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ITEM II 7. <br /> City of <br /> Elk <br /> River <br /> MEMORANDUM <br /> TO: Economic Development Authority <br /> FROM: Heidi Steinmetz, Assistant Director of Economic Development <br /> 5 <br /> DATE: August 9, 2004 <br /> SUBJECT: Consider Business Incubator Tenant Lease Extension: K-Netica <br /> Attachment <br /> • K-Netica Newsletter,July 2004 <br /> Background <br /> K-Netica,became an Incubator tenant in May of 2002, subleasing 2,267 SF of space. The <br /> EDA granted the company six-month sublease extensions in April 2003 and January 2004. <br /> In addition to the stock offering, the company has made timely cash rent payments in the <br /> amount of$566.75 per month. <br /> K-Netica has developed a universal human language translator utilized through computer <br /> software. The software has a number of key applications for commercial,government, <br /> military, and personal use. The attached K-Netica newsletter describes recent K-Netica <br /> activities. <br /> Issue <br /> Joe Roushar, Chief Technology Officer, has requested that the EDA consider a six-month <br /> sublease extension through February 2005. <br /> Mr. Roushar will be in attendance to provide the EDA with a brief company update <br /> followed by a question and answer session. <br /> Staff Recommendation <br /> Staff recommends that the EDA consider granting the 6-month sublease extension to <br /> K-Netica effective August 21,2004 through February 20,2005 at the following cash/stock <br /> rent rate: <br /> $ 4 per SF cash rent ($755.66 per month) <br /> • $ 7 per SF stock value (divided among building owner, Incubator consultant, &EDA) <br /> $ 11 per SF total rent value <br />