GARJA 2020 Initial Georgia Agribusiness and Rural Jobs Act Report Table of Contents Overview Page 3 Accomplishments Page 4 Summary Pages 5-6 GARJA's Certified Capital Received Page 7 GARJA's Certified Capital Received Initial Page 7 Reporting Status Schedule of Tax Credits Page 7 Granted Qualified Investments in Eligible Business Pages 8-9 Location and Industry Sector of Pages 10-12 Companies Receiving GARJA Investment Pie Chart of Investments by Industry Page 13 Sector Map of Investment Activity in Georgia Page 14 2 Overview Senate Bill 133, known as the "Georgia Agribusiness and Rural Jobs Act" (GARJA), was approved by the Georgia General Assembly during the 2017 legislative session, and subsequently signed into law by then Governor Nathan Deal. The GARJA Program is administered by the Georgia Department of Community Affairs (DCA). Requirements of GARJA are outlined in Section 33-1-25 of Chapter 1 of Title 33 of the Official Code of Georgia annotated. GARJA is intended to provide access to capital for Georgia businesses in some of the State's most rural areas. A rural area means any county in Georgia that has a population of less than 50,000. Eligible businesses must have less than 250 employees with their principal business operation in one or more rural areas. The business must be in an eligible industry sector including agricultural, manufacturing, health care, technology or transportation. DCA approved five Rural Funds (entities created by private companies) in June 2018 to participate in the GARJA Program. $100 million was certified by DCA in capital investment authority among the five Rural Funds. Each Rural Fund received approval of $20 million in capital investment authority, which was required to be used for loans or equity investments to eligible small businesses by June 30, 2020. The Rural Funds must maintain qualified investments equal to 100 percent of their capital investments for an additional three years until June 30, 2023. Please refer to Page 7 for GARJA's Certified Capital Received and Initial Reporting Status. The Rural Funds raised capital from rural investors in exchange for tax credits earned against a rural investor's state tax liability. Amount of the credit claimed by a rural investor cannot exceed the amount of such entity's state tax liability for the tax year for which the credit is claimed. Also, at least 50 percent of the capital raised by the Rural Funds was composed of capital from sources other than the amount of capital received from the tax credit investors. Please refer to Page 7 for the Schedule of Tax Credits Granted. The purpose of this publication is to summarize the information provided on the Initial Reports submitted by all Rural Funds for the initial deployment of their collective $100 million in capital investments. 3 Accomplishments At the end of the initial two-year deployment period for GARJA (June 30, 2020), the five Rural Funds deployed a total of 38 investments for a total of $101,355,000 in 23 counties in 4 of the 5 eligible industry sectors. Together, they expect to create 702 jobs and retain 608 jobs with these investments. Please see Page 8 for the Qualified Investments in Eligible Businesses. # Rural Inv Fund Term Loan LOC Total Jobs Jobs * Equity Investment Created Retained Co. 4 Appalachian $18,000,000 Fund 1, LLC $2,000,000 $20,000,000 122 299 3 16 Enhanced $20,880,000 Capital Georgia, Rural Fund, LLC $200,000 $21,080,000 269 6 Georgia $12,915,000 $7,150,000 $210,000 $20,275,000 54 Rural Investment Fund, LLC 6 Southeast $18,799,980 Community Development Fund X, LLC $1,200,020 $20,000,000 169 6 Stonehenge $19,450,000 Georgia Rural Fund, LLC $550,000 $20,000,000 88 38 $90,044,980 $7,150,00 $4,160,020 $101,355,00 702 197 9 23 4 21 6 68 6 608 * Number of Counties Agricultural investments were 23.78% of the total, or $24,105,000. By statute, at least 10% of total capital investments had to be in this industry sector, and at least 10% of agricultural investments had to be equity investments. There were $2,810,000 in equity investments, or 11.65%. Healthcare was 7.45%, or $7,550,000 Manufacturing was 50.02% or $50,700,000 Transportation and Warehousing was 17.76% or $18,000,000 Other was .99% or $1,000,000. This was Soap Creek Marina in Lincolnton that was attached to boat manufacturing and is used to showcase for boat sales Technology is not represented 4 Summary CHALLENGES The Rural Funds reported that investments in the technology industry were particularly challenging since they received very few inquiries from technology companies. The technology companies reviewed were difficult to underwrite since they were startups or early stage companies. Several of the Rural Funds were unfamiliar with the State and who to partner with or where to go to find the small businesses in need of capital, which slowed their deployment of GARJA funds. Restricting the size of eligible businesses to 250 employees or less was another challenge for the Rural Funds. STRATEGIES Rural Funds were surveyed regarding how they partnered with other economic professionals throughout the State to achieve their success with the first phase of the program. Some indicated success by partnering with Economic Developers and Chambers, local lunch and learns, local and state representatives and senators for referrals, and the University of Georgia Small Business Development Centers. Others mentioned proprietary relations or direct calling with little assistance from economic professionals. Several mentioned that the most helpful leads came from DCA and commented that the credibility of DCA was the most effective tool they had to get the word out regarding the GARJA Program. DCA worked diligently with local regional representatives to promote GARJA, making it a top priority to discuss at all speaking engagements and meetings with local development authorities in rural areas of eligibility. Regional representatives referred small businesses to the Rural Funds in hopes that they could make their investments in their communities. Open communication among the Rural Funds and DCA has been essential to the success of the program, to date. DCA continues to market the program on behalf of the Rural Funds. Most of the Rural Funds made the reporting process much easier by submitting their initial detailed reports on each investment as the investment was made instead of waiting until the end of the initial two-year deployment period to submit them. This enabled DCA to monitor the progress of the program over the initial deployment period, as well as generate the initial statistics for management more quickly. The Initial Reports then verified the grand totals and provided compliance certifications necessary to satisfy statute requirements. 5 Summary, continued SUCCESSES DCA determined the Rural Funds deployed the initial $100 million of capital investments in compliance with the rules and regulations of the program. In one instance, a Rural fund was able to revolve investments before the initial deployment date deadline. Another Rural Fund found it necessary to add their own investments to make a project work to the advantage of the small business. Four of five of the targeted industry sectors had significant job creation. Please refer to Pages 10-12 for the Location and Industry Sector of Eligible Businesses Receiving GARJA Investments along with the Pie Chart of Investments by Industry Sector on Page 13 and a Map of Investment Activity in Georgia on Page 14. DCA observed that almost all of the GARJA investments were first lien investments with turn-down letters from local banks. Without the advantage of the GARJA Program, these small businesses would not have been able to secure any financing. The Rural Funds were able to provide affordable, patient capital at reasonable rates. The success of the GARJA Program has gotten the attention of other states. DCA has received calls to discuss the details of the GARJA Program from states working to establish a similar, successful program. A DCA website is available for other states to view along with the contact information of the Rural Funds. https://www.dca.ga.gov/community-economic-development/incentive-programs/ georgia-agribusiness-rural-jobs-act The website has been helpful to market to all development authorities and professional economic developers throughout Georgia. 6 GARJA's Certified Capital Received and Initial Reporting Status GARJA Rural Fund Amount of Certified Capital Received Appalachian Fund I, LLC $20,000,000 Enhanced Capital Georgia Rural Fund, LLC Georgia Rural Investment Fund, L.L.C. Southeast Community Development Fund X, L.L.C. Stonehenge GA Rural Fund, LLC Total Invested in GARJA $20,000,000 $20,000,000 $20,000,000 $20,000,000 $100,000,000 Initial Amount of Certified Capital Deployed Initial Reporting $20,000,000 $21,080,000 In Compliance In Compliance $20,275,000 In Compliance $20,000,000 In Compliance $20,000,000 In Compliance $101,355,000 Schedule of Tax Credits Granted GARJA Rural Fund Tax Credits Authorized 2020 Appalachian Fund I, LLC $3,000,000 Enhanced Capital Georgia Rural Fund, LLC Georgia Rural Investment Fund, L.L.C. $3,000,000 $3,000,000 Southeast Community Development Fund X, L.L.C. Stonehenge GA Rural Fund, LLC $3,000,000 $3,000,000 Total Tax Credits Authorized for 2020 $15,000,000 7 Qualified Investments in Eligible Businesses GARJA Rural Fund Appalachian Fund I, LLC Investment Name of Business Date 12/31/19 Eagle Railcar Services Appalachian Fund I, LLC 12/31/19 Elixir Extrusions, LLC Appalachian Fund I, LLC 6/17/20 Appalachian Fund I, LLC 6/17/20 Amount of Certified Capital Invested FarmGrowth Management Services, LLC Gordon Switching Company Amount of Certified Capital Invested $6,500,000 $6,500,000 $2,000,000 $5,000,000 $20,000,000 Enhanced Capital Georgia Rural Fund, LLC 12/12/18 Enhanced Capital Georgia Rural Fund, LLC 10/30/19 Enhanced Capital Georgia Rural Fund, LLC 5/20/20 Enhanced Capital Georgia Rural Fund, LLC 1/7/19 Enhanced Capital Georgia Rural Fund, LLC 7/2/19 Enhanced Capital Georgia Rural Fund, LLC 4/10/20 Enhanced Capital Georgia Rural Fund, LLC 4/30/20 Enhanced Capital Georgia Rural Fund, LLC 2/21/20 Enhanced Capital Georgia Rural Fund, LLC 4/17/19 Enhanced Capital Georgia Rural Fund, LLC 3/8/19 Enhanced Capital Georgia Rural Fund, LLC 4/10/20 Enhanced Capital Georgia Rural Fund, LLC 9/17/18 Enhanced Capital Georgia Rural Fund, LLC 6/4/20 Enhanced Capital Georgia Rural Fund, LLC 12/12/19 Enhanced Capital Georgia Rural Fund, LLC 3/29/10 Enhanced Capital Georgia Rural Fund, LLC 3/20/20 Amount of Certified Capital Invested Blackdirt Farm Management, $2,000,000 LLC Blackdirt Farm Management, $587,850 LLC Blackdirt Farm Management, $500,000 LLC Cabinet Concepts $1,500,000 Cabinet Concepts $325,000 Cornucopia Farms Avera, LLC Habersham Vintners, Inc. $345,000 $800,000 Highline Structures, LLC $1,500,000 Horton Cargo Haulers, LLC $2,000,000 Keith Griffin Farms $1,800,000 Lake Country Brewing, LLC $250,000 Luther Griffin Farm $3,800,000 Luther Griffin Farm $1,072,150 Second Century AG, LLC $3,000,000 Soap Creek Marina & Resort, $1,000,000 LLC White Oak Pastures, Inc. $600,000 $21,080,000 8 Qualified Investments in Eligible Businesses GARJA Rural Fund Investment Date Georgia Rural Investment Fund, L.L.C. 5/15/19 Georgia Rural Investment Fund, L.L.C. 5/15/20 Georgia Rural Investment Fund, L.L.C. 5/29/19 Georgia Rural Investment Fund, L.L.C. 6/25/19 Georgia Rural Investment Fund, L.L.C. 4/9/20 Georgia Rural Investment Fund, L.L.C. 12/27/19 Amount of Certified Capital Invested Name of Business Bhugesh Investments, LLC Bhugesh Investments, LLC Georgia Earth and Pipe, LLC Hellman-Chang, LLC Revive Milling, LLC Soteria Solar Services, LLC Amount of Certified Capital Invested $2,960,000 $2,300,000 $2,320,000 $2,595,000 $3,600,000 $6,500,000 $20,275,000 Southeast Community Development Fund X, L.L.C. Southeast Community Development Fund X, L.L.C. Southeast Community Development Fund X, L.L.C. Southeast Community Development Fund X, L.L.C. Southeast Community Development Fund X, L.L.C. 8/21/19 6/17/20 5/15/20 11/1/19 3/13/19 Southeast Community Development Fund X, L.L.C. 12/10/20 Amount of Certified Capital Invested 1115 Smith OpCo LLC Cady Bag Company LLC GAXtracts LLC Global Environmental Enterprises, LLC Meridian Holdings Group, Inc. & Danimer Scientific Holdings, LLC StruXure Outdoor, Inc. $4,250,000 $5,000,000 $2,000,000 $500,000 $6,500,000 $1,750,000 $20,000,000 Stonehenge GA Rural Fund, LLC Stonehenge GA Rural Fund, LLC Stonehenge GA Rural Fund, LLC Stonehenge GA Rural Fund, LLC 6/10/20 12/20/19 4/26/19 1/17/20 Stonehenge GA Rural Fund, LLC 3/25/19 Stonehenge GA Rural Fund, LLC 11/16/20 Amount of Certified Capital Invested CFactor Leasing Corp. $4,100,000 Custom Structures, Inc. $5,100,000 Door Kraft Products, Inc. $5,500,000 Georgia Dental Management, $3,300,000 LLC Holton Cattle & Consulting, $1,500,000 LLC Conner Holdings, LLC $500,000 $20,000,000 Total GARJA Certified Capital Deployed $101,355,000 9 Location and Industry Sector of Eligible Businesses Receiving GARJA Investments GARJA Rural Fund Enhanced Capital Georgia Rural Fund, LLC Southeast Community Development Fund X, L.L.C. Stonehenge GA Rural Fund, LLC Enhanced Capital Georgia Rural Fund, LLC Stonehenge GA Rural Fund, LLC Appalachian Fund I, LLC Georgia Rural Investment Fund, L.L.C. Georgia Rural Investment Fund, L.L.C. Georgia Rural Investment Fund, L.L.C. Enhanced Capital Georgia Rural Fund, LLC Enhanced Capital Georgia Rural Fund, LLC Enhanced Capital Georgia Rural Fund, LLC Southeast Community Development Fund X, L.L.C. Stonehenge GA Rural Fund, LLC Enhanced Capital Georgia Rural Fund, LLC Enhanced Capital Georgia Rural Fund, LLC Enhanced Capital Georgia Rural Fund, LLC Enhanced Capital Georgia Rural Fund, LLC Enhanced Capital Georgia Rural Fund, LLC Business Name County Highline Structures, LLC Cady Bag Company LLC CFactor Leasing Corp. White Oak Pastures, Inc. Appling Atkinson Bryan Clay Conner Holdings, LLC. Clinch Elixir Extrusions, LLC Coffee Soteria Solar Services, LLC Georgia Earth and Pipe, LLC Hellman-Chang, LLC Coffee Dawson Dawson Keith Griffin Farms Decatur Luther Griffin Farm Decatur Luther Griffin Farm Decatur Meridian Holdings Group, Inc. & Danimer Scientific Holdings, LLC Georgia Dental Management LLC Lake Country Brewing, LLC Second Century AG, LLC Decatur Dodge Greene Irwin Blackdirt Farm Management, LLC Blackdirt Farm Management, LLC Blackdirt Farm Management, LLC 10 Jefferson Jefferson Jefferson 2017 NAICS* 321992 339999 333120 11211 113310 331318 493110 327320 337122 112111 112111 112111 339999 621210 312120 115114 115116 115116 115116 NAICS Title/Sector Prefabricated Wood Building Manufacturing All Other Miscellaneous Manufacturing Construction Machinery Manufacturing Beef Cattle Ranching and Farming, including Feedlots Logging Other Aluminum Rolling, Drawing, and Extruding General Warehousing and Storage Ready-Mix Concrete Manufacturing Nonupholstered Wood Household Furniture Manufacturing Beef Cattle Ranching and Farming Beef Cattle Ranching and Farming Beef Cattle Ranching and Farming All Other Miscellaneous Manufacturing Offices of Dentists Breweries Postharvest Crop Activities (except Cotton Ginning) Farm Management Services Farm Management Services Farm Management Services Location and Industry Sector of Eligible Businesses Receiving GARJA Investments GARJA Rural Fund Enhanced Capital Georgia Rural Fund, LLC Stonehenge GA Rural Fund, LLC Business Name County 2017 NAICS* Cornucopia Jefferson 11141 Farms Avera, LLC Custom Structures, Inc. Laurens 332311 Enhanced Capital Georgia Rural Fund, LLC Southeast Community Development Fund X, L.L.C. Soap Creek Marina & Resort, LLC StruXure Outdoor, Inc. Lincoln 713930 Lumpkin 33232 Stonehenge GA Rural Fund, Holton Cattle & Mitchell 112111 LLC Consulting, LLC Georgia Rural Investment Fund, L.L.C. Bhugesh Morgan 336320 Investments, LLC Georgia Rural Investment Fund, L.L.C. Bhugesh Morgan 336320 Investments, LLC Appalachian Fund I, LLC Southeast Community Development Fund X, L.L.C. Enhanced Capital Georgia Rural Fund, LLC FarmGrowth Management Services, LLC GAXtracts LLC Cabinet Concepts, LLC Morgan 115116 Oconee 111421 Putnam 337110 Enhanced Capital Georgia Cabinet Rural Fund, LLC Concepts, LLC Putnam 337110 11 NAICS Title/Sector Food Crops Grown Under Cover Prefabricated Metal Building and Component Manufacturing Marinas Ornamental and Architectural Metal Products Manufacturing Beef Cattle Ranching and Farming Motor Vehicle Electrical and Electronic Equipment Manufacturing Motor Vehicle Electrical and Electronic Equipment Manufacturing Farm Management Services Nursery and Tree Production Wood Kitchen Cabinet and Countertop Manufacturing Wood Kitchen Cabinet and Countertop Manufacturing Location and Industry Sector of Eligible Businesses Receiving GARJA Investments GARJA Rural Fund Business Name County Stonehenge GA Rural Fund, Door Kraft LLC Products, Inc. Putnam 2017 NAICS* 337110 Enhanced Capital Georgia Horton Cargo Rural Fund, LLC Haulers, LLC Putnam 336214 Southeast Community 1115 Smith OpCo Thomas Development Fund X, L.L.C. LLC 623312 Southeast Community Development Fund X, L.L.C. Georgia Rural Investment Fund, L.L.C. Global Environmental Enterprises, LLC Revive Milling, LLC Washington 326199 Washington 115114 Enhanced Capital Georgia Rural Fund, LLC Appalachian Fund I, LLC Habersham Vintners, Inc. Eagle Railcar Services White 111332 Wilkinson 488210 Appalachian Fund I, LLC Gordon Switching Company Wilkinson 488210 NAICS Title/ Sector Wood Kitchen Cabinet and Countertop Manufacturing Travel Trailer and Camper Manufacturing Assisted Living Facilities for the Elderly All Other Plastics Product Manufacturing Postharvest Crop Activities (except Cotton Ginning) Grape Vineyards Support Activities for Rail Transportation Support Activities for Rail Transportation *NAICS is the North American Industry Classification System 12 Georgia Agribusiness and Rural Jobs Act Investments by Industry Sector in 23 Counties (as of 6/30/2020) Key: Manufacturing: $50,700,000 Agricultural: $24,105,000 Transportation & Warehousing: $18,000,000 Healthcare: $7,550,000 Other: $1,000,000 Total Amount: $101,355,000 .99% 17.76% 23.78% 50.02% 7.45% 13 Georgia Agribusiness and Rural Jobs Act Program Investment Activity as of 6/30/2020 GARJA Loan Totals Dade Catoosa Whitfield Fannin Towns Rabun Union Under $1 million Walker Chattooga Murray Gilmer Gordon Pickens Lumpkin WhiteHabersham (1) Stephens Dawson (2) Hall Banks Franklin Hart $1 - $4 million $4 - $8 million $8 - $12 million Floyd Bartow Cherokee Forsyth Over $12 million Jackson Madison Elbert Polk Paulding Cobb Gwinnett Barrow Clarke Oglethorpe Haralson Carroll Heard Douglas DeKalb Oconee Walton (1) Wilkes (2) Fulton Rockdale Clayton Newton Morgan (3) Greene Taliaferro Lincoln (1) Columbia Henry McDuffie Fayette Warren Coweta Spalding Butts Jasper Putnam (4) Hancock Glascock Richmond GARJA non-eligible GARJA eligible Troup Meriwether Pike Lamar Monroe Jones Baldwin Jefferson Washington (4) Upson (2) Harris Talbot Bibb Wilkinson Crawford Twiggs Johnson Burke Jenkins Screven Muscogee ChattahoocheeMarion Taylor Peach Houston Bleckley Macon Laurens (1) Emanuel Treutlen Candler Bulloch Effingham Schley Stewart Webster Sumter Quitman Randolph Terrell Lee Dooly Crisp Pulaski Wilcox Dodge (1) Montgomery Wheeler (1) Toombs Evans Tattnall Telfair Bryan (1) Turner Ben Hill Jeff Davis Appling (1) Liberty Long Chatham Clay (1) Calhoun Dougherty Worth Irwin (1) Tift Coffee (2) Early Baker Miller Seminole Decatur (4) Mitchell (1) Colquitt Atkinson Berrien (1) Cook Grady (1) Thomas (1) Brooks Lanier Clinch (1) Lowndes Echols Bacon Wayne Pierce McIntosh Ware Brantley Glynn Charlton Camden 14