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07282010CRACOMMUNITY REDEVELOPMENT AGENCY (CRA) (CITY COUNCIL) MINUTES WEDNESDAY, JULY 28, 2010 4:00 PM CITY COUNCIL CHAMBERS 1225 MAIN ST, SEBASTIAN, FL 1. Mayor Gillmor called the CRA meeting to order at 4:00 p.m. 2. The Pledge of Allegiance was recited. 3. ROLL CALL Mayor Richard H. Gillmor Vice -Mayor Jim Hill Council Member Andrea Coy Council Member Don Wright EIlYOF HOME OF PELICAN ISLAND City Council Absent: Council Member Eugene Wolff (excused) Staff Present: City Manager, Al Minner City Attorney, Robert Ginsburg City Clerk, Sally Maio Deputy City Clerk, Jeanette Williams Finance Director, Ken Killgore Growth Management Director, Rebecca Grohall Police Chief, Michelle Morris Police Captain, Robert Lockhart MIS Senior Systems Analyst, Rob Messersmith 4. APPROVAL OF MINUTES June 9, 2010 Meeting MOTION by Ms. Coy and SECOND by Mr. Hill to approve the June 9 2010 minutes passed on a voice vote of 4 -0. 5. NEW BUSINESS A. Master Plan Capital Improvements Projects Prioritization (City Manager Transmittal) Brandon Schaad, Outlier Planning Group, gave a PowerPoint presentation summarizing the projects recently ranked at the previous meeting (see presentation attached). The City Manager requested feedback on the submitted projects. Mr. Wright suggested adding public comment, and Mayor Gillmor recommended taking comment before Council deliberation. Community Redevelopment Agency Meeting July 28, 2010 Page Two Public Comment Sal Neglia, Sebastian, recommended keeping away from the Archie Smith fish house project because of the cost and maintenance. Mr. Wright asked him what Council should do with this property, and Mr. Neglia responded the County should improve the property as was planned, and though he was not against the project, it should not be done by the City. Mr. Hill said everything in the presentation was outline as Council directed. He asked if there are funds outside of utilizing CRA funds to improve Cleveland and Coolidge Streets. The City Manager replied there were other ways, and explained that even though paving of these streets was at the bottom of Council's priority list, everyone agrees it is a priority, that the $300,000 for approximately 3 miles of streets was a rough estimate based on current asphalt paving costs. He said the way to shift the project out of CRA is to increase the local option gas tax funds, which would require us to increase our tax rate to generate monies or by making transfers from other general fund balances to support the improvement. Mr. Hill said he was asking because Council recently approved a resurfacing plan which did not include these two roads because they were to be included in the CRA, and now we are looking at the CRA and they are not in here. The City Manager said they are broken down in three ways: Cavcorp which makes certain improvements, paving of streets which makes certain improvements and Coolidge/ Cleveland projects which includes on- street parking. Mr. Hill asked where that is noted in the CIP budget. The City Manager explained the financial pattern in the CRA allows us to do a couple of big projects, intertwine some small improvements; and if you get above a $250,000 project that is a big project so he tried to prioritize gateway, Archie Smith Fish House, gateways, Cavcorp, waterfront improvements first and then by the time you get to FY12/13/14 the fund balances are starting to diminish. He said what he is recommending is taking those streets out and listing them as "paving" and use local option gas tax funds. Mr. Hill asked if, where it shows in FY12 "parking improvements projects/$250,000 other funds or Archie Smith would that be considered doing those roads. The City Manager said yes, you could do Cavcorp, you could pave roads or you could do Archie Smith. Ms. Coy asked if that included modifications for on street parking at that date and time, because we don't want to rush and pave it. The City Manager said staff didn't have specificity on the improvement and was trying to set aside a block of money to plan what those improvements are going to be. Mr. Wright said we do not have adequate parking in the district for business growth and all of the different public uses, so we are lucky that all of these forces came together and we can take a comprehensive approach to substantially increase parking in the district to allow more access to the public. He asked if the cost for a parking study had been determined. 2 Community Redevelopment Agency Meeting July 28, 2010 Page Three Mr. Hill said that is why he was asking questions, because those things are not necessarily in here, and we are going to have discussion about the Archie Smith Fish House which may be another liability without funding, and he wanted to make sure the paving of streets is absolutely in the plan. Ms. Coy noted the parking study is in FY 11, and Mr. Hill said that absolutely needs to be done so we are not going along haphazardly and throwing parking spaces out there. Mr. Wright said he thought if we had that parking study done, it would help us evaluate it better and provide some direction to the City Manager, and did not think it would cost us more than $15,000 to $20,000. The City Manager noted it was listed at $30,000, based on a recent Vero Beach study. Mayor Gillmor asked Joe Schulke, who is a professional engineer and Sebastian resident, if Coolidge and Cleveland Streets could be included in a Cavcorp master plan. Mr. Schulke said that could absolutely be done in steps, with the first phase being stormwater permitting for the whole project. Ms. Coy added that not all of the 3.5 miles of streets listed need to be paved at one time, and perhaps street paving can be moved up one year. Mr. Hill said the only issue with that would be the parking study has to come before that. The City Manager reminded Council for FY 10 when starting to plan for Cavcorp, there was an allocation for $750,000, and of that $400,000 was from CRA, $250,000 from DST, and $100,000 from recreation impact fees. He said what this chart doesn't show is that there is a residual $350,000 remaining and some of these projects would be qualifying projects to take from recreational impact fees, potentially $100,000 could be used for Hurricane Harbor, which would bring money back into CRA which could be used for Cleveland and Coolidge, however he said what staff needs to hear from Council is what specific projects Council wants to do but he did not want to jump the gun because of how it was ranked. He asked them to feel free to tell him what they want done and when. Mr. Wright suggested Council discuss it and come back for a consensus. Mr. Hill said the parking study coming before the paving is critical, noting the study is listed in FY 11. The City Manager said potentially we could begin the RFP process for the study now, with funding in FY 11 and complete it by November. Mr. Hill said then what the City Manager was saying was, that without touching anything on here, we can add $300,000 for street paving and parking. The City Manager responded that was true as long as they were willing to push back the gateway project. Mr. Wright said he thought we were pushing back the Cavcorp property. Mr. Hill then asked, what was the $300,000 that the City Manager just mentioned was hanging out there. 3 Community Redevelopment Agency Meeting July 28, 2010 Page Four The City Manager said it was DST and recreation impact fees and he cannot pave streets with either of those funds, but he can build parking lots with DST funds, and he can use recreation impact fees for Hurricane Harbor improvements. Mr. Wright clarified then that the City Manager needs direction from Council to reassign those funds. Ms. Coy suggested Council could push gateways up so they could use those monies next year for parking. The City Manager said you can take the $100,000 recreation impact fee money and spend that on Cleveland and Coolidge, and then you can use local option gas tax to do the street paving. Mr. Wright suggested grouping the gateway and uniform signage together in the study which would have put that first instead of third on the priority list. He then noted a cut in the billboard item by $20,000, which he thought was a good idea, but recommended offering the business community the opportunity to share advertising costs on the billboards and highlight those businesses on the billboards, which would better utilize the money and might bring more people to the community. Ms. Coy said though he presents an interesting idea, she did not think the billboards worked, the only one that looks decent is the one in Titusville, the others are dumpy and they need to be lit at night. She said she did not know if we could raise enough money through partnerships, noting businesses are hurting right now. She said she would like to scratch billboards, and perhaps look at it again down the road. Mr. Hill said he was not sure whether they were working or not, and questioned the cost of the Titusville sign. He asked what the evidence was that the billboards were not working. Ms. Coy said people mention the sign in Titusville but not the others. She said the Chamber keeps statistics, and Mayor Gillmor said he had contacted them and they have received 150 hits since February to gosebastian.com, though he did not know how we can quantify that. The City Manager said the intent of the $20,000 in the CIP was to keep one sign. After further discussion, it was the consensus of Council that the Titusville sign was the best of the signs, and were in agreement with keeping that amount. Mr. Wright again suggested giving businesses an opportunity to participate in the cost. Mr. Hill said he would not be opposed to that but it would have to come to CRA for review. Ms. Coy said she would listen, and Mayor Gillmor said it would be hard to determine what businesses would be included. Mr. Wright noted we are going to be looking at the LDRs in regard to parking and it is important that we look at additional parking in the district, noted the underground utilities did not get a lot of play, that Council should go ahead and shift money around as they identify certain things they can do that are higher priorities than others. He said there are no Parks and Recreation Committee projects that are more critical than the Hurricane Harbor project, and that street improvements need to be done. Mayor Gillmor said the $535,119 allotted for the waterfront programs needs to stay in there, along with the renovations to get the leaseholds. Mr. Wright suggested waiting to see who the tenants will be before some of the renovations are done so the building fits the tenants. The City Manager said in accordance with the FLS lease, if Council approves 4 Community Redevelopment Agency Meeting July 28, 2010 Page Five it, there are improvements that must be done to make the building marketable in the amount of $150,000 to $200,000. Mr. Wright said he agreed with the budget, but suggested items such as a/c ductwork and paint could be contingent upon the tenant. Mayor Gillmor asked if all agreed we could wiggle in the parking study, and Mr. Hill noted that this October is FY 11 and the money doesn't need to be spent until then. Mayor Gillmor confirmed then that all members were good on FY10 budget. For the FY11 there was agreement that one billboard stays which takes $20,000 down to $15,000 and maybe less with a co -op agreement, the parking study is in there, and then asked the others about the landscaping /gateway item. Ms. Coy noted the gateway presentation is not planned until two weeks for now so it makes it tough. Mr. Hill said we could shift $300,000 into the FY 11 budget for parking without pulling anything out, and Mr. Wright agreed we should be moving that amount into the budget for parking improvements, leave the gateways in there and if we are uncomfortable with the presentation or if it is less expensive we save some money. Mayor Gillmor said then we would move parking improvements from FY 12 to FY 11, and Mr. Hill said not necessarily, rather it would simply increase the FY 11 by $300,000 for a total of $790,727 and leave FY 12 the same, because we are going to be using DST funds for the waterfront and shift funds that were already in place for the Cavcorp property for parking. For FY 12, Mr. Wright noted that the focus would go back to Cavcorp. The City Manager concurred and said if you shift some monies around it might also get you some asphalt paving and maybe we skip the presidential streets or you throw some bucks at it. Mr. Wright said that line can be renamed Cavcorp instead of parking improvements. Everyone agreed the rest of it is good. Mr. Hill asked everyone what they want to do with Archie Smith. Ms. Coy asked to leave it, noting the City Manager had spoken to IRC staff. She said about six months ago, the County said they were interested in using a significant portion of the left over $300,000 Land Acquisition Committee money toward Archie Smith to meet their obligations. Mr. Wright asked if we were going to talk about the Archie Smith House now or wait until the Council meeting. It was decided to address it during this meeting. The City Manager reiterated Council's priorities to amend the master plan to be: the working waterfront parking improvements /study advertise Sebastian gateway improvements historic preservation He initially mentioned utilities, but it was scratched from the list. 5 Community Redevelopment Agency Meeting July 28, 2010 Page Six He said he will have the items bulleted and the numbers shifted for the upcoming CIP meeting. Ms. Coy said it is time for this Council to ask questions and push the County Commission to move on the Archie Smith Fish House. Mr. Wright said if you read details of the County's management plan for the Archie Smith Fish House, they have not lived up to any of the commitments they made in the grant application, which provide that within one year they conduct engineering, architectural consulting studies, historic building analysis, preservation design, along with an updated stewardship report. He said there is a substantial amount of money they are required to spend that they have not spent, and he agreed the City should not be left with this, however, unless the City gets a hold of it nothing will ever happen. Mr. Wright suggested maybe cooperating or putting pressure on the County and having the Working Waterfront Committee start looking at this and figuring out what they can get from the County. He said the cost of what the County was supposed to do could be $300,000 to $400,000, and that should be turned over to contract for the work that needs to be done there. He said we need to work with the County to get something done without assuming all of the financial responsibilities. John Conway, Chairman, Working Waterfront Committee, said staff brought the Archie Smith idea to the Committee and the Committee voted unanimously to take on the project to give Council a recommendation. Sal Neglia said he spoke to some of the Commissioners and the City Manager spoke to Bob Keating and they offered a 99 year lease but did not want to put any money into it. Mr. Wright said that would not be acceptable because they have an obligation to the State. The City Manager explained the County didn't get State money to purchase Archie Smith; they used Land Acquisition monies and hoped to reimburse themselves with State monies but it never came through. He said he cannot speak for the County but said from his discussions with their staff, they feel they are a bit overextended in some of the ways they spent their Land Acquisition money, and some of the ways they have to make improvements, noting they have $300,000 left to get things done and are feeling the pinch and are more than happy to do the lease with us. He said he did not think the pressure to make the improvements is going to come from the State, but the hammer will be political and their commitment made when they purchased the property. Mr. Wright questioned whether it might be possible to get grants for the improvements. Mr. Hill agreed with Mr. Wright, said the purchase was approved and paid for by the County residents to protect and preserve the historical property, approved by the Land Acquisition Committee and the County Commission and it needs to be pushed that way. He said the City should not take ownership, but potentially in the future partner with the County in seeking grants. He said in the meantime, there are code violations that the City can approach the County with. The City Manager confirmed City codes need to be maintained. 6 Community Redevelopment Agency Meeting July 28, 2010 Page Seven Ms. Coy said there is a company that might be interested in working on the property called AlgaGen, LLC, noting they are looking for a site with access to deep water to produce edible algae. (See info attached) Mr. Hill reiterated that there is consensus to have the Working Waterfront Committee look for ways to improve the property and have staff look at potential code violations. Mayor Gillmor asked for a report as to the code violations. The City Manager suggested drafting a resolution encouraging the County to move on this; Ms. Coy suggested the Mayor could read resolution at the next County Commission meeting for emphasis; and Mr. Hill suggested adding that the City is willing to partner in looking for grants for the improvements for the fish house. 6. Being no further business, Mayor Gillmor adjourned the CRA meeting at 5:17 p.m. Approved at the 9 22/10 CRA meeting. Richa H. Gillmor, Mayor ATTEST: Sally A. Maio, M City Clerk 7 1 CEO 1 Laboratory Technician 1 CFO 1 Sales 1 Engineer 1 Office Manager 3 Aquaculture Technicians 1 Shipping and Receiving Clerk INDIAN RIVER COUNTY, FLORIDA MEMORANDUM TO: Members of the Economic Development Council DIV ON HEAD CONCURRENCE iiA 4 _0„,..;,./.,..._ A ge Robert M. Keating, AICP; THROUGH: Sasan Rohani, AICP; Chief, Lon DESCRIPTION AND CONDITIONS 1 Development Director ange Planning --7/26ho er„4 FROM: Bill Schutt, AICP; Senior Economic Development Planner, Long -Range Planning DATE: July 13, 2010 RE: Consideration of AlgaGen LLC's Request For a Local Jobs Grant It is requested that the information herein presented be given formal consideration by the Economic Development Council at its regular meeting of July 20, 2010. As part of the Board of County Commissioners initiatives to improve the local economy, a package of economic development incentives was established in 1996 to attract new businesses to the county and to encourage existing businesses to expand their operations within the county. Included in that package of incentives was a local jobs grant program. That program, which was revised by the Board of County Commissioners in October 2000, December 2006, and March 2009, provides a financial incentive to businesses that create good paying, full -time jobs in Indian River County. Recently, AlgaGen LLC applied for a local jobs grant. As indicated in its local jobs grant application, AlgaGen LLC proposes to expand its existing operation at 7250 9th Street SW (Oslo Road), Vero Beach. The company currently employs 3 people and has 2 unpaid volunteers. The proposed expansion will bring approximately 10 new jobs to the county. The estimated quantity of jobs by job type is as follows: To be eligible for the County's Local Job Grant Program, an applicant must create at least 5 new jobs, and those jobs must pay wages equal to or greater than 75% of the county's average annual wage (average annual wage for 2008 $35,879). ANALYSIS AlgaGen LLC AlgaGen LLC is a plankton aquaculture farming operation located at 7250 9th Street SW (Oslo Road), Vero Beach. Formed in 2002, AlgaGen LLC provides plankton for a wide variety of markets /applications. These include: aquaculture and agriculture feeds, food ingredients and condiments, nutraceuticals (food or food products that provide health and medical benefits), pharmaceuticals, and specialty chemicals. Currently, the company's products are sold throughout the US and are also exported to Europe and Asia. Going forward, AlgaGen LLC intends to continue to use the Vero Beach location as its regional, national, and international headquarters. As proposed, the company will bring ten new jobs to Indian River County; six of those jobs qualify under the Indian River County Local Jobs Grant Program criteria. Local Jobs Grant Eligibility Review Industry Classification of Business To qualify for the County's Local Jobs Grant Program, a company must be one of the county's targeted industries. Under the County's target industry list, AlgaGen LLC qualifies for the jobs grant program under "Pharmaceuticals "Marine Science "Corporate /Regional Headquarters and "Research and Development Job Creation Threshold As structured, the county's jobs grant program provides $3,000 for each new position created that pays from 75% to 99.99% of the County's average annual wage; $5,000 for each new position created that pays from 100% to 149.99% of the County's average annual wage; and $7,000 for each new position created that pays 150% or more of the County's average annual wage. Currently, the County's average annual wage is $35,879. Based upon its job grant application, AlgaGen LLC plans to create 10 new jobs in Indian River County, and 6 of the proposed jobs will meet the minimum job grant qualification of having salaries that are above 75% of the County's average annual wage ($26,909.25). Consistent with state law confidentiality allowances, the applicant has requested that the specific salaries remain confidential as part of the local jobs grant application and agreement. The grant calculation provided below, however, provides information on how many jobs qualify for each local jobs grant amount. 2 Category Qualified Jobs Amount per Job Total 75% of county average wage 0 $3,000 $0 100% of county average wage 3 $5,000 $15,000 150% of county average wage 3 $7,000 $21,000 Total Grant Amount $36,000 Grant Calculation Jobs Grant Agreement If the Economic Development Council recommends that the Board of County Commissioners approve AlgaGen LLC's local jobs grant application, staff will prepare a local jobs grant agreement to be executed between the County and AlgaGen LLC. That agreement will stipulate various requirements, including: The grant will be payable over a three year period. The company will provide copies of its quarterly unemployment compensation reports (UCT 6 form) to the County so that the County can verify that the number of jobs claimed tor each local jobs grant payment level is being provided. The company must supply documentation to the County showing that employees reside within the County or in adjacent counties. If approved, the grant will be funded from County General Fund contingencies taken from three separate County fiscal years starting in County fiscal year 2011 -12. CONCLUSION Based on the analysis conducted, staff has determined that AlgaGen LLC qualifies for a local jobs grant of up to $36,000. RECOMMENDATION Staff recommends that the Economic Development Council recommend that the Board of County Commissioners approve a local jobs grant of up to $36,000 for AlgaGen LLC. ATTACHMENT 1. Jobs Grant Application 2. AlgaGen LLC Informational Material F: \Community Development \Users\EDplannr \Incentives Funding\Jobs Grant Program\AlgaGen\EDC agenda item AlgaGen.doc 3 25 June 2010 7250 SW Oslo Road, Vero Beach. FL 32968 772 -978 -1395 www algagen.com Subject: Application for Indian River County Job Grant Program To: The Board of County Commissioners Indian River County, Florida AlgaGen is pleased to submit this request for a Job Grant that will supplement the company's growing cost structure as it expands to address its market and new opportunities. We are the only dedicated plankton farm in Florida. As one of the world's premier plankton aquaculture farms, AlgaGen has grown because of our established reputation for reliability, quality, and service. Our products represent the finest quality as demanded by our discriminating customers that include the Smithsonian, ORA (Oceans, Reefs Aquariums Inc.), Harbor Branch, FIT, FAU, OF Gainesville, and the U.S. Fish and Wildlife Service. In our current restructuring plans, we want to add ten new jobs to the business, including key professionals (CEO, CFO, and Production Engineer) as well as technical and administrative positions required to perform and support our production and sales operations. All of these jobs will have full benefits. Indian River County is a business friendly jurisdiction that is geographically ideal for our marketplace. We look forward to expanding our presence here, and to becoming more active in the business community. Thank you for considering our application. Please contact me if you have any questions. Sincerely, Erik Stenn, M.Sc. President and Managing Member Attachment 1 7250 SVV Oslo Road, Vero Beach. FL 32968 772 -978 -1395 www.algagen.com 25 June 2010 Subject: LLC Ownership To: The Board of County Commissioners Indian River County, Florida In reference to our application for Job Grant consideration from the Indian River County Government, AlgaGen is required to explain its ownership structure. AlgaGen was founded in Indian River County in November 2002, by Erik Stenn, who is the Managing Member of the LLC. At the time of application, Erik Stenn remains the sole owner of the LLC. AlgaGen does disclose that this job grant application is part of the company's restructuring, which if completed will result in growth of staff, facilities, production and revenues. This restructuring will also create a new ownership structure involving new equity owners William J. Cox (who will become the new CEO) and Glenn A. Jackson (who will become our new CFO). It is currently anticipated that this equity will be held equitably between the three members. Erik Stenn will remain the LLC's Managing Member. AlgaGen is committed to remaining in Indian River County, and to growing our core capabilities within the local economy. Please contact me if you have any questions. Sincerely, Erik Stenn, M. Sc. President and Managing Member LOCAL JOBS GRANT PROGRAM APPLICATION I L APPLICANT INFORMA'T'ION: AlgaGen LLC Erik Stenn, Managing Member Business Name Business Owners Name 7250 SW Oslo Road Address 772 978 1395 Phone Number Bill Cox (321 305 7381) Contact Person eriksribalga en.conl Email CEO Title Business Unit's Federal Employer Identification Number: 06 1659725 Business Unit's Unemployment Compensation Number: 2808461-8 Vero Beach FL 32968 City State Zipcode WWW.alira <_=en.coni Website Which of the following best describes this business: New business to Indian River County X Existing business in Indian River County creating new jobs 3 +2 unpaid/volunteer If an expansion, how many jobs are currently in the business? 1 2 II. PROPOSED SITE LOCATION (if known): Preferred location within Vero Beach city limits Address Property Parcel Number(s) City Zipcode Current Location (if different): IR Co. 7250 SW Oslo Road Vero Beach FL 32968 Address City State Zipcode 333919 Property Parcel Number(s) III. BUSINESS DESCRIPTION: Give a full description of the primary business activities /functions: Formed in Indian River County in 2002, for eight years AlgaGen LLC has grown to become one of the world's premier plankton aquaculture farming operations specializing in high purity high volume plankton production from a wide range of both proprietary and in -stock phyto and zooplankton species. Our products sell into commercial industrial, consumer, and government markets in the U.S. AlgaGen products are also exported to and distributed in Europe and Asia. Our core capabilities include: bulk plankton production; specialty plankton production contracted production services; just -in -time production of plankton orders; and, providing turn-key plankton solutions to our fish farming, aquaria, research, and government customers. AlgaGen's products are seeing consistently increasing demand as aquaculture continues to grow and mature as an industry. AlgaGen's products are also necessary for the high -end marine aquarium market_ where pure, high quality, live food is essential. AlgaGen is currently expanding to meet market demand, and to expand its range of products and services. List the NAICS Code(s) for the business: 112519, 541620, 541690, 541711, 541990 SIC Codes: 0919, 2092, 2099, 2833, 2869 Will the site be a dedicated headquarters office (regional, national, or international)? YES Phase Number of net new full -time equivalent jobs created in the business Date by which jobs will be created Average Annual Wages I 5 08/01/10 89,800 Il 5 01/15/11 29,400 III Total 10 r IV. JOB CREATION INFORMATION: Anticipated number of new full -time jobs that will be created by the business in Indian River County: I0 Salary range of new full -time jobs identified in the previous question: $40,000 to $150,000+ (PLEASE LIST ALL NEW POSITIONS AND SALARIES ON APPENDIX A OF APPLICATION) V. CRIMINAL /CIVIL FINES OR PENALTITES: List and explain any criminal or civil fines or penalties or ongoing investigations that have been imposed upon the company, its executives, or its affiliates and any recent bankruptcy proceedings of the applicant or its parent company: NONE._ To the best of my knowledge, the information included in this application is accurate. Signature of Owner or Authorized Representative Date Erik Stenn, Managing Member Printed Name 3 7250 SW Oslo Road, Vero Beach, FL 32968 772 978 -1395 www.algagen.com We put the "TON" in Plankton Florida Aquaculture Certificate No. 2241062 Florida's only dedicated plankton farm, providing bulk plankton products and services to our customers worldwide since 2002. Welcome to AlgaGen We are one of the world's preeminent suppliers of high quality high purity plankton and planktonic products in both small and bulk volumes, on a one -time or continuous delivery basis. Our products include: Live zooplankton, phytoplankton, and macro -algae Ready -to -Use plankton pastes Proteins and chemicals extracted from plankton ...which are ingredients for. Feeds, Foods, Condiments, Nutraceuticals, Pharmaceuticals, and Cosmetics AlgaGen's Retail Products: PhycoPureTM, ReefPodsTM, Decap'd BrineTM, WildTown" Commercial Services include: Bulk Plankton Deliveries, Contract Production, Research We provide: Bulk Quantities of live plankton, Ready -2- Use- and frozen pastes Specialty Orders Scheduled Guaranteed Supply and Delivery Services Research, Consulting, Culturing, and Analytical Services Our Customers include: Commercial Aquaculture Operations Ornamental Breeders and Hobbyists Marine Laboratories, Universities, Private Research Institutions Agro- Industrial, Pharmaceutical and Specialty Chemical sectors Attachment 2 High density, high volume algae production laboratory quality products and services Company History. AlgaGen has been in the plankton aquaculture business for eight years. Founded in 2002 by Erik Stenn, AlgaGen remains totally dedicated to providing the finest quality plankton products available. Erik's vision was to have a focused company with a turn -key capability to grow a variety of phyto and zooplankton. Today, Erik is a world renown plankton aquaculture expert and his company AlgaGen is rapidly growing to become a world leader in high quality plankton aquaculture. With two decades of continuous plankton aquaculture expertise behind him, Erik Stenn decided that there were better ways to approach the business. What was needed was a flexible production system that could rapidly scale up or down any particular organism, in order to meet a continually changing and evolving market place. Today, the company's proprietary processes produce exceptionally large biomass volumes. These yields, produced with reliable results on a consistent basis, define AlgaGen as a business. Core Capabilities. AlgaGen is a world leader at providing flexible, on- demand, plankton production to meet our customer's exacting technical specifications. The company can produce plankton crops in both large and small volumes, at prices that will satisfy our clientele. The company's core capabilities include: Fast scale -up for commercial sized orders hundreds to thousands of liters of live phytoplankton per delivery Production facilities that support multiple large and small sized orders being processed and shipped simultaneously A large culture collection that ensures AlgaGen has the plankton species you need for most commercial and research applications In -house research and analytical capabilities, further supported by close working relationships with near -by, world class, university laboratories Proprietary production processes that ensure the highest standards of quality control and product purity, proven by years of successful deliveries to some of the market's most discriminating customers. Call us today: Erik Stenn, M.Sc., President 772 978 -1395 eriks a(�algagen.com AlgaGen LLC 7250 Oslo Road, Vero Beach, Florida 32968 www.algagen.com AIgaGen 21st Century High Tech Farming. Quick Look "Putting the ton in plankton. 8 years in business Steady customers, established business, outstanding reputation Proprietary IP Huge, fragmented traditional market Multiple market sectors Significant barriers to entry Natural Fisheries are Collapsing The US is the world's 3rd largest seafood consuming nation. Only Aquaculture can reliably deliver seafood. AlgaGen's Opportunity All finfish and shellfish require plankton, especially during larval and early juvenile growth stages. Plankton are valuable, perishable (they're alive), and difficult to grow with consistent results. Fish taste better when fed with natural plankton. AlgaGen is a proven, high quality, plankton farming operation with few market peers. Diverse Markets Applications Aquaculture and Agriculture Feeds Food Ingredients Condiments Nutraceuticals Pharmaceuticals, anti cancer, anti aging... Specialty Chemicals Industrial Applications ...single- sector cycles are not fatal AIgaGen The company's reputation is outstanding. A world leader in high- density algae aquaculture. AlgaGen also grows other plankton. Hallmarks are consistent high volume yields of difficult -to -grow plankton with exceptional quality and purity. Product Categories Microalgae Macroalgae Zooplankton ...Live, Pastes, Extracts... It Takes a Master 25 years in algae aquaculture Proprietary processes Master of the Art Operationally at the Leading Edge Eric Stenn, M.Sc., Chairman and CTO Founder ofAlgaGen A Rare Skill "Only perhaps a dozen people on the planet know how to grow algae in high density systems. Algae specialists (who can do this) are becoming the rock stars of biology..." National Geographic, Oct '07, page 57 History Founded in 2002; based upon two decades of algae aquaculture experience Regional player in ornamental and laboratory plankton markets Strong, established, international reputation Products ship internationally, and include significant prestigious customers... The Best Choose AIgaGen US Fish Wildlife Service Smithsonian Harbour Branch ORA Atlanta Aquarium Miami Aquarium Florida Institute of Technology Florida Atlantic University OF Gainesville MIT, Sandia, Brown Univ, Dallas World Aquarium, Monterrey Bay Aquarium, New England Aquarium Understanding the Market Fish farms: outsource plankton feeds Ornamental breeders and hobbyists want the best quality they need plankton Plankton must be fresh it's perishable It's difficult to grow Larval and early juvenile stage finfish and shellfish require plankton. AlgaGen's Advantages Guaranteed deliveries, guaranteed supply Large specimen collection ensures on- demand supplies Proprietary unique high- density, continuous batch, algae growth processes It's a JIT Market tough performance Exceptional Reputation: Renown for high quality and purity lab quality products Consistency and Reliability The Florida Market Florida leads the nation in aquaculture 67% of State's aquaculture is ornamental 10 major laboratories (proximity!) Major commitment to aquaculture from FL DoACS and from local jurisdictions Major trade shows occur in Orlando yearly ...AlgaGen is ideally positioned to dominate this market... Forum Post from Texas "I would never put "tiger pods" in my aquarium. They have no business in most reef aquariums. If they are thriving in your system you can bet that your other pods aren't. Reefpods by Algagen is a much better source of pod life than Tiger pods." High End Market Public Aquariums University Laboratories (FIT, FAU, UF) Government Labs and Farms (USFWS alone has 86 such facilities) Research Institutions (Ruskin, Mote, Harbour Branch, Indian River, Smithsonian) Specialty Chemicals Contract Production Moving Forward New Management Team Marketing Business Focus: Expansion Build and expand existing relationships Build delivery service on East Coast Create West Coast presence (farm Caribbean Operations Diversify revenues while building high- margin sales in bulk deliveries Management Team Erik Stenn, M.Sc., Chairman CTO Founder of AlgaGen William J. Cox, M.A., CEO CEO(2), COO, CTO Glenn A. Jackson, M.B.A., CFO CEO, COO, CFO(5) The Future A business spanning North America with market share in Europe with a presence in diverse market sectors Grow in -house laboratory capabilities to continue to maintain our position at the leading edge of this market (extracted products) Emphasis on IP; build asset value m 0 U Q C m CD N J 4) O 0 4-- a; CO O C 00 CC O LL 0 0 0 N 1) +-J 0) E 0) O Q E aA U tn co 1, D 0 0 O N -tJ�- 0) CO E 0 c 0 1) 0 0 N 0 0 0 0 0 0 o o O N -1-; N a-0 c OA ca x—I ID o CU ca co n 0 0 0 0 cD 0 C5 E 4—) 43 (r) uJ (r) 0 0 (13 2 4E5 ELI 1 8 8 8 8 8 8 8 8 8 00.000000_00c c; c) 0 Le) c17 d c:) Id Lo 11) 0 R 4 1" CNI 1 v— OD