Forget shampoo and chocolates: Jameson Inns is going to reward loyal customers with shares of its own stock. The Securities and Exchange...
WASHINGTON — Forget shampoo and chocolates: Jameson Inns is going to reward loyal customers with shares of its own stock.
The Securities and Exchange Commission staff last week approved Jameson’s plan to register 3 million shares for distribution to frequent travelers.
“To our knowledge, we are the first company in any industry to offer common stock as an award for being a frequent customer,” Jameson Chairman and Chief Executive Thomas Kitchin said during a conference call last November. He said program participants will receive Jameson shares by “doing nothing more than paying for their room.”
Atlanta-based Jameson owns and operates about 100 economy hotels under the Jameson name in the Southeast and 23 Signature Inns in the Midwest. Its stock-for-sleep plan will be open to guests who enroll in it after three or more nights’ stay.
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The program is off-limits to children and adults who haven’t previously invested in stocks or mutual funds.
The proposal, filed with the SEC last September, was approved last week, although Jameson has yet to announce it. A company spokesman wasn’t immediately available to comment.
Guests who enroll in the program would have 10 percent of their room charges credited toward the purchase of Jameson stock, now trading near $2.50 a share.
Shares will be provided through a designated broker or the company, based on the average closing price for the last five trading days of each month. Customers won’t pay commissions on shares they receive, but will pay fees on shares they sell.
Unique rewards plan
Since it caters to business travelers in small towns, Jameson chose something novel rather than compete with a conventional rewards program, said William Marks, a senior analyst at JMP Securities in San Francisco who follows Jameson.
“I respect the company for its creativity,” said Marks. “No other company has a program like this in place.”
Whether investors like the idea remains to be seen. Existing shareholders might balk if the rewards program dilutes the stock value or cuts into Jameson’s revenue.