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Economic Development Authority Minutes August 14, 2006 Page 4 was proposed. Comtissioner Tveite stated he felt 10% down and an additional 10% for a six-month extension was appropriate. President Gongoll proposed scheduling a future planning session to identify potential business park properties. Commissioner Klinzing noted that staff will be looking at the gravel muting areas for future development. Strategic Industrial Marketing Plan URdate Ms. Mehelich provided a report on progress to date for updating the EDA' Strategic Industrial Marketing Plan. She noted that according to Wolf Marketing & Media, 95% of the feedback received in the interviews was positive. The Marketing Committee will meet to review the research data and to firm up objectives for the update. Ms. Mehelich stated that she anticipates the completed plan will be presented at the EDA's regular September meeting. 9. Update on Incubator Location Commitmem - K-Netica Ms. Mehelich provided an update on events leading to the EDA's request to K-Netica to require them to repurchase the shazes of stock owned by the EDA. She discussed the response from K-Netica CEO Steven Pederson, describing the company's situation and request for the EDA to reconsider its action. Staff would like direction from the EDA as to how to proceed. President Gongoll stated the letter was sent to him as Chair of the EDA, but that he would disclose that he still is an advisor to K-Netica and holds a position as having an option on some warrants in the company. He stated that he had asked Ms. Mehelich if Mr. Pederson's and Mr. Jacob's comments could be presented to the EDA for comments and/or discussion. Commissioner Dwyer stated it is mentioned several times in the letter that there was no space in Elk River to relocate. He felt that K-Netica perhaps did not look for space in good faith, although they indicate in the letter that they did. He noted that when Mr. Rousher was before the EDA, he indicated that one of the reasons for their move was attracting talent to their organization. He felt their azguments in the letter are somewhat contradictory of their comments when they were before the EDA. Commissioner Dwyer stated that they did not end their lease early, and that it was expiring on its own. He stated that the company had three months to look for space. He felt that they signed an agreement and should be bound to it. He felt that if K-Netica wished to find someone to buy the City's shazes, so be it. He felt that if they did not like the terms of the agreement when they signed it, they should not have signed it. President Gongoll stated that K-Netica indicated that the spaces they found in Elk River were twice as much as they were willing to pay and felt that is why they ended up in the Earle Brown property. He noted that they will be sub-leasing their space there. The EDA discussed Mr. Pederson's comments, as well as comments received from Harlon Jacobs of Genesis. Commission Motin stated he is only wiling to consider deferral if the company can show significant hazdship, and if not, he felt the EDA should proceed with their request. He did not feel the City could speculate on future value of the stocks. He disagreed with the company's arguments, as well.