Document:

Option Agreement, dated February 1, 2005

 Exhibit 10.1 
  
 OPTION AGREEMENT 
  
 This Option Agreement (“Agreement”) is entered into as of February 1, 2005, by and between Ambassadors International, Inc., a Delaware
corporation (“Ambassadors”), and BellJa Holding Company, Inc., a California corporation (the “Company”). These parties are sometimes referred to herein individually by name or as a “Party” and
collectively as the “Parties.” 
  
 RECITALS 
  
 WHEREAS, the Company is the
holder of 34% of the issued and outstanding shares (the “BellPort Japan Shares”) of BellPort Japan, a corporation organized under the laws of Japan (“BellPort Japan”); 
  
 WHEREAS, concurrent with the execution of this Agreement, Ambassadors and
BellPort Group, Inc., a Delaware corporation (“BellPort”), have entered into an Agreement and Plan of Merger, pursuant to which Ambassadors will acquire all of the outstanding capital stock of BellPort (the “Merger
Agreement”); 
  
 WHEREAS, prior to executing the Merger
Agreement, BellPort sold the BellPort Japan Shares to the Company and the stockholders of the Company consist of the same individuals that were the stockholders of BellPort; 
  
 WHEREAS, the Company has agreed to provide Ambassadors an option to purchase the BellPort Japan Shares and/or the Company;
and 
  
 WHEREAS, Ambassadors would not have entered into the
Merger Agreement or consummate the transactions contemplated thereby without the Company agreeing to the terms and conditions of this Agreement. 
  
 AGREEMENT 
  
 NOW, THEREFORE, in consideration of the foregoing, and the mutual agreements set forth herein and other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the Parties hereto, intending to be legally bound, hereby agree as follows: 
  
 SECTION 1. OPTION; OPTION EXERCISE 
  
 (a) Option Grant. In consideration of Ambassadors’ payment to the Company of the amount of One Hundred Dollars ($100) and agreement to enter
into the Merger Agreement and consummate the transactions contemplated thereby, the Company hereby grants Ambassadors an option right to purchase the BellPort Japan Shares and/or the Company (the “Option”) pursuant to the terms and
conditions of this Agreement. Whether such Option is exercised shall be determined by Ambassadors in its sole and absolute discretion. 
  
 (b) Option Exercise. The Option may be exercised by Ambassadors, in its sole and absolute discretion, at any time from the date of this Agreement
through 11:59 p.m., PST, on February 1, 2006 (the “Option Termination Time”). Ambassadors shall exercise its Option by 

 
giving written notice of its election to exercise to the Company (the “Option Notice”). If the Option is not exercised by Ambassadors by
delivering the Option Notice to the Company on or prior to the Option Termination Time, the Option granted under this Agreement shall expire and be of no further force or effect; provided, however, that, if an Option Notice has been
delivered on or prior to the Option Termination Time and the Closing (as defined below) is to occur after the Option Termination Time, the Option and this Agreement shall not terminate until the earlier of the withdrawal of such Option Notice and
the Closing. Notwithstanding anything in this Agreement to the contrary, Ambassadors shall have the right to withdraw any Option Notice, in its sole and absolute discretion, for any reason and at any time (including following the Valuation
Firms’ (as defined below) determination of the Purchase Price following receipt of a Option Notice). In no event shall any such withdrawal serve as a termination of the Option granted in this Agreement or otherwise affect or alter
Ambassadors’ right to exercise the Option at any later date prior to the Option Termination Time. 
  
 SECTION 2. PURCHASE PRICE 
  
 (a) Determination. If Ambassadors exercises its Option as provided in Section 1(b), the purchase price (the “Purchase Price”) shall be an amount equal to the Fair Market Value of the BellPort Japan Shares or the
Company, as applicable, as of the date of the Option Notice. For this purpose, “Fair Market Value” shall mean the price at which a motivated seller would sell and a motivated buyer would purchase the BellPort Japan Shares or the Company,
as applicable, as of the date of the Option Notice. The Fair Market Value shall be determined by a reputable independent valuation firm (the “Valuation Firm”) with experience in determining the value of assets similar to the
BellPort Japan Shares or companies similar to the Company, as applicable. Upon delivery of an Option Notice, Ambassadors and the Company shall agree upon, and jointly appoint, the Valuation Firm and agree upon the methodologies to be employed by the
Valuation Firm when determining the Purchase Price. Within one hundred twenty (120) calendar days of such appointment, the Valuation Firm shall determine the Purchase Price and provide each of Ambassadors and the Company with a report setting forth
the Purchase Price and the Valuation Firm’s calculations and materials supporting such valuation. The determination of the Purchase Price by the Valuation Firm following each Option Notice shall be binding on the Company and Ambassadors with
respect to such Option Notice, except as otherwise agreed between the Company and Ambassadors. The fees and expenses of the Valuation Firm shall be borne equally between Ambassadors and the Company upon the Closing, provided that if Ambassadors
withdraws its Option Notice then such fees shall be borne by Ambassadors. 
  
 (b) Payment. Upon delivery of evidence of the transfer of the ownership of the BellPort Japan Shares to Ambassadors on the books and records of BellPort Japan (as discussed in Section 3(a) below), Ambassadors
shall pay the Purchase Price to the Company (in the case of the purchase of the BellPort Japan Shares) or to the stockholders of the Company (in the case of the purchase of the Company). At the election of the Company (which shall be made and a
notice thereof delivered to Ambassadors on or before the 20th business day prior to the scheduled Closing Date), the Purchase Price shall be paid either (i) by wire transfer of immediately available funds to a bank account designated by the Company
or (ii) in shares of common stock, par value $0.01 per share, of Ambassadors (“Ambassadors Common Stock”), provided that, in the event payment of the Purchase Price in Ambassadors Common Stock would require Ambassadors to obtain
stockholder approval under any applicable law or regulation (including the regulations 

  

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promulgated by the NASDAQ National Market), the payment of shares of Ambassadors Common Stock shall be reduced to the extent necessary so that any such
stockholder approval shall no longer be required (and cash shall be substituted therefor). For the purpose of determining the number of shares of Ambassadors Common Stock to be delivered by Ambassadors for payment of the Purchase Price, a share of
Ambassadors Common Stock shall be valued at an amount equal to the average daily volume-weighted trading price of Ambassadors Common Stock, as reported on the NASDAQ National Market, on the date prior to the Closing. 
  
 SECTION 3. CLOSING 
  
 (a) Subject to Section 1(b), the closing (the “Closing”) of the purchase of the Company or the BellPort
Japan Shares, as applicable, by Ambassadors pursuant to the exercise of the Option shall take place on a date reasonably specified by Ambassadors, but in no event later than sixty (60) days following the date the Purchase Price is determined in
accordance with Section 2 (the “Closing Date”), unless a later date is agreed to in writing by the parties. On the Closing Date, the Company shall use its best efforts to cause BellPort Japan to register and/or recognize the
transfer of the BellPort Japan Shares to Ambassadors on its book and records and shall use its best efforts to cause BellPort Japan to approve the transfer of the BellPort Japan Shares to Ambassadors. 
  
 (b) On or prior to the Closing Date, the Company shall provide Ambassadors
with written evidence (in a form acceptable to Ambassadors in its sole discretion) that the consummation of the transactions contemplated by the Option have been approved by the Board of Directors (or equivalent body) of BellPort Japan pursuant to
the terms of BellPort Japan’s governing documents and any agreement between BellPort Japan, the Company and any other entity or person holding an equity, economic or other ownership interest in BellPort Japan (the “Required
Approvals”). The obligation of Ambassadors to consummate the purchase set forth in the Option Notice is subject to receipt of the Required Approvals. 
  

(c) On the Closing Date, Ambassadors and the Company shall execute such written instruments and take such other actions as the Ambassadors and the
Company shall reasonably request in connection with the consummation of the transaction contemplated by this Agreement, including a purchase agreement containing customary terms and conditions of purchase. 
  
 SECTION 4. REPRESENTATIONS AND WARRANTIES 
  
 (a) Representations and Warranties of the Company. The Company hereby
makes the following representations and warranties to Ambassadors, and each of which shall be renewed at the Closing: 
  
 (i) The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of California. The
Company has the corporate power to own its properties and to carry on its business as now being conducted. 
  
 (ii) The Company has all requisite corporate power and corporate authority to enter into this Agreement. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Company, and no further action is required on the part of the Company to authorize this
Agreement and consummate the transactions 

  

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contemplated hereby. This Agreement has been duly executed and delivered by the Company, and assuming the due authorization, execution and delivery by
Ambassadors constitutes a legal, valid and binding obligation of the Company, enforceable in accordance with its terms, except as such enforceability may be limited by principles of public policy and subject to the laws of general application
relating to bankruptcy, insolvency and the relief of debtors and to rules of law governing specific performance, injunctive relief or other equitable remedies. 
  

(iii) The execution and delivery by the Company of this Agreement and the consummation of the transactions contemplated hereby will not
(a) conflict with or result in a breach of any provision of the Certificate of Incorporation or Bylaws of the Company, or (b) violate or conflict with any judgment, order, decree, statute, law, ordinance, rule or regulation applicable to the Company
or its properties or assets. A true and complete copy of the governing documents of BellPort Japan and any agreement between BellPort Japan, the Company and any other entity and/or person holding an equity, economic or other ownership interest in
BellPort Japan has been previously delivered to Ambassadors. 
  
 (iv) No consent, waiver, approval, order or authorization of, or registration, declaration or filing with any court, administrative agency or commission or other federal, state, county, local or other foreign
governmental authority, instrumentality, agency or commission (“Governmental Entity”) or any third Party (excluding BellPort Japan) is required by or with respect to the Company in connection with the execution and delivery of this
Agreement and or the consummation of the transactions contemplated hereby. 
  
 (b) Representations and Warranties of Ambassadors. Ambassadors hereby makes the following representations and warranties to the Company, and each of which shall be renewed at the Closing: 
  
 (i) Ambassadors is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. Ambassadors has the corporate power to own its properties and to carry on its business as now being conducted. 
  
 (ii) Ambassadors has all requisite corporate power and corporate authority to enter into this Agreement. The
execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Ambassadors, and no further action is required on the part of
Ambassadors to authorize this Agreement and consummate the transactions contemplated hereby. This Agreement has been duly executed and delivered by Ambassadors, and assuming the due authorization, execution and delivery by the Company constitutes a
legal, valid and binding obligation of Ambassadors, enforceable in accordance with its terms, except as such enforceability may be limited by principles of public policy and subject to the laws of general application relating to bankruptcy,
insolvency and the relief of debtors and to rules of law governing specific performance, injunctive relief or other equitable remedies. 
  
 (iii) The execution and delivery by Ambassadors of this Agreement and the consummation of the transactions contemplated hereby will not
(a) conflict with or result in a breach of any provision of the Certificate of Incorporation or Bylaws of Ambassadors, or (b) violate or conflict with any judgment, order, decree, statute, law, ordinance, rule or regulation applicable to Ambassadors
or its properties or assets. 
  

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 (iv) No consent, waiver, approval, order or authorization of, or registration,
declaration or filing with any Governmental Entity or any third Party is required by or with respect to Ambassadors in connection with the execution and delivery of this Agreement and or the consummation of the transactions contemplated hereby.

  
 SECTION 5. MISCELLANEOUS 
  
 (a) Covenants of the Company. During the term of this Agreement:

  
 (i) The operations of the Company shall
consist solely of owning the BellPort Japan Shares and the Company shall not incur any material liability without the prior written consent of Ambassadors (which consent shall not be unreasonably withheld); and 
  
 (ii) The Company shall provide Ambassadors with copies of
all documents and materials received or prepared by the Company relating to Bellport Japan. 
  
 (b) Assignment. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the Parties hereto, in whole or in part (whether by operation of law or otherwise),
without the prior written consent of the other Party, and any attempt to make any such assignment without such consent shall be null and void; provided, however, Ambassadors may assign this Agreement and its rights, interests or
obligations hereunder to any entity or person who acquires all or substantially all of the capital stock or assets of Ambassadors (whether by purchase, merger, reconsolidation or otherwise). Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of and be enforceable by the Parties and their respective successors and assigns. 
  
 (c) Specific Performance, Etc. Ambassadors and the Company, in addition to being entitled to exercise all rights provided herein or granted by law,
including recovery of damages, shall be entitled to specific performance of each other Parties’ obligations under this Agreement. Ambassadors and the Company agree that monetary damages would not be adequate compensation for any loss incurred
by reason of a breach by any of them of the provisions of this Agreement and each hereby agrees to waive the defense in any action for specific performance that a remedy at law would be adequate. 
  
 (d) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of California. 
  
 (e)
Interpretation. The headings of the Sections contained in this Agreement are solely for the purpose of reference, are not part of the agreement of the Parties and shall not affect the meaning or interpretation of this Agreement. 

 
 (f) Notices. All notices and other communications provided for or
permitted hereunder shall be in writing and shall be deemed to have been duly given and received when delivered by overnight courier or hand delivery, when sent by telecopy, or five days after mailing if sent by registered or certified mail (return
receipt requested) postage prepaid, to the Parties at 

  

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the following addresses (or at such other address for any Party as shall be specified by like notices, provided that notices of a change of address shall be
effective only upon receipt thereof). 
  
 If to
the Company, at: 
  
 BellJa Holding Company, Inc.

 101 Shipyard Way, Suite M 
 Newport Beach, California 92663 
 Attention: Paul Penrose 
 Facsimile: (949) 723-7786 
  
 If to Ambassadors, at: 
  
 Ambassadors International, Inc. 
 1071 Camelback Street 
 Newport Beach, California 92660 
 Attention: Chief Financial Officer 
 Facsimile: (949) 219-6066 
  
 with copies to: 
  
 Latham & Watkins LLP 
 650 Town Center Drive, Suite 2000 
 Costa Mesa, California 92626 
 Attention: Charles K. Ruck 
 Facsimile: (714) 755-8290 
  
 (g) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to constitute one and the same agreement. 
  
 (h) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstances, is held
invalid, illegal, or unenforceable in any respect for any reason, the validity, legality, and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be in any way impaired thereby.

  
 (i) Amendment. This Agreement may be amended only by
written agreement signed by each of Ambassadors and the Company. 
  
 (j) Entire Agreement. This writing constitutes the entire agreement of the Parties with respect to the subject matter hereof. 
  

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 IN WITNESS WHEREOF, the Parties have executed this Agreement on the date first written above. 

 

			
	AMBASSADORS INTERNATIONAL, INC.
		
	By:	 	 /s/ Brian R. Schaefgen

	 	 	Brian R. Schaefgen
	 	 	Chief Financial Officer, Treasurer and Secretary
	
	BELLJA HOLDING COMPANY, INC.
		
	By:	 	 /s/ Paul Penrose

	 	 	Paul Penrose
	 	 	President

  

 7Separation Agreement

 EXHIBIT 10.1 
  
 SEPARATION AGREEMENT 
  

This Separation Agreement, dated as of February 2, 2005 (“Separation Agreement”), between David Bulger (“Bulger”) and Innkeepers
USA Trust (“Trust”), provides as follows: 
  
 In
consideration of the promises contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: 
  
 1. Bulger’s employment with Trust will voluntarily cease as of 5:00 pm EST on a mutually agreeable date which shall be (a) no earlier
than the date that the Trust’s Annual Report on Form 10-K for the year ended December 31, 2004 (the “2004 10-K”) is filed with the SEC and (b) no later than the later of (i) the date that the Trust’s Quarterly Report on Form 10-Q
for the Quarter ended March 31, 2005 (the “First Quarter 10-Q”) is filed with the SEC and (ii) the date of the 2005 annual shareholders meeting (the “Separation Time”). Bulger will continue in his current duties as the
Trust’s Chief Financial Officer and principal accounting officer until the Separation Time, including without limitation providing all signatures and/or certifications of the principal accounting officer or chief financial officer that are
required in connection with (x) the initial filing of the 2004 10-K or any amendment to the 2004 10-K to be filed by the Trust to include information required by applicable SEC rules or guidance related to the Trust’s internal control over
financial reporting as of December 31, 2004; and (y) the First Quarter 10-Q (“First Quarter Certifications”). Bulger will not be required to participate in the Trust’s conference call discussing earnings for the quarter ended March
31, 2005. 
  
 2. The Trust will: 
  

	 	A.	Maintain Bulger’s current salary and benefits through the Separation Time, in the normal course consistent with current practice. 

  

	 	B.	Pay Bulger cash severance of $330,000.00, which the parties agree will be paid to Bulger on the first regularly scheduled payroll date that is at least one week after the Separation
Time (“Severance Payment Date”), without interest and subject to applicable withholding and payroll taxes. 

  

	 	C.	If Bulger is required by the Trust to provide the First Quarter Certifications, pay Bulger an additional amount equal to $12,500.00, which the parties agree will be paid to Bulger
on the Severance Payment Date, without interest and subject to applicable withholding and payroll taxes. 

  

	 	D.	Acknowledge that as of the Separation Time that Bulger will be “vested” in the 10,000 restricted common shares that are currently outstanding. At Bulger’s request and
upon receipt of customary documentation from Bulger and/or his broker, provide customary documentation to Bulger’s broker or the Trust’s transfer agent to assist in facilitating Bulger’s disposal of said shares in the public market on
or after the Separation Time. 

	 	E.	Not make any disparaging remarks about Bulger, which could reasonably be deemed to adversely affect Bulger or his opportunities for future employment. 

  
 3. Bulger will: 
  

	 	A.	Facilitate the expeditious and efficient transitioning of his duties to other persons designated by the Trust through the Separation Time. 

  

	 	B.	Assist to the extent requested by the Trust in the effort to identify and recruit one or more replacements for his duties. 

  

	 	C.	Without limiting Section 2.A. above or any other term hereof, promptly comply with any direction by the Trust prior to the Separation Time to cease (i) working on behalf of the
Company, (ii) representing himself as an officer, employee, agent or other representative of the Company, or (iii) visiting the Company’s offices or properties. 

  

	 	D.	Not copy or use in any way any Trust property. Bulger will have the right to remove his personal files and property from the Trust’s offices. 

  

	 	E.	Not make any disparaging remarks, which could in any way adversely affect the Trust or Innkeepers Hospitality Management, Inc. (collectively, with its past and present affiliates,
“IH”), or their business prospects, trustees, directors, officers, employees, or the properties in which either has an interest. 

  

	 	F.	Deliver to the Trust on the Severance Payment Date a then-currently dated release in the form of Section 4 below. Bulger acknowledges and agrees that the delivery of such release is
a material condition to the Trust’s obligations under both Section 2.B and Section 2.C. 

  
 4. Bulger, individually and on behalf of each of his affiliates, successors, heirs, assigns and any other persons or entities claiming through any of them, fully, forever, irrevocably, and unconditionally releases the
Trust, and its officers, trustees, employees, agents and affiliates (including, for this purpose only, IH), and any of their successors or assigns, from and against any and all claims, causes of action, agreements (including employment or severance
agreements), damages, liabilities and expenses, including attorney fees and costs, whether known or unknown, at law or in equity or mixed, which he or any of them, had, now has or in the future may have arising out of any matter or thing that has
happened, developed or occurred before the date hereof. Bulger agrees not to file any legal or similar action or voluntarily participate in any legal or similar action, which could reasonably be deemed adverse to the Trust, IH or their trustees,
directors, officers, employees, businesses or properties. Bulger understands that the release contained in this Section 4 is a general release. To the extent permitted by any applicable law, Bulger hereby waives any waiting or revocation period that
might otherwise apply with respect to the release set forth in this Section 4. 
  
 5. Bulger and the Trust each agree that (a) the cessation of Bulger’s employment with the Trust is not the result of any accounting-related policy or disagreement and (b) they are aware of no accounting-related issue or policy of the
Trust with respect to which they are not in agreement. 
  
  

 6. This Separation Agreement may not be amended, modified or otherwise changed in any manner except by a writing executed
by all of the parties hereto. This Separation Agreement shall be governed by, and construed in accordance with, the laws of the State of Florida. This Agreement constitutes all of the agreements between Bulger and the Trust relating to the matters
set forth herein and supersedes all other prior or concurrent oral or written letters, agreements and understandings with respect to the matters set forth herein. The failure of either party to insist upon strict performance of any term hereof shall
not be deemed to be a waiver by such party of any term of this Separation Agreement. If any term, covenant or condition of this Separation Agreement is held to be invalid, illegal or unenforceable in any respect, this Separation Agreement shall be
construed without such provision. 
  

			
	BULGER:	 	 
		
	 /s/ David Bulger

	 	Dated: February 2, 2005
	David Bulger	 	 
		
	TRUST:	 	 
		
	 /s/ Jeffrey H. Fisher

	 	Dated: February 2, 2005
	 Jeffrey H. Fisher,
 Chairman, Chief
Executive
	 	 
	Officer and President

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