”), and Michael Azar as the “Holders’ Representative.” 
 RECITALS 
 WHEREAS, in connection with the Company’s acquisition of all of the
issued and outstanding membership interests of Quantum Value Management, LLC and pursuant to that certain Purchase Agreement, dated May 16, 2006, by and among the Company, Quantum Value Management, LLC, and the Holders, the Company entered into
a Non-Negotiable Subordinated Promissory Note, dated July 3, 2006 (the “Note”), pursuant to which it promised to pay to the Holders’ Representative as escrow agent for, and for further distribution to, the Holders an
aggregate amount equal to $1,072,243 together with interest thereon; 
 WHEREAS, the total amount of accrued and unpaid interest under
the Note as of the date hereof is $4,765.53 (the “Total Interest”); 
 WHEREAS, each Holder is the payee of the
percentage of the Total Interest set forth on Schedule A hereto, which amount shall be referred to as the “Interest” of each respective Holder; 
 WHEREAS, the principal amount outstanding under the Note as of the date of this Agreement is $1,072,243 (the “Total Debt”); 
 WHEREAS, each Holder is the payee of the percentage of the Total Debt set forth on Schedule A hereto, which amount shall be referred to as
the “Debt” of each respective Holder; 
 WHEREAS, the Company desires to pay in cash to each Holder an amount equal
to his Interest as listed on Schedule A hereto; 
 WHEREAS, each Holder desires to exchange his Debt for the number of shares
of common stock of the Company, no par value (the “Common Stock”) listed on Schedule A hereto (the “Shares”); 
 WHEREAS, the number of Shares issuable to each Holder was determined by dividing the amount of such Holder’s Debt by the average closing price per share of the Company’s Common Stock for the twenty
(20) consecutive Trading Days immediately preceding March 18, 2008, which amount was rounded up to the nearest whole number of shares; 
 NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereby agree as follows: 
  

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 AGREEMENT 
 1. Recitals. The above recitals are incorporated herein by reference. 
 2.
Representations and Warranties of the Holders. Each Holder represents and warrants to the Company as follows: 
 (a) Holder owns
and holds his Debt, free and clear of any liens or encumbrances and has full power and authority to transfer and dispose of his Debt, free and clear of any liens or encumbrances. 
 (b) Holder has the requisite power and authority to enter into and perform his obligations under this Agreement and each other agreement entered into by
the parties hereto in connection with the transactions contemplated by this Agreement. 
 (c) The execution, delivery and performance of this
Agreement by the Holder and the consummation by the Holder of the transactions contemplated hereby will not result in a violation of any agreements of the Holder. 
 (d) This Agreement has been duly authorized, executed, and delivered by the Holder and, upon due execution and delivery by the Holder, will constitute, legal, valid, and binding obligations enforceable against the
Holder in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, moratorium, and other similar laws of general application affecting creditors’ rights, and except as enforcement may be limited by general
equitable principles. 
 (e) Holder understands that the Shares are “restricted securities” and have not been registered under the
Securities Act of 1933, as amended (the “Securities Act”) or any applicable state securities law and is acquiring the Shares as principal for his own account and not with a view to or for distributing or reselling the Shares or any
part thereof in violation of the Securities Act or any applicable state securities law, has no present intention of distributing any of the Shares in violation of the Securities Act or any applicable state securities law and has no arrangement or
understanding with any other persons regarding the distribution of the Shares in violation of the Securities Act or any applicable state securities law. Holder does not have any agreement or understanding, directly or indirectly, with any person to
distribute any of the Shares. 
 (f) Holder is an “accredited investor” as defined in Rule 501(a) under the Securities Act. Holder
has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Shares, and has so evaluated the merits and risks of such investment.
Holder is able to bear the economic risk of an investment in the Shares and, at the present time, is able to afford a complete loss of such investment. 
 (g) Holder has had an opportunity to discuss the Company’s business, management, and financial affairs with management of the Company and has had an opportunity to view the Company’s facilities. Holder
acknowledges that (i) except for the matters that are expressly covered by the Agreement, Holder is relying on his own investigation and analysis in 

  

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entering into the Agreement and consummating the transactions contemplated thereby, (ii) Holder is sophisticated and has undertaken such investigation,
and has been provided with and has evaluated such documents and information, as Holder has deemed necessary in connection with the execution, delivery and performance of the Agreement, (iii) Holder has reviewed the Disclosure Materials, and
(iv) the Company makes no representation or warranty to Holder other than as expressly made in this Agreement, including, without limitation, with respect to any projections, estimates or budgets heretofore delivered or made available to Holder
concerning future revenues, expenses, expenditures or results of operations of the Company and Holder is consummating the transactions contemplated by the Agreement without any representation or warranty, express or implied, by the Company or any of
its advisors or affiliates, except as expressly set forth in this Agreement. 
 (h) It is understood that each certificate representing the
Shares shall be stamped or otherwise imprinted with legends substantially similar to the following (in addition to any legend required under applicable state securities laws: 
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.

 3. Representations and Warranties by the Company. The Company represents and warrants to each Holder as follows: 

(a) The Company has all requisite corporate power and authority to enter into and perform this Agreement, and to issue the Shares to each Holder.

 (b) The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby will not result in a violation of the Company’s Articles of Incorporation, as amended and as in effect on the date hereof, the Company’s Amended and Restated Bylaws, as amended and as in effect on the date hereof, or
any other agreements of the Company. 
 (c) This Agreement has been duly authorized, executed, and delivered by the Company and, upon due
execution and delivery by the Company, will constitute, legal, valid, and binding obligations enforceable against the Company in accordance with its terms. 
 (d) The Shares, when issued, sold and delivered in compliance with the provisions of this Agreement, will be duly and validly issued, fully paid and nonassessable, and such Shares will be free and clear of any liens
or encumbrances; provided, however, that the Shares may be subject to restrictions on transfer under state or federal securities laws. 
  

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 4. The Exchange. At the Closing (as defined below), the Company will pay to each Holder the
amount of Interest owed to each Holder and instruct its transfer agent to issue to each Holder, the Shares in exchange for the Total Debt, which shall be surrendered by the Holders (the “Exchange”). 
 5. The Closing. The Exchange will occur at the offices of the Company on the date of execution of this Agreement, or at such other time,
place, and manner agreed upon by the Company, the Holders, and the Holders’ Representative (the “Closing”). The following events will take place at Closing: 
 (a) Interest Payment. The Company will deliver to each Holder a check for the amount of Interest set forth opposite such Holder’s name on
Exhibit A. 
 (b) Issuance of the Shares. The Company will instruct its transfer agent to issue and deliver to each Holder
certificates evidencing the Shares issuable to such Holder set forth opposite his name on Exhibit A, registered in the name of such Holder, against delivery by the Holders’ Representative of the Note. 
 (c) Delivery of Consideration. The Holders’ Representative will deliver to the Company, the Note and any other instruments representing the
Total Debt. Notwithstanding the foregoing, in the event that the Note or any other instrument representing the Total Debt has been lost or destroyed (“Lost Debt”), the Company in its sole discretion may waive the requirement that
such Lost Debt be delivered in accordance with this Section, in which case (a) such Lost Debt shall be automatically cancelled and of no further force or effect as of the Closing, (b) each Holder and his assigns, shall at all times
indemnify and hold harmless the Company, its directors, officers, employees or agents and any person acting on behalf of or at the request of the Company, together with any successors and assigns of any of the foregoing, from and against any and all
claims, actions and suits, whether groundless or otherwise, and from and against any and all losses, damages, judgments, costs, counsel fees, expenses and liabilities whatsoever, which any of such indemnitees at any time shall or may sustain or
incur (i) by reason of any claim which may be made in respect of the Lost Debt, and (ii) by reason of payment for or transfer, exchange or delivery of the Lost Debt, and (c) the Holders’ Representative (or any of the Holders)
shall immediately surrender the Lost Debt to the Company for cancellation without consideration should such Lost Debt at any time hereafter come into his possession or control. 
 (d) Documents. All certificates, opinions, instruments, schedules, and other documents referenced in this Agreement will be executed and/or
delivered, as necessary. Each Holder shall, after Closing, do all things and execute and deliver all documents reasonably requested by the Company to effectuate the transactions contemplated by this Agreement. 
 6. Company Registration. 
 (a) If the
Company determines to prepare and file with the Securities and Exchange Commission a registration statement relating to an offering for its own account or the account of others under the Securities Act of 1933 (the “Act”) of any of its
equity securities, other than pursuant to (i) a registration statement on Forms S-4 or S-8 (each as 

  

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promulgated under the Securities Act) or any successor or substantially similar forms, (ii) a registration on any form that does not permit secondary
sales, or (iii) a registration statement relating to secondary sales of any securities purchased from the Company for cash in which the registration rights agreement entered into by the Company in connection therewith prohibits the inclusion of
the Shares in such registration statement, the Company will: 
 i. promptly give to each Holder written notice thereof in accordance with
Section 7(b); and 
 ii. use its reasonable best efforts to include in such registration (and any related qualification under
blue sky laws or other compliance) and in any underwriting involved therein, all of the Shares specified in a written request or requests, made by any Holder and received by the Company within ten (10) days after the written notice from the
Company described in clause (i) above is mailed or delivered by the Company in accordance with Section 7(b). Such written request may specify all or a part of a Holder’s Shares be included in the registration described in the
notice. 
 (b) If the registration of which the Company gives notice is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as a part of the written notice given pursuant to Section 6(a)(i). In such event, the right of any Holder to registration pursuant to this Section 6 shall be conditioned upon such
Holder’s participation in such underwriting and the inclusion of such Holder’s Shares in the underwriting to the extent provided herein. All Holders proposing to distribute their Shares through such underwriting shall (together with the
Company) enter into an underwriting agreement in customary form requested by the representative of the underwriter or underwriters selected by the Company, including any lock-up provisions contained therein. If any Holder does not agree to the terms
of any such underwriting, such Holder shall be excluded therefrom by written notice from the Company or the underwriter. Any Shares excluded or withdrawn from such underwriting shall be withdrawn from such registration. 
 (c) If the registration of which the Company gives notice is for a registered public offering and if the representative of the underwriters advises the
Company in writing that marketing factors require a limitation on the number of shares to be underwritten, the number of Shares to be included in such registration shall be reduced by the amount determined by such underwriter representative. The
number of shares of securities that are entitled to be included in the registration and underwriting shall be allocated first to the Company for securities being sold on its own account and as required by any other registration rights agreement
entered into prior to the date hereof; second, to the extent available, the Shares that the Holder has requested to be included therein as nearly as possible pro rata among the Holders based on the number of Shares the Holders have requested to be
included therein, and third, to the extent available, among any other selling security holders, as nearly as possible pro rata based on the number of securities such selling security holders have requested to be included therein. 
  

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 (d) The Company shall have the right to terminate or withdraw any registration initiated by it under this
Section 6 prior to the effectiveness of such registration whether or not any Holder has elected to include Shares in such registration. 
 (e) Notwithstanding anything to the contrary contained herein, the Company shall have no obligation to register any Shares pursuant to this Section 6 to the extent that (i) the sale of such securities is deemed to be a primary
underwritten offering by the Company and (ii) such Shares are eligible to be sold without volume limitations pursuant to Rule 144(k) (or any similar provision then in force) under the Act. 
 7. Miscellaneous. 
 (a) Neither
this Agreement nor any of the terms or conditions hereof may be waived, amended or modified except by means of a written instrument duly executed by the party to be charged therewith. Any waiver or amendment shall only be applicable in the specific
instance, and shall not constitute or be construed as a waiver or amendment in any other or subsequent instance. No failure or delay on the part of any party in respect of any enforcement of obligations hereunder shall in any manner affect such
party’s right to seek or effect enforcement at any other time or in respect of any other required performance. 
 (b) All notices and
other communications required or permitted hereunder shall be in writing and shall be mailed by United States certified mail, postage prepaid, sent by facsimile or delivered personally by hand or nationally recognized courier addressed (i) if
to a Holder at such address as Holder or permitted assignee shall have furnished to the Company in writing, or (ii) if to the Company, at such address or facsimile number as the Company shall have furnished to each Holder in writing. All such
notices and other written communications shall be effective on the date of mailing, facsimile transfer or delivery. 
 (c) Neither this
Agreement nor any rights or obligations hereunder may be assigned by any Holder or by the Holders’ Representative without the express prior written consent of the Company. 
 (d) This Agreement will be governed by and construed and interpreted in accordance with the substantive laws of the State of Michigan, without giving
effect to any choice of law or conflicts of law provision or rule that would cause the application of the laws of a jurisdiction other than Michigan. Each party to this Agreement (a) consents to the personal jurisdiction of the state and
federal courts having jurisdiction in Detroit, Michigan, (b) waives any defense, whether asserted by a motion or pleading, that Detroit, Michigan, is an improper or inconvenient venue. EACH PARTY TO THIS AGREEMENT KNOWINGLY, VOLUNTARILY, AND
INTENTIONALLY WAIVES THE RIGHT TO A JURY TRIAL IN ANY LAWSUIT BETWEEN THE PARTY AND ANY OTHER PARTY WITH RESPECT TO THIS AGREEMENT. 
 (e)
This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, executors, administrators, personal representatives, successors and permitted assigns. 
  

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 (f) This Agreement may be executed in counterparts, each of which shall be deemed to be an original
hereof, but all of which together shall constitute one and the same instrument. 
 (g) This Agreement constitutes the sole and entire
agreement and understanding between the parties hereto as to the subject matter hereof, and supersedes all prior discussions, agreements and understandings of every kind and nature between them as to such subject matter. 
 (h) This Agreement is intended for the sole and exclusive benefit of the parties hereto and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns, and no other person or entity shall have any right to rely on this Agreement or to claim or derive any benefit herefrom absent the express written consent of the party to be charged with such
reliance or benefit. 
 (i) No Holder will make any press release or other public announcement regarding this Agreement or any transaction
contemplated hereby without the Company’s prior written consent. 
 8. Certain Definitions. 
 (a) “Disclosure Materials” all reports required to be filed by the Company under the Securities Act and the Securities Exchange Act of
1934, as amended, including pursuant to Section 13(a) or 15(d) thereof, for the twenty-four months preceding the date hereof. 
 (b)
“Trading Day” means any day on which the Common Stock traded on the Principal Market, or, if the Principal Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities
market on which the Common Stock is then traded; provided that “Trading Day” shall not include any day on which the Common Stock is scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is
suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New
York Time). 
 (c) “Principal Market” means the American Stock Exchange. 
 [SIGNATURES ON FOLLOWING PAGE] 
  

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 IN WITNESS WHEREOF, the parties hereto have executed this Exchange Agreement on and as of the date
first set forth above. 
  

			
	THE COMPANY:
	
	VERI-TEK INTERNATIONAL, CORP.
		
	By:	 	 /s/ David J. Langevin

		 	David J. Langevin
		 	Chairman and Chief Executive Officer
	
	THE HOLDERS:
	
	 /s/ Michael Azar

	Michael Azar
	 Address for Notice: 840 W. Long Lake
Suite 601
 Troy, MI 48098

	Facsimile Number: 248-220-2039
	
	 /s/ David J. Langevin

	David J. Langevin
	Address for Notice: 7402 West 100th Place
Bridgeview, Ill
60455
	Facsimile Number: 708-237-2060
	
	 /s/ Robert J. Skandalaris

	Robert J. Skandalaris
	Address for Notice: 840 W. Long Lake
Troy, MI 48098
	Facsimile Number: 248-220-2007
	
	 /s/ Lubomir Litchev

	Lubomir Litchev
	Address for Notice: 48 Portwine Rd.
	Willowbrook, IL 60527
	Facsimile Number:
                            

  

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	 /s/ Patrick T. Flynn

	Patrick T. Flynn
	 Address for Notice: 401 S. Old Woodward
Suite 340
 Birmingham, MI 48009

	Facsimile Number: 248-433-3143
	
	 /s/ Michael D. Hull

	Michael D. Hull
	Address for Notice: 7235 Locklin St.
West Bloomfield, MI 48324
	Facsimile Number: 248-844-0144
	
	THE HOLDERS’ REPRESENTATIVE:
	
	 /s/ Michael Azar

	Michael Azar

  

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 SCHEDULE A 
  

												
	 The Holders
	  	Amount of Total
Debt
Attributable to
Each Holder	 	 	Amount of
Debt	  	Amount of
Interest	  	Shares of
Common Stock
to be issued by
the
Company
(based on value
of $5.08 per
share)
	 Michael Azar
	  	18.43	%	 	$	197,614.38	  	$	878.29	  	38,901
	 David J. Langevin
	  	36.86	%	 	$	395,228.77	  	$	1,756.57	  	77,801
	 Robert J. Skandalaris
	  	36.86	%	 	$	395,228.77	  	$	1,756.57	  	77,801
	 Lubomir Litchev
	  	5	%	 	$	53,612.15	  	$	238.28	  	10,554
	 Patrick T. Flynn
	  	1.90	%	 	$	20,372.62	  	$	90.55	  	4,011
	 Michael D. Hull
	  	.95	%	 	$	10,186.31	  	$	45.27	  	2,006Exhibit 10.4

 Exhibit 10.4 
 APPLE REIT NINE, INC. 
 2008 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN 
 EFFECTIVE APRIL 30, 2008 

 APPLE REIT NINE, INC. 
 2008 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN 
 EFFECTIVE APRIL 30, 2008 
 1. Purpose. The purpose of this Apple REIT Nine, Inc. 2008 Non-Employee Directors Stock Option Plan (the “Plan”) is to encourage
ownership in Apple REIT Nine, 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 Nine, 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) “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 the reasonable application of a reasonable valuation method consistent
with the requirements of Treasury Regulations section 1.409A-1(b)(5)(iv)(B). 
 (i) “Initial Closing” means the
first closing of the Offering that will occur after the Minimum Offering is achieved. 
 (j) “Insider” means a
person subject to Section 16(b) of the Act. 
 (k) “Minimum Offering” means the sale of 9,523,810 Units
pursuant to the Offering. 
 (l) “Offering” means, collectively, (1) the sale of up to $2,000,000,000 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 November 8, 2007 (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”). 
  

 2 

 (m) “Option” means a right to acquire Units granted under the Plan, at a price
determined in accordance with the Plan. 
 (n) “Treasury Regulations” mean the final, temporary or proposed
regulations issued by the Treasury Department and/or Internal Revenue Service as codified in Title 26 of the United States Code of Federal Regulations 
 (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. 
  

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 4. Participation in the Plan. Each director of the Company who is not otherwise an employee of the
Company or any subsidiary of the Company and was not an employee of the Company or subsidiary for a period of at least one year before the Date of Grant shall be eligible to participate in the Plan. 
 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
2008 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. 
  

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 (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 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 100% of 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; 
  

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 (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; 
 (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. Modification and Extension of Options Prohibited. 
 (a) Notwithstanding any provision of this Plan or any Option agreement to the contrary, (i) no Modification shall be made in respect to any Option if such Modification would result in the Option constituting a
deferral of compensation, and (ii) no Extension shall be made in respect to any Option, if such Extension would result in the Option having an additional deferral feature from the Date of Grant, in each case within the meaning of applicable
Treasury Regulations under Code section 409A. 
 (b) Subject to subsection (d) below, a “Modification” for
purposes of subsection (a) means any change in the terms of the Option (or change in the terms of the Plan or applicable Option agreement) that may provide the holder of the Option with a direct or indirect reduction in the exercise price of
the Option, regardless of whether the holder in fact benefits from the change in terms. 
  

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 (c) Subject to subsection (d) below, an “Extension” for purposes of
subsection (a) means either (i) the provision to the holder of an additional period of time within which to exercise the Option beyond the time originally prescribed, or (ii) the conversion or exchange of the Option for a legally
binding right to compensation in a future taxable year, or (iii) the addition of any feature for the deferral of compensation to the terms of the Option, or (iv) any renewal of the Option that has the effect of (i) through
(iii) above. 
 (d) Notwithstanding subsections (b) and
(c) above, it shall not be a Modification or an Extension, respectively, to change the terms of an Option in accordance with Section 13 of the Plan, or in any of the other ways or for any of the other purposes provided in applicable
Treasury Regulations or other guidance under Code section 409A as not resulting in a Modification or Extension for purposes of that section. In particular, it shall not be an Extension to extend the exercise period of an Option to a date no later
than the earlier of (i) the latest date upon which the Option could have expired by its original terms under any circumstances or (ii) the 10th anniversary of the original Date of Grant. 
 9. Effective Date of the Plan. This Plan was originally effective on
April 30, 2008, having been approved by the shareholders of the Company on such date. Until the requirements of any applicable state or federal securities laws have been met, no Option shall be exercisable that is not contingent on the
satisfaction of these requirements. If at any time subsequent to the initial satisfaction of these requirements, the requirements of any applicable federal or state securities laws fail to be met, no Option granted shall be exercisable until the
Board has determined that these requirements have again been met. 
  

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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 

  

 8 

 
issuance to shareholders generally of rights, options or warrants for the purchase of common shares or preferred shares of the Company), the number and kind
of units or other securities to be subject to 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 or other securities with respect to any unexercised Option, the Board shall round down the number of
units or other securities covered by the Option so as to eliminate the fractional unit or other security. 
 (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, consistent with applicable provisions of the Code and any applicable federal or
state securities laws. 
 (c) 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), materially modifies the requirements as to eligibility for participation in the Plan or materially increase the benefits 

  

 9 

 
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 Rule
16b-3 of the Securities and Exchange Commission promulgated under the Act or other applicable federal or state securities laws or to meet the requirements of the Code and regulations thereunder. 
 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. Options granted under the Plan are not intended to provide for any deferral of compensation that would be subject to Code section 409A.

 IN WITNESS WHEREOF, the Company has caused this Plan to be executed this
30th day of April, 2008. 
  

			
	APPLE REIT NINE, INC.
		
	By:	 	 /s/ Glade M. Knight

		 	Glade M. Knight,
		 	Chairman of the Board

  

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