Note 11 – Private Placement

On April 24, 2025, JFB Construction Holdings invested $1,000,000 in CM OB Hotel Owner, LLC, a Delaware limited liability company formed to acquire, develop, and operate a 117-room Courtyard by Marriott hotel in Olive Branch, Mississippi. The investment was made through a private placement offering of up to $5,000,000 in Class A Membership Interests at $1,000 per unit, pursuant to Regulation D, Rule 506(c). The minimum investment was $100,000, with proceeds designated for the acquisition, development, and operation of the hotel.

JFB holds a 19.5% ownership interest in the Class A Membership Interests of CM OB Hotel Owner, LLC. This ownership percentage is below the 20% threshold required for equity method accounting under U.S. GAAP; therefore, the investment is currently being carried at cost basis, as the entity is private.

Class A Members are entitled to an 8% cumulative, non-compounding preferred return (beginning upon hotel operations), a return of capital, and a share of distributable cash as outlined in the offering subscription agreement. Pursuant to a side agreement dated April 24, 2025, JFB Construction Holdings is exempt from the standard promote structure. The Company does not possess ownership or majority voting rights due to minimal investment in CM OB Hotel Owner, LLC. Furthermore, the Company does not exercise control over the activities that significantly influence the economic performance of CM OB Hotel Owner, LLC