EB-5 TEA Analysis

Per Neil's request — does Sprocket Networks / Aristotle / Plains capex fall inside EB-5 Targeted Employment Areas? CanAM $40M loan facility needs ≥$60M of bill-of-materials in TEA tracts to clear due diligence with a comfortable margin.

Bottom line for CanAM $40M facility: Of Neil's $130M Sources & Uses (CFW + Aristotle), only ≈ $14M of capex falls inside a TEA via either rural or high-unemployment pathway. Cannot support a $40M EB-5 loan without folding in Plains Internet's East-TX build (100% rural, ~$X capex) or another rural-heavy project.

Sources & Uses (Neil, May 13)

Uses$130M

CFW (Sprocket)$50M

Aristotle (Lasso BEAD)$80M

Sources$130M

DA equity$20M

Rollover$10M

Grants$60M

EB-5 (CanAM)$40M @ 6% / 6yr

TEA test #1: Rural area

EB-5 RIA 2022 rural = outside any MSA AND outside any city/town ≥20,000 pop. TX rural land area: 68.4% of state. Computed from Census TIGER 2024 CBSA shapefile (26 TX MSAs).

Network	Mi	Rural mi	%
Sprocket FWF (CFW)	274	0	0%
Sprocket Dallas	14	0	0%
Aristotle Collin	507	0	0%
Aristotle Harrison	261	2.7	1%
Aristotle Upshur	453	1.0	0.2%
Plains Angelina	767	767	100%
Plains Nacogdoches	705	705	100%
Combined	2,981	1,476	49.5%

Rural verdict for CanAM ($50M CFW + $80M Aristotle):
~$0 qualifies. All FWF and 99%+ of Aristotle is inside an MSA (DFW or Longview). Surprise: Harrison + Upshur are in Longview MSA, not rural.

Plains Internet (East TX) is 100% rural. Angelina + Nacogdoches are micropolitan, not metropolitan — they cleanly satisfy the EB-5 rural test. Plains capex isn't in Neil's current $130M Sources & Uses but is a clean rural-EB-5 target if added or financed separately.

TEA test #2: High-unemployment area (HUA)

HUA = census tract (or contiguous group of tracts) with unemployment rate ≥ 150% of the national average, per most recent ACS 5-year data. National rate (ACS 2020–2024): 5.23%. HUA threshold: ≥ 7.85%. 1,537 of 6,842 TX tracts qualify, covering 17.2% of state land area.

Network	Mi	TEA mi	%
Sprocket FWF (CFW)	274	37.0	13.5%
Sprocket Dallas	17	2.2	13.4%
Aristotle Collin	507	48.1	9.5%
Aristotle Harrison	261	13.0	5.0%
Aristotle Upshur	453	65.5	14.5%
Plains Angelina	966	966	100%
Plains Nacogdoches	873	872	100%
Combined (rural ∪ HUA)	3,350	2,004	59.8%

TEA mi column = miles inside the combined rural ∪ HUA polygon. Plains routes are already 100% rural, so the HUA pathway adds little for them. For Sprocket + Aristotle, HUA is the only available pathway — all of their build is inside DFW or Longview MSAs, but ~5–15% of each MSA build passes through high-unemployment tracts.

HUA verdict for Neil's $130M Sources & Uses:
~$50M CFW × 13.5% ≈ $6.8M TEA-eligible.
~$80M Aristotle (weighted across Collin/Harrison/Upshur) × ~10% ≈ $7.5M TEA-eligible.
Combined CFW + Aristotle TEA capex: ≈ $14M — well short of the $60M BOM cushion CanAM wants for a $40M EB-5 facility. Sprocket + Aristotle alone cannot support the $40M loan through either rural or HUA pathway as currently scoped.

Adding Plains gets you there. Plains Angelina + Nacogdoches = $X capex, 100% TEA (rural). Folding Plains into the CanAM borrower group — or running a separate EB-5 facility against Plains capex — clears the BOM coverage test with room to spare.

Map layers

Sources

TEA criteria per USCIS Policy Manual, Vol 6 G Ch 5 and the EB-5 RIA 2022. IIUSA's reference map: iiusa.org TEA Mapping Tool. Boundary data: Census TIGER/Line 2024 (CBSA + tract shapefiles). Unemployment data: ACS 2020–2024 5-year estimates (table B23025) via Census Reporter. Last updated: .