5.0. EDSR 08-08-2005 ITEM # 5.
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City of
Elk.
River
MEMORANDUM
TO: Economic Development Authority
FROM: Heidi Steinmetz, Assistant Director of Economic Development
DATE: August 8, 2005
SUBJECT: Consider Business Incubator Tenant Lease Extension: K-Netica
Background
K-Netica became an Incubator tenant in May of 2002, subleasing 2,267 SF of space. The
company has developed a universal human language translator utilized through computer
software. The software has a number of key applications for commercial,government,
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military, and personal use.
The EDA has granted K-Netica four sublease extensions (one for 9 months and three for 6
months). In addition to the stock offering, the company has made timely cash rent
payments.
Issue
Joe Roushar, Chief Technology Officer, has requested that the EDA consider a fifth
sublease extension for the term of six-months through February 2006. Mr. Roushar will be
in attendance to provide the EDA with a brief company update.
Staff Recommendation
Staff recommends that the EDA consider granting the 6-month sublease extension to
K-Netica effective August 21, 2005 though February 20,2005 at the following cash/stock
rent rate:
$ 4 per SF cash rent ($755.66 per month)
$ 7 per SF stock value (divided among building owner, Incubator consultant, &EDA)
$ 11 per SF total rent value
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