Apple Hospitality REIT Inc

This Pay Versus Performance section is not deemed filed with the SEC and is not to be incorporated by reference in any of the Company’s filings under the Securities Act or the Exchange Act, respectively, whether made before or after the date of this proxy statement and irrespective of any general incorporation language therein.

The following table sets forth information concerning the compensation actually paid to the Company's CEO and to its other NEOs compared to Company performance for the years ended December 31, 2024, 2023, 2022, 2021 and 2020. The disclosure included in this section is prescribed by SEC rules and does not necessarily align with how the Company or the Compensation Committee views the link between the Company’s performance and its NEO’s pay. For a discussion of how the Company views its executive compensation structure, including alignment with Company performance, see Compensation Discussion and Analysis beginning on page 38. The Compensation Committee did not consider the pay versus performance disclosure below in making its pay decisions for any of the years shown.

(1)

The principal executive officer ("PEO") for 2024, 2023, 2022, 2021 and 2020 was Justin G. Knight, Chief Executive Officer of the Company.

(2)

Compensation actually paid is based on the total compensation measure included in the Summary Compensation Table ("SCT") on page 51, with the following adjustments made to the amounts disclosed for equity awards.

(3)

The non-PEO NEOs ("average other NEOs") are the following for each year disclosed. 2024, 2023, 2022 and 2021: Nelson G. Knight, President, Real Estate and Investments; Elizabeth S. Perkins, Senior Vice President and Chief Financial Officer; Karen C. Gallagher, Senior Vice President and Chief Operating Officer; and Rachel S. Labrecque, Senior Vice President and Chief Accounting Officer; and 2020: Nelson G. Knight; Ms. Perkins; Ms. Gallagher; and Matthew P. Rash, Senior Vice President, Chief Legal Officer and Secretary.

(4)

Total shareholder return measures the benefit to shareholders of holding the Company's Common Shares over a period of time, including the change in the share price as well as the reinvestment of dividends during the same period of time.

(5)

For each fiscal year in the table, the amount included for the Company and its peer group is the cumulative total shareholder return as of the end of that year. The measurement period begins with the market close on the last trading day before the earliest fiscal year in the table (December 31, 2019), through and including the end of the Company's last completed fiscal year (December 31, 2024).

(6)

Total shareholder return relative to a peer group measures the benefit to shareholders of holding the Company's Common Shares relative to that of its peer companies over a period of time, including the change in the share price as well as the reinvestment of dividends during the same period of time. It is used as a metric within the annual incentive program for all years presented in the table above. In February 2024, the Compensation Committee approved a new total shareholder return peer group, starting with the 2024 incentive compensation plan, to include Chatham Lodging Trust, DiamondRock Hospitality Company, Host Hotels & Resorts, Inc., Park Hotels & Resorts Inc., Pebblebrook Hotel Trust, RLJ Lodging Trust, Ryman Hospitality Properties, Inc., Summit Hotel Properties, Inc., Sunstone Hotel Investors, Inc. and Xenia Hotels & Resorts, Inc. In the previous year, 2023, the Company's peer group consisted of Ashford Hospitality Trust, Inc., Chatham Lodging Trust, RLJ Lodging Trust and Summit Hotel Properties, Inc. The update to the total shareholder return peer group was done to more closely align the members with the peer group used for evaluating, benchmarking and setting compensation for the Company's incentive compensation plans. This new peer group includes peers with a similar market capitalization and are in a similar industry to the Company which ultimately provides a more relevant comparison of the Company's performance relative to its peers. The "Peer Group Total Shareholder Return" column in the above table is calculated based on the Company's 2024 peer group. Refer to the table below for a comparison of the cumulative total shareholder return results between the Company, the 2024 peer group and the 2023 peer group.

(7)

MFFO per share - The Company used MFFO, as defined and reconciled to audited GAAP net income (loss) for each year included in the table above within Exhibit 1, and divided it by the Company’s weighted average Common Shares outstanding for the year ended December 31, 2024, 2023, 2022, 2021 and 2020, respectively. FFO is a predominant measure of operating performance used by real estate investment trusts and the Company reports the measure in accordance with the National Association of Real Estate Investment Trusts ("Nareit") guidelines, and makes certain adjustments to this measure to present MFFO as a supplemental measure of operating performance in its earnings releases, financial presentations and SEC filings. As noted above in “Compensation Discussion and Analysis—Elements of Executive Compensation," for the 2024 annual incentive compensation plan, MFFO per share made up 7.5% of the total weighting for the annual incentive compensation award. No other operational performance goal or metric had a greater weighting.

Relationship Between Pay and Performance

The following charts show the relationship of the compensation actually paid to the Company's NEOs in comparison to total shareholder return, peer group shareholder return, net income (loss) and MFFO per share.

Compensation Actually Paid versus Total Shareholder Return $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 $8,000,000 $9,000,000 $ 2020 2021 2022 $120.00 $100.00 $80.00 $60.00 $40.00 $20.00 $ PEO Actual Pay Avg. Other NEO Actual Pay TSR Peer Group TSR Total Shareholder Return

Compensation Actually Paid versus Net Income $1,000,000 $2,000,000 $3,000,000 $4,000,

Compensation Actually Paid versus MFFO Per Share Modified FFO Per Share$1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 $8,000,000 $9,000,000 $ 2020 2021 2022 $ $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 Net Income $ PEO Actual Pay Avg. Other NEO Actual Pay Modify FFO Per Share

The compensation structure for the Company's NEOs is specifically designed so that a significant portion of their total compensation is incentive based and directly aligns their interests with those of the Company's shareholders. The table and charts above show that the compensation actually paid to the Company's NEOs is closely aligned with shareholder value. During all five years, the compensation actually paid to the PEO and non-PEOs was greater than the summary compensation table total as a result of higher total shareholder return performance relative to peers on a long-term basis and total operational based equity awards that were earned at or above target.

The following are the most important financial performance measures used by the Company in its determination of incentive compensation:

•

Total shareholder return (1-, 2- and 3-year returns)

•

Total shareholder return relative to peer group (1-, 2- and 3-year returns)

•

MFFO per share (as defined within Exhibit 1)

PROPOSAL 4. APPROVAL OF THE APPLE HOSPITALITY REIT, INC. EMPLOYEE STOCK PURCHASE PLAN

The Company is requesting that shareholders approve the Apple Hospitality REIT, Inc. Employee Stock Purchase Plan (the “ESPP”), which was approved by the Company's Board, subject to shareholder approval. The ESPP is being submitted for approval by the shareholders at the Annual Meeting. The Company believes that the ESPP will provide a key benefit to eligible employees. In particular, the ESPP provides a convenient way for the Company's employees to purchase Common Shares at a discounted price, which gives employees a vested interest in the Company's success and aligns their interests with that of the Company's shareholders. If approved by the shareholders, the ESPP will become effective on May 19, 2025.

Summary of the ESPP

The following is a summary of the material terms of the ESPP. The summary does not purport to be complete and is qualified in its entirety by reference to the full text of the ESPP, which is attached as Appendix A and incorporated herein by reference. Shareholders are encouraged to read the text of the ESPP in its entirety.

Purpose. The purpose of the ESPP is to provide an added incentive for eligible employees of the Company to promote the Company’s best interests by providing an opportunity to those employees to purchase Common Shares at below-market prices through payroll deductions. The ESPP (i) aligns the interests of the Company’s shareholders and eligible employees by increasing the proprietary interest of such employees in the Company’s growth and success, (ii) advances the interests of the Company by attracting, retaining, and rewarding eligible employees, and (iii) motivates eligible employees to act in the long-term best interests of the Company.

Administration. The ESPP will be administered by the Compensation Committee, which has the right to determine any questions which may arise regarding the interpretation and application of the provisions of the ESPP and to make, administer and interpret such rules and regulations as it deems necessary. Any determinations will be made by the Compensation Committee in its sole discretion and will be final and binding. The Compensation Committee is authorized from time to time to delegate some or all of its authority under the ESPP to a subcommittee or other individuals as it deems necessary, appropriate, or advisable.

The ESPP is not intended to qualify as an “employee stock purchase plan” within the meaning of section 423 of the Internal Revenue Code of 1986, as amended (the “Code”).

Eligibility. Any individual who is an active employee of the Company (or its designated subsidiaries) will be eligible to participate in the ESPP. As of April 3, 2025, approximately 64 employees would have been eligible to participate in the ESPP.

Shares Available for Issuance. If the ESPP is approved by the shareholders at the Annual Meeting, the maximum number of Common Shares that may be purchased under the ESPP will be 600,000 Common Shares, subject to adjustment for stock dividends, stock splits, spin-off, or combinations of stock. Common Shares purchased under the ESPP may be any combination of (i) authorized and unissued Common Shares, (ii) Common Shares purchased by the Company on the open market, or (iii) other Common Shares held by the Company as treasury shares.

Offering Periods. If approved by the Company's shareholders, the ESPP will be implemented and the first offering period will commence on a date determined by the Compensation Committee following shareholder approval of the ESPP. Initially, the ESPP will be implemented by consecutive six-month offering periods beginning on such dates determined by the Compensation Committee. The Compensation Committee may establish different offering periods. Common Shares are purchased on the last trading day of each offering period.

Participation in the Plan. Eligible employees become participants in the ESPP by executing and delivering to the Company an enrollment form in accordance with the procedures established by the Compensation Committee. The enrollment form specifies the employee’s contribution percentage (which will be based on whole percentages of compensation and may not be less than 1%, or exceed 15%, of the participant’s base salary or wages) and authorizes the Company to make after-tax payroll deductions for the purchase of Common Shares under the ESPP.

A participant may discontinue his or her participation in the ESPP at any time up to ten business days before the last trading day in an offering period by delivering written notice to the Company and following any procedures established by the Compensation Committee. Upon a withdrawal from the ESPP during an offering period, all payroll deductions for the offering period will be returned to the participant. The participant may not re-elect to participate in the ESPP during the applicable offering period but may make a new election to participate in any future offering period. Unless the participant’s participation is discontinued, the purchase of Common Shares occurs automatically at the end of the offering period. Once an employee becomes a participant, he or she will automatically be enrolled in subsequent offering periods unless the employee withdraws from the ESPP or becomes ineligible to participate.

Purchase Price. The purchase price per share at which Common Shares are sold under the ESPP is no less than the lower of (i) 85% of the fair market value of such Common Shares on the first trading day of an offering period, or (ii) 85% of the fair market value of such Common Shares on the last trading day of the offering period. The fair market value of the Common Shares on a given date is the closing price per Common Share on the NYSE as of such date (provided that, if the Common Shares are publicly traded on more than one national stock exchange or national market system, the Compensation Committee shall designate the appropriate national stock exchange or national market system for purposes of the fair market value determination). As of the Record Date, the closing price of the Company's Common Shares reported on the NYSE was $13.33 per Common Share. Because employee participants may purchase the Company's Common Shares at a discount to the fair market value of its Common Shares, the value of the purchase of Common Shares under the ESPP is not currently determinable.

Delivery of Common Shares. On the last trading day of the offering period, the balance of a participant’s account under the ESPP will be applied to the purchase of the number of Common Shares determined by dividing the account balance by the purchase price, subject to limitations in the ESPP. No fractional Common Shares will be delivered under the ESPP, unless permitted by the Compensation Committee.

Common Share Purchase Limits. Under the ESPP, a participant’s payroll deductions during any calendar year may not exceed $25,000.

Termination of Employment; Disability; or Death. Upon the termination of a participant’s employment for any reason (other than death or disability), the participant will (i) immediately cease to participate in the ESPP and (ii) receive any amounts being held in his or her account. In the event of a participant’s termination of employment during an offering period due to death or disability, the participant or, in the case of his or her death, the participant’s heirs or estate or designated beneficiary may elect to receive the amount credited to the participant’s account or to have the account applied to the purchase of Common Shares at the end of the offering period.

Adjustment or Changes in Capitalization. In the event of any change in the outstanding Common Shares by reason of a nonreciprocal transaction between the Company and its stockholders (such as a stock split, stock dividend, rights offering or recapitalization through a large, nonrecurring cash dividend) affecting such Common Shares or the price of such Common Shares, the aggregate number of such Common Shares available under the ESPP, the maximum number of such Common Shares that each participant may purchase during an offering period or over a calendar year, and the per-share price used to determine the purchase price, will be appropriately adjusted in accordance with the determination made by the Compensation Committee.

Liquidation, Winding Up or Dissolution. Unless provided otherwise by the Compensation Committee, in the event of the proposed liquidation, winding up or dissolution of the Company, the offering period then in progress will be shortened. The Compensation Committee will set a new purchase date, which will result in the applicable offering period terminating immediately prior to the consummation of the proposed liquidation, winding up or dissolution.

Asset Sale, Merger or Consolidation. In the event of a proposed sale of all or substantially all of the assets of the Company, or the merger or consolidation of the Company with or into another entity, each outstanding purchase right under the ESPP will be assumed, continued, or an equivalent right to purchase Common Shares will be substituted, by the successor or resulting entity or a parent or subsidiary of such entity. If the outstanding purchase rights under the ESPP are not assumed, continued, or substituted in such a transaction, any offering period then in progress will be shortened by setting a new purchase date prior to the consummation of such transaction, and any offering period then in progress will end on the new purchase date.

Non-assignability. No rights or accumulated payroll deductions of a participant under the ESPP may be pledged, assigned, alienated, attached, sold or otherwise transferred for any reason during the lifetime of a participant (other than by will or the laws of descent and distribution). If a participant attempts to make such a transfer, the Compensation Committee may elect to treat such act as an election by the participant to withdraw funds from the offering period and no Common Shares will be purchased during such offering period by such participant.

Amendment and Termination of the Plan. The ESPP may be amended, modified, suspended, or terminated by the Compensation Committee for any reason subject to applicable laws, rules and regulations. However, to the extent necessary to comply with applicable law, regulation or stock exchange rule, the Company shall obtain stockholder approval of any amendment in such a manner and to such a degree as required. The ESPP shall terminate on the earlier of (i) the date the ESPP is terminated by the Compensation Committee and (ii) the date on which all purchase rights are exercised in connection with a change in control of the Company.

Registration with the SEC. If the shareholders approve the ESPP, the Company intends to file with the SEC a registration statement on Form S-8 covering the new Common Shares reserved for issuance under the ESPP as soon as reasonably practicable following approval.

Certain Federal Income Tax Consequences

The following is a brief description of federal income taxation upon employees and the Company under the ESPP. This summary is not intended to constitute tax advice, is not intended to be exhaustive and, among other things, does not describe state, local or foreign tax consequences or the tax consequences arising in the context of the employee’s death.

The ESPP, and the right of participants to make purchases thereunder, is not intended to qualify as an “employee stock purchase plan” under Section 423 of the Code. Accordingly, certain tax benefits available to participants in a Section 423 plan are not available under the ESPP.

For federal income tax purposes, a participant generally will not recognize taxable income on the grant of a purchase right under the ESPP and the Company will not be entitled to any deduction at such time. Upon the purchase of Common Shares under a purchase right, a participant will recognize ordinary income, and the Company will be entitled to a corresponding deduction, in an amount equal to the difference between the fair market value of the Common Shares on the purchase date and the purchase price paid for the Common Shares. A participant’s basis in Common Shares received upon purchase, which is used to determine the participant’s gain or loss on subsequent disposition of such Common Shares, in general, will be the fair market value of the Common Shares on the date of the purchase.

Upon the subsequent sale of the Common Shares as a result of a purchase right, the participant will recognize capital gain or loss (long-term or short-term, depending on the holding period following the date the Common Shares were purchased by the participant prior to disposing of them).

This is a general summary under current law of the material federal income tax consequences to an employee who participates in the ESPP. This summary deals with the general federal income tax principles that apply and is provided only for general information. Certain types of taxes, such as, for example, state, local and foreign income taxes and federal employment taxes, are not discussed. Tax laws are complex and subject to change and may vary depending on individual circumstances and from locality to locality. The summary above does not discuss all aspects of federal income taxation that may be relevant in light of a participant’s personal circumstances. Further, this summarized tax information is not tax advice and a participant in the ESPP should rely on the advice of his or her legal and tax advisors.

New Plan Benefits

The actual number of Common Shares that may be purchased under the ESPP by any individual (or any group of individuals) is not determinable as there are multiple variables, including, each employee’s voluntary election to participate, the amount of payroll contributions elected by each employee, and the fair market value of the Company's Common Shares at various future dates.

The affirmative vote of a majority of the votes cast will be necessary to approve this proposal. Abstentions and broker non-votes will have no effect on the outcome of this proposal.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE“FOR” THE ABOVE PROPOSAL.