JER Partners Agrees to Acquire Jameson Inns, Inc. for $2.97 Per Share in Cash

Jameson Inns, Inc. (Nasdaq: JAMS) today announced that it has entered into a definitive agreement by which an affiliate of JER Partners will acquire all outstanding shares of Jameson Inns in a cash merger for $2.97 per share.

Jameson Inns The Jameson Inns board of directors approved the transaction unanimously with one member absent, and intends to recommend to Jameson Inns' shareholders that they adopt the agreement.

The aggregate transaction value, including assumption of approximately $190 million in debt, is approximately $371 million. The per share price to Jameson Inns' shareholders represents a premium of approximately 30% based on the closing price of Jameson Inns common stock on May 19, 2006.

"This transaction provides significant incremental shareholder value for Jameson Inns' shareholders," said Thomas W. Kitchin, Chairman and CEO of Jameson Inns, adding, "we believe that JER and its Atlanta-based affiliate, Longhouse Hospitality, which will operate the business after the merger, will provide our employees and brands with the experience and proven track record that will result in continued leadership, financial stability, quality and growth."

JER has confirmed that Jameson Inns will be operated as a privately held independent company controlled by JER. Jameson Inns will continue to do business under the Jameson Inn and Signature Inn names.

The merger is subject to customary closing conditions, including the approval of a majority of the outstanding Jameson Inns common shares at a meeting of Jameson Inns shareholders, and is expected to be completed in the third quarter of 2006. The merger is not subject to the ability of JER to obtain financing.

Said David Fraser, a Jameson Inns board member since March 2004, "After careful consideration in conjunction with our independent advisors, our independent directors approved this transaction as in the best interests of our shareholders."

"Jameson Inns is an outstanding company with highly talented employees, a heritage of leadership in the marketplace and a strong regional brand," added Cia Buckley, President of JER's US Fund Business. "By joining our company, Jameson Inns will be able to maintain a long-term focus on growth and a commitment to delivering value for all of its constituents. We view this major acquisition not only as a key strategic investment for JER/Longhouse, but as a platform for growth."

JMP Securities LLC acted as financial advisor to Jameson Inns' board of directors, Jones Day acted as the board's transaction counsel and Conner & Winters acted as Jameson Inns' counsel. Friedman, Billings, Ramsey & Co., Inc. acted as financial advisor to JER and O'Melveny & Myers LLP acted as JER's legal advisor.

About Jameson Inns

Jameson Inns, Inc. owns and operates 107 proprietary-branded hotel properties in the southeastern and midwestern United States. Jameson Inns has also licensed 12 hotels to operate as Jameson Inns. In total, there are currently 119 Inns (111 under the Jameson Inn brand and 8 under the Signature Inn brand), with a combined 7,550 guestrooms in 12 states.

About JER

JER is the investment arm of the J.E. Robert Companies, which over the last 25 years has developed a reputation as one of the premier real estate investment and asset management firms. Since launching its real estate investment program 15 years ago, JER, together with its financial partners, has acquired over 14,000 assets with a gross investment in excess of $14 billion. JER has built a global presence, with offices in the United States and Europe, and has completed investments in ten countries worldwide.

JER currently manages six discretionary private equity capital funds aggregating $2.3 billion of committed equity and is focused on investing in real estate portfolios, commercial mortgage backed securities and loans, individual assets, and operating companies in North America and Europe.

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