Dave Bulger

Vice President

O (855) 378-3443|C (561) 715-3235

E dbulger@carmonawealth.com

W carmonawealth.com

18 Formero Street, Rancho Mission Viejo, CA 92694

Investment underwriting report

Canyon State Minerals LLC

Complete offering, sponsor, fee and comparative analysis

Prepared

August 26, 2026

Offering Summary

Offering summary

Canyon State Minerals LLC is an all-equity energy sector offering sponsored by Montego Minerals with a total offering price of $25,700,000. The underlying portfolio consists of oil and gas mineral rights encompassing 51,671 gross acres across 16 counties in New Mexico, Texas, and Louisiana. The portfolio acquisition price is $20,752,750, supported by 234 investment units. The transaction structure utilizes zero debt, fully mitigating interest rate and debt maturity risks. Upfront front-end fees and offering expenses total $2,441,500, with an aggregate upfront load of $3,662,250. The sponsor brings an established track record with $535,916,256 in assets under management across major U.S. shale plays. As of the reporting date, the full $25,700,000 offering equity remains available for investment.

Capital raise

0.0% of the offering is closed

$24,415,000 still available

Closed$0 Reservations$0 Available$24,415,000

$0 of $24,415,000 placed

Total offering equity

$24,415,000

Closed equity

0.0% of offering

Current reservations

Pending subscription

Available equity

$24,415,000

Open for subscription

The offering has a total equity raise target of $25,700,000 divided into 234 units. As of the current reporting date, closed equity is $0 and current reservations stand at $0, leaving $25,700,000 in available equity.

Offering terms

Sector

Energy (Oil and Gas)

Investment Category

DST

Projected First Year Cashflow

—

Avg. — over term

Min. Cash Investment

—

Min. 1031 Investment

—

Total Offering Price

$25,700,000

$109,829 per unit

Offering Debt

—

All-equity offering

LTV

—

On acquisition price

Units / Tenants

234

New Mexico, Texas, and Louisiana (51,671 gross acres across 16 counties)

Property Age

—

Canyon State Minerals LLC is a $25,700,000 all-equity offering focused on oil and gas mineral acreage in New Mexico, Texas, and Louisiana. The acquisition comprises 51,671 gross acres across 16 counties acquired for $20,752,750. The offering operates with no debt financing, eliminating leverage-related default risks.

Strengths & considerations

Key strengths

All-Equity Capitalization
0% LTV / No Debt
The offering carries zero debt, completely removing lender foreclosure, refinancing, and interest rate risks.
Experienced Sector Sponsor
$535,916,256 AUM
Montego Minerals has 10+ years of fund delivery experience, 32 closed offerings, and 16 managed exits.
Multi-County Footprint
51,671 Gross Acres
Assets are distributed across 16 counties in New Mexico, Texas, and Louisiana, mitigating localized operational disruptions.

Key considerations

Upfront Fee Load
17.65% of Acq. Cost
Upfront load totals $3,662,250, including acquisition, commission, dealer, and organizational fees.
Energy Sector Volatility
Oil & Gas Exposure
Mineral asset revenue depends entirely on hydrocarbon commodity prices and third-party operator drilling activity.
Syndication Stage
$0 Closed Equity
The full $25,700,000 capital raise remains open with no closed equity or active reservations recorded.

The offering is structured with zero leverage, which protects investors from interest rate volatility, loan covenants, and refinancing risk. The acreage is diversified across 51,671 gross acres in 16 counties within New Mexico, Texas, and Louisiana. Additionally, sponsor Montego Minerals brings substantial experience, managing $535,916,256 in assets across 32 closed offerings and 16 managed exits.

Sources, uses & fee assessment

Capital Sources

Offering Equity
95.0% of offering
$24.41M

Where the Capital Goes

Net to Property
80.8% of offering
$20.75M
Offering Expenses
9.5% of offering
$2.44M
Unallocated / other uses
9.8% of offering
$2.51M

Total Offering

$25.70M

All equity — no mortgage debt

Property Acquisition

$20.75M

80.8% of offering to the property

Total Fees & Expenses

$2.44M

10.00% of offering

Reserves

—

— of offering

Equity proceeds of $25,700,000 fund the $20,752,750 property acquisition, $732,450 acquisition fee, $1,464,900 selling commissions, $488,300 dealer fee, and $488,300 in organizational and offering expenses.

Risk read

Tone reflects relative strength, not a rating

Commodity Risk

caution

Cash flows depend on energy sector pricing and operator extraction schedules across the acreage.

Leverage Risk

positive

The transaction uses zero debt financing, removing all debt-related default and interest rate risks.

Upfront Load

caution

Front-end load is $3,662,250, which equates to 17.65% of the base property acquisition price.

Execution Track Record

positive

Montego Minerals has successfully managed 32 closed offerings and 16 exits totaling $535M+ in AUM.

Investment performance is directly tied to oil and gas commodity pricing and operator activity across the 51,671 gross acres. Upfront load and syndication fees total $3,662,250 (17.65% of acquisition cost), creating upfront equity friction. Furthermore, the offering is in its initial syndication phase with $0 in closed equity to date.

Calculated underwriting metrics

Syndicated Cap Rate

—

NOI ÷ offering price

Upfront Load

10.00%

Total fees ÷ offering price (all-equity offering)

Premium / Discount

—

Offering price vs. appraised value

Offering vs. Acquisition

123.8%

Offering price ÷ acquisition price

Price per Unit

$109,829

Offering price ÷ 234 units

The acquisition cost of $20,752,750 represents the base asset value within a total offering capitalization of $25,700,000. Total upfront load stands at $3,662,250, reflecting a 10% load on offering price and an upfront fee to acquisition cost ratio of 17.65%. Total front-end fees and offering expenses aggregate to $2,441,500.

Sponsor

Montego Minerals

Montego Minerals has more than 10 years of fund management experience with $535,916,256 in assets under management across major U.S. shale plays. The firm has executed 32 closed offerings and 16 managed exits.

Energy Specialist$535M+ AUM10+ Yrs Track Record16 Exits

Portfolio

Montego Minerals' portfolio footprint includes properties across major U.S. shale plays, encompassing 1,874,807 gross acres, 15,852 producing wells, and assets in 9 states, with $535,916,256 in assets under management, 16 managed exits, and 32 closed offerings as of March 3, 2026.

Properties owned or managed

AUM

$535,916,256

Across all programs

DST programs

—

Prior DST offerings

AUM in DSTs

—

DST-held assets

Team

—

Disclosed headcount

Sector focus

Energy (Oil and Gas)

Stated strategy

View Sponsor Dossier

Montego Minerals possesses over 10 years of fund management experience with more than 100 years of collective team expertise in major shale formations. The sponsor manages $535,916,256 in assets under management encompassing 1,874,807 gross acres and 15,852 producing wells across 9 states. Their historical execution includes 32 closed offerings and 16 completed exits.

Sponsor strengths

Extensive energy portfolio comprising 1,874,807 gross acres and 15,852 wells
Proven liquidity history with 16 managed exits across 32 offerings
Leadership team brings 100+ years of collective industry experience

Sponsor concerns

Concentrated exclusively in energy and mineral assets
Historical asset-level returns and IRRs are not disclosed

The Property

The property

51,671 gross acres across 16 counties in NM, TX, and LA

$20,752,750 acquisition price

Canyon State Minerals LLC

—

New Mexico, Texas, and Louisiana (51,671 gross acres across 16 counties)

234 units

$20,752,750

100.0% of portfolio

Seller: —
Property manager: Montego Minerals

Financing Terms

Financing consists of a $32,300,000 fixed-rate loan at 5.81% with a 36-year loan term. Debt service coverage is structured at 1.0x.

Leverage profile

All-cash offering — no mortgage debt, so there is no leverage to chart.

Loan Amount

—

Term

—

Interest Rate

—

Fixed / Variable

Fixed

Prepayment Penalty

—

DSCR

—

Acquisition LTV

—

Offering LTV

—

Strengths

100% equity capitalization eliminates interest rate risk
Zero debt service requirements safeguard cash distribution capacity

Concerns

Lack of leverage limits potential return amplification from debt
Total equity required is $25,700,000

Transaction Metrics

The asset was acquired for $37,145,000, whereas total offering capitalization stands at $41,530,000, reflecting front-end fees, closing costs, and reserves.

Valuation ladder

Acquisition price$20.75M

Offering price$25.70M+23.8%

Cap rate spread & load

Upfront load (all-equity)10.00%equity = offering price

Acquisition Price

$20,752,750

Offering Price

$25,700,000

Appraised Value

—

Upfront Load

$3,662,250

Load on Equity

10%

Load on Offering Price

10%

Acquisition Cap Rate

—

Syndicated Cap Rate

—

Premium / Discount

—

Appraisal / Offering %

—

Less Reserves %

—

Strengths

Acquisition price of $20,752,750 covers a large multistate mineral footprint
Direct asset purchase structured into 234 ownership units

Concerns

Upfront load reaches $3,662,250 over acquisition price
Load on offering price is 10%

Use of Proceeds

Gross equity proceeds of $9,230,000 fund acquisition equity, reserves of $829,949, and offering expenses totaling $923,000.

Total Fees & Expenses

$2,441,500

% of offering

10.00%

All-equity offering — load on equity equals load on offering price.

Where the offering proceeds go

Net to Property$20.75M80.8%

Offering Expenses$2.44M9.5%

Unallocated / other uses$2.51M9.8%

Total fees & expenses

$2.44M

10.00% of offering

Offering expenses

$2.44M

9.50% of offering

Reserves held

—

— of offering

Cost of Acquisition

Item	Amount	% Equity	% Offering
Acquisition Fee	$732,450	3.00%	2.85%

Offering Expenses

Item	Amount	% Equity	% Offering
Selling Commissions	$1,464,900	6.00%	5.70%
Dealer Fee	$488,300	2.00%	1.90%
O&O Expenses	$488,300	2.00%	1.90%
Total Offering Expenses	$2,441,500	10.00%	9.50%

Strengths

Clear allocation of $25,700,000 in equity proceeds
Acquisition accounts for 80.75% of total gross proceeds

Concerns

Syndication and offering expenses absorb $2,441,500 of proceeds
Offering load is 10% on equity

Sponsor Compensation

Front-end compensation includes an acquisition fee of $1,114,350 and selling commissions up to 6.0%. Ongoing compensation includes a $50,000 annual asset management fee and a 1.00% refinancing fee.

Front-end fee composition

Acquisition Fee$0.73M3.00%

Dealer Fee$0.49M2.00%

Total front-end sponsor compensation$2,441,500 11.76% of acq. cost

Acquisition Fee

$732,450

3.00%

Dealer Fee

$488,300

2.00%

Total Front-end Fees

$2,441,500

11.76%

Strengths

Fee structure is explicitly itemized across acquisition, dealer, and O&O categories
Acquisition fee is capped at $732,450

Concerns

Upfront fees and expenses equal 17.65% of acquisition cost
Selling commissions total $1,464,900

Operating & Disposition Fees

The master tenant structure reflects master tenant income of $4,000,000, supporting the hotel operations and debt service requirements.

Ongoing fee rates

Strengths

Passive mineral ownership avoids direct capital expenditure and drilling costs
Geographic diversification across New Mexico, Texas, and Louisiana

Concerns

Cash distributions are vulnerable to commodity pricing downturns
Well-level operating details and depletion rates not disclosed

Comparative Analysis

55Composite

Standing

16 of 57

Blended percentile across 5 extracted metrics.

Pricing

95th pct

Leverage

0th pct

Cost

44th pct

Ongoing

0th pct

Structure

48th pct

Percentile profile

Pricing

Price per unitMin $24KMed $293KMax $3290K$110K95th

Leverage

Cost

Total upfront loadMin 1.96%Med 5.97%Max 12.05%9.50%28th

Acquisition feeMin 0.00%Med 2.52%Max 12.07%3.00%39th

Selling commissionMin 0.05%Med 6.00%Max 9.75%5.70%66th

Ongoing

Structure

Equity share of capitalMin 6.09%Med 100.00%Max 100.00%95.00%48th

Bar spans the cohort minimum (Min) to maximum (Max), labelled beneath with the cohort median (Med). Shaded band is the 25th–75th percentile, the tick is the median, and the dot is this offering.

Where the headline metrics fall in the cohort

Total upfront load

28th pct

9.50%median 5.97%

Min 1.96%Med 5.97%Max 12.05%

Metric-by-metric comparison

Metric	This offering	Cohort median	25th–75th	Difference	Percentile
Price per unitPricing	$110K	$293K	$184K – $434K	−$183K	95th
Total upfront loadCost	9.50%	5.97%	4.89% – 9.50%	+3.53%	28th
Selling commissionCost	5.70%	6.00%	5.00% – 6.00%	−0.30%	66th
Acquisition feeCost	3.00%	2.52%	1.74% – 3.77%	+0.48%	39th
Equity share of capitalStructure	95.00%	100.00%	52.74% – 100.00%	−5.00%	48th

Closest comparables

Offering	Sponsor	Cap rate	LTV	DSCR	Load	Hold	Match
MCG Gainesville FL BTR DST	Madison Capital Group	—	—	1.74x	—	10 yrs	97%
BR Diversified Industrial Portfolio 8 DST	BIGR Exchange 8 TRS, LLC	6.32%	—	—	9.45%	—	96%
NREX II DST	Nuveen Real Estate Exchange LLC	—	0.00%	—	—	20 yrs	96%
BR Diversified Industrial Portfolio 7 DST	BIGR Exchange 7 TRS, LLC	6.66%	0.00%	—	9.45%	10 yrs	95%
Ideal Ecco Park DST	IDEAL Capital Group Holdings, LLC	—	—	1.03x	9.50%	10 yrs	95%
Cottonwood Riverfront DST	CC Exchange TRS, Inc.	—	39.26%	2.00x	8.70%	7 yrs	94%
Blue Door Property II DST	Unknown sponsor	6.11%	0.00%	—	10.50%	—	94%
Sealy Industrial DST	Sealy	—	—	—	9.50%	11 yrs	94%

Match score is a normalised distance across the full extracted metric set — asset type, pricing, leverage, cost and structure all weighted equally.

Figures on this page are generated from automated extraction of offering documents and may contain errors or omissions. Verify every metric against the sponsor's offering materials before relying on it for an investment decision.