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5.0. EDSR 11-10-2003
Item # 5 • 1-� City of Elk River MEMORANDUM TO: Economic Development Authority Steinmetz, Assistant Director of Economic Development S FROM: Heidi p DATE: November 10, 2003 SUBJECT: Strategic Industrial Marketing Activities Update Attachments • Progress Partner Dispatch (Economic Development Newsletter) November 2003 • New Urbanism&Redevelopment Conference Brochure • Energy City Open House Article, North Crow River News, October 27, 2003 • • Energy Alley Conference Description • KnowledGenetica Newsletter, October 2003 • Manufacturing Week Article, Elk River Star News, October 29, 2003 • Business Retention&Expansion Visit 2003-2004 Schedule • Thank You Ad, Elk River Star News, October 22, 2003 • Sportech Article,The Business Journal, October 17, 2003 I. Product Offering Strategy Industrial Land Issue There is a separate agenda item for discussion of this issue. I. Competitive Strategy There is no new information to report. I I I. Key Account/Lead Generation Strategy Staff has met with Wells Fargo Business Lending staff and is undergoing follow up meetings with brokers and developers,including Northstar Partners and Colliers Towle. 411 Strategic Industrial Marketing Activities Update November 10,2003 Page 2 of 4 • Prospect Company Description Client Requirements Current Status Gamesa(2002 Inquiry) Needs up to 30-acres for Delayed Decision Spanish manufacturer of wind office/warehouse and generation equipment manufacturing Finished wood operation(2003) Met with owner and toured Delayed Decision existing facility Bixby Energy Systems (2002) Needs 50,000-100,000sf existing In contact with broker for new Biomass stove manufacturer, lease space within 30-45 days construction if can't find existing incubator graduate,Rogers inventory in Andover,Anoka, Coon Rapids Precision machining company, Needs 20,000sf lease/new Expanding into adjacent available Dayton(2001) construction lease space Metal fabrication company,Blaine Needs land for 25,000sf building, Looking for 15,000sf existing lease to be in operation by Nov.2004 space Cymbet Corporation(2002) Needs up to 100,000sf Financing Delay Manufacturer of solid-state manufacturing space for lease batteries,incubator graduate IV. Promotions & Advertising Strategy Advertising Upcoming advertisements include the Nov/Dec Leasing Guide, featuring Cymbet,and the November MN Real Estate Journal, featuring Tescom. V. Public Relations Strategy • Economic Development Newsletter The attached third edition of the Economic Development Newsletter, the Progress Partner Dispatch, was distributed in early November to over 200 people representing the following groups: • Elk River manufacturers • High-tech companies located in Anoka, Sherburne,and Wright Counties • Past&present prospects/inquiries • Key accounts The purpose is to inform businesses of information useful to their operations and present an "open for business" image. MN Real Estate Journal (MREJ) Conference Similar to previous years,the EDA will sponsor the November 20th MREJ New Urbanism & Redevelopment conference (see attached conference brochure). Sponsorship includes the following items: • City's name and logo on all conference marketing materials • Half page article and half page ad in a special conference insert of MREJ • Display booth space at the conference • Bonus ad in an upcoming MREJ • Five free passes to the event 1110 • A panelist position at the event (the Director of Economic Development will be a panelist discussing the Downtown Revitalization Project) Strategic Industrial Marketing Activities Update November 10,2003 Page 3 of 4 • MREJ's Economic Development&Site Selection conference is tentatively scheduled for mid- December. The Economic Development Department will receive similar exposure at this event at no cost to the EDA. Energy City Roughly twenty people,including three staff members,Mayor Klinzing, and several speakers, attended the Energy City Rogers High School Open House held on October 21s` See the attached article describing the energy efficient aspects of Rogers High School and its relation to Energy City. On November 14`h, staff will be attending the Minnesota's Renewable Energy Research: Status& Opportunities conference,which is sponsored by Energy City's "parent" organization, Energy Alley (see attached conference description). A copy of the Energy City display board (currently on display at the Energy City Environmental Learning Center) will be included in the conference poster session. The session allows university researchers/students, nonprofit,government, and industry representatives to display their research regarding renewable energy and energy-efficient technologies. Conference marketing materials will also include a description of Energy City. The conference is also an opportunity for staff to network with energy related businesses who may be interested in an Elk River location. Business Incubator Congressman Mark Kennedy's District Director,Mark Matuska, toured the Incubator and Cymbet Corporation on October 23`d. Jeff Bakken, son of Medtronic founder, Earl Bakkan, • also attended the event. On November 13th,representatives from the City of Hutchinson will be touring the Incubator as part of their research in starting their own program. Attached is the October KnowledGenetica newsletter. VI. Strategic Partnership Strategy Downtown Revitalization Project MetroPlains was awarded its tax credit application from the MN Housing Finance Agency. The City Council considered the HRA recommendation regarding the Small Cities Development Program application and held a public hearing on October 27th and approved two resolutions regarding the grant application. The application is for grant funds to be used for commercial and rental rehabilitation, as well as new rental construction in the Downtown Revitalization area. The application was submitted the end of October. Grant awards will be announced in early March of 2004. The HRA extended the Preliminary Redevelopment Agreement with MetroPlains to January 30,2004, to provide sufficient time to work together toward a Development Agreement. • Strategic Industrial Marketing Activities Update November 10,2003 Page 4 of 4 • VII. Business Retention Strategy 2003 Business Retention and Expansion (BRE)Visit Summary (see attached 2003 schedule) • The 2003 BRE visit schedule included 19 Elk River manufacturers • 8 visits were conducted • 9 companies were not interested in participating (2 of the 9 located elsewhere) • Staff is working to schedule the 2 remaining visits The attached 2004 BRE schedule includes Elk River manufacturers who were not contacted in 2003. Manufacturing&Technology Week, October 20-24,2003 Approximately 30 people attended the October 215`Manufacturing Week luncheon, 20 of which toured Cymbet and Marketech earlier that morning. The Commissioner of the MN Dept. of Employment and Economic Development presented both Cymbet and Marketech with recognition plaques signed by the Governor. See the attached article for details on the event. Additional recognition of Elk River manufacturers was provided in the attached full-page "Thank You" ad printed on the back page of the October 22nd issue of the Elk River Star News and the Economic Development display booth was rotated among the following banks during the month of October: • • Week of Oct. 6th US Bank • Week of Oct. 13th American National Bank • Week of Oct. 20th The Bank of Elk River • Week of Oct. 27th First National Bank of Elk River Sportech Last month, staff reported that The Bank of Elk River co-sponsored an ad congratulating Sportech for being among The Business Journal's 2003 Growth 50 Private Companies. It was announced on October 17`"that Sportech placed number 35 on the list (see the attached article). i * PROGRESS PARTNER City' Y- Dispatch Elk di— River November 2003 The Light Industrial Hub of the Northwest Metro Kudos and celebrations for Elk River New Tax Incentives Manufacturers! Make NOW the Time In recent months,a number of local firms have reached to Finance New milestones or been recognized for other achievements: Equipment. • Great River Energy celebrated its 4 millionth ton of solid waste The"Jobs and Growth Tax Relief converted to electricity with an open house attended by over Act of 2003"recently passed by 200 people. • Cymbet Corporation was recognized by Finance and Congress increases the dollar amount small business owners can Commerce Media Group as one of 15 Innovators of the Year for its thin film batteries that will eventually power hearing deduct from their taxes as an investment in new equipment,such aids,semiconductors,or even real-time clocks. as machinery and computers. • Sportech was again placed on The Business Journal's Growth 50 for Private Companies,this year ranking number 35. This tax advantage,with In addition,the Elk River Economic Development Authority restrictions that make it expressly organized an event to highlight Manufacturing and Technology for small businesses,creates an • Week during the fourth week of October. The event featured immediate tax deduction for tours of Cymbet Corporation and Marketech prior to a luncheon businesses that invest in equipment at the Elk River Country Club. To show his support for the between 2002 and 2006. importance of Elk River's efforts to foster a great manufacturing Immediate deductions of up to community,Matt Kramer,Commissioner of MN Department of $100,000 represent four times the Employment and Economic Development,took time from his previous cap of$25,000. busy schedule to welcome attendees. In addition,the Minnesota Business The highlight of the luncheon was the keynote address from Finance Corporation (MBFC) has Mark Sheffert,Chairman & CEO.of Manchester Companies,Inc. special financing options available In his address,Sheffert stressed the importance of innovation. now devised especially to utilize "If all employees are in touch with the big picture,they'll be these new tax regulations. The SBA able to come up with better ways of doing what they do, 504 loan program is uniquely suit- strengthening the innovation process"said Sheffert. ed to finance acquisition and instal- lation of machinery because of the low down payment required and z the fixed,competitive rate over a 10-year term. ;� According to Nadene Kruize, xZ a MBFC Loan Officer,"If a business fit : has been considering investing in c. g A4 ,,, expensive equipment and/or ;, .„ machinery,NOW is the time! Give ,fidme a call at 320-258-5007 for 0 „:t , k '. complete details on the SBA -- 504 Program.” Matt Kramer presented Rich Duggan and Charles Butcher of Marketech with a plaque signey Governor Tim Pawlenty recognizing Marketech''contributions of manufacturing to the Minnesota economy. to River O3065 Orono Pkwy Elk River,MN 55330 E&O Tool and Plastics Partners with Elk River Manufacturers Anoka-Ramsey Community College Week Trivia A grant from the Minnesota Job Skills Partnership will allow 1)Dynetic Systems produces servomotors Anoka-Ramsey Community College to develop and provide that are used in which of the following: customized training for employees of E&O Tool and Plastics. a. Cooling brakes and drivers in This training will allow E&O to maintain a competitive edge NASCAR races with foreign manufacturers,helping the firm to remain a viable b. Flush valves on airplane toilets employer in Elk River. c. Military robots used to search caves in Afghanistan "It will focus on LEAN manufacturing training,specifically d. A&C only geared to helping E & 0 (Tool and Plastics) implement LEAN e. All of the above manufacturing processes at their facility,"says ARCC Director of Customized Training,Jim McCormick."Additional training topics include cell technology,theory of constraint,transitioning to a 2) Which of the following Elk River LEAN environment,and safety issues in a LEAN environment." businesses make products used in space and aeronautical According to Heidi Steinmetz, Assistant Director of Economic applications: Development for the City of Elk River,"Our department is a. Tescom constantly digging to find opportunities like the one E&O found b. Metal Craft Machine &Engineering with Anoka-Ramsey. That's how we managed to get funds for c. Dynetic Systems our Technical Assistance and Operations Consulting program d. All of the above and others from the Initiative Foundation." The Technical Assistance e. None of the above program provides funds for expanding Elk River firms,or those intending to relocate,to access consulting services from Minnesota Technology,Inc.that will help improve their 3) On the new overpass bridge at manufacturing efficiency. Highway 169 and County Road 33, AME will pour how many cubic yards Steinmetz adds,"Workforce development is a critical initiative of concrete: for Elk River. We have an exceptional employee base,but we a. 750 cubic yards want that quality to continue improving." b. 1000 cubic yards c. 1500 cubic yards 0 Contact Changes: d. 2000 cubic yards Cathy Mehelich Phone: 763.635.1041 e. None, the bridge is made of iron Heidi(Hall) Steinmetz Phone: 763.635.1042 EDA Fax 763.635.1090 pc'p-Z`p-t(ADM Visit us on the web at ci.elk-river.mn.us a. a) co co C C CU O71 w Cf) C II i 1 , 1.. ,. 0 o ( 1).,„ 0 U A41'• I . 9 ,� 1.1 OS L Y O 4— d L O O z W ,&:E; ' P"'.1..... ==-' Hwa 'A C%1 0c . 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'ate E E £ � E r E g o a) € a � N oo /�\j-T�'_� z L CA H •H 0 0 O O 0 TN N 5 0 0 c 0 v) — d 1�1 ; 0 —cs z L " O O i > h v v -0 - E r d '- J P� 6i } Apr SS CO _ a0 W Q m N u' U in a ii �.�-�� D cool monious debate—last week as the city of Rogers and Hassan Township signed an order Question One will ask )eis ly annexation agreement. taxpayers for $2�nillion for The agreement allows the staged annexation by the city of portions of the township, QHS while the township gets city utilities to service its Hwy. 101 corridor: falo The agreement also protects large amounts of Hassan's open space. DiSt. 728 referer will The agreement will eventually bound the two communities together by no later than ori '030. / / / /� ^ / The Elk River School District 7:3‘ /0'' 'Q3 6 V O1 Z (/ 1l t � ysL.- / esus, port the following three question ling Question one—operating lev3 c R e r V H � h S�h O I`o- G re e n ' 1 \ogteaching positions that were pre ts also keep needforce with fuure budget cuts.increasing -solo noted for ener desie Question two—operating lev3gy • Funds from this levy woulc Jane tkel, books,curriculum and media ma :cky by Kathy Hara Europe," said Bratlie. "But it's looking at responsibility to nology and/or technical support. ;rat- new technology for Minnesota." kids." Question three bond referer hop- "I was shocked,as an archi- In fact, Rogers High School is Fifty years ago, he said, Q es ion to r .r this icert tett, that we put our children the first of two High Perfor- school buildings had blown on jests be a includedin700-student by in windowless rooms," said mance buildings in the state, asbestos, lead and mercury in •southern part of the district $ 'eble Stephan Tanner at an open with the second beingthe dis- the paint, and flat roofs that P house at Rogers High School trict's new Westwood Eleinen- produced mold. These and • Construct a 700-student el well Tuesday, Oct. 21, which was tary School. other problems have led to an Elk River—$18 million. per- sponsored by Energy City The school district is a part- asthma epidemic among school • Construct a planned third icert Tanner joined Dr. Ron ner of Energy City,and Bratlie children. Junior High School—$4.2 milli Bratlie, director of business is on its board. The organza- At Rogers, students will be ^ • Renovate the Iower level of: elec- and operations for the Elk tion, which is under the breathing clean air because of million. Gar- River Area School District,and umbrella of the Minnesota the desiccant displacement sys- • Purchase land for future med, others to discuss the features Environmental Initiative and tem for heating, ventilation merman and east Elk River loca Me" they built into Rogers High Energy Alley, includes'repre- and air conditioning. Air is • Match the state grant of$4 bled School which make it a "High sentatives of environmental pushed into the rooms at floor el the Handke school facility Performance"building. organizations, businesses, level and it then rises natural- • Improve air quality syste It all began, said Bratlie, schools, government agencies ly, warming as it rises, and is School and Salk Junior High Sc] Sion when he voiced his concerns and community groups. These pulled out at the ceiling level. •Fund repair'and renovation .sser about old buildings in the groups work together to find This prevents "dirty air" from out the district—$10 million. .chool district with bad roofs and implement innovative being circulated through the and problems with mold. Tan- projects such as the High Per- room as in more standard sys- Polling places kom ner told him he should go to formance schools. Energy City tems. Switzerland and Germany to sponsored the open house to In a tour of the building, in the cit Precinct Rogers,Hassan 5•encompasses all l see how buildings "are really recognize the achievements Bratlie pointed out other ,fea- Y Ta built."And that is what he did. - made in the schoolis energy tures of the school. There areCombined polling place: Rogi A team spent a week of long saving designs. skylights in the field house,for Center,21201 Memorial Dr.,Roi days — at no expense to tax- "This is not just,another instance,which are part of the Precinct 6:encom asses all part- payers, Bratlie pointed out — building," said Bruce Bomier, "100%daylighting"concept. p the touring buildings and learning president of the Environmen- in the city of Otsego, city of had about sustainable design. tal Resource Council."This is a Michael. the "This is not new technology new way of looking at kids and Combined polling place: Otse in the United States and the environment.A new wayof RHS ENERGY/see page 11 River Rd.NE,Otsego,MN 5533 His- ,851, ns Word of Peace dedicates new home pris- iated by Kathy Hara ensemble that leads worship time a bell rings, an angel gets were • monthly, as well as a folk- its wings,"said Sahlen. pew_ Word of Peace Lutheran singing trio,The Three of Us. .:. -- -. , .. .- - In addition to the church ease, Church (ELCA) in Rogers was "One of the visions I have for choirs, Sahlen has formed the 1 acing fully moved into its new build- this building is to see it as a OK Chorale,Rogers Communi- nited ing at 21705 129th Ave. N. by concert site,"said Mike Sahlen, ty Choir, which will join with Friday, Oct. 17, and the first the church's director of music, Voices of Peace in the dedica .ussia services were conducted that citing the good acoustics of the tion services and will also pres 'cera- weekend. new building. "This is a great ent a Christmas concert at the � . ' h Dedication services for this space for choral music." church Sunday,Dec. 7. ni � 3 first phase of the new church At present, Word of Peace's During the move, Word of r "'� ".,?,. building will be Sunday,Nov.2, congregation numbers above Peace did not leave everything '.:::::04:1-;:i.::'::-,::-.-': at 8, 9:30 and 11 a.m., and 2;500. And many of the mem behind at its 28-year-old build- " k ,..:; Wednesday,Nov.5,at 7:37 p.m. bers are musical,judging from ing on Main St."We moved the -°- x = 's (The festival services will be a the number of choirs.There is a much beloved stained glass : i blend of traditional and con- senior choir called Voices of window," said Sahlen. "It looks temporary worship, although Peace, two children's choirs, a very pretty in its new home." normally the 8, 9:30 and 11 women's choir called Deo C'zlo- a.m. services are traditional rias,and a group called Harmo- ntary liturgical,blended and contem- ny,which Sahlen calls a mathe- The three crosses of Word e ,. , porary,respectively) matically challenged gospel Rogers was recently moved f • ��YY11 North Crow River News Monday, October 27,2003 Page 11 -;,i;; • would include: d1. A new 700 student ele- entary school constructed in systems at Rogers High the southern part of the district RHS ENERGY/continued School. Even so, the envi iool ($18 million). ronment there is sunny and 1.7 2. A new 700 student ale- fresh.And,said Superinten- ney mentary school constructed in The white translucent improves student learning by dent Dr. Alan Jensen, .'his the eastern part of the district skylights provide enough significant amounts. "Every school we build from per ($18 million). sunlight, even on cloudy It will take approximately a now on will be better than ;, 3. Construction of a third days, to eliminate or mini- year to fine tune all the new the last." 'Y l to classroom wing at Rogers mize the`amount of electric icu- Junior High($4.2 million). lighting needed, while also and 4. Renovation of the lower preventing glare.The school 3 _, w - 1/or level of Elk River High School is designed to use as much '1, . M the ($1 million). natural light as possible. .,: j> pen 5.' Purchase of land for Classrooms are narrow so • r: sunlight comingthrough the R, vp rhe future school construction in` g g will Zimmerman and eastern Elk many windows will reach )as- River($3 million). • the back walls, and ceilings 6. Construction of locker are sloped to facilitate the aed, rooms and an athletic field at distribution of the light. ' 1> Mme Zimmerman High School ($1.3 High windows between �' --,,,,:7-- nth million). g classrooms and hallways " * • . ' ' 7. Matching the state grant allow the sunlight into the • r SYS - "` ;ers of $450,000 to repair and interior areas,as well. ` and remodel the Handke facility. The initial costs of build- � K� ` '' - ingsustainable schools mayre h a 8. Improvement. of the air txy �� �y, ; not be lower, but there are ` �, . . If quality systems at Otsego Ele- , --.0;.:--,-,•,!-.F:... :,:.,, '�' ' Auld mentary and Salk Junior High significant savings for both �� 1 , 000 School($5.4 million). the short term and the long F r' 14 a 9. Repair and renovation term. The schools are built 4 g �N t rojects at schools throughout to last,maintenance is easi- :• k „ nd•�e district($10 million). er and energy efficiencies um keep operating costs down. �`n> The floors, for instance, are F' made of terrazzo,which willE:.:;:.•••••••,4:.::-::::•::-:;.:.,:il,m;:ai51?-ii*,4111111116111441.111-1.8.., viv:Nia90:aii.-moti- - last forever,are.easy to clean y2a' . . land. and do not mold. And the fi'3 (, roof is made of five layers of �. In the new building, there K mainly recycled rubber and aux are two conference rooms, g k will last 30 years,as opposed x offices, an infant and a toddler '� " w to a normal life span of ;ah AI Lble nursery, a library, a kitchen ' s v n �h It seven or eight years.And the _ _ , and.a large narthex which can annual energy savings for ex ,x . > ath accommodate church dinners. Rogers High School is Photo byKathyara e is There is also a small chapel, expected to be$116,200. Dr.Ron Bratlie(right),director of business nd per- which will eventually have a The bottom line, though, ations for the Elk River Area School District,points out ' will small alwtar and a whichstained will be is the consequence for the the high windows and sloping roofs in Rogers High ' window and be students. Cleaner air will- Schoolis media center during an open house Tuesday, for available for- prayer and pri- result in healthier students, Oct.21.Bratlie explained how the schoolis designs elim- and vate baptisms. A one-story which certainly enhances irate or greatly reduce the need for electric lighting ,on. building, the church is coin,- re- pletely handicap accessible. learning. More than that, during daylight hours. ' Nelson anticipates anew though, recent studies of Mark Dobberstein (left), who has elementary-age _ :lip, senior pastor will be called to schools using daylighting children,attended the open house to find out about the hatWord of Peace by the end'of this show the environment energy efficiencies of the new high school. i ace year: The-call committee has )m- been working since before July - mm- and is already conducting sec- and interviews of candidates. STMA/continued "It's difficult to know every- ,,aew With the growth of the church, thing far in the future,"Lefeb- ate Nelson also believes that in the vre responded. "(The tax nom next three years another full- impact) is not going to drop - old�Mme pastor will he chosen to Board member Chuck Lefeb- ing another school in four 50%or go up 50%•;I know that -, ' m n the new senior pastor and vre said,"To me the question is years.That's my prediction." fora fact." 24 sociate pastor Rick Skare. very simple. If you're happy One resident said she feels Lastly,a resident questioned file "There is a lot of commit- with 25 students per class or the public is unaware of the what happens if the referen- )00 ment at this church,"said Nel- higher, then you don't need a Nov 4 vote. Ziegler said an - dui doesn't pass. Ziegler said bias son. "Behind every ministry levy.If not,then we must have informational brochure is the district would limit the hir- on there are an awful lot of hands revenue to hire teachers." being sent to all district resi-, ing of new teachers,class sizes of and hearts involved." A resident questioned how dents. would increase,and the district 1 long this referendum will suf- Another resident questioned would continue to budget with- fice and if and when the dis- if the district projected out adeouate revenues to hpin Energy Alley presents Minnesota's Renewable Energy Research : Status & Opportunities Energy Alley's conference on research is designed to focus and prioritize research on renewable energy in Minnesota. The conference will present the extent of research currently taking place in Minnesota in order to determine particular strengths in local capabilities, as well as critical gaps. The conference will include a participant discussion directed specifically towards enabling research institutions, policymakers, industry and nonprofits to make informed decisions about providing resources for energy research. Speakers and attendees will address critical questions about the future of renewables research in Minnesota: * How much and what kind of research in renewable energy is under way in Minnesota now? What are the particular strengths and critical gaps in the renewable energy research field in Minnesota? *What are the top priorities for projects and resources for the state and the University of Minnesota's new Initiative for Renewable Energy and the Environment? The conference will include a poster session that will provide a comprehensive look at Minnesota's research in renewable energy, as well as energy-efficient technologies. University researchers and students, nonprofit organizations, government agencies and industry representatives are invited to participate in the poster session. Friday, November 14 8:00 am -4:30 pm (registration begins at 7 am) 410 Earle Brown Heritage Center 6155 Earle Brown Drive Brooklyn Center, Minnesota MEI Members: $40 Non-members: $60 Students: $30 Registration and poster session information can be found at http://www.mn-ei.org/ea/research03.html or contact Suzy Knutson at sknutson@mn-ei.orq. You need not pay in advance, all registrants will be invoiced after the event. For more information, please contact Erik Pratt at 612-334-3388, ext 102. Energy Alley is a program of the Minnesota Environmental Initiative. Thanks to Minnesota's Renewable Energy Research: Status & Opportunities sponsors Alliant Energy Corporation, Aquila Inc., CenterPoint Energy Minnegasco, Connexus Energy, Dakota Electric Association, East Central Energy, Great River Energy, Market Street Energy Company, Minnesota Department of Commerce, Minnesota Power, Otter Tail Power Company, Parsons Electric Company, the Weidt Group and Xcel Energy. The poster session is sponsored by the University of Minnesota's Initiative for Renewable Energy and the Environment. • „4"61,.. Volume 2.2 11ChAjeuza October 2003 ‘IStiew' An Update of KnowledgeNetica Corporation Products Nearing Completion Call Center Product Update Since KnowledgeNetica's inception in April, 1999, we We have entered into an agreement with AltiCom have sought customer funding to help us build the CTI, a call center products and services vendor company. With products nearing completion, we are catering to small to mid-sized call centers. We have nearer than ever to achieving this objective. Four received a list of needed product capabilities from the separate groups, two homeland-defense related and pilot customers with whom we are cooperating. We two commercial are expressing significant interest in believe we can deliver all these capabilities in the purchasing licenses to our ISYLTM (I Speak Your relatively near-term, and most of them with higher Language) Fusion products to read the newswires, performance and accuracy than our competitors. and information on the web and in available documents and interpret them for possible risks to We see the corporate call center as one of our most the economic security (commercial groups) or to the lucrative markets. Fortuitously, the capabilities we peace and tranquility(homeland defense groups). are building for the Fusion product line support call center self-service as well. Avaya and SpanLink, two Our Homeland Defense Intelligence Fusion product is of our prospective Call Center product partners, have the K-Netica Intelligence Fusion Engine (KNIFE). expressed deep interest in these capabilities and are awaiting product availability. We will keep you posted on these products as they are readied for the market. • Intellectual Property Update KNIFE uses deep conceptual profiles of events and We have filed for patent protection for the ISYLTM communication patterns that could introduce risks or technology with the European Patent Office (EPO). threats, and reads vast quantities of information in Our US patents are already in review and we expect text format to determine if they contain any to file new patents, especially for KNIFE related statements that could be actionable. Getting more inventions within the next six months. This protects real actionable information is the key value of our technology from 2002 on. KNIFE products. In our knowledge society, knowledge workers need to be empowered with tools The United States Patent and Trademark Office has that cut through the clutter and noise in the glut of issued K-Netica a trademark for the ISYLTM mark information available, and deliver gems of useful provided we use it in a commercial transaction by knowledge to help them succeed and dominate. February 4, 2004. We are confident that we will meet that date. In combination with a customer's databases and text- based knowledge resources, KNIFE can be deployed ; ew Website and Graphics to analysts throughout customer sites. The system assists analysts in building profiles of events, entities, .may times, places and communication patterns that could 4100, contain actionable information. These profiles are ` `°''` � ' ” ° � '�•1 ��� deep in that they contain concepts in context, not We have a brand new website up and running with just keywords. We also offer a proprietary knowledge new graphics and a catchy look and feel. As you have repository where customers can build large historical probably noticed, this includes updating our company records of the knowledge that did or could have logo to a more printer friendly graphic. We have helped them in the past. emphasized the knowledge network as one of our significant differentiators. Abbreviating the name may Researchers, speculators, actuaries, stock traders even make it easier for people to figure out how to ioand intelligence analysts, among others, could pronounce it. Please stop by the new web site at: greatly benefit from KNIFE actionable knowledge. www.knowledgenetica.com Volume 2.2 K-Netica Newsletter October 2003 Welcome to New Personnel We are excited to announce expansion in our • technical team: - � T.; - t�fill CIHt �i�I - Randy Timo: Randy is an Artificial Intelligence r"ttn'lzar .fr. software developer and co-founder of Visual Circuits, rm ftff�E[rrnaprt I a Minneapolis-based producer of high-performance lfri y 5 video systems used broadly in retail video consumer r� and interaction applications. Randy has education • and experience in cognitive modeling, a fundamental -121 °° r L process in our product design and development. He y,t will be helping us develop and productize our ISYLT"' systems for commercial release. We have been working with the Chief Technology Officer and the Chief Scientist to assist the Bureau in their attempts to identify and forestall potential threats to national security. We believe our ISYLTM interpreter, Polyglot translator and KNIFE Intelligence ' = Fusion products can all play important roles in improving homeland defense. ,aF In preparation for this expo, we are developing new marketing materials and graphics to help tell our story. If you have any ideas that could help us describe the true value and potential of our products, please contact us. John Lowe: John has joined the team as a linguist • and knowledge engineer. Formerly Chief Linguist and Director of Core Engineering at Ask Jeeves, Inc. Visit our office or Peruse our Web Site John has a huge wealth of experience in Natural Our offices are located at 16820 Hwy 10, Suite 120. Language Processing, and products that use this The offices are part of the Elk River New Economic capability to deliver value to customers. He has Development Effort. Call us to schedule a visit. Our already brought significant value to K-Netica through web site is located at www.knowledgenetica.com. Our site his knowledge extraction work to build the core provides more information on our company's focus and a knowledge base. directory of our key resources. Josh Nash: Josh is an intern serving as a Developer About K-Netica and Quality Assurance Technician. He is a graduate K-Netica is an investor-owned company. People of Anoka High School and will be with us until interested in more information should contact Joe November 10th when he is moving on to his new Roushar at K-Netica, (763) 274-1000. home in Texas. He is working on web crawling sentence analysis tools as well as test plans for the K-Netica Corporation was formed in 1999 to develop existing ISYLTM code base. software that readily understands people rather than forcing them to adapt to the computer. Imagine calling a We welcome you to introduce us to others who may company to inquire about the status of an order, and NOT be interested in joining our team as interns, being forced to listen to an extensive menu of options and contractors or employees. then press or say a number which may get you to the next step. K-Netica's patent-pending technology provides a Upcoming Events simple and elegant answer to the difficult challenge of On November 13 K-Netica is participating at an managing and reducing call center operational costs. internal technology exposition for the US Federal Published by: Bureau of Investigation at the J. Edgar Hoover KnowledgeNetica Building in Washington, DC. 16820 Hwy 10,Suite 120,Elk River,MN 55330 Voice:(763)274-1000 Fax:(763)274-1118 Kik ,., 36 October 17, 2003 THE BUSINESS JOURNAL Growth 50 0 Ilt;'"' '4W.'''..:::,-4 Sportech Inc. . k Latddoc COMPANY El RIPIIO : 'j �;i" -- Manufacturer of power sports components € .. _. COMPANY£3 Sl;Rl1 3- ' Generic pharmaceutical manufacti t EO.Chris Carlson i 3-y f REVENUE t9E $ 2002 REVENUE,: $6,137,59il 7' GED.Bruce paddock 3-YEd R REVS I GRfl * I GROWTH; EMPL0VEES:35 # # 2001 I EVEI t#E.$4; ,� EM Lt EE :225 HEAIIOUEEs:35 Elk; River , ■ Z 0O EVE' tt :.$3,521,336 _____ TER :New dope 73___,____ Have you needed to seek financing from new or alternate sources in the past year? How did your company raise capital to fund its g Besides financing from The Bank of Elk River,the city of Elk River assisted with a $20,000 Small Business Association Business Gc 20,000 square foot facility expansion by applying and receiving a grant from the sonal funds Minnesota Department of Employment and Economic Development,which in turn was provided to Sportech as low-interest gap financing to the project. Have you needed to seek financing from new or a No.Internal cash flow and relationship with U. What has been the primary driver of your revenue growth? We have focused on offering products to existing customers and have used some of What are you doing to drive growth, in light of t the same technology to introduce new products into entirely new markets,such as Research and development more than 20 new. utility vehicles,motorcycles and personal watercraft. concept to filed abbreviated new drug applicatb Administration What are you doing to drive growth, in light of the soft economy? We have worked hard to establish a clear point of differentiation within our indus Would you ever sell the company? 4, try We have made great efforts to avoid the"commodity"side of our business, Probably not,unless change in personal health choosing rather to focus on proprietary products with limited competition. What are your business plans for the coming yea What are your business plans for the coming year? Continue to look for small niche bio-equivalent In the first quarter of 2004 we will be introducing a new line of products into an that both offer weak patent or off patent produc entirely new,"high-profile, high-volume"segment of the power sports industry This market will be new,but our approach will be the same:hot,new products featuring innovative processes and materials—with clear definition from our competitors. lF }.. ,i �"o! 4 CO _ x ....i'ir i x credits at 3-t 3 �: nein aI' expanding high t 0 rt u� man b ,�� Z@st den ice£.F x .� k For morenfm g :mode �+rr .• an application cont; k ' x' ; mu 1,0%1_ 10 South Bodge St eet.Suit oogfsi-,..r.• Phone.8tl{l i 9 -9 !6I ai.7i face-to-FACE , , cIilwi�iwa- i. ,n • with() want mask. Some business,we can all agree,needs to be done through a mask. Anything off the field never should be. At USLink we do business Want official bragging rights f� face-to-face and person-to person-providing quality Local,Long Distance and Internet game plans. Order reprints of articles or Top 25 Lists Every business customer has a personal account executive who takes that feature your company! the tirr.e to,,n.ie.oron`I hnvi vnnr hncinec<nneratec It'c norenn�l - 100 0 `' • • 8 / Star News / Wednesday, October 29, 2003 • Visit urs on the web at www.erstarnews.com ELK RIVER Speakers, tours hi hl ht re_e Manufacturing, technology ` week brings in a top state official ,f e by Jake Muonio :` .,,`,..,''1,:44v-/-1 Staff writer River's u 'A 4, ' Minnesota Manufacturing t and Technology Week � ` (MMTW) have pretty impressive offices. )f# One runs a companythat ry takes up half a floor of the IDS tower in Minneapolis. Y `� '+�s d' The other sits in a desk in 4m � the state Capitol. , n „,,,,*:.,t,,,,z,::::, 4,,..17...,,f,,t,,,,::,, Mark Sheffert, CEO of Manchester Companies, spoke at. an Oct. 21 lunch eon for members of Elk ti River businesses and the Chamber of Commerce, calling for constant innova- jilt _ tion at the manufacturing level. Mark Sheffert stresses that companies constantly The other guest, Minne- strive to be bigger,better faster and cheaper.(Photos:by sota Department of .lake Muonio, graphic by Lynne Kasper) Employment and Economic was very impressed with Sportech,which was recent- Development (DEED) the progress they've made, ly the recipient of$200,000 Commissioner Matt especially in terms of secur in federal grant dollars Kramer, was on hand to ing financing." which Kramer's - office visit several Elk River corn- ion om Cymbet raised millions of approved. parties. dollars from foreign Since an expansion,which "It was quite an honor er investors in an earlto ier capi was helped out by the grant host Commissioner Kramer tel campaign,but has had a dollars,Sportech has added and to; show him some of harder time raising money eight full-time jobs and will our manufacturers,” said lately. add at least seven more. Cathy Mehelich,Elk River's Mehelich said it was also "I think it kind of put Elk director of economic Bevel beneficial for Kramer to River in his mind, for when opment. hear about some of the he talks to prospective new Kramer visited Cymbet, How well do ou know your local manufacturers? Marketech and Sportech struggles Marketech has businesses from out of statey had recently. and across the country, during his trip to Elk River. i,pyretic s stems "It's good to hear from Mehelich said. "In the end Y produces servomotors that are used in which of the "The commissioner heard following. some of the challenges both companies — how my hope is he will keep us a cooling brakes anddriven-1h A€igiilftr ccs �-t they're changing their busi in mind for these business b.Flush valves onaii,lane toilet $}, (`iymbet'S) been going „ Flush vrobotsuse totkea, „caves Afhanist "`-,` -, ness plans and looking at opportunities. d a a c only t through since its inception, a ani of fh#abore , x Mehelich said. "I think (he) new _opportunities so they Sheffert spoke to about 25 , kFt# ; can succeed,"she said. Chamber members and- 2. + industry relies on fat M Precision Machi in i ii t aileciaf dies for which of the following shapes Mehelich said the two business people, challengtitc companies are good exam- ing organizations to inno os fail" _� ;` pm . ' Ales of the companies being vate. i`ia arari;M1e3 � ` , i a e.All of the above ,° recognized . MMTW. This is a tough, tough ` "Both companies have business (climate),"he sa>d, 3.204,14i1 local company is working with , r , �+ ,;; - a t Fin a th`e develo ment of alternative h dr $ about 16 employees,and its Every company today has diet p y �� those small-to medium size to look inside and find a b. ill � r�;#tib: k ,. ctescoiri' +-�r companies that are often way to put something in 0.b.N a c omy s , Y processg- e.All of the above � 3 kl'lthe bread and butter of our to make it bi �`'' communities like ours" she ger better, faster and a:Each earn '"" y ggregate Industries produc said. cheaper. » landscape products? Kramer also toured Mehelich said Sheffert'sblocks a 4 - "A �'., --;• speech was one of the bet- o. ,ui%iiiin Noche ' d:9,flf3it ti00 blocks '' ter attended MMTW events e.None of the above s Matt Kramer, commission- they've had. �~ er of the Minnesota rtiPIRGconvertswasteproductsinto a The Oct. 21 events were ma;;y heroes per rear' Department of Employ- s onsored b the cit of Elk l P Y Y ar'#,l1oEi hbn56§ zi r ment and Economic River and the 'Elk River hatma homes 1 ''''''i7 Development Development spoke Oct. 0.;;10.000 homes 9 V Area Chamber of 26 000 homes 21. i ua!g figrtisa , `"," Commerce. k �- _ — ‘,,,t,..1 - to it`a-C.41:`a-I Kai -c.-,,,-,0-.,-_,, , * t ' =fir 1 banie y,eL!!, 14 ri,‘„,,,,_:,,,,,,,,,„:„„,„::::,,,,,,,,,,,::„.:„_,,,..:::„,:i„,„,„:„:„.....,,,,, „:....„ "The Cityo Elk River acknowled es a reciates manufacturing i ., � and technology businesses that contribute to the City of Elk River , ,Y . z :-fi with high-skill, high-wage .that tax base, business and community i development". Mayor Stephanie Klinzing AlltoolPinnacle Design and Manufacturing kt E AME Group f.. -r; -Aggregate Industries Blaha Machining Contour Mold The Cretex Companies p Custom Conveyor Corporation „ *„. Custom Cutter Grinding Cymbet Corporation a Diamond Lake Tool F Dimensional Concepts A may. Dynetic Systems Co. E&O Tool & Plastics . -_,-,-.1=s; - -tr- ' ,itt.;;;;..„,; X Elk River Machine Company Great River Energy Integrite Manufacturing Corporation _t_ jr r MN Fabrication Machine P y 4 J&J Machine f� 5 , M&M Precision Machining y� R l itis Marketech x A1 McChesney Cabinet & Counter Metal Craft Machine Engineering , i Neos , NRG „ fr • Pomeroy Tool ,_ *,_ ,. _ ProTech Engineering Riverside Manufacturing tF_r,: SoftPac Industries Solors Optional Axis Art,Z'�,.E Sportech ,.'',--::',.,',1:_11;-1::--::-:_-:‘,11:: � :1-' � p„ Superior Tool Grinding Co. h ., Supermats i� r � i Tadsonp. F Tescom Corporation Timron Precision Gear ... 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