10QSB

FORM 10-QSB

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934

For the Quarter Ended March 31, 2004	Commission File No. 0-9996
DOTRONIX, INC.
(Exact name of small business issuer as specified in its charter)
Minnesota	41-1387074
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
160 First Street, SE, New Brighton, MN 55112
(Address of principal executive offices)
651-633-1742
(Issuer’s telephone number)

Check whether the registrant (1) has filed all reports required to be filed by section 13 or 15 (d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

YES       X                      NO             

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.

Class	Outstanding at May 14, 2004
Common stock, par value $ .05 per share	4,641,741 shares

DOTRONIX, INC.
INDEX

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PART I.   FINANCIAL INFORMATION

ITEM 1.   CONDENSED FINANCIAL STATEMENTS

DOTRONIX, INC.
CONDENSED BALANCE SHEETS

	March 31 2004			June 30 2003
	(UNAUDITED)
ASSETS CURRENT ASSETS
Cash and cash equivalents	$	190,690		$	13,519
Accounts receivable, less allowance for doubtful
accounts of $10,400 and $7,600		97,890			149,839
Life Insurance proceeds receivable		—			500,000
Inventories		331,274			404,591
Prepaid expenses		45,563			11,776
TOTAL CURRENT ASSETS		665,417			1,079,725
PROPERTY, PLANT AND EQUIPMENT		51,265			102,690
ASSETS HELD FOR SALE		—			537,397
TOTAL ASSETS	$	716,682		$	1,719,812
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES
Revolving loans payable to a related party	$	552,133		$	1,365,375
Demand notes payable		135,000			—
Accounts payable		214,909			153,841
Accrued compensation and payroll taxes		36,050			59,650
Other accrued liabilities		21,120			33,664
Current portion-deferred gain on sale of
building to a related party		47,613			47,613
TOTAL CURRENT LIABILITIES		1,006,825			1,660,143
DEFERRED GAIN ON SALE OF BUILDING
TO A RELATED PARTY		194,419			230,130
STOCKHOLDERS’ DEFICIT
Common stock, $.05 par value, 12,000,000 shares
authorized, 4,601,741 and 4,180,341 shares issued
and outstanding		230,087			209,017
Additional paid-in capital		11,035,560			10,941,146
Accumulated deficit		(11,750,209	)		(11,320,624	)
TOTAL STOCKHOLDERS’ DEFICIT		(484,562	)		(170,461	)
TOTAL LIABILITIES AND
STOCKHOLDERS’ DEFICIT	$	716,682		$	1,719,812

See notes to condensed financial statements

Note:   The balance sheet as of June 30, 2003 has been condensed from the audited financial statements.

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DOTRONIX, INC.
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)

	Three months ended March 31						Nine months ended March 31
	2004			2003			2004			2003
REVENUES	$	347,175		$	384,852		$	858,857		$	1,313,649
COST OF SALES		196,795			448,503			457,108			1,296,998
GROSS MARGIN		150,380			(63,651	)		401,749			16,651
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSE		285,042			432,446			791,776			1,251,750
LOSS FROM OPERATIONS		(134,662	)		(496,097	)		(390,027	)		(1,235,099	)
INTEREST EXPENSE		2,086			29,248			39,558			62,173
NET LOSS	$	(136,748	)	$	(525,345	)	$	(429,585	)	$	(1,297,272	)
Basic and diluted net loss
per common share	$	(0.03	)	$	(0.13	)	$	(0.10	)	$	(0.31	)
Average number of common
shares outstanding		4,217,778			4,178,874			4,192,729			4,174,823

See notes to condensed financial statements

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DOTRONIX, INC
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)

	Nine months ended March 31
	2004			2003
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(429,585	)	$	(1,297,272	)
Adjustment to reconcile net loss to net cash
provided (used) by operating activities:
Depreciation		58,010			117,606
Recognition of deferred gain on sale of building		(35,711	)		(35,711	)
Loss on sale of property and equipment		89,880			—
Life insurance proceeds		500,000			—
Inventory write-down		—			215,000
Stock compensation		8,320			10,005
Change in operating assets and liabilities:
Accounts receivable		51,949			258,341
Inventories		73,317			236,792
Prepaid expenses		(33,787	)		(26,672	)
Accounts payable		61,068			72,004
Accrued compensation and payroll taxes		(23,600	)		(32,488	)
Other accrued liabilities		(12,544	)		(6,010	)
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES		307,317			(488,405	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment		(6,935	)		(13,194	)
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock		107,164			—
Borrowings on demand notes		135,000
Borrowings on revolving loans to a related party		635,393			2,112,377
Repayments on revolving loans to a related party		(1,000,768	)		(1,673,657	)
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES		(123,211	)		438,720
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		177,171			(62,879	)
CASH AND CASH EQUIVALENTS AT THE BEGINNING
OF THE PERIOD		13,519			150,328
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	$	190,690		$	87,449

See notes to condensed financial statements

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DOTRONIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS

A.   Basis of Presentation

This Form 10-QSB contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose any statements contained in this Form 10-QSB that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “continue” or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties, and actual results may differ materially depending on a variety of factors, many of which are not within the Company’s control. These factors include but are not limited to economic conditions generally and in the industries in which the Company’s customers participate; competition within the Company’s industry, including competition from much larger competitors; technological advances that could render the Company’s products less competitive or obsolete; failure by the Company to successfully develop new products or to anticipate current or prospective customers’ product needs; price increases or supply limitations for components purchased by the Company for use in its products; availability of sufficient financing and delays, reductions, or cancellations of orders previously placed with the Company.

The balance sheet as of March 31, 2004, the statements of operations for the three and nine month periods ended March 31, 2004 and 2003 and the statements of cash flows for the nine month periods ended March 31, 2004 and 2003 have been prepared by the Company without audit. In the opinion of management, all adjustments (consisting only of normal recurring accruals) necessary to present fairly the financial position, results of operations and cash flows at March 31, 2004 and for the three and nine months periods ended March 31, 2004 and 2003 presented herein have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these financial statements be read in conjunction with the Company’s financial statements and notes thereto included in the Annual Report on Form 10-KSB of the Company for the fiscal year ended June 30, 2003.

B.   Stock Options

The Company uses the accounting guidance of Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees” for measurement and recognition of stock-based transactions with employees. No compensation cost has been recognized for options issued under the plans when the exercise price of the options is at least equal to the fair market value of the common stock at the date of grant. Had compensation cost for the stock options issued been determined based on the fair value at the grant date, consistent with the provisions of SFAS No. 123, “Accounting for Stock Based Compensation”the Company’s three and nine months

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ended March 31, 2004 and 2003 net loss and net loss per share would have been changed to the pro forma amounts indicated below:

	Three months ended March 31						Nine months ended March 31
	2004			2003			2004			2003
Net loss as reported	$	(136,748	)	$	(525,345	)	$	(429,585	)	$	(1,297,272	)
Deduct: total stock based employee
compensation expense determined
under the fair value method
Pro forma net loss		(3,100	)		(263	)		(7,400	)		(263	)
Net loss per share:	$	(139,848	)	$	(525,608	)	$	(436,985	)	$	(1,297,535	)
Basic and diluted-as reported	$	(0.03	)	$	(0.13	)	$	(0.10	)	$	(0.31	)
Basic and diluted-pro forma	$	(0.03	)	$	(0.13	)	$	(0.10	)	$	(0.31	)

C.   Critical Accounting Policies and Accounting Pronouncements

CRITICAL ACCOUNTING POLICIES

The Company has credit policies that establish specific criteria related to credit worthiness that its customers must meet prior to the shipment of product to the customer. The Company periodically makes limited and selective exceptions to its policy of not shipping to customers with overdue balances when the particular customer has met specific criteria that are indicative of such customers’ ability to pay their past due and future balances.

The Company does not accept returns from customers without its prior authorization. Returns are typically accepted only for damaged or defective goods, or for pricing or shipping discrepancies. The Company reserves the right to refuse authorization of any returns. If the Company accepts an unauthorized return or if a return is the result of a customer error, the customer may be subject to a 10% handling charge. The Company reserves the right to cancel open orders or backorders for those customers who abuse or excessively use return privileges.

The Company believes that the selection and application of its accounting policies are appropriately reasoned. The following are the accounting policies that management believes require the most difficult, subjective or complex judgments about matters that are inherently uncertain.

Inventory Valuation — An inventory write-down is established to reduce inventory to the lower of cost or market for estimated surplus and discontinued inventory items. The amount of the inventory write-down is determined by analyzing historical and projected sales information, plans for discontinued products and other factors. Changes in sales volumes due to unexpected economic or competitive conditions are among the factors that would result in materially different amounts for this item. Because there is considerable uncertainty in the continuation of current sales trends, additional inventory write-downs may be required if revenues remain at current levels, or continue to decline in future periods.

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Allowance for Doubtful Accounts — An allowance is established for estimated uncollectible accounts receivable. The required allowance is determined by reviewing customer accounts and making estimates of amounts that may be uncollectible. Factors considered in determining the amount of the reserve include the age of the receivable, the financial condition of the customer, general business and economic conditions, and other relevant facts and circumstances. Unexpected changes in the aforementioned factors would result in materially different amounts.

Recognition of Revenue — The Company recognizes revenue when title of the goods passes to the customer.

D.   Related Party Transaction

On March 31, 2004, the Company sold its assets held for sale (real property in Eau Claire, Wisconsin), and the proceeds of $447,867 from the sale were transferred to the Estate of William S. Sadler, the late president and chief executive officer of Dotronix, to reduce the principal amount outstanding under a loan and security agreement the Company had entered into with Mr. Sadler.

ITEM 2.   MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

OVERVIEW AND NEW BUSINESS PLAN

The Company, founded in 1980, was formerly a supplier and original equipment manufacturer of cathode ray tube (“CRT”) displays. The demand for CRT displays has declined over the last several years, primarily due to the introduction of new display technologies. In response to this decline and to opportunities arising from the new technologies, the Company closed its manufacturing facility in January 2003 and began to develop a new business plan. Pursuant to the Company’s new business plan, the Company plans to provide video signage systems to end users such as restaurants and retail stores. The Company intends to offer complete packages for such systems, including design, installation and maintenance, to potential customers. At least in the short term, the Company intends to outsource all or most of the installation and maintenance services. The necessary computer software will be acquired from various third party vendors. The Company will limit its reduced manufacturing capacities to the designing and testing of prototype units and specialty applications, such as the Mega-Screen™ rear projection unit, and most manufacturing will be outsourced.

On March 31, 2004, the Company sold its assets held for sale (real property in Eau Claire, Wisconsin), and the proceeds of $447,867 from the sale were transferred to the Estate of William S. Sadler, the late president and chief executive officer of Dotronix, to reduce the principal amount outstanding under a loan and security agreement the Company had entered into with Mr. Sadler.

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As of March 31, 2004, the Company had a working capital deficit of $341,408. To continue operations and implement its new business plan, the Company depends on financing. The Company secured a line of credit in the amount of $450,000 from an outside investor, Mr. Terry L. Myhre, on April 7, 2004. Demand notes with an aggregate principal amount of $135,000 that the Company had issued to Mr. Myhre previously became a part of the line of credit. The Company also retained the services of an investment banking company to assist in raising funds through equity financing. There is no guarantee that the Company will be successful in obtaining equity financing at terms and conditions acceptable to the Company and, even though the Company was able to satisfy its immediate working capital needs through debt financing, there is no guarantee that the Company will be able to implement its new business plan successfully and continue operating or that the Company will be profitable.

On April 7, 2004, Mr. Myhre also entered into an agreement with the Estate of William S. Sadler and Minnesota River Aviation, Inc. (“MRAI”), a corporation controlled by the Estate, pursuant to which Mr. Myhre acquired an option to purchase from the Estate and MRAI up to one million shares of Dotronix common stock at $0.05 per share. This option expires on November 5, 2010. The Estate and MRAI currently hold 1,278,959 shares of Dotronix’s common stock.

The Company’s common stock is quoted on the OTC Bulletin Board under the symbol “DOTX”.

RESULTS OF OPERATIONS

Revenue decreased by $37,677 or 10% for the three-month period ended March 31, 2004 and by $454,792 or 35% for the nine month period ended March 31, 2004, compared to the same periods in the prior year. The Company currently generates revenue primarily from the sale of CRT products and services. Due to the competition from alternative video display technologies, such as plasma and LCD panels, the number of units of CRT products sold has significantly declined, thereby reducing the Company’s revenues. In addition, the Company lost sales to major distributors and manufactures of CRT based products who aggressively reduced the prices for their products to generate sales in a highly competitive market. Under the new business plan, the Company’s efforts to sell video signage system packages has resulted in only four sales, all for test sites, and the Company has not derived any significant revenues under its new business plan. The Company does not expect any significant revenues under the new business plan before June 30, 2004, the end of this fiscal year. There is no guarantee that the Company will generate significant revenues from the sale of video signage system packages or that it will be profitable in the foreseeable future.

The gross margin percentage for the three-month period ended March 31, 2004 was 43%, compared to a negative (17)% in the prior year quarter. The gross margin percentage for the nine-month period ended March 31, 2004 was 47%, compared to 1% for the prior year nine-month period. The current year (fiscal 2004) gross margin percentages for the three-month and nine-month periods were significantly influenced by last time buy orders with above average margins, including shipments of

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approximately $270,000 for the three-month period and $420,000 for the nine-month period ended March 31, 2004. An additional contributor to improved margins was the sale of inventory that had been written down. The primary cause of the prior year (fiscal 2003) three-month and nine-month gross margins was closing costs associated with the shut down of the Eau Claire, Wisconsin manufacturing facility, which was completed in January 2003. It is highly unlikely that the Company will attain gross margin percentage levels similar to the three- and nine-month periods ended March 31, 2004, in the future.

Selling, general, and administrative expenses decreased $147,404, or 34% in the three-month period ended March 31, 2004 and $459,974 or 37% in the nine month period ended March 31, 2003, when compared to the same periods of the prior year. The decreases were the result of continuing reductions in personnel costs and lower building lease and related costs.

Interest expense decreased by $27,162 or 93% during the three-month period ended March 31, 2004 and by $22,615 or 36% during the six-month period ended March 31, 2003, compared to the same periods of the prior year. The primary cause of the decrease was lower borrowing levels.

LIQUIDITY AND CAPITAL RESOURCES

Cash and cash equivalents as of March 31, 2004 was $190,690, an increase of $177,171 from cash and equivalents of $13,519 as of June 30, 2003. During this period, the net cash provided by operating activities amounted to $307,317. This positive cash flow resulted primarily from the Company’s receipt of life insurance proceeds in the amount of $500,000 as a result of the death of its late president and chief executive officer, William S. Sadler. Financing activities during the nine-month period ended March 31, 2004 used cash in the amount of $123,211, applying the payment of the life insurance proceeds to reduce the revolving credit line that Mr. Sadler had granted to the Company. $107,164 of cash was provided by the sale of common stock and the exercise of stock options.

During the nine month period ended March 31, 2004, the Company generated revenues of $858,857 and incurred a net loss of $429,585. The Company will be able to continue operating only if it is able to secure debt and/or equity financing at terms and conditions acceptable to the Company that will allow the Company to finance its operations until it is able to generate revenues from the sale of video signage systems in accordance with its new business plan. On April 7, 2004, the Company secured a credit facility in the amount of $450,000. The Company does not expect any significant revenues under its new business plan before June 30, 2004, the end of this fiscal year.

On March 31, 2004, the Company sold its real property in Eau Claire, Wisconsin, to an unrelated third party and net proceeds of $447,867 were applied against the debt to the Estate of William S. Sadler of $1,000,000.

On April 7, 2004, agreements between the Company, the Estate of William S. Sadler, and the outside investor were signed. A summary of the terms of these agreements is as follows:

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The amount owing the Estate of $552,133 was reduced to $150,000, with interest only payments due monthly at a 5% per annum interest rate. The principal amount is due on November 20, 2008. The Estate has an option to convert the outstanding loan amount into Company common stock at $1.00 per share. As additional consideration for the reduction of the loan, the Company cancelled existing warrants to Mr. Sadler for the purchase of up to 365,094 shares of the Company’s common stock at exercise prices ranging from $0.085 to $0.60 per share, and issued new warrants to the Estate to purchase 385,000 shares of common stock at an exercise price of $0.05 per share.

In a related agreement, Mr. Terry L. Myhre, an outside investor, agreed to provide a credit line of up to $450,000 to the Company, which is convertible into common stock at $1.50 per share. Outstanding demand notes of the investor with an aggregate principal of $135,000 became part of the credit line. In consideration for the credit line, Mr. Myhre also received warrants to purchase 100,000 shares of the Company’s common stock at an exercise price of $0.10 per share.

Commitments and Contingencies

Office equipment and computer equipment are leased under non-cancelable operating leases. Minimum future obligations on these operating leases and amounts owing under the revolving credit facility, at March 31, 2004, are as follows:

Contractual obligation payments due by period	1 Year		2-3 Years		4-5 Years		Over 5 Years		Total
Operating lease with a
related party	$	73,200	$	146,400	$	146,400	$	6,100	$	372,100
Other operating leases		10,412		—		—		—		10,412
Revolving credit facility		552,133								552,133
Demand notes		135,000								135,000
Total	$	770,745	$	146,400	$	146,400	$	6,100	$	1,069,645

CRITICAL ACCOUNTING POLICIES

The Company’s critical accounting policies and accounting pronouncements are listed in Note C to the condensed financial statements.

The Company recognizes revenue when title of goods passes to the customer.

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ITEM 3.   CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures.

The Company’s Chief Executive Officer, Kurt T. Sadler, and Chief Financial Officer, Robert V. Kling, have reviewed the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based upon this review, these officers believe that the Company’s disclosure controls and procedures are effective in ensuring that information that is required to be disclosed by the Company in reports that it files under the Securities Exchange Act of 1934 is recorded, processed and summarized and reported within the time periods specified in the rules of the Securities and Exchange Commission. The officers are aware that there is a lack of segregation of duties due to the small number of employees dealing with general administrative and financial matters. However, they have decided that considering the employees involved and the control procedures in place, risks associated with such lack of segregation are insignificant and the potential benefits of adding employees to clearly segregate duties do not justify the expenses associated with such increases.

Changes in internal controls.

There were no changes in the Company’s internal controls over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II — OTHER INFORMATION

ITEM 2.   CHANGES IN SECURITIES AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES

On March 24, 2004, the Company issued an aggregate of 400,000 units to six purchasers for $0.25 per unit pursuant to a Securities and Purchase Agreement dated February 20, 2004. Each unit consists of one share of Common Stock and a warrant to purchase one share of Common Stock at $0.50 per share. The warrants expire on January 31, 2009. The Company relied upon Rule 506 of Regulation D for an exemption from registration in connection with the issuance of the units.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

See Exhibit Index following signature page.

(b) Reports on Form 8-K

On February 9, 2004, a report was filed on Form 8-K announcing that a press release was issued on February 6, 2004 to announce that the agreements from November 2003 between the Company and the Estate of its late CEO regarding the forgiveness of debt, and between the Company and an outside

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investor regarding a credit line have not been completed and are being renegotiated.

On February 20, 2004 a report was filed on Form 8-K announcing that a press release was issued on February 20, 2004 to announce the Company’s results for the quarter ended December 31, 2003.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Dotronix, Inc.
Date:   May 14, 2004	By:		/s/   Kurt T. Sadler
		Kurt T. Sadler, President (Principal Executive Officer)
	By:		/s/   Robert V. Kling
		Robert V. Kling Chief Financial Officer (Principal Financial and Accounting Officer)

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DOTRONIX, INC.
EXHIBIT INDEX
QUARTERLY REPORT ON FORM 10-QSB
FOR QUARTER ENDED MARCH 31, 2004

10.1* Amendment to September 8, 2003 employment agreement with Kurt T. Sadler dated November 17, 2003.

10.2* Amendment to September 8, 2003 employment agreement with Robert V. Kling, dated November 17, 2003.

10.3 Amendment No.1 to Agreement to extend and amend Loan and Security Agreement of November 5, 2003, between the Company and the Estate of William S. Sadler, dated April 7, 2004

10.4 Warrant to the Estate of William S. Sadler to purchase 385,000 shares of Dotronix Common Stock at $0.05 per share, dated April 7, 2004

10.5 Registration Rights Agreement between the Company and the Estate of William S. Sadler, dated April 7, 2004

10.6 Loan Agreement between the Company and Terry L. Myhre, dated April 7, 2004

10.7 Security Agreement made and entered into by the Company in favor of Terry L. Myhre, dated April 7, 2004

10.8 Subordination Agreement made and given by the Estate of William S. Sadler in favor of Terry L. Myhre, dated April 7, 2004

10.9 Promissory Note in the principal amount of $450,000 from the Company to Terry L. Myhre, dated April 7, 2004

10.10 Warrant to Terry L. Myhre to purchase 100,000 shares of Dotronix Common Stock a $0.10 per share, dated April 7, 2004

10.11 Option Agreement between Terry L. Myhre, the Estate of William S. Sadler and Minnesota River Aviation, Inc., dated April 7, 2004

10.12 First Amendment to Lease between the Estate of William S. Sadler and the Company, dated April 7, 2004

31.1 Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2 Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1 Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*Management agreement or compensatory plan or arrangement.

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EX-10.1

EXHIBIT 10.1

                     AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT
                    BETWEEN DOTRONIX, INC. AND KURT T. SADLER
                    -----------------------------------------

Reference is hereby made to that Employment Agreement dated September 8, 2003,
between Dotronix, Inc., a Minnesota corporation (hereinafter "Dotronix"). and
Kurt T. Sadler (hereinafter "Sadler").

     Dotronix and Kling hereby agree to amend the Employment agreement as
     follows:

Paragraph 5, Stock option grants, shall be amended to read as follows:

     Dotronix agrees to issue stock options for 50,000 shares of common stock to
     Sadler under the 1999 Stock Incentive Plan. The vesting date shall be as
     follows; 12,500 shares shall vest on the date of issuance of the stock
     option grant, 12,500 shares shall vest on April 1, 2004, 12,500 shares
     shall vest on October 1, 2004, and 12,500 shares shall vest on April 1,
     2005. The option price for the 50,000 shares shall be the closing price of
     the stock on the grant date. Each stock option shall be for 10 years. Once
     a grant has been made it will remain in effect until it expires 10 years
     after issuance.

Paragraph 6 (b) Severance Benefit shall be amended to read as follows:

     In the event Sadler's employment terminates following a Change of Control
     as defined in Section 11 below, any unvested shares shall immediately vest.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of November
     17, 2003

     DOTRONIX, INC.


     By /s/ Robert V. Kling
     Robert V. Kling
     Chief Financial Officer


     /s/ Kurt T. Sadler
     Kurt T. Sadler






                                       15

EX-10.2

EXHIBIT 10.2

                     AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT
                   BETWEEN DOTRONIX, INC. AND ROBERT V. KLING
                   ------------------------------------------

Reference is hereby made to that Employment Agreement dated September 8, 2003,
between Dotronix, Inc., a Minnesota corporation (hereinafter "Dotronix"). and
Robert V. Kling (hereinafter "Kling").

     Dotronix and Kling hereby agree to amend the Employment agreement as
     follows:

Paragraph 5, Stock option grants, shall be amended to read as follows:

     Dotronix agrees to issue stock options for 50,000 shares of common stock to
     Kling under the 1999 Stock Incentive Plan. The vesting date shall be as
     follows; 12,500 shares shall vest on the date of issuance of the stock
     option grant, 12,500 shares shall vest on April 1, 2004, 12,500 shares
     shall vest on October 1, 2004, and 12,500 shares shall vest on April 1,
     2005. The option price for the 50,000 shares shall be the closing price of
     the stock on the grant date. Each stock option shall be for 10 years. Once
     a grant has been made it will remain in effect until it expires 10 years
     after issuance.

Paragraph 6 (b) Severance Benefit shall be amended to read as follows:

     In the event Kling's employment terminates following a Change of Control as
     defined in Section 11 below, any unvested shares shall immediately vest.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of November
     17, 2003

     DOTRONIX, INC.


     By /s/ Kurt T. Sadler
     Kurt T. Sadler
     President

     /s/ Robert V. Kling
     Robert V. Kling







                                       16

EX-10.3

EXHIBIT 10.3

                               AMENDMENT NO. 1 TO
            AGREEMENT TO EXTEND AND AMEND LOAN AND SECURITY AGREEMENT

This Amendment No. 1 (the "Amendment") is entered into this 7th day of April
2004 by and between the Estate of William S. Sadler, 1370 West Ryan Avenue,
Roseville, MN 55113 (the "Estate") and Dotronix, Inc., a Minnesota corporation,
with its principal place of business located at 160 First Street S.E., St. Paul
Minnesota 55112-7894 ("Dotronix"), to amend that Agreement to Extend and Amend
Loan and Security Agreement dated November 5, 2003 (the "Agreement") between the
Estate and Dotronix.

WHEREAS, the Agreement provided for the transfer of certain real property of
Dotronix to the Estate; and

WHEREAS, in the meantime the parties have agreed that such real property shall
be sold to a third party instead of being transferred to the Estate and that the
proceeds from such sale shall be paid to the Estate;

NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained in this Amendment, the parties hereto agree as follows:

1.   Section 1 of the Agreement is deleted and replaced with the following
     language:

     "Dotronix shall sell to a third party the real estate in Eau Claire,
     Wisconsin, that is more fully described in Exhibit A hereto and shall pay
     $465,000.00 from such sale, less $17,132.68 for fees and expenses payable
     upon the closing of the sale (the "Sales Proceeds") to the Estate. Such
     payment shall be made upon the closing of the sale of the real estate. Upon
     payment of the Sales Proceeds to the Estate, the principal amount due and
     owing under the Loan and Security Agreement dated February 23, 2000 (the
     "Loan Agreement"), as amended, originally entered into by and between
     William S. Sadler and Dotronix, shall be reduced from $1,000,000 to
     $150,000."

2.   Section 4 of the Agreement is deleted.

3.   In Section 5 of the Agreement, the phrase "and upon transfer of title and
     ownership of the Eau Claire, Wisconsin property" is deleted.

4.   Section 6 and Section 7(d) of the Agreement are deleted.


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]



                                       17



IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
on the day and year first above written.

The Estate of William S. Sadler
By its Personal Representatives

/s/ Dorothy E. Sadler
Dorothy E. Sadler

/S/ JILL D. SADLER
Jill D. Sadler

/s/ Kurt T. Sadler
Kurt T. Sadler


DOTRONIX, INC.

By:  /s/ Robert V. Kling
         Robert V. Kling
         Its Chief Financial Officer





























                                       18

EX-10.4

EXHIBIT 10.4

         THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY AND ISSUABLE
PURSUANT HERETO HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT") AND MAY NOT BE OFFERED OR SOLD, TRANSFERRED,
PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT IN A TRANSACTION THAT IS
EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND FROM THE
REGISTRATION AND QUALIFICATION REQUIREMENTS OF APPLICABLE STATE SECURITIES LAWS,
OR IN A TRANSACTION EFFECTED PURSUANT TO SUCH REGISTRATION AND QUALIFICATION.

         THIS WARRANT IS NOT TRANSFERABLE EXCEPT AS SET FORTH IN PARAGRAPH 7
BELOW.


                                 DOTRONIX, INC.
                            (A MINNESOTA CORPORATION)

                       WARRANT TO PURCHASE 385,000 SHARES
                   OF COMMON STOCK, PAR VALUE $0.05 PER SHARE

         THIS CERTIFIES THAT, for value received, Estate of William S. Sadler or
its permitted transferees (the "Holder") is entitled to subscribe for and
purchase 385,000 shares (the "Shares") of fully paid and nonassessable common
stock, par value $0.05 per share ("Common Stock") of Dotronix, Inc., a Minnesota
corporation (the "Company") at the Warrant Exercise Price as determined in
accordance with the terms hereof, which shall initially be equal to $0.05 per
share, subject to the provisions and upon the terms and conditions hereinafter
set forth.

         1. Term. The purchase right represented by this Warrant is exercisable,
in whole or in part, at any time and from time to time commencing on the date
hereof and ending at the close of business on April 7, 2011.

         2. Method of Exercise; Payment; Issuance of New Warrant. Subject to
Paragraph 1 hereof, the purchase right represented by this Warrant may be
exercised by the Holder, in whole or in part and from time to time, by the
surrender of this Warrant (with the notice of exercise form attached hereto as
Exhibit 1 duly executed) at the principal office of the Company and by the
payment to the Company, by check or such other manner of payment as the parties
may agree, of an amount equal to the then applicable Warrant Exercise Price (as
defined in Paragraph 4) per share multiplied times the number of Shares then
being purchased. The person or persons in whose name(s) any certificate(s)
representing the Shares shall be issuable upon exercise of this Warrant shall be
deemed to have become the holder(s) of record of, and shall be treated for all
purposes as the record holder(s) of, the shares represented thereby (and such
shares shall be deemed to have been issued) immediately prior to the close of
business on the date or dates upon which this Warrant is exercised. In the event
of any exercise of the rights represented by this Warrant, certificates for the
shares of stock so purchased shall be delivered

                                       19


to the Holder as soon as is reasonably practicable and, unless this Warrant has
been fully exercised or expired, a new Warrant representing the portion of the
Shares, if any, with respect to which this Warrant shall not then have been
exercised shall also be issued to the Holder as soon as is reasonably
practicable.

         3. Stock Fully Paid; Reservation of Shares. The Company agrees that all
Shares issued upon the exercise of the rights represented by this Warrant will,
upon issuance, be fully paid and nonassessable, and free from all preemptive
rights, taxes, liens and charges with respect to the issue thereof; provided,
that the Company shall not be required to pay any withholding taxes with respect
to the issue of shares or any transfer taxes with respect to the issue of shares
in any name other than that of the registered holder hereof. During the period
within which the rights represented by this Warrant may be exercised, the
Company will at all times have authorized, and reserved for the purpose of
issuance upon exercise of the purchase rights evidenced by this Warrant, a
sufficient number of shares of its Common Stock to provide for the exercise of
the rights represented by this Warrant. The Company shall at all times take all
such action and obtain all such permits or orders as may be necessary to enable
the Company lawfully to issue such shares of Common Stock as duly and validly
issued, fully paid and nonassessable shares upon exercise in full of this
Warrant by Holder.

         4. Adjustment of Warrant Exercise Price and Number of Shares. The
number and kind of securities purchasable upon the exercise of this Warrant and
the Warrant Exercise Price shall be subject to adjustment from time to time upon
the occurrence of certain events as set forth in this Paragraph 4:

                  (a) If the Company at any time divides the outstanding shares
         of its Common Stock into a greater number of shares (whether pursuant
         to a stock split, stock dividend or otherwise), and conversely, if the
         outstanding shares of its Common Stock are combined into a smaller
         number of shares, the Warrant Exercise Price in effect immediately
         prior to such division or combination shall be proportionately adjusted
         to reflect the reduction or increase in the value of each such share of
         Common Stock.

                  (b) If any capital reorganization or reclassification of the
         capital stock of the Company, or consolidation or merger of the Company
         with another corporation, or the sale of all or substantially all of
         its assets to another corporation shall be effected in such a way that
         holders of the Company's Common Stock shall be entitled to receive
         stock, securities or assets with respect to or in exchange for such
         Common Stock, then, as a condition of such reorganization,
         reclassification, consolidation, merger or sale, the Holder shall
         thereafter have the right to purchase and receive upon the basis and
         upon the terms and conditions specified in this warrant and in lieu of
         the shares of the Common Stock of the Company immediately theretofore
         purchasable and receivable upon the exercise of the rights represented
         hereby, such shares of stock, other securities or assets as would have
         been issued or delivered to the Holder if Holder had exercised this
         Warrant and had received such shares of Common Stock immediately prior
         to such reorganization, reclassification, consolidation, merger or
         sale. The Company shall not effect any such consolidation, merger or
         sale unless prior to the consummation thereof the successor corporation
         (if other than the Company) resulting from such consolidation or merger
         or the corporation purchasing such assets shall assume by written
         instrument executed and mailed to the Holder at the last address of the
         Holder appearing on the books of the Company the obligation to deliver
         to the Holder such shares of stock,


                                       20


         securities or assets as, in accordance with the foregoing provisions,
         the Holder may be entitled to purchase.

                  (c) Except as provided in paragraph (d) below, if and whenever
         the Company shall (i) issue or sell any shares of Common Stock for a
         consideration per share less than the Warrant Exercise Price in effect
         immediately prior to the time of such issuance or sale, (ii) issue or
         sell any warrants, options or other rights to acquire shares of Common
         Stock at a purchase price less than the Warrant Exercise Price in
         effect immediately prior to the time of such issuance or sale, or (iii)
         issue or sell any other securities that are convertible into shares of
         Common Stock for a purchase or exchange price less than the Warrant
         Exercise Price in effect immediately prior to the time of such issuance
         or sale, then, upon such issuance or sale, the Warrant Exercise Price
         shall be reduced to the price (calculated to the nearest cent)
         determined by dividing (A) an amount equal to the sum of (I) the number
         of shares of Common Stock outstanding immediately prior to such issue
         or sale multiplied by the then existing Warrant Exercise Price and (II)
         the consideration, if any, received by the Company upon such issue or
         sale plus the consideration to be received by the Company upon the
         exercise of such stock purchase rights by (B) an amount equal to the
         sum of (I) the number of shares of Common Stock outstanding immediately
         prior to such issue or sale and (II) the number of shares of Common
         Stock thus issued or sold or issuable or saleable upon the exercise of
         such purchase rights or the conversion of such convertible securities;
         PROVIDED, HOWEVER, that in the event that any such purchase right
         expires or is terminated prior to the exercise of this Warrant, the
         Warrant Exercise Price shall be recalculated by deleting such purchase
         right, and PROVIDED FURTHER, that if an adjustment is made to the
         Warrant Exercise Price as a result of the issuance or sale of any such
         purchase rights or convertible securities, no further adjustment shall
         be made to the Warrant Exercise Price at the time such purchase rights
         are exercised or convertible securities are converted.

                  (d) Notwithstanding the provisions of paragraph (c) above, no
         adjustment shall be made in the Warrant Exercise Price as a result of
         (i) the exercise of options or warrants to purchase Common Stock or
         other derivative securities exercisable for shares of Common Stock
         which are outstanding at the date of this Warrant; (ii) the grant of
         options to purchase Common Stock or the grant of restricted stock and
         other similar equity-based compensation awards pursuant to stock option
         and incentive plans which have been or are in the future approved by
         the Company's board of directors, or the exercise of such options or
         awards or (iii) the issuance of additional warrants in substantially
         the form of this Warrant pursuant to the Company's borrowing
         arrangements with Terry L. Myhre, or the exercise of such warrants.

                  (e) If the Company takes any other action, or if any other
         event occurs, which does not come within the scope of the provisions of
         paragraphs (a) through (c) above but which should result in an
         adjustment in the Warrant Exercise Price and/or the number of shares
         subject to this Warrant in order to fairly protect the purchase rights
         of the Holder, an appropriate adjustment in such purchase rights shall
         be made by the Company.

                  (f) Upon each adjustment of the Warrant Exercise Price, the
         Holder shall thereafter be entitled to purchase, at the Warrant
         Exercise Price resulting from such adjustment, the number of shares
         obtained by multiplying the Warrant Exercise Price in

                                       21


         effect immediately prior to such adjustment by the number of shares
         purchasable pursuant hereto immediately prior to such adjustment and
         dividing the product thereof by the Warrant Exercise Price resulting
         from such adjustment.

                  (g) Upon any adjustment of the warrant exercise price, the
         Company shall give written notice thereof to the Holder stating the
         warrant exercise price resulting from such adjustment and the increase
         or decrease, if any, in the number of shares purchasable at such price
         upon the exercise of this warrant, setting forth in reasonable detail
         the method of calculation and the facts upon which such calculation is
         based.

         5. No Fractional Shares. No fractional shares of Common Stock will be
issued in connection with any exercise hereunder, but in lieu of such fractional
shares the Company shall make a cash payment therefor upon the basis of the
market price of such shares as of the close of business on the exercise date.

         6. No Privilege of Stock Ownership. Prior to the exercise of this
Warrant, the Holder shall not be entitled, by virtue of holding this Warrant, to
any rights of a stockholder of the Company, including (without limitation) the
right to vote or to receive dividends or other distributions.

         7. Transfer of Warrant. This Warrant shall not be transferable except
pursuant to the laws of descent and distribution.

         8. No Registration Rights; Legend. The Company is not obligated to
register this Warrant or any of the shares of Common Stock issuable hereunder
pursuant to the Securities Act of 1933 or any state securities laws. Any
certificates representing shares of Common Stock issued hereunder shall bear a
restrictive legend in such form and substance as counsel to the Company advises
the Company is required under applicable securities laws.

         9. Notices. Any notice, request or other document required or permitted
to be given or delivered to the Holder or the Company shall be delivered, or
shall be sent by certified or registered mail, postage prepaid, to the Holder at
its address as shown on the books of the Company or to the Company at the
address indicated therefor on the signature page of this Warrant.

         10. Binding Effect on Successors. This Warrant shall be binding upon
any corporation succeeding the Company by merger or consolidation. All of the
covenants and agreements of the Company contained herein shall inure to the
benefit of the permitted transferees of the Holder.

         11. Descriptive Headings. All descriptive headings contained herein are
for convenience only and shall not be construed as part of this Warrant.

         12. Governing Law. This Warrant shall be governed by the laws of the
State of Minnesota, without reference to its principles of conflicts of laws.

         13. Amendments and Waivers. Any term of this Warrant may be amended,
and the observance of any term of this Warrant may be waived (either generally
or in a particular instance, and either retroactively or prospectively), only
with the written consent of the


                                       22


Company and the Holder. Any such amendment or waiver shall be binding on the
Company and the Holder and any permitted transferee of this Warrant.

                                                DOTRONIX, INC.

                                                By:  /s/ Robert V. Kling
                                                Title: Chief Financial Officer
                                                Address:
                                                160 First Street S.E.
                                                New Brighton, Minnesota 55112

Dated:  April 7, 2004
































                                       23



EXHIBIT 1 TO STOCK PURCHASE WARRANT
- -----------------------------------

NOTICE OF EXERCISE


Dotronix, Inc.
160 First Street S.E.
New Brighton, Minnesota 55112


Ladies and Gentlemen:

         _________________________________ (the "Holder") hereby elects to
purchase, pursuant to the provisions of that Stock Purchase Warrant dated as
________________registered in the name of the Holder (the "Warrant"), shares of
Common Stock, par value $0.05 per share, of Dotronix, Inc., a Minnesota
corporation. The Holder hereby surrenders the Warrant and delivers herewith a
check in payment of the Warrant Exercise Price payable for such shares pursuant
to the Warrant.

         Please issue a certificate or certificates representing said shares of
Common Stock registered in the name of the Holder. If the number of shares set
forth above is less than the full number of shares issuable pursuant to the
Warrant, also please issue a new Warrant registered in the name of the Holder
for the balance of the shares issuable pursuant to the Warrant.

Dated: _____________________________, 20_____



                                              __________________________________
                                              [Holder]

                                              By: ______________________________

                                              Name: ____________________________

                                              Title: ___________________________

                                              Address: _________________________

                                              __________________________________

                                              Tax I.D. No.: ____________________




                                       24

EX-10.5

EXHIBIT 10.5

                          REGISTRATION RIGHTS AGREEMENT

         THIS REGISTRATION RIGHTS AGREEMENT, dated as of April 7, 2004 (this
"Agreement"), is made by and between DOTRONIX, INC. , a Minnesota corporation,
with headquarters located at 160 First Street S.E, New Brighton, MN 55112-7894
(the "Company"), and the Estate of William S. Sadler, 1370 West Ryan Avenue,
Roseville, MN 55113 (the "the Estate").

                              W I T N E S S E T H:

         WHEREAS, upon the terms and subject to the conditions of Amendment to
Extend and Amend Loan and Security Agreement, dated November 5, 2003, as amended
by Amendment No.1 dated as of April 7, 2004 (the "Loan Agreement"; terms not
otherwise defined herein shall have the meanings ascribed to them in the Loan
Agreement), the Company has agreed to issue to the Estate warrants (the
"Warrants") to purchase up to 385,000 shares of Common Stock at an exercise
price of $0.05 per share (the "Warrant Shares"); the Warrants are issued in
exchange for the cancellation of certain outstanding warrants, as specified in
the Loan Agreement; and

         WHEREAS, to induce the Estate to execute and deliver the Loan
Agreement, the Company has agreed to provide certain piggyback registration
rights under the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute (collectively, the
"Securities Act"), with respect to the Common Stock;

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and the
Estate hereby agree as follows:

         1. DEFINITIONS. As used in this Agreement, the following terms shall
have the following meanings:

         (a) "the Estate" means the Estate and any permitted transferee or
assignee of the Estate who agrees to become bound by the provisions of this
Agreement in accordance with Section 9 hereof and who holds Registrable
Securities.

         (b) "Register," "Registered," and "Registration" refer to a
registration effected by preparing and filing a Registration Statement or
Statements in compliance with the Securities Act and pursuant to Rule 415 under
the Securities Act or any successor rule providing for offering securities on a
continuous basis ("Rule 415"), and the declaration or ordering of effectiveness
of such Registration Statement by the United States Securities and Exchange
Commission (the "SEC").

         (c) "Registrable Securities" means the Warrant Shares, together with
any shares of Common Stock issued or issuable upon any stock split, dividend or
other distribution, recapitalization or similar event with respect to the
foregoing; provided, however, that such securities shall cease to be Registrable
Securities (i) upon their sale pursuant to a Registration Statement, (ii) upon
their sale pursuant to Rule 144 under the Securities Act, or (iii) as soon as
they are transferable under Rule 144(k) of the Securities Act



                                       25


         (d) "Registration Statement" means a registration statement of the
Company with the Securities and Exchange Commission for a public offering and
sale of securities of the Company (other than a registration statement on Form
S-8, Form S-4, any successor form thereto, or any other form covering only
securities proposed to be issued in exchange for securities or assets of another
corporation).

         2. REGISTRATION RIGHTS. THE ESTATE shall have demand piggy-back
registration rights with respect to the Registrable Securities, subject to the
conditions set forth below. If, at any time, the Company participates (whether
voluntarily or by reason of an obligation to a third party) in the registration
of any shares of the Company's stock within two (2) years from the date hereof,
the Company shall give written notice thereof to the Estate and the Estate shall
have the right, exercisable within ten (10) business days after receipt of such
notice, to demand inclusion of all or a portion of the Estate's Registrable
Securities in such registration statement. If the Estate exercises such
election, the Registrable Securities so designated shall be included in the
registration statement at no cost or expense to the Estate.

            In connection with any offering under this Section 2 involving an
underwriting, the Company shall not be required to include any Registrable
Securities in such underwriting unless the Estate accepts the terms of the
underwriting as agreed upon between the Company and the underwriters selected by
it. If, in the written opinion of the managing underwriter, the registration of
all, or part of, the Registrable Securities that the Estate has requested to be
included in such registration exceed the number of shares that can be sold
without adversely affecting the marketability of the offering, then the Company
shall be required to include in the underwriting only the number of Registrable
Securities that the managing underwriter believes may, when added to the number
of shares of Common Stock that other holders entitled to include shares of
Common Stock in such registration have requested to be included therein, be sold
without causing such adverse effect. If the number of Registrable Securities to
be included in the underwriting in accordance with the foregoing is less than
the total number of shares that the Estate has requested to be included, then
the Estate and other holders of shares of Common Stock entitled to include
shares of Common Stock in such registration shall participate in the
underwriting pro rata based upon their total ownership of shares of Common Stock
of the Company. If any holder would thus be entitled to include more shares than
such holder requested to be registered, the excess shall be allocated among
other requesting holders pro rata based upon their total ownership of
registrable shares.

         3. OBLIGATIONS OF THE COMPANY. In connection with a registration of the
Registrable Securities, the Company shall do each of the following.

         (a) Prepare, and file with the SEC a Registration Statement with
respect to not less than the number of Registrable Securities provided in
Section 2 above, and thereafter use its reasonable best efforts to cause such
Registration Statement relating to Registrable Securities to become effective.

         (b) Notify the Estate, not less than five (5) days prior to such
filing; and (if so requested by the Estate) confirm such notice in writing no
later than one (1) business day following the day (i)(A) when a Prospectus or
any Prospectus supplement or post-effective amendment to the Registration
Statement is proposed to be filed; (B) whenever the SEC notifies the Company
whether there will be a "review" of such Registration Statement; (C) whenever
the Company receives (or a representative of the Company receives on its behalf)
any


                                       26


oral or written comments from the SEC in respect of a Registration Statement
(copies or, in the case of oral comments, summaries of such comments shall be
promptly furnished by the Company to the Estate); and (D) with respect to the
Registration Statement.

         (c) Furnish to the Estate (i) promptly after the same is prepared and
publicly distributed, filed with the SEC, or received by the Company, one (1)
copy of the Registration Statement, each preliminary prospectus and prospectus,
and each amendment or supplement thereto, and (ii) such number of copies of a
prospectus, and all amendments and supplements thereto and such other documents,
as the Estate may reasonably request in order to facilitate the disposition of
the Registrable Securities owned by the Estate;

         (d) As promptly as practicable after becoming aware thereof, notify the
Estate of the happening of any event of which the Company has knowledge, as a
result of which the prospectus included in the Registration Statement, as then
in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and use its best efforts promptly to prepare a supplement or
amendment to the Registration Statement or other appropriate filing with the SEC
to correct such untrue statement or omission, and deliver a number of copies of
such supplement or amendment to the Estate as the Estate may reasonably request;

         (e) As promptly as practicable after becoming aware thereof, notify the
Estate of the issuance by the SEC of a Notice of Effectiveness or any notice of
effectiveness or any stop order or other suspension of the effectiveness of the
Registration Statement at the earliest possible time;

         (f) Use its reasonable efforts to secure and maintain the designation
of all the Registrable Securities covered by the Registration Statement on the
"OTC Bulletin Board Market" of the National Association of Securities Dealers
Automated Quotations System ("NASDAQ") within the meaning of Rule 11Aa2-1 of the
SEC under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and the quotation of the Registrable Securities on The NASDAQ Bulletin Board
Market; and, without limiting the generality of the foregoing, to arrange for at
least two market makers to register with the National Association of Securities
Dealers, Inc. ("NASD") as such with respect to such Registrable Securities;

         (g) Provide a transfer agent and registrar, which may be a single
entity, for the Registrable Securities not later than the effective date of the
Registration Statement;

         (j) Cooperate with the Estate to facilitate the timely preparation and
delivery of certificates for the Registrable Securities to be offered pursuant
to the Registration Statement and enable such certificates for the Registrable
Securities to be in such denominations or amounts as the case may be, as the
Estate may reasonably request.

         4. OBLIGATIONS OF THE ESTATE. In connection with a registration of the
Registrable Securities, the Estate shall have the following obligations:

         (a) It shall be a condition precedent to the obligations of the Company
with respect to the Registrable Securities that the Estate shall furnish to the
Company such information regarding itself, the Registrable Securities held by
it, and the intended method of


                                       27


disposition of the Registrable Securities held by it, as shall be reasonably
required to effect the registration of such Registrable Securities and shall
execute such documents in connection with such registration as the Company may
reasonably request. At least ten (10) days prior to the first anticipated filing
date of the Registration Statement, the Company shall notify the Estate of the
information the Company requires from the Estate (the "Requested Information")
if the Estate elects to have any of the Estate's Registrable Securities included
in the Registration Statement. If at least two (2) business days prior to the
filing date the Company has not received the Requested Information from the
Estate, then the Company may file the Registration Statement without including
the Registrable Securities;

         (b) the Estate, by the Estate's acceptance of the Registrable
Securities, agrees to cooperate with the Company as reasonably requested by the
Company in connection with the preparation and filing of the Registration
Statement hereunder, unless the Estate has notified the Company in writing of
the Estate's election to exclude all of the Estate's Registrable Securities from
the Registration Statement; and

         (c) the Estate agrees that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 3(d) or (e),
above, the Estate will immediately discontinue disposition of Registrable
Securities pursuant to the Registration Statement covering such Registrable
Securities until the Estate's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3(d) and, if so directed by the
Company, the Estate shall deliver to the Company or destroy (and deliver to the
Company a certificate of destruction) all copies in the Estate's possession, of
the prospectus covering such Registrable Securities current at the time of
receipt of such notice.

         5. EXPENSES OF REGISTRATION.

         (a) All reasonable expenses incurred in connection with registrations,
filings or qualifications pursuant to Section 3, but including, without
limitation, all registration, listing, and qualifications fees, printers and
accounting fees, the fees and disbursements of counsel for the Company, shall be
borne by the Company.

         (b) Neither the Company nor any of its subsidiaries has, as of the date
hereof, entered into, nor shall the Company nor any of its subsidiaries, on or
after the date of this Agreement, enter into any agreement with respect to its
securities that is inconsistent with the rights granted to the Estate in this
Agreement or otherwise conflicts with the provisions hereof.

         6. INDEMNIFICATION. In the event any Registrable Securities are
included in a Registration Statement under this Agreement:

         (a) To the extent permitted by law, the Company will indemnify and hold
harmless the Estate who holds such Registrable Securities, the beneficiaries and
distributees, if any, of the Estate, each person, if any, who controls the
Estate within the meaning of the Securities Act or the Exchange Act (each, an
"Indemnified Person" or "Indemnified Party"), against any losses, claims,
damages, liabilities or expenses (joint or several) incurred (collectively,
"Claims") to which any of them may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such Claims (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of or are based
upon any of the


                                       28


following statements, omissions or violations in the Registration Statement, or
any post-effective amendment thereof, or any prospectus included therein: (i)
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or any post-effective amendment thereof or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, (ii)
any untrue statement or alleged untrue statement of a material fact contained in
the final prospectus (as amended or supplemented, if the Company files any
amendment thereof or supplement thereto with the SEC) or the omission or alleged
omission to state therein any material fact necessary to make the statements
made therein, in light of the circumstances under which the statements therein
were made, not misleading or (iii) any violation or alleged violation by the
Company of the Securities Act, the Exchange Act, any state securities law or any
rule or regulation under the Securities Act, the Exchange Act or any state
securities law (the matters in the foregoing clauses (i) through (iii) being,
collectively, "Violations"). Subject to clause (b) of this Section 6, the
Company shall reimburse the Estate promptly as such expenses are incurred and
are due and payable for any legal fees or other reasonable expenses incurred by
the Estate in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(a) shall not (I) apply to a Claim arising
out of or based upon a Violation that occurs in reliance upon and in conformity
with information furnished in writing to the Company by or on behalf of any
Indemnified Person expressly for use in connection with the preparation of the
Registration Statement or any such amendment thereof or supplement thereto, if
such prospectus was timely made available by the Company pursuant to Section
3(c) hereof; (II) be available to the extent such Claim is based on a failure of
the Estate to deliver or cause to be delivered the prospectus made available by
the Company; or (III) apply to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which
consent shall not be unreasonably withheld. The Estate will indemnify the
Company and its officers, directors and agents (each, an "Indemnified Person" or
"Indemnified Party") against any claims arising out of or based upon a Violation
that occurs in reliance upon and in conformity with information furnished in
writing to the Company, by or on behalf of the Estate, expressly for use in
connection with the preparation of the Registration Statement, subject to such
limitations and conditions as are applicable to the Indemnification provided by
the Company to this Section 6. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of the Indemnified
Person and shall survive the transfer of the Registrable Securities by the
Estate pursuant to Section 9.

         (b) Promptly after receipt by an Indemnified Person or Indemnified
Party under this Section 6 of notice of the commencement of any action
(including any governmental action), such Indemnified Person or Indemnified
Party shall, if a Claim in respect thereof is to be made against any
indemnifying party under this Section 6, deliver to the indemnifying party a
written notice of the commencement thereof and the indemnifying party shall have
the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying party and the Indemnified Person or the Indemnified Party, as the
case may be. In case any such action is brought against any Indemnified Person
or Indemnified Party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate in, and, to the
extent that it may wish, jointly with any other indemnifying party similarly
notified, assume the defense thereof, subject to the provisions herein stated
and after notice from the indemnifying party to such Indemnified Person or
Indemnified Party of its election so to assume the defense thereof, the
indemnifying


                                       29


party will not be liable to such Indemnified Person or Indemnified Party under
this Section 6 for any legal or other reasonable out-of-pocket expenses
subsequently incurred by such Indemnified Person or Indemnified Party in
connection with the defense thereof other than reasonable costs of
investigation, unless the indemnifying party shall not pursue the action of its
final conclusion. The Indemnified Person or Indemnified Party shall have the
right to employ separate counsel in any such action and to participate in the
defense thereof, but the fees and reasonable out-of-pocket expenses of such
counsel shall not be at the expense of the indemnifying party if the
indemnifying party has assumed the defense of the action with counsel reasonably
satisfactory to the Indemnified Person or Indemnified Party. The failure to
deliver written notice to the indemnifying party within a reasonable time of the
commencement of any such action shall not relieve such indemnifying party of any
liability to the Indemnified Person or Indemnified Party under this Section 6,
except to the extent that the indemnifying party is prejudiced in its ability to
defend such action. The indemnification required by this Section 6 shall be made
by periodic payments of the amount thereof during the course of the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.

         7. CONTRIBUTION. To the extent any indemnification by an indemnifying
party is prohibited or limited by law, the indemnifying party agrees to make the
maximum contribution with respect to any amounts for which it would otherwise be
liable under Section 6 to the fullest extent permitted by law; provided,
however, that (a) no contribution shall be made under circumstances where the
maker would not have been liable for indemnification under the fault standards
set forth in Section 6; (b) no seller of Registrable Securities guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any seller of Registrable
Securities who was not guilty of such fraudulent misrepresentation; and (c)
contribution by any seller of Registrable Securities shall be limited in amount
to the net amount of proceeds received by such seller from the sale of such
Registrable Securities.

         8. REPORTS UNDER EXCHANGE ACT. With a view to making available to the
Estate the benefits of Rule 144 promulgated under the Securities Act or any
other similar rule or regulation of the SEC that may at any time permit the
Estate to sell securities of the Company to the public without registration
("Rule 144"), the Company agrees to:

         (a) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act,
or, if the provisions of Rule 144(c)(2) are applicable, ensure that the
standards contemplated by Rule 144(c) to permit sales by the Estate under said
Rule 144 are satisfied at all times; and

         (b) furnish to the Estate so long as the Estate owns Registrable
Securities, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144, the Securities Act
and the Exchange Act, (ii) a copy of the most recent annual or quarterly report
of the Company and such other reports and documents so filed by the Company and
(iii) such other information as may be reasonably requested to permit the Estate
to sell such securities pursuant to Rule 144 without registration.

         9. ASSIGNMENT OF THE REGISTRATION RIGHTS. The rights to have the
Company register Registrable Securities pursuant to this Agreement shall be
automatically assigned by the Estate to any transferee of the Registrable
Securities only if: (a) the Estate


                                       30


agrees in writing with the transferee or assignee to assign such rights, and a
copy of such agreement is furnished to the Company within a reasonable time
after such assignment, (b) the Company is, within a reasonable time after such
transfer or assignment, furnished with written notice of (i) the name and
address of such transferee or assignee and (ii) the securities with respect to
which such registration rights are being transferred or assigned, (c)
immediately following such transfer or assignment the further disposition of
such securities by the transferee or assignee is restricted under the Securities
Act and applicable state securities laws, and (d) at or before the time the
Company received the written notice contemplated by clause (b) of this sentence
the transferee or assignee agrees in writing with the Company to be bound by all
of the provisions contained herein. In the event of any delay in filing or
effectiveness of the Registration Statement as a result of such assignment, the
Company shall not be liable for any damages arising from such delay.

                  10. AMENDMENT OF REGISTRATION RIGHTS. Any provision of this
Agreement may be amended and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Estate. Any
amendment or waiver effected in accordance with this Section 10 shall be binding
upon the Estate and the Company.

         11. MISCELLANEOUS.

         (a) A person or entity is deemed to be the owner of Registrable
Securities whenever such person or entity owns of record such Registrable
Securities. If the Company receives conflicting instructions, notices or
elections from two or more persons or entities with respect to the same
Registrable Securities, the Company shall act upon the basis of instructions,
notice or election received from the registered owner of such Registrable
Securities.

         (b) Notices required or permitted to be given hereunder shall be given
in the manner contemplated by the Agreement, if to the Company or to the Estate,
to their respective address contemplated by the Agreement, or at such other
address as each such party furnishes by notice given in accordance with this
Section 11(b).

         (c) Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.

         (d) This Agreement shall be governed by and interpreted in accordance
with the laws of the State of Minnesota for contracts to be wholly performed in
such state and without giving effect to the principles thereof regarding the
conflict of laws. Each of the parties consents to the jurisdiction of the
federal courts whose districts encompass any part of the City of Minneapolis or
the state courts of the State of Minnesota sitting in the City of Minneapolis in
connection with any dispute arising under this Agreement and hereby waives, to
the maximum extent permitted by law, any objection, including any objection
based on FORUM NON COVENIENS, to the bringing of any such proceeding in such
jurisdictions.

         (e) If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Agreement or the
validity or enforceability of this Agreement in any other jurisdiction.

                                       31


         (f) Subject to the requirements of Section 9 hereof, this Agreement
shall inure to the benefit of and be binding upon the successors and assigns of
each of the parties hereto.

         (g) All pronouns and any variations thereof refer to the masculine,
feminine or neuter, singular or plural, as the context may require.

         (h) The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning thereof.

         (i) This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same agreement. This Agreement, once executed by a party, may be delivered to
the other party hereto by telephone line facsimile transmission of a copy of
this Agreement bearing the signature of the party so delivering this Agreement.

         (j) This Agreement constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein. This Agreement supersedes all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof. This Agreement may
be amended only by an instrument in writing signed by the party to be charged
with enforcement thereof.

         IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective representatives thereunto duly authorized as of the
day and year first above written.


The Estate of William S. Sadler
By its Personal Representatives

/s/ Dorothy E. Sadler
Dorothy E. Sadler

/S/ JILL D. SADLER
Jill D. Sadler

/s/ Kurt T. Sadler
Kurt T. Sadler


DOTRONIX, INC.

By:  /s/ Robert V. Kling
         Robert V. Kling
         Its Chief Financial Officer


                                       32

EX-10.6

EXHIBIT 10.6

LOAN AGREEMENT

April 7, 2004

Dotronix, Inc.
160 First Street SE
New Brighton, MN 55112-7894

Dear Ladies and Gentlemen:

         The undersigned ("Lender") agrees to lend to Dotronix, Inc.
("Borrower") $450,000, as described in this Agreement.

Loan, Interest and Fees.
- ------------------------

The Loan. Subject to the terms and conditions of this Agreement, Lender will
make loans to the Borrower (collectively, the "Loan") from time to time from the
date hereof until April 7, 2005, during which period the Borrower may repay and
reborrow in accordance with the provisions hereof, provided, that the aggregate
unpaid principal amount of all outstanding loans under this Agreement shall not
exceed $450,000 at any time. Each time the Borrower desires to obtain a loan
advance pursuant to this agreement, such request by the Borrower shall be in
writing (which may be by facsimile), or by telephone promptly confirmed in
writing, and must be given so as to be received by the Lender not later than
11:00 a.m., Minneapolis time, on the date at least 2 business days prior to the
date of the requested advance. Each request for an advance shall specify (i) the
borrowing date (which shall be a business day), and (ii) the amount of such
advance. The Lender will make the amount of the requested advance available to
the Borrower, in immediately available funds not later than 5:00 p.m.,
Minneapolis time, within 2 business days after the date requested. If, at any
time, or for any reason, the principal amount outstanding under this agreement
exceeds $450,000, the Borrower shall immediately pay to the Lender, in cash, the
amount of such excess. Any requested advance that would increase the principal
outstanding amount of the Loan to an amount greater than $450,000 will be denied
by Lender.

The Note. The Loan shall be evidenced by a note (as hereafter amended, extended,
renewed or replaced, the "Note"). All unpaid principal and all interest accrued
on the Note shall be due and payable on April 7, 2005. The parties agree that
the Note shall replace the demand notes issued by Borrower to Lender in the
principal amount of $30,000 each dated September 4, 2003, November 19, 2003 and
January 7, 2004 for a total principal amount of $90,000 and the demand note
issued to Borrower to Lender in the principal amount of $45,000 dated January
21, 2004 (all such notes collectively referred to herein as the "Demand Notes").
Under the outstanding Demand Notes, an aggregate amount of $135,000 has been
advanced as of the date of this Agreement. The Lender acknowledges that no
interest payments are outstanding, due and payable under any of the Demand Notes
as of the date of this Agreement.

Interest. The principal balance of the Loan shall bear interest equal to five
percent (5%) per annum as set forth in the Note, payable as set forth in the
Note.

                                       33


Optional Prepayments. Borrower may prepay the Loan, in whole or in part, at any
time, without premium or penalty.

Payments. Payments of principal, interest, fees and expenses hereunder and under
the Note shall be made without set-off or counterclaim in immediately available
funds not later than 5:00 p.m., Minneapolis time, on the dates called for under
this Agreement at the address of Lender set forth in Section 6.3. Funds received
on any day after such time shall be deemed to have been received on the next
business day. Whenever any payment would be due on a day which is not a business
day, such payment shall be made on the next succeeding business day and such
extension of time shall be included in the computation of any interest or fees.

Collateral Security. As security for the prompt satisfaction of Borrower's
obligations under the Loan, Borrower grants to Lender a lien on, and a security
interest in, all personal property of Borrower whether now owned or existing or
hereafter acquired by the Borrower and wherever located, as more fully described
in the Security Agreement dated of even date herewithin (the " Security
Agreement").

         1.7 Warrant. As additional consideration for the Loan, Borrower will
issue to Lender a warrant for the purchase of one hundred thousand (100,000)
shares of Borrower's common stock at an exercise price of $0.10 per share in the
form acceptable to the Lender (the "Warrant").

Conditions Precedent. The obligation of Lender to make any Loan advance
hereunder shall be subject to the satisfaction of the conditions precedent that
Lender shall have received all of the following, in form and substance
satisfactory to Lender, each duly executed (as hereafter amended, modified,
extended, renewed or replaced, the "Loan Documents"):

the Note, in exchange for which Lender shall return the Demand Notes to Borrower
for cancellation;

a Subordination Agreement given by the Estate of William S. Sadler (the
"Estate") in form acceptable to the Lender;

the Warrant;

                  (d) the Security Agreement;

                  (e) the Borrower shall amend its New Brighton lease in form
         acceptable to Lender;

                  (f) an Option Agreement by and among the Lender, the Estate
         and Minnesota River Aviation, Inc., and

                  (g) such other instruments, documents and agreement as Lender
         shall reasonably require.




                                       34


Representations and Warranties. To induce Lender to enter into this Agreement,
and to make Loan advances hereunder, Borrower represents and warrants to Lender:

Validity. The Loan Documents constitute the legal, valid and binding obligations
of Borrower, enforceable against Borrower in accordance with their terms.

No Conflict; No Default. The execution, delivery and performance by Borrower of
the Loan Documents will not result in a breach of or constitute a default under
any indenture, loan or credit agreement or any other agreement, lease or
instrument to which Borrower is a party or by which it or any of its properties
may be bound.

Financial Statements and Condition. Borrower has made available to the Lender,
in the form filed with the SEC (excluding any exhibits thereto), (i) its Annual
Report on Form 10-KSB for the fiscal year ended June 30, 2003, and (ii) its
Quarterly Report on Form 10-QSB for the quarter ended September 30, 2003, (the
forms, reports, and other documents referred to in clauses (i) and (ii) above
being referred to herein, collectively, as the "Borrower SEC Reports"). To the
best of Borrower's knowledge, the Borrower SEC Reports (i) were or will be
prepared in accordance with the requirements of the Securities Act and the
Exchange Act, as the case may be, and the rules and regulations thereunder and
(ii) did not at the time they were filed, contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements made therein, in the light of the
circumstances under which they were or are made, not misleading.

Litigation and Contingent Liabilities. There are no material actions, suits or
proceedings pending or, to the knowledge of Borrower, threatened against or
affecting Borrower before any court, arbitrator, governmental department or
other instrumentality and Borrower has no material contingent liabilities.

Covenants. Borrower covenants and agrees with Lender that for so long as there
is any amount remaining unpaid on the Note, or Lender has any obligation to make
any Loan hereunder, Borrower will comply with the following:

Financial Statements. Furnish to Lender such financial information with respect
to Borrower as Lender may reasonably request from time to time.

Access to Records. Permit Lender to discuss Borrower's affairs, finances and
accounts with officers of Borrower, all at such reasonable times and as often as
Lender may reasonably request.

Reimbursement of Expenses. Promptly reimburse Lender for any and all expenses of
collection of the Loan, including reasonable attorneys' fees.

Representation of Lender. Lender represents that he is an "Accredited Investor"
as defined in Rule 501(a) of Regulation D under the Act based upon the Lender
being an individual with total assets in excess of $1,000,000. Furthermore,
Lender acknowledges and represents that:

He has received and reviewed the Borrower SEC Reports;

He is able to bear the economic risk of the transaction described in this
Agreement;

                                       35


He understands the risk of investment in Borrower;

Neither the Note nor the Warrant have been registered under the Securities Act
of 1933, as amended (the "Act") or state securities laws; and

The Note and Warrant are being purchased by the Lender for his own account and
for investment and without the intention of reselling or redistributing the
same, and that if Lender should determine to dispose or transfer the Note or
Warrant, he will not do so without (1) obtaining an opinion of counsel
satisfactory to Borrower that such proposed disposition or transfer may lawfully
be made without registration under the Act, or (2) such registrations are in
effect.

Miscellaneous.

Binding Effect. The parties hereto agree that this Agreement shall be binding
upon and inure to the benefit of their respective heirs, successors in interest
and assigns.

Governing Law. This Agreement and the rights and obligations of the parties
hereunder and under the Note and any other documents delivered herewith shall be
construed in accordance with and governed by the substantive laws (but not the
laws of conflict) of the State of Minnesota. Borrower hereby consents to the
jurisdiction of the courts of the State of Minnesota and federal courts located
in the State of Minnesota for any actions brought hereon or on the Note.

Notices. Any notices required or contemplated hereunder shall be effective upon
the placing thereof in the United States mails, certified mail and with return
receipt requested, postage prepaid, and addressed as follows:

            If to Borrower:        Dotronix, Inc.
                                   160 First Street SE
                                   New Brighton, MN 55112-7894
                                   Attn: Robert V. Kling, CFO

            If to Lender:          Terry L. Myhre
                                   9691 North 101st Street
                                   Stillwater, MN 55082

                                   Copy to:
                                   Robert W. Junghans
                                   2 Skillman Lane
                                   North Oaks, MN 55127

No Waivers. No failure or delay on the part of Lender in exercising any right,
power or privilege hereunder and no course of dealing between Borrower and
Lender shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power, or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.

Accounting Terms. All accounting terms not otherwise specifically defined in
this Agreement shall be construed in accordance with generally accepted
accounting principles consistently applied.

[Signatures on following page]



                                       36


                                        LENDER:

                                        /s/ Terry L. Mhyre
                                        Terry L. Myhre



                  Accepted and agreed to as of the date above.

                                        DOTRONIX, INC.

                                        By: /s/ Robert V. Kling
                                            Robert V. Kling
                                            Its:  Chief Financial Officer


ACCEPTANCE AND ACKNOWLEDGMENT
- -----------------------------

         The undersigned hereby consents to the foregoing Loan Agreement and
acknowledges that all contingencies and conditions precedent to the
effectiveness of the Agreement to Extend and Amend Loan and Security Agreement
among the undersigned and Borrower dated November 5, 2003 have been fully
satisfied.

                                        The Estate of William S. Sadler
                                        By its Personal Representatives

                                        /s/ Dorothy E. Sadler
                                        Dorothy E. Sadler

                                        /S/ JILL D. SADLER
                                        Jill D. Sadler

                                        /s/ Kurt T. Sadler
                                        Kurt T. Sadler












                                       37

EX-10.7

EXHIBIT 10.7

SECURITY AGREEMENT

         This Security Agreement ("AGREEMENT") is made and entered into by
DOTRONIX, INC., a Minnesota corporation (the "DEBTOR"), in favor of TERRY L.
MYHRE, an individual resident of Minnesota (the "LENDER") as of April 7, 2004.

         The Debtor has entered into that certain letter loan agreement with the
Lender of even date herewith (as amended from time to time, the "LOAN
AGREEMENT").

         To induce the Lender to make the financial accommodations provided to
the Debtor pursuant to the Loan Agreement, Debtor desires to pledge, grant,
transfer, and assign to the Lender a security interest in the Collateral (as
hereinafter defined) to secure the Obligations (as hereinafter defined), as
provided herein.

         Therefore, for good and valuable consideration, Debtor hereby agrees
for the benefit of the Lender as follows:

ARTICLE 1.  SECURITY INTEREST

         1.1 GRANT OF SECURITY INTEREST. The Debtor hereby grants a security
interest in and collaterally assigns the Collateral (defined below) to the
Lender to secure all of the Obligations (defined below) to the Lender. The
intent of the parties hereto is that the Collateral secures all Obligations
(defined below) to the Lender, whether or not such Obligations exist under this
Agreement or any other agreements executed in connection with the Loan Agreement
(together and individually, the "LOAN DOCUMENTS").

         1.2 "COLLATERAL" means all personal property of the Debtor whether now
owned or existing or hereafter acquired by the Debtor, wherever located
(including all documents, general intangibles, additions and accessions, spare
and repair parts, special tools, replacements, returned or repossessed goods and
books and records relating to the following; and all proceeds and products of
the following) including, without limitation, the following:

         ALL EQUIPMENT ("EQUIPMENT"), FIXTURES, AND INVENTORY ("INVENTORY")
         (INCLUDING ALL GOODS HELD FOR SALE, LEASE OR DEMONSTRATION OR TO BE
         FURNISHED UNDER CONTRACTS OF SERVICE, GOODS LEASED TO OTHERS, TRADE-INS
         AND REPOSSESSIONS, RAW MATERIALS, WORK IN PROCESS AND MATERIALS OR
         SUPPLIES USED OR CONSUMED IN DEBTOR'S BUSINESS), INCLUDING ALL SPARE
         AND REPAIR PARTS, SPECIAL TOOLS, EQUIPMENT AND REPLACEMENTS FOR ANY OF
         THE FOREGOING, AND ANY SOFTWARE EMBEDDED THEREIN OR RELATED THERETO;

         ALL ACCOUNTS ("RECEIVABLES"), CONTRACT RIGHTS, DOCUMENTS, CHATTEL PAPER
         (INCLUDING ELECTRONIC CHATTEL PAPER), INSTRUMENTS, AND GENERAL
         INTANGIBLES (INCLUDING RIGHTS TO PAYMENT FROM STATE OR FEDERAL
         GOVERNMENT ASSISTANCE PROGRAMS), ALL RETURNED OR REPOSSESSED GOODS THE
         SALE OF WHICH GAVE RISE TO ANY OF THE FOREGOING;



                                       38


         ALL FINANCIAL ASSETS, INVESTMENT PROPERTY, SECURITIES (WHETHER
         CERTIFICATED OR UNCERTIFICATED, AND INCLUDING INVESTMENT COMPANY
         SECURITIES), SECURITY ENTITLEMENTS, SECURITIES ACCOUNTS, COMMODITY
         CONTRACTS, AND COMMODITY ACCOUNTS, INCLUDING ALL SUBSTITUTIONS AND
         ADDITIONS THERETO, AND ALL DIVIDENDS, DISTRIBUTIONS AND SUMS
         DISTRIBUTABLE OR PAYABLE FROM, UPON OR IN RESPECT OF SUCH PROPERTY;
         ALL COMMERCIAL TORT CLAIMS;
         ALL DEPOSIT ACCOUNTS;
         ALL LETTER-OF-CREDIT RIGHTS;
         ALL SUPPORTING OBLIGATIONS THAT SUPPORT THE PAYMENT OR PERFORMANCE OF
         ANY OF THE FOREGOING; AND
         ALL ADDITIONS AND ACCESSIONS TO, ALL PROCEEDS, PRODUCTS, OFFSPRING AND
         PROFITS OF, AND ALL RIGHTS AND PRIVILEGES INCIDENT TO, ANY OF THE
         FOREGOING.

The terms set forth in this Agreement shall have the meanings set forth in the
Uniform Commercial Code as adopted in the State of Minnesota, unless otherwise
defined herein.

         1.3 "OBLIGATIONS" means each and all of the Debtor's debts,
liabilities, obligations, covenants, warranties, and duties to the Lender,
whether now or hereafter existing or incurred, arising out of any Loan
Documents.

ARTICLE II.  WARRANTIES AND COVENANTS

In addition to all other warranties and covenants of the Debtor under the Loan
Documents which are expressly incorporated herein as part of this Agreement and
while any part of the credit granted the Debtor under the Loan Documents is
available or any Obligations to the Lender are unpaid or outstanding, the Debtor
continuously warrants and agrees as follows:

         2.1 DEBTOR'S NAME, ORGANIZATION; The Debtor will not do business under
another name nor use any trade name without giving ten (10) days prior written
notice to the Lender. The address appearing in Schedule A below is the Debtor's
principal place of business; and all Collateral is located at that address or
the other addresses listed Schedule A except to the extent the Debtor has
provided prior written notice to the Lender of any change of address/new
location. Schedule A does not limit the Lender's rights to Collateral wherever
located.

         2.2 OWNERSHIP; MAINTENANCE OF COLLATERAL; RESTRICTIONS ON LIENS AND
DISPOSITIONS. The Debtor is the sole owner of the Collateral free of all liens,
claims, other encumbrances and security interests except for liens securing
obligations owing to The Estate of William S. Sadler and its assigns and as
otherwise permitted in writing by the Lender. The Debtor will: (i) maintain the
Collateral in good condition and repair (reasonable wear and tear excepted), and
not permit its value to be impaired; (ii) not permit waste, removal or loss of

                                       39


identity of the Collateral; (iii) keep the Collateral free from all liens,
executions, attachments, claims, encumbrances and security interests other than
the Lender's security interest and the Permitted Liens set forth on Schedule A
(iv) defend the Collateral against all claims and legal proceedings by persons
other than the Lender and holders of the Permitted Liens; (v) pay and discharge
when due all taxes, levies and other charges or fees upon the Collateral except
for payment of taxes contested by the Debtor in good faith by appropriate
proceedings so long as no levy or lien has been imposed upon the Collateral;
(vi) not lease, sell or transfer the Collateral to any party nor move it to any
new location outside of the ordinary course of business; (vii) not permit the
Collateral, without the consent of the Lender, to become a fixture or an
accession to other goods; (viii) not permit the Collateral to be used in
violation of any applicable law, regulation or policy of insurance; and, (ix) as
to the Collateral consisting of instruments and chattel paper, preserve the
Lender's rights in it against all other parties.

         2.3 MAINTENANCE OF SECURITY INTEREST. The Debtor shall take any action
reasonably requested by the Lender to preserve the Collateral and to establish
the value of, the priority of, to perfect, to continue the perfection of or to
enforce the Lender's interest in the Collateral and the Lender's rights under
this Agreement; and shall pay all costs and expenses related thereto.

         2.4 COLLATERAL INSPECTIONS; MODIFICATIONS AND CHANGES IN COLLATERAL. At
reasonable times and at reasonable intervals, the Lender may examine the
Collateral and the Debtor's records pertaining to it, wherever located, and make
copies of such records at the Debtor's expense; and the Debtor shall assist the
Lender in so doing. Without the Lender's prior written consent, the Debtor shall
not materially alter, modify, discount, extend, renew or cancel any Collateral,
except for discounts customarily granted in the Debtor's ordinary course of
business for payment on accounts, physical modifications to the inventory
occurring in the manufacturing process or alterations to equipment which do not
materially affect its value. The Debtor shall promptly notify the Lender in
writing of any material change in the condition of the Collateral and of any
change in location of the Collateral. Upon and during the continuance of any
default, or if otherwise reasonably requested by Lender, Borrower shall
reimburse Lender for the cost of Lender's onsite inspections; provided that if
Borrower is not in default, Borrower shall not be requested to pay for more than
one on-site inspection per year.

         2.5 COLLATERAL RECORDS, REPORTS AND STATEMENTS. The Debtor shall keep
accurate and complete records respecting the Collateral in such form as the
Lender may approve. At such times as the Lender may require, the Debtor shall
furnish to the Lender any records/information the Lender might require,
including, without limitation, a statement certified by the Debtor and in such
form and containing such information as may be prescribed by the Lender showing
the current status and value of the Collateral. Lender shall have the right to
receive copies of all property inspections performed by any franchisor and the
Debtor's responses thereto.

         2.6 AUTHORIZATION OF FILING. The Debtor hereby authorizes the Lender to
file all financing statements describing the Collateral, and all amendments
thereto, in any offices as the Lender, in its sole discretion, may determine.

         2.7 INSURANCE. For so long as any Obligations remain unpaid and the
Lender has any obligation under the Loan Agreement to extend credit to the
Debtor, the Debtor will maintain insurance with respect to its tangible
Collateral at full replacement cost.

                                       40


ARTICLE III.  COLLECTIONS

         3.1 DEPOSIT WITH THE LENDER. At any time during the continuance of an
Event of Default, the Lender may require that all proceeds of Collateral
received by the Debtor shall be held by the Debtor upon an express trust for the
Lender, shall not be commingled with any other funds or property of the Debtor
and shall be turned over to the Lender in precisely the form received (but
endorsed by the Debtor, if necessary for collection) not later than the business
day following the day of their receipt. All proceeds of Collateral received by
the Lender directly or from the Debtor shall be applied against the Obligations
in such order and at such times as the Lender shall determine.

ARTICLE IV.  RIGHTS AND DUTIES OF THE LENDER

         In addition to all other rights (including setoff) and duties of the
Lender under the Loan Documents that are expressly incorporated herein as a part
of this Agreement, the following provisions shall also apply:

         4.1 AUTHORITY TO PERFORM FOR THE DEBTOR. The Debtor presently appoints
the Lender as the Debtor's attorney-in-fact (coupled with an interest and
irrevocable while any Obligations remain unpaid) to do any of the following upon
and during the continuation of a default by the Debtor hereunder (subject to any
notice requirements or grace/cure periods under this or other agreements between
the Debtor and the Lender): (i) to endorse or place the name of the Debtor on
any invoice or document of title relating to accounts, drafts against customers,
notices to customers, notes, acceptances, assignments of government contracts,
instruments, financing statements, checks, drafts, money orders, insurance
claims or payments or other documents evidencing payment or a security interest
relating to the Collateral; (ii) to receive, open and dispose of all mail
addressed to the Debtor and to notify the Post Office authorities to change the
address for delivery of mail addressed to the Debtor to an address designated by
the Lender; (iii) to do all such other acts and things necessary to carry out
the Debtor's duties under this Agreement and the other Loan Documents; and (iv)
to perfect, protect and/or realize upon the Lender's interest in the Collateral.
If the Collateral includes funds or property in depository accounts, the Debtor
authorizes each of its depository institutions to remit to the Lender, without
liability to the Debtor, all of the Debtor's funds on deposit with such
institution upon written direction by the Lender after default and during the
continuance of a default by the Debtor hereunder. All acts by the Lender are
hereby ratified and approved except arising out of gross negligence or willful
misconduct, and the Lender shall not be liable for any acts of commission or
omission, nor for any efforts of judgment or mistakes of fact or law.

         4.2 VERIFICATION AND NOTIFICATION; LENDER'S RIGHTs. The Lender may
verify Collateral in any manner, and the Debtor shall assist the Lender in so
doing. Upon the occurrence and during the continuance of a default hereunder,
the Lender may at anytime and the Debtor shall, upon request of the Lender,
notify the account debtors to make payment directly to the Lender; and the
Lender may enforce collection of, sell, settle, compromise, extend or renew the
indebtedness of such account debtors; all without notice to or the consent of
the Debtor. Until account debtors are so notified, the Debtor, as agent of the
Lender, shall make collections on the Collateral. The Lender may at any time
notify any bailee possessing Collateral of the Lender's security interest and,
upon the occurrence and during the continuance of a default hereunder, direct
such bailee to turn over the Collateral to the Lender.

                                       41


         4.3 COLLATERAL PRESERVATION. The Lender shall use reasonable care in
the custody and preservation of any Collateral in its physical possession but in
determining such standard of reasonable care, the Debtor expressly acknowledges
that the Lender has no duty to: (i) insure the Collateral against hazards; (ii)
ensure that the Collateral will not cause damage to property or injury to third
parties; (iii) protect it from seizure, theft or conversion by third parties,
third parties' claims or acts of God; (iv) give to the Debtor any notices
received by the Lender regarding the Collateral; (v) perfect or continue
perfection of any security interest in favor of the Debtor, (vi) perform any
services, complete any work-in-process or take any other action in connection
with the management or maintenance of the Collateral; or (vii) sue or otherwise
effect collection upon any accounts even if the Lender shall have made a demand
for payment upon individual account debtors. Notwithstanding any failure by the
Lender to use reasonable care in preserving the Collateral, the Debtor agrees
that the Lender shall not be liable for consequential or special damages arising
therefrom.

ARTICLE V. DEFAULTS AND REMEDIES

         The Lender may enforce its rights and remedies under this Agreement
upon default. A default shall occur if the Debtor fails to comply with the terms
of any Loan Documents (including this Agreement or any guaranty by the Debtor)
beyond any applicable grace or cure period provided therein.

         5.1      CUMULATIVE REMEDIES; NOTICE; WAIVER. In addition to the
                  remedies for default set forth in the Loan Documents, the
                  Lender upon default shall have all other rights and remedies
                  for default provided by the Uniform Commercial Code, as well
                  as any other applicable law and this Agreement, INCLUDING,
                  WITHOUT LIMITATION, THE RIGHT TO REPOSSESS, RENDER UNUSABLE
                  AND/OR DISPOSE OF THE COLLATERAL WITHOUTJUDICIAL PROCESS. The
                  rights and remedies specified herein are cumulative and are
                  not exclusive of any rights or remedies that the Lender would
                  otherwise have.

ARTICLE VI.  MISCELLANEOUS

         All other provisions in the Loan Documents are expressly incorporated
as a part of this Agreement.

         All documents attached hereto, including any appendices, schedules,
riders, and exhibits to this Agreement, are hereby expressly incorporated by
reference.

         This Agreement supersedes and replaces the Security Agreement made and
entered into by the Debtor in favor of the Lender as of January 7, 2004.

                  IN WITNESS WHEREOF, the undersigned has executed this SECURITY
         AGREEMENT as of the date first written above.


                                        DOTRONIX, INC.

                                        By: /s/ Robert V. Kling
                                            Robert V. Kling
                                            Its Chief Financial Officer







                                       42



SCHEDULE A

IDENTIFICATION, CHIEF EXECUTIVE OFFICE AND COLLATERAL LOCATIONS LIST

Taxpayer Identification Number:  41-1387074

Organizational Identification Number:  3T-1032  (MN)

Address of Principal Office:  160 First Street SE, New Brighton, MN 55112-7894

Other Collateral Locations:  None

Permitted Liens: Liens of the following parties: The Estate of William S. Sadler
and its assigns






























                                       43

EX-10.8

EXHIBIT 10.8

                             SUBORDINATION AGREEMENT

         THIS SUBORDINATION AGREEMENT, dated as of April 7, 2004, is made and
given by The estate of william s. sadler (the "Junior Creditor"), in favor of
terry l. myhre, and his endorsees, heirs and assigns (the "Senior Creditor").

RECITALS:

         A. DOTRONIX, INC., a Minnesota corporation (the "Borrower") is or may
hereafter become indebted to the Senior Creditor.

         B. The Borrower is indebted to the Junior Creditor under a Loan and
Security Agreement originally dated as of February 23, 2000, as amended (the
"Loan and Security Agreement"). As of the date of this Agreement, the Borrower
owes to the Junior Creditor the principal amount of $150,000 (the "Principal
Amount") under the Loan and Security Agreement, at an interest rate of 5% p.a.;
interest is due and payable monthly on the first business day of the following
month.

         C. The Junior Creditor acknowledges that the loan or other extensions
of any financial accommodation or credit to the Borrower by the Senior Creditor
is of value to the Junior Creditor.

AGREEMENTS:

         NOW, THEREFORE, for good and valuable consideration, receipt of which
is hereby acknowledged by the Junior Creditor, and in order to induce the Senior
Creditor to make loans or extend credit or any other financial accommodation to
or for the benefit of the Borrower, or to grant such renewals or extensions
thereof as the Senior Creditor may deem advisable, and to better secure the
Senior Creditor in respect of the foregoing, the Junior Creditor hereby agrees
as follows:

         SECTION 1.  DEFINITIONS, RULES OF CONSTRUCTION.

                  (a) For purpose of this Agreement, the following terms shall
have the following meanings:

                  "Bankruptcy Code" shall mean 11 U.S.C. ss. 101 et seq., as
amended from time to time.

                  "Borrower" shall have the meaning given to that term in
         Recital A above, and shall include any successor (including a
         debtor-in-possession under the Bankruptcy Code), assignee, receiver,
         trustee or estate thereof.

                  "Default" shall mean any event which with the giving of notice
         or lapse of time, or both, would become an Event of Default.

                  "Event of Default" shall mean (i) any failure of the Borrower
         to pay when due (whether at the date scheduled therefor or earlier upon
         acceleration), or when demanded (with respect to any obligation payable
         on demand), any item constituting Senior Debt, or (ii) any event shall
         occur or condition shall exist and shall continue for more than the
         period of grace, if any, applicable thereto and shall have the effect
         of causing, or permitting the Senior Creditor or any subsequent holder
         of Senior Debt to cause, any item of Senior Debt to become due prior to
         its stated maturity or to realize upon any collateral given as security
         therefor.

                  "Permitted Payments" shall have the meaning given in Section 3
below.

                                       44


                  "Person" shall mean an individual, corporation, association,
         partnership, limited partnership, trust, organization, individual or
         government or any governmental agency or any political subdivision
         thereof.

                  "Security Interest" means any lien, pledge, mortgage,
         encumbrance, charge or security interest of any kind whatsoever,
         whether arising under a security instrument or as a matter of law,
         judicial process or otherwise, or any agreement to grant any lien, or
         security interest in, or to pledge, mortgage or encumber, any assets.

                  "Senior Debt" shall mean all liabilities and obligations of
         the Borrower to the Senior Creditor howsoever created, arising or
         evidenced, whether direct or indirect, absolute or contingent, due or
         to become due, now existing or hereafter arising or incurred,
         including, without limitation, any and all interest accruing on any of
         the Senior Debt after the commencement of any proceedings referred to
         in Section 5 below, notwithstanding any provision or rule of law which
         might restrict the rights of the Senior Creditor, as against the
         Borrower or anyone else, to collect such interest.

                  "Subordinated Debt" shall mean all obligations, liabilities
         and indebtedness of the Borrower to the Junior Creditor, howsoever
         arising or evidenced, whether direct or indirect, absolute or
         contingent, due or to become due, now existing or hereafter arising or
         incurred, under any written or unwritten agreement, provided, that such
         Subordinated Debt may not exceed the Principal Amount plus interest in
         the amount of $645.83 outstanding that is payable as of the date of
         this Agreement.

                  (b) In this Agreement, in the computation of a period of time
         from a specified date to a later specified date, unless otherwise
         stated the word "from" means "from and including" and the word "to" or
         "until" each means "to but excluding."

                  (c) Other terms may be defined in other parts of this
         Agreement. All references to agreements and other contractual
         instruments shall be deemed to include all subsequent amendments
         thereto or changes therein entered into in accordance with their
         respective terms, and all references to Persons shall be deemed to
         include their permitted successors, heirs and assigns. Unless the
         context in which used herein otherwise clearly requires, "or" has the
         inclusive meaning represented by the phrase "and/or." All
         incorporations by reference of covenants, terms, definitions or other
         provisions from other agreements are incorporated into this Agreement
         as if such provisions were fully set forth herein, and include all
         necessary information and related provisions from such other
         agreements, and all such covenants, terms, definitions or other
         provisions from other agreements incorporated into this Agreement by
         reference shall survive any termination of such other agreements until
         the Senior Debt has been indefeasibly paid in full and all financing
         arrangements between the Borrower and the Senior Creditor shall have
         been terminated.

         SECTION 2. STANDBY; SUBORDINATION. The payment and performance of the
Subordinated Debt is hereby subordinated to the payment and performance in full
of the Senior Debt, and, except as set forth in Section 3 below, the Junior
Creditor will not ask, demand, sue for, take or receive from the Borrower or any
other Person liable for all or any part of the Senior Debt, by setoff or in any
other manner, the whole or any part of the Subordinated Debt, or any monies
which may now or hereafter be owing in respect of the Subordinated Debt (whether
such amounts represent principal or interest, or obligations which are due or
not due, direct or indirect, absolute or contingent), including, without
limitation, taking any additional security for any of the foregoing, or the
taking of any negotiable


                                       45


instrument therefor, unless and until all of the Senior Debt shall have been
indefeasibly paid and satisfied in full and all financing arrangements between
the Borrower and Senior Creditor have been terminated. The Junior Creditor
warrants and represents and agrees that (a) all Security Interests of the Junior
Creditor in any assets of the Borrower or any assets securing the Senior Debt
shall and hereby are subordinated to the rights and interests of the Senior
Creditor, if any, in those assets, (ii) the Junior Creditor shall have no right
to possession of any such assets or to foreclose upon any such assets, whether
by judicial action or otherwise, unless and until all the Senior Debt shall have
been indefeasibly paid and satisfied in full and all financing arrangements
between the Borrower and Senior Creditor have been terminated, and (iii) at the
request of the Senior Creditor, the Junior Creditor shall authorize, execute or
deliver to the Senior Creditor such termination statements and releases as the
Senior Creditor shall reasonably request to release the Junior Creditor's
Security Interest in or against such property. The Junior Creditor, prior to the
indefeasible payment in full and discharge of the Senior Debt and the
termination of all financing arrangements between the Borrower and the Senior
Creditor, shall have no right to enforce any claim with respect to the
Subordinated Debt, or to take any action against the Borrower or the property of
the Borrower or of any other Person liable for all or any part of the Senior
Debt for the benefit of the Borrower. The Junior Creditor acknowledges and
agrees that, to the extent the terms and provisions of this Agreement are
inconsistent with any agreement or understanding between the Junior Creditor and
the Borrower, such agreement or understanding shall be subject to this
Agreement.

         SECTION 3. PERMITTED PAYMENTS. Notwithstanding the provisions of
Section 2 above, until the Senior Creditor gives the Junior Creditor written
notice (in the manner set forth below) of the occurrence of an Event of Default
or a Default, and provided that:

                  (i)      there shall not then exist any breach of this
                           Agreement by the Junior Creditor which has not been
                           waived, in writing, by the Senior Creditor,

                  (ii)     at the time of the payment described below no Event
                           of Default exists and is continuing,

                  (iii)    the payment described below, if made, would not give
                           rise to the occurrence of any Event of Default, and

                  (iv)     none of the events described in Section 5 has
                           occurred,

Borrower may pay to the Junior Creditor, and the Junior Creditor may accept from
Borrower, interest payments when due (without acceleration) with respect to
Subordinated Debt ("Permitted Payments").

         SECTION 4. SUBORDINATED DEBT OWED ONLY TO THE JUNIOR CREDITOR. The
Junior Creditor warrants and represents that the Junior Creditor has not
previously assigned any interest in the Subordinated Debt, that no other Person
owns an interest in the Subordinated Debt (whether as joint holders of
Subordinated Debt, participants or otherwise) and that the entire Subordinated
Debt is owing only to the Junior Creditor. The Junior Creditor further covenants
that the entire Subordinated Debt shall continue to be owing only to the Junior
Creditor unless it is assigned to a Person who agrees with the Senior Creditor
to be bound by the subordination provisions set forth herein.

         SECTION 5. PRIORITY. In the event of (a) any distribution, division, or
application, partial or complete, voluntary or involuntary, by operation of law
or otherwise, of all or any part of the assets of the Borrower or the proceeds
thereof to the creditors of the Borrower or to their claims against the
Borrower, or (b) any readjustment of the debt or obligations of the Borrower,
whether by reason of


                                       46


liquidation, bankruptcy, arrangement, receivership, assignment for the benefit
of creditors or any other action or proceeding involving the readjustment of all
or any part of the Senior Debt or Subordinated Debt, or the application of the
assets of the Borrower to the payment or liquidation thereof, or (c) the
dissolution or other winding up of the business of the Borrower, or (d) the sale
of all or substantially all of the assets of the Borrower, then, and in any such
event, the Senior Creditor shall be entitled to receive indefeasible payment in
full of all of the Senior Debt prior to the payment of all or any part of the
Subordinated Debt.

         SECTION 6. GRANT OF AUTHORITY TO SENIOR CREDITOR. In order to enable
the Senior Creditor to enforce his rights hereunder in any of the actions or
proceedings described in Section 5, the Senior Creditor is hereby irrevocably
authorized and empowered, in his discretion, to file and present for and on
behalf of the Junior Creditor such proofs of claims or other motions or
pleadings as the Senior Creditor may deem expedient or proper to establish the
Senior Creditor's entitlement of payment from, or on behalf of, the Junior
Creditor with respect to the Subordinated Debt and to vote such proofs of claims
in any such proceeding and to demand, sue for, receive and collect any and all
dividends or other payments or disbursements made thereon in whatever form the
same may be paid or issued and to apply the same on account of any of the Senior
Debt. The Junior Creditor irrevocably authorizes and empowers the Senior
Creditor to demand, sue for, collect and receive each of the payments and
distributions described in Section 5 above and give acquittance therefor and to
file claims and take such other actions, in the Senior Creditor's own name or in
the name of the Junior Creditor or otherwise, as the Senior Creditor may deem
necessary or advisable for the enforcement of this Agreement. To the extent that
payments of distributions are made in property other than cash, the Junior
Creditor authorizes the Senior Creditor to sell such property to such buyers and
on such terms as the Senior Creditor, in his sole discretion, shall determine.
The Junior Creditor will execute and deliver to the Senior Creditor such powers
of attorney, assignments and other instruments or documents, including
debentures (together with such assignments or endorsements as the Senior
Creditor shall deem necessary), as may be reasonably requested by the Senior
Creditor in order to enable the Senior Creditor to enforce any and all claims
upon or with respect to any or all of the Subordinated Debt and to collect and
receive any and all payments and distributions which may be payable or
deliverable at any time upon or with respect to the Subordinated Debt, all for
the Senior Creditor's own benefit.

         SECTION 7. PAYMENTS RECEIVED BY THE JUNIOR CREDITOR. Except for
Permitted Payments, if the Junior Creditor receives any value, property,
payment, distribution, security, instrument or proceeds thereof upon or with
respect to the Subordinated Debt prior to the indefeasible payment in full of
the Senior Debt and termination of all financing arrangements between the
Borrower and the Senior Creditor, the Junior Creditor shall receive and hold the
same in trust, as trustee, for the benefit of the Senior Creditor and shall
forthwith deliver the same to the Senior Creditor in precisely the form received
(except for the endorsement or assignment by the Junior Creditor where
necessary), for application on any of the Senior Debt, due or not due and, until
so delivered, the same shall be held in trust by the Junior Creditor as the
property of the Senior Creditor. In the event of the failure of the Junior
Creditor to make any such endorsement or assignment to the Senior Creditor is
hereby irrevocably authorized to make the same.

         SECTION 8. CONTINUING NATURE OF SUBORDINATION. This Agreement shall be
effective and may not be terminated or otherwise revoked by the Junior Creditor
until the Senior Debt shall have been fully paid and discharged and all
financing arrangements between the Borrower and the Senior Creditor have been
terminated. This is a continuing agreement of subordination and the Senior
Creditor may continue, at any time and without notice to the Junior Creditor, to
extend credit or other financial accommodations and loan monies to or for the
benefit of the Borrower in reliance hereon. No obligation of the Junior Creditor
hereunder shall be affected by the dissolution, liquidation, death or


                                       47


incapacity of, or written revocation by, the Junior Creditor or any other
subordinated party, pledgor, endorser, or guarantor, if any.

         SECTION 9. ADDITIONAL AGREEMENTS BETWEEN SENIOR CREDITOR AND BORROWER.
The Senior Creditor, at any time and from time to time, may enter into such
agreement or agreements with the Borrower as the Senior Creditor may deem
proper, increasing the amount of, extending the time of payment of or renewing
or otherwise altering the terms of all or any of the Senior Debt or affecting
any security underlying any or all of the Senior Debt, and may exchange, sell,
release, surrender or otherwise deal with any such security, without in any way
thereby impairing or affecting this Agreement.

         SECTION 10. BANKRUPTCY ISSUES. If the Borrower becomes the subject of
proceedings under the Bankruptcy Code and if the Senior Creditor desires to
permit the use of cash collateral or to provide financing to the Borrower under
either Section 363 or Section 364 of the Bankruptcy Code, the Junior Creditor
agrees that adequate notice of such financing to the Junior Creditor, if
required under applicable law, shall have been provided if the Junior Creditor
receives notice two (2) business days prior to entry of any order approving such
cash collateral usage or financing. Notice of a proposed financing or use of
cash collateral shall be deemed given upon the sending of such notice to the
Junior Creditor in the manner specified in Section 16, below. All allocations of
payments between the Senior Creditor and the Junior Creditor shall continue to
be made after the filing of a petition under the Bankruptcy Code on the basis
provided in this Agreement. In the event that the Junior Creditor at any time
acquires any security for the Subordinated Debt, the Junior Creditor agrees not
to assert any right the Junior Creditor may have to "adequate protection" of the
Junior Creditor's interest in such security in any Bankruptcy proceeding or to
seek relief from automatic stay, without the prior written consent of the Senior
Creditor. The Junior Credit shall promptly deliver any form of adequate
projection it receives or the value thereof to the Senior Creditor. The Junior
Creditor waives any claim the Junior Creditor may now or hereafter have against
the Senior Creditor arising out of the Senior Creditor's election, in any
proceeding instituted under Chapter 11 of the Bankruptcy Code, of the
application of Section 1111(b)(2) of the Bankruptcy Code, and/or any borrowing
or grant of a security interest under Section 364 of the Bankruptcy Code by the
Borrower, as debtor in possession, or by a trustee. To the extent that the
Senior Creditor receives payments on, or proceeds of any collateral for, the
Senior Debt which are subsequently avoided, invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee,
receiver or any other party under any Bankruptcy law, state or federal law,
common law or equitable cause, then, to the extent of such payment or proceeds
received, the Senior Debt, or part thereof, intended to be satisfied shall be
revived and continue in full force and effect as if such payments or proceeds
had not been received by the Senior Creditor.

         SECTION 11. INSTRUMENT LEGEND; NO AMENDMENTS TO SUBORDINATED
INSTRUMENTS. Every instrument evidencing Subordinated Debt shall be inscribed
with a legend conspicuously indicating that payment thereof is subordinated to
the claims of the Senior Creditor pursuant to the terms of this Agreement. Upon
request after the occurrence of an Event of Default, the original of every
instrument evidencing Subordinated Debt shall be promptly delivered to the
Senior Creditor. The Junior Creditor will not agree to any amendment,
restatement or other modification of any instrument evidencing Subordinated
Debt, without the prior written consent of the Senior Creditor.

         SECTION 12. WAIVERS. The Senior Debt shall be deemed to have been made
or incurred in reliance upon this Agreement. The Junior Creditor expressly
waives all notice of the acceptance by the Senior Creditor of the subordination
and other provisions of this Agreement and all other notices not specifically
required pursuant to the terms of this Agreement whatsoever, and the Junior
Creditor expressly waives reliance by the Senior Creditor upon the subordination
and other agreements as herein

                                       48


provided. The Junior Creditor agrees that the Senior Creditor has made no
warranties or representations with respect to the due execution, legality,
validity, completeness or enforceability of any agreement evidencing any Senior
Debt, or the collectability of the Senior Debt, and that the Senior Creditor
shall be entitled to manage and supervise his loans and other financial
accommodations to the Borrower without regard to the existence of any rights
that the Junior Creditor may now or hereafter have in or to any of the assets of
the Borrower. The Junior Creditor agrees that the Senior Creditor shall have no
liability to the Junior Creditor for, and waives any claim which the Junior
Creditor may now or hereafter have against, the Senior Creditor arising out of
any and all actions which the Senior Creditor in good faith takes or omits to
take (including, without limitation, actions with respect to any security for
the Senior Debt, actions with respect to the occurrence of an Event of Default,
actions with respect to the foreclosure upon, sale, release, or depreciation of,
or failure to realize upon, any security for the Senior Debt and actions with
respect to the collection of any claim for all or any part of the Senior Debt
from any guarantor or other party) with respect to or any other agreement
related to any Senior Debt or to the collection of the Senior Debt or the
valuation, use, protection or release of any security for the Senior Debt.

         SECTION 13. SENIOR CREDITOR'S WAIVERS. No waiver shall be deemed to be
made by the Senior Creditor of any of his rights hereunder unless the same shall
be in writing signed on behalf of the Senior Creditor, and each waiver, if any,
shall be a waiver only with respect to the specific instance involved and shall
in no way impair the rights of the Senior Creditor or the obligations of the
Junior Creditor to the Senior Creditor in any other respect at any other time.

         SECTION 14. FINANCIAL CONDITION OF BORROWER; OTHER ACTIONS BY THE
SENIOR CREDITOR. The Junior Creditor hereby assumes responsibility for keeping
informed of the financial condition of the Borrower, any and all endorsers and
any and all guarantors of the Subordinated Debt and of all other circumstances
bearing upon the risk of nonpayment of the Senior Debt and/or the Subordinated
Debt that diligent inquiry would reveal. The Junior Creditor hereby agrees that
the Senior Creditor shall have no duty to advise the Junior Creditor of
information known to the Senior Creditor regarding such condition or any such
circumstances. In the event the Senior Creditor, in his sole discretion,
undertakes, at any time or from time to time, to provide any such information to
the Junior Creditor, the Senior Creditor shall be under no obligation (i) to
provide any such information to the Junior Creditor on any subsequent occasion,
(ii) to undertake any investigation not a part of his regular business routine,
or (iii) to disclose any information which, pursuant to his usual practices, the
Senior Creditor wishes to maintain confidential. The Junior Creditor hereby
agrees that all payments received by the Senior Creditor may be applied, in
whole or in part, to any of the Senior Debt, as the Senior Creditor, in his sole
discretion, deems appropriate and assents to any extension or postponement of
the time of payment of the Senior Debt or to any other indulgence with respect
thereto, to any substitution, exchange or release of collateral which may at any
time secure the Senior Debt and to the addition or release of any other Person
primarily or secondarily liable therefor.

         SECTION 15. SUBROGATION. When the Senior Debt shall have been fully
paid and discharged and all financing arrangements between the Borrower and the
Senior Creditor have been terminated, the Junior Creditor shall be subrogated to
the rights of the Senior Creditor to receive payments or distribution of assets
of the Borrower made on such Senior Debt until the principal of and premium, if
any, and interest on (and any other amounts due with respect to) the
Subordinated Debt shall be paid in full. For the purposes of such subrogation,
no payments or distributions to the Senior Creditor of any cash, property or
securities to which the Junior Creditor would be entitled except for these
provisions shall, as between the Borrower, its creditors other than the Senior
Creditor, and the Junior Creditor, be deemed to be a payment by the Borrower to
or on account of Senior Debt, it being understood that these


                                       49


provisions in this Section are used, and are intended, solely for the purpose of
defining the relative rights of the Junior Creditor, on the one hand, and the
Senior Creditor, on the other hand.

         SECTION 16. NOTICES. All communications and notices provided under this
Agreement to any party shall be given in writing by manual delivery, facsimile
transmission, overnight courier or United States first class mail to such
party's address shown on the signature page hereof, or to any party at such
other address as may be designated by such party in a notice to the other
parties. All periods of notice shall be measured from the date of delivery
thereof if manually delivered, from the date of sending if sent by facsimile
transmission, from the first business day after the date of sending if sent by
overnight courier, or from four days after the date of mailing if mailed.

         SECTION 17. GOVERNING LAW AND CONSTRUCTION. THE VALIDITY, CONSTRUCTION
AND ENFORCEABILITY OF THIS AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES
THEREOF.

         SECTION 18. CONSENT TO JURISDICTION. AT THE OPTION OF THE SENIOR
CREDITOR, THIS AGREEMENT MAY BE ENFORCED IN ANY FEDERAL COURT OR MINNESOTA STATE
COURT SITTING IN HENNEPIN COUNTY, MINNESOTA; AND THE JUNIOR CREDITOR CONSENTS TO
THE JURISDICTION AND VENUE OF ANY SUCH COURT AND WAIVES ANY ARGUMENT THAT VENUE
IN SUCH FORUMS IS NOT CONVENIENT. IN THE EVENT THE JUNIOR CREDITOR COMMENCES ANY
ACTION IN ANOTHER JURISDICTION OR VENUE UNDER ANY TORT OR CONTRACT THEORY
ARISING DIRECTLY OR INDIRECTLY FROM THE RELATIONSHIP CREATED BY THIS AGREEMENT,
THE SENIOR CREDITOR AT HIS OPTION SHALL BE ENTITLED TO HAVE THE CASE TRANSFERRED
TO ONE OF THE JURISDICTIONS AND VENUES ABOVE-DESCRIBED, OR IF SUCH TRANSFER
CANNOT BE ACCOMPLISHED UNDER APPLICABLE LAW, TO HAVE SUCH CASE DISMISSED WITHOUT
PREJUDICE.

         SECTION 19. WAIVER OF JURY TRIAL. THE JUNIOR CREDITOR, AND THE SENIOR
CREDITOR BY THEIR ACCEPTANCE HEREOF, IRREVOCABLY WAIVE ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER
THIS AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT OR DOCUMENT DELIVERED OR WHICH
MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY CREDIT
RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT, AND AGREE THAT ANY SUCH
ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

         SECTION 20. SEVERABILITY. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.

         SECTION 21.  MISCELLANEOUS.

                  (a) This Agreement and the terms, covenants and conditions
         hereof shall inure to the benefit of the Senior Creditor and his heirs
         and assigns. Nothing contained in this Agreement,

                                       50


         expressed or implied, is intended to confer upon any Person other than
         the parties hereto and thereto any rights, remedies, obligations or
         liabilities hereunder or thereunder.

                  (b) This Agreement sets forth the entire understanding of the
         parties hereto relating to the subject matter hereof, and all prior
         understandings and negotiations, written or oral, are merged into and
         superseded by this Agreement. Any modification, amendment or waiver of
         this Agreement or any provision herein shall be binding upon the Senior
         Creditor only if contained in a writing signed by or on behalf of the
         Senior Creditor. No failure on the part of the Senior Creditor to
         exercise and no delay in exercising any power or right hereunder, shall
         operate as a waiver thereof; nor shall any single or partial exercise
         of any power or right preclude any other or further exercise thereof or
         the exercise of any other power or right. The remedies herein provided
         are cumulative and not exclusive of any remedies provided by law.

                  (c) The Junior Creditor hereby acknowledges that (i) it has
         been advised by counsel in the negotiation, execution and delivery of
         this Agreement, (ii) the Senior Creditor has no fiduciary relationship
         to the Junior Creditor, and (iii) no joint venture exists between the
         Junior Creditor and the Senior Creditor.

                  (d) The section titles contained in this Agreement are and
         shall be without substantive meaning or content of any kind whatsoever
         and are not a part of the agreement between the parties hereto.

                  (e) All covenants, agreements, representations and warranties
         made in this Agreement and in any certificates or other papers
         delivered by or on behalf of the Junior Creditor pursuant hereto shall
         be deemed to have been relied upon by the Senior Creditor and shall
         survive the execution and delivery of this Agreement, and shall
         continue in full force and effect so long as any Senior Debt remains
         outstanding and unpaid or any financing arrangement between the
         Borrower and the Senior Creditor remains in effect. All statements of
         fact relating to the Junior Creditor contained in any certificate or
         other paper delivered to the Senior Creditor at any time after the date
         hereof by or on behalf of the Junior Creditor pursuant hereto or in
         connection with the transactions contemplated hereby shall constitute
         representations and warranties by the undersigned hereunder.

                  (f) This Agreement may be executed in any number of
         counterparts, all of which taken together shall constitute one and the
         same instrument, and any of the parties hereto may execute this
         Agreement by signing any such counterpart.

         IN WITNESS WHEREOF, this Subordination Agreement has been signed as of
the date first set forth above.

                                        The Estate of William S. Sadler
                                        By its Personal Representatives

                                        /s/ Dorothy E. Sadler
                                        Dorothy E. Sadler

                                        /S/ JILL D. SADLER
                                        Jill D. Sadler

                                        /s/ Kurt T. Sadler
                                        Kurt T. Sadler

                                        Address for Notice:
                                        -------------------
                                        1370 West Ryan Avenue
                                        Roseville, MN 55113

                                        SENIOR CREDITOR

                                        /s/ Terry L. Myhre
                                        Terry L. Myhre

                                        Address for Notice:
                                        -------------------
                                        9691 North 101st Street
                                        Stillwater, MN 55082

                                        Copy to:
                                        Robert W. Junghans
                                        2 Skillman Lane
                                        North Oaks, MN 55127


ACCEPTANCE AND ACKNOWLEDGMENT

         The Borrower named above hereby accepts, and acknowledges receipt of a
copy of, the foregoing Subordination Agreement and agrees that it will not pay
any of the "Subordinated Debt" (as defined in the foregoing Agreement) or grant
any security therefor, except as the foregoing Agreement provides.

                                        DOTRONIX, INC.

                                        /s/ Robert V. Kling
                                        Robert V. Kling
                                        Its Chief Financial Officer


                                       51

EX-10.9

EXHIBIT 10.9
                                      NOTE

$450,000                                                  April 7, 2004
                                                          Minneapolis, Minnesota

         For value received, the undersigned, Dotronix, Inc., a Minnesota
corporation ("Maker"), hereby promises to pay to the order of Terry L. Myhre,
his heirs and assigns ("Lender") at any place designated at any time in writing
by the holder hereof, in lawful money of the United States of America, the
principal sum of Four Hundred Fifty Thousand and 00/100 dollars ($450,000) or so
much thereof as has been advanced and remains outstanding under a letter loan
agreement dated the date hereof between Maker and Lender (the "Loan Agreement"),
together with interest (calculated on the basis of actual days elapsed in a
360-day year) on the unpaid principal hereof, from the date immediately
available funds representing the principal sum are credited to the account of
the Maker until this Note is fully paid, at a rate equal to five percent (5%)
per annum. As used herein, "due date" means April 7, 2005.

         Interest shall be payable monthly, on the last day of each month
commencing April 30, 2004, and on the last day of each succeeding month
thereafter until this Note is paid in full on or prior to the due date.

         This Note shall be payable in lawful money of the United States of
America in immediately available funds. All payments on this Note shall be
applied to the payment of accrued interest before being applied to the payment
of principal. Any payment which is required to be made on a day which is not a
banking business day shall be payable on the next succeeding banking business
day and such additional time shall be included in the computation of interest.
The principal amount of this Note may be prepaid in whole or in part at any time
without prior notice, premium, or penalty so long as such prepayment is
accompanied by payment of all interest accrued.

As of the due date, the Lender may convert all (but not part) of the entire
principal amount of and accrued interest on this Note into shares of common
stock of the Company ("Shares"). The number of Shares into which the Note may be
converted shall be determined by dividing (i) the entire outstanding principal
amount under this Note as of the due date plus all unpaid accrued interest, by
(ii) $1.50. In order to exercise the right of optional conversion, the Lender
shall give written notice of such conversion to the Maker no later than the date
that is 60 days prior to the due date.

         The occurrence of any one or more of the following events shall
constitute an "Event of Default": (a) the Maker shall fail to make when due,
whether by acceleration or otherwise, any payment


                                       52


of principal of, or interest on, the Note and such failure shall continue for a
period of 5 business days after notice thereof; or (b) any representation or
warranty made by the Maker in the Loan Agreement shall prove to have been false
or misleading in any material respect on the date as of which the facts set
forth are stated; or (c) the Maker shall fail to comply with any agreement in
the Loan Agreement, provided, however, that the occurrence of any event that
would otherwise constitute an Event of Default under subsections (b) or (c)
shall not constitute an Event of Default until such default shall remain uncured
for a period of 30 days after the Maker's notice thereof, so long as (i) the
Maker promptly notifies the Lender thereof, (ii) such default can reasonably be
remedied in such period, and (iii) the Maker is proceeding with best
commercially reasonably efforts to cure such failure as soon as possible.

         If any Event of Default shall occur and be continuing, the Lender may
declare that the outstanding unpaid principal balance of the Note, the accrued
and unpaid interest thereon and all other obligations of the Maker to the Lender
under this Note to be forthwith due and payable, whereupon the Note, all accrued
and unpaid interest thereon and all such obligations shall immediately become
due and payable, in each case without further demand or notice of any kind, all
of which are hereby expressly waived, anything in this Note to the contrary
notwithstanding. In addition, upon any Event of Default and so long as such
Event of Default continues, the Lender may exercise all rights and remedies
under any other instrument, document or agreement between the Maker and the
Lender, and enforce all rights and remedies under any applicable law.

         The Maker agrees to reimburse the Lender upon demand for all reasonable
attorney's fees and expenses paid or incurred by the Lender in connection with
the collection and enforcement of this Note.

         Maker waives presentment, notice of dishonor, protest, and notice of
protest, and any or all other notices or demands (other than demand for payment)
in connection with the delivery, acceptance, performance, default, endorsement,
or guaranty of this Note. The liability of Maker hereunder shall be
unconditional and shall not be in any manner affected by any indulgence
whatsoever granted or consented to by the holder hereof, including but not
limited to any extension of time, renewal, waiver, or other modification. Any
failure of the holder to exercise any right hereunder shall not be construed as
a waiver of the right to exercise the same or any other right at any time and
from time to time thereafter. Lender or any holder may accept late payments, or
partial payments, even though marked "payment in full" or containing words of
similar import or other conditions, without waiving any of its rights. No
amendment, modification, or waiver of any provision of this Note nor consent to
any departure by Maker therefrom shall be effective, irrespective of any course
of dealing, unless the same shall be in writing and signed by Lender, and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given. This Note cannot be changed or terminated
orally or by estoppel or waiver or by any alleged oral modification regardless
of any claimed partial performance referable thereto.

         Any notice from Lender to Maker shall be deemed given when delivered to
Maker by hand or when deposited in the U.S. mail and addressed to Maker at the
last address of Maker appearing on Lender's records.

         This Note replaces and supersedes the demand notes made by Maker in
favor of Lender in the principal amount of $30,000 each dated September 4, 2003,
November 19, 2003 and January 7, 2004 for an aggregate principal amount of
$90,000, and the demand note made by Maker to Lender in the principal amount of
$45,000 dated January 21, 2004.

         This Note shall be governed by and construed in accordance with the
laws of the State of Minnesota applicable to instruments made and to be
performed wholly within that state. If any


                                       53


provision of this Note is held to be illegal or unenforceable for any reason
whatsoever, such illegality or unenforceability shall not affect the validity of
any other provision hereof.

         MAKER AGREES THAT ANY ACTION, SUIT, OR PROCEEDING IN RESPECT OF OR
ARISING OUT OF THIS NOTE MAY BE INITIATED AND PROSECUTED IN THE STATE OR FEDERAL
COURTS, AS THE CASE MAY BE, LOCATED IN HENNEPIN COUNTY, MINNESOTA. MAKER
CONSENTS TO AND SUBMITS TO THE EXERCISE OF JURISDICTION OVER ITS PERSON BY ANY
SUCH COURT HAVING JURISDICTION OVER THE SUBJECT MATTER, WAIVES PERSONAL SERVICE
OF ANY AND ALL PROCESS UPON IT, AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE
MADE BY REGISTERED MAIL DIRECTED TO MAKER AT ITS ADDRESS SET FORTH BELOW OR TO
ANY OTHER ADDRESS AS MAY APPEAR IN LENDER'S RECORDS AS THE ADDRESS OF MAKER.

         IN ANY ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING OUT OF THIS
NOTE, LENDER AND MAKER BOTH WAIVE TRIAL BY JURY, AND MAKER ALSO WAIVES (i) THE
RIGHT TO INTERPOSE ANY SETOFF OR COUNTERCLAIM OF ANY NATURE OR DESCRIPTION; (ii)
ANY OBJECTION BASED ON FORUM NON CONVENIENS OR VENUE; AND (iii) ANY CLAIM FOR
CONSEQUENTIAL, PUNITIVE, OR SPECIAL DAMAGES.


                                        DOTRONIX, INC.,
                                        a Minnesota corporation

                                        By:  /s/ Robert V. Kling
                                             Robert V. Kling
                                             Its: Chief Financial Officer



                                       54

EX-10.10

EXHIBIT 10.10


         THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY AND ISSUABLE
PURSUANT HERETO HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT") AND MAY NOT BE OFFERED OR SOLD, TRANSFERRED,
PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT IN A TRANSACTION THAT IS
EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND FROM THE
REGISTRATION AND QUALIFICATION REQUIREMENTS OF APPLICABLE STATE SECURITIES LAWS,
OR IN A TRANSACTION EFFECTED PURSUANT TO SUCH REGISTRATION AND QUALIFICATION.


                                 DOTRONIX, INC.
                            (A MINNESOTA CORPORATION)

                       WARRANT TO PURCHASE 100,000 SHARES
                   OF COMMON STOCK, PAR VALUE $0.05 PER SHARE

         THIS CERTIFIES THAT, for value received, Terry L. Myhre or his
permitted transferees (the "Holder") is entitled to subscribe for and purchase
100,000 shares (the "Shares") of fully paid and nonassessable common stock, par
value $0.05 per share ("Common Stock") of Dotronix, Inc., a Minnesota
corporation (the "Company") at the Warrant Exercise Price as determined in
accordance with the terms hereof, which shall initially be equal to $0.10 per
share, subject to the provisions and upon the terms and conditions hereinafter
set forth.

         1. Term. The purchase right represented by this Warrant is exercisable,
in whole or in part, at any time and from time to time commencing on the date
hereof and ending at the close of business on April 7, 2011.

         2. Method of Exercise; Payment; Issuance of New Warrant. Subject to
Paragraph 1 hereof, the purchase right represented by this Warrant may be
exercised by the Holder, in whole or in part and from time to time, by the
surrender of this Warrant (with the notice of exercise form attached hereto as
Exhibit 1 duly executed) at the principal office of the Company and by the
payment to the Company, by check, of an amount equal to the then applicable
Warrant Exercise Price (as defined in Paragraph 4) per share multiplied times
the number of Shares then being purchased. The person or persons in whose
name(s) any certificate(s) representing the Shares shall be issuable upon
exercise of this Warrant shall be deemed to have become the holder(s) of record
of, and shall be treated for all purposes as the record holder(s) of, the shares
represented thereby (and such shares shall be deemed to have been issued)
immediately prior to the close of business on the date or dates upon which this
Warrant is exercised. In the event of any exercise of the rights represented by
this Warrant, certificates for the shares of stock so purchased shall be
delivered to the Holder as soon as is reasonably practicable and, unless this
Warrant has been fully exercised or expired, a new Warrant representing the
portion of the Shares, if any, with respect to which this Warrant shall not then
have been exercised shall also be issued to the Holder as soon as is reasonably
practicable.

         3. Stock Fully Paid; Reservation of Shares. The Company agrees that all
Shares issued upon the exercise of the rights represented by this Warrant will,
upon issuance, be fully paid and nonassessable, and free from all preemptive
rights, taxes, liens and charges with respect to the issue thereof; provided,
that the Company shall not be required to pay any withholding taxes with respect
to the issue of shares or any transfer taxes with respect to the issue of shares
in any name other than that of the registered holder hereof. During the period
within which the rights represented by this Warrant may be exercised, the
Company will at all times have authorized, and reserved for the purpose of
issuance upon exercise of the purchase rights evidenced by this Warrant, a
sufficient number of shares of its Common Stock to provide for the exercise of
the rights represented by this Warrant. The Company shall at all times take all
such action and obtain all such permits or orders as may be necessary to enable
the Company lawfully to issue such shares of Common Stock as duly and validly
issued, fully paid and nonassessable shares upon exercise in full of this
Warrant by Holder.

         4. Adjustment of Warrant Exercise Price and Number of Shares. The
number and kind of securities purchasable upon the exercise of this Warrant and
the Warrant Exercise Price shall be subject to adjustment from time to time upon
the occurrence of certain events as set forth in this Paragraph 4:

                  (a) If the Company at any time divides the outstanding shares
         of its Common Stock into a greater number of shares (whether pursuant
         to a stock split, stock dividend or otherwise), and conversely, if the
         outstanding shares of its Common Stock are combined into a smaller
         number of shares, the Warrant Exercise Price in effect immediately
         prior to such division or combination shall be proportionately adjusted
         to reflect the reduction or increase in the value of each such share of
         Common Stock.

                                       55


                  (b) If any capital reorganization or reclassification of the
         capital stock of the Company, or consolidation or merger of the Company
         with another corporation, or the sale of all or substantially all of
         its assets to another corporation shall be effected in such a way that
         holders of the Company's Common Stock shall be entitled to receive
         stock, securities or assets with respect to or in exchange for such
         Common Stock, then, as a condition of such reorganization,
         reclassification, consolidation, merger or sale, the Holder shall
         thereafter have the right to purchase and receive upon the basis and
         upon the terms and conditions specified in this warrant and in lieu of
         the shares of the Common Stock of the Company immediately theretofore
         purchasable and receivable upon the exercise of the rights represented
         hereby, such shares of stock, other securities or assets as would have
         been issued or delivered to the Holder if Holder had exercised this
         Warrant and had received such shares of Common Stock immediately prior
         to such reorganization, reclassification, consolidation, merger or
         sale. The Company shall not effect any such consolidation, merger or
         sale unless prior to the consummation thereof the successor corporation
         (if other than the Company) resulting from such consolidation or merger
         or the corporation purchasing such assets shall assume by written
         instrument executed and mailed to the Holder at the last address of the
         Holder appearing on the books of the Company the obligation to deliver
         to the Holder such shares of stock, securities or assets as, in
         accordance with the foregoing provisions, the Holder may be entitled to
         purchase.

                  (c) Except as provided in paragraph (d) below, if and whenever
         the Company shall (i) issue or sell any shares of Common Stock for a
         consideration per share less than the Warrant Exercise Price in effect
         immediately prior to the time of such issuance or sale, (ii) issue or
         sell any warrants, options or other rights to acquire shares of Common
         Stock at a purchase price less than the Warrant Exercise Price in
         effect immediately prior to the time of such issuance or sale, or (iii)
         issue or sell any other securities that are convertible into shares of
         Common Stock for a purchase or exchange price less than the Warrant
         Exercise Price in effect immediately prior to the time of such issuance
         or sale, then, upon such issuance or sale, the Warrant Exercise Price
         shall be reduced to the price (calculated to the nearest cent)
         determined by dividing (A) an amount equal to the sum of (I) the number
         of shares of Common Stock outstanding immediately prior to such issue
         or sale multiplied by the then existing Warrant Exercise Price and (II)
         the consideration, if any, received by the Company upon such issue or
         sale plus the consideration to be received by the Company upon the
         exercise of such stock purchase rights by (B) an amount equal to the
         sum of (I) the number of shares of Common Stock outstanding immediately
         prior to such issue or sale and (II) the number of shares of Common
         Stock thus issued or sold or issuable or saleable upon the exercise of
         such purchase rights or the conversion of such convertible securities;
         PROVIDED, HOWEVER, that in the event that any such purchase right
         expires or is terminated prior to the exercise of this Warrant, the
         Warrant Exercise Price shall be recalculated by deleting such purchase
         right, and PROVIDED FURTHER, that if an adjustment is made to the
         Warrant Exercise Price as a result of the issuance or sale of any such
         purchase rights or convertible securities, no further adjustment shall
         be made to the Warrant Exercise Price at the time such purchase rights
         are exercised or convertible securities are converted.

                  (d) Notwithstanding the provisions of paragraph (c) above, no
         adjustment shall be made in the Warrant Exercise Price as a result of
         (i) the exercise of options or warrants to purchase Common Stock or
         other derivative securities exercisable for shares of Common Stock that
         are outstanding at the date of this Warrant; (ii) the exercise of the
         warrant to purchase 385,000 shares of Common Stock to be granted to the
         estate of William S. Sadler as of the date of this Warrant, (iii) the
         grant of options to purchase Common Stock or the grant of restricted
         stock and other similar equity-based compensation awards pursuant to
         stock option and incentive plans which have been approved by the
         Company's board of directors, or the exercise of such options


                                       56


         or awards or (iv) the issuance of additional warrants in substantially
         the form of this Warrant pursuant to the Company's borrowing
         arrangements with Terry L. Myhre, or the exercise of such warrants.

                  (e) If the Company takes any other action, or if any other
         event occurs, which does not come within the scope of the provisions of
         paragraphs (a) through (c) above but which should result in an
         adjustment in the Warrant Exercise Price and/or the number of shares
         subject to this Warrant in order to fairly protect the purchase rights
         of the Holder, an appropriate adjustment in such purchase rights shall
         be made by the Company.

                  (f) Upon each adjustment of the Warrant Exercise Price, the
         Holder shall thereafter be entitled to purchase, at the Warrant
         Exercise Price resulting from such adjustment, the number of shares
         obtained by multiplying the Warrant Exercise Price in effect
         immediately prior to such adjustment by the number of shares
         purchasable pursuant hereto immediately prior to such adjustment and
         dividing the product thereof by the Warrant Exercise Price resulting
         from such adjustment.

                  (g) Upon any adjustment of the warrant exercise price, the
         Company shall give written notice thereof to the Holder stating the
         warrant exercise price resulting from such adjustment and the increase
         or decrease, if any, in the number of shares purchasable at such price
         upon the exercise of this warrant, setting forth in reasonable detail
         the method of calculation and the facts upon which such calculation is
         based.

         5. No Fractional Shares. No fractional shares of Common Stock will be
issued in connection with any exercise hereunder, but in lieu of such fractional
shares the Company shall make a cash payment therefor upon the basis of the
market price of such shares as of the close of business on the exercise date.

         6. No Privilege of Stock Ownership. Prior to the exercise of this
Warrant, the Holder shall not be entitled, by virtue of holding this Warrant, to
any rights of a stockholder of the Company, including (without limitation) the
right to vote or to receive dividends or other distributions.

         7. Transferability. This Warrant may not be offered or sold,
transferred, pledged, hypothecated or otherwise disposed of except in a
transaction that is exempt from the registration requirements of the Securities
Act and from the registration and qualification requirements of applicable state
securities laws, or in a transaction effected pursuant to such registration and
qualification.

         8. No Registration Rights; Legend. The Company is not obligated to
register this Warrant or any of the shares of Common Stock issuable hereunder
pursuant to the Securities Act of 1933 or any state securities laws. Any
certificates representing shares of Common Stock issued hereunder shall bear a
restrictive legend in such form and substance as counsel to the Company advises
the Company is required under applicable securities laws.

         9. Notices. Any notice, request or other document required or permitted
to be given or delivered to the Holder or the Company shall be delivered, or
shall be sent by certified or registered mail, postage prepaid, to the Holder at
its address as shown on the books of the Company or to the Company at the
address indicated therefor on the signature page of this Warrant.

                                       57


         10. Binding Effect on Successors. This Warrant shall be binding upon
any corporation succeeding the Company by merger or consolidation. All of the
covenants and agreements of the Company contained herein shall inure to the
benefit of the permitted transferees of the Holder.

         11. Descriptive Headings. All descriptive headings contained herein are
for convenience only and shall not be construed as part of this Warrant.

         12. Governing Law. This Warrant shall be governed by the laws of the
State of Minnesota, without reference to its principles of conflicts of laws.

         13. Amendments and Waivers. Any term of this Warrant may be amended,
and the observance of any term of this Warrant may be waived (either generally
or in a particular instance, and either retroactively or prospectively), only
with the written consent of the Company and the Holder. Any such amendment or
waiver shall be binding on the Company and the Holder and any permitted
transferee of this Warrant.





                                        DOTRONIX, INC.

                                        By:  /s/ Robert V. Kling
                                        Title: Chief Financial Officer
                                        Address:
                                        160 First Street S.E.
                                        New Brighton, Minnesota 55112

Dated:  April 7, 2004























                                       58



EXHIBIT 1 TO STOCK PURCHASE WARRANT
- -----------------------------------

NOTICE OF EXERCISE


Dotronix, Inc.
160 First Street S.E.
New Brighton, Minnesota 55112


Ladies and Gentlemen:

         _____________________________________ (the "Holder") hereby elects to
purchase, pursuant to the provisions of that Stock Purchase Warrant dated as
________________registered in the name of the Holder (the "Warrant"), shares of
Common Stock, par value $0.05 per share, of Dotronix, Inc., a Minnesota
corporation. The Holder hereby surrenders the Warrant and delivers herewith a
check in payment of the Warrant Exercise Price payable for such shares pursuant
to the Warrant.

         Please issue a certificate or certificates representing said shares of
Common Stock registered in the name of the Holder. If the number of shares set
forth above is less than the full number of shares issuable pursuant to the
Warrant, also please issue a new Warrant registered in the name of the Holder
for the balance of the shares issuable pursuant to the Warrant.

Dated: _____________________________, 20_____



                                              __________________________________
                                              [Holder]

                                              By: ______________________________

                                              Name: ____________________________

                                              Title: ___________________________

                                              Address: _________________________

                                              __________________________________

                                              Tax I.D. No.: ____________________



                                       59

EX-10.11

EXHIBIT 10.11

                                OPTION AGREEMENT

         This AGREEMENT, dated as of April 7, 2004 (this "AGREEMENT"), is
entered into by and among Terry L. Myhre, an individual resident of the State of
Minnesota ("GRANTEE"), the William S. Sadler Estate (the "Estate"), and
Minnesota River Aviation, Inc., a Minnesota corporation ("MRAI," and together
with the Estate, the "GRANTORS").

         WHEREAS, the Estate and MRAI are holders of 574,159 and 704,800 shares
of common stock, par value $0.05 per share (the "COMMON STOCK"), of Dotronix,
Inc., a Minnesota corporation (the "COMPANY"), respectively.

         WHEREAS, the Grantors have agreed to grant to Grantee an option to
purchase shares of Common Stock, upon the terms and subject to the conditions
set forth herein.

         NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE 1
STOCK OPTION

         Section 1.01. GRANT OF STOCK OPTION. The Grantors hereby grant Grantee
an irrevocable option (collectively, the "OPTION") to purchase, in the
aggregate, up to 1,000,000 shares of Common Stock (as the same may be adjusted
from time to time pursuant to Section 1.05, the "OPTIONED SHARES") at a purchase
price of $0.05 per Optioned Share (the "PURCHASE PRICE"), subject to the terms
and conditions provided herein.

         Section 1.02. EXERCISE OF OPTION. (a) Subject to the conditions below
and as set forth in 1.03 hereof, Grantee may exercise the Option, in whole or in
part, at any time or from time to time on any business day after the date hereof
and prior to 5:00 p.m., Minneapolis time, on November 5, 2010 (the "EXPIRATION
DATE"). If Grantee wishes to exercise the Option for all or some of the Optioned
Shares, Grantee shall send a written notice (the "EXERCISE NOTICE") to the
Grantors specifying the total number of Optioned Shares that Grantee wishes to
purchase pursuant to such exercise and the place (which shall be within the
State of Minnesota), the date of purchase (which shall be not less than one nor
more than 20 business days after the date of the Exercise Notice, and no later
than the Expiration Date), and the time for the closing of such purchase. Each
closing of a purchase of Optioned Shares (a "CLOSING") shall take place at the
place, on the date (the "CLOSING DATE") and at the time designated by Grantee in
the Exercise Notice; PROVIDED, HOWEVER, that if, at any Closing Date, the
conditions set forth in Section 1.04 shall not have been satisfied (or waived by
the Grantors), Grantee may postpone the Closing until a date within five
business days after such conditions are satisfied (but no later than the
Expiration Date).

         (b) The number of Optioned Shares that Grantee wishes to purchase
pursuant to each Exercise Notice shall be allocated between the Grantors based
upon mutual agreement of the Grantors. If the Grantors cannot mutually agree
upon such allocation prior to a given Closing, the Optioned Shares with respect
to such Closing shall be allocated first to the Estate and then to MRAI;
PROVIDED, HOWEVER, that in no event shall more than an aggregate of 574,159
shares of Common Stock be allocated to the Estate. The obligations of each
Grantor pursuant to this Agreement are several and not joint.

         (c) Grantee shall not be under any obligation to deliver any Exercise
Notice and may allow the Option to terminate without purchasing any Optioned
Shares hereunder; PROVIDED, HOWEVER, that once Grantee has delivered to the
Grantors an Exercise Notice, subject to the terms and conditions of this
Agreement, Grantee shall be bound to effect the purchase as described in such
Exercise Notice.

                                       60


         (d) The Purchase Price for the Optioned Shares to be purchased upon any
exercise of the Option shall be payable, at Grantee's option, in cash or a
cashier's check.

         Section 1.03. CLOSING. At each Closing, (a) each Grantor shall deliver
to Grantee a certificate or certificates representing the Optioned Shares to be
purchased from such Grantor at such Closing (in the amount as provided in in
Section 1.02(b) hereof), in each case duly endorsed or accompanied by stock
powers duly executed in blank and (b) Grantee shall deliver to Grantors the
Purchase Price for such Optioned Shares.

         Section 1.04. CONDITIONS TO GRANTORS' OBLIGATIONS. The obligation of
Grantors to sell Optioned Shares at any Closing is subject to the following
conditions:

         (a) The representations and warranties of Grantee contained in Article
3 shall be true and correct at and as of the Closing Date as if made at and as
of such date, and the Grantors shall have received a certificate signed by
Grantee to the foregoing effect; and

         (b) There shall be no preliminary or permanent injunction or other
order, decree or ruling issued by a court of competent jurisdiction or by a
governmental, regulatory or administrative agency or commission, nor any
statute, rule, regulation or order promulgated or enacted by any governmental
authority, prohibiting or otherwise restraining the purchase and sale of such
Optioned Shares at the Closing.

         Section 1.05. ADJUSTMENT UPON CHANGE IN CAPITAL STOCK. In the event of
any change in the Company's capital stock by reason of any stock dividend, stock
split, reverse stock split, stock combination, recapitalization,
reclassification, exchange of securities, or extraordinary or liquidating
dividend or distribution, or in the event of any merger, reorganization, or
consolidation to which the Company is a party but is not the surviving entity,
then the number and kind of shares or securities subject to the Option and the
Purchase Price (but not the total purchase price for all Optioned Shares) shall
be appropriately and equitably adjusted so that Grantee shall receive, upon
exercise of the Option, and payment of the same total purchase price, the number
and class of shares or other securities or property that Grantee would have
received in respect of the Optioned Shares purchasable upon exercise of the
Option if the Option had been exercised immediately prior to such event.

ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF GRANTORS

         Each Grantor severally represents and warrants to Grantee that:

         Section 2.01. POWER AND AUTHORITY; BINDING EFFECT. Such Grantor has all
requisite power and authority to enter into this Agreement and to perform its
obligations hereunder. The execution, delivery, and performance by such Grantor
of this Agreement and the consummation by such Grantor of the transactions
contemplated hereby (i) have been duly authorized by such Grantor and no other
action on the part of such Grantor is necessary to authorize the execution,
delivery, or performance by such Grantor of this Agreement and the consummation
by such Grantor of the transactions contemplated hereby and (ii) require no
action by or in respect of, or filing with, any governmental body, agency, or
official. This Agreement has been duly executed and delivered by such Grantor
and is a valid and binding agreement of such Grantor, enforceable against it in
accordance with its terms, except as


                                       61


enforcement may be limited by bankruptcy, insolvency, moratorium, or other
similar laws relating to creditors' rights generally.

         Section 2.02. VALID TITLE. Such Grantor is the sole beneficial owner of
the Optioned Shares allocated to such Grantor with no restrictions on the
Grantor's rights of disposition pertaining thereto. At each Closing, such
Grantor will convey good title to the Optioned Shares being purchased free and
clear of any and all claims, liens, charges, encumbrances, and security
interests.

         Section 2.03. EXCEPTION TO REPRESENTATIONS AND WARRANTIES.
Notwithstanding anything to the contrary contained elsewhere in this Agreement,
neither Grantor makes any representation or warranty as to whether the grant or
the exercise of the Option requires approval by the board of directors or the
shareholders of the Company pursuant to Minnesota Statutes, Section 302A.671, or
as to whether any such approval has been obtained.

ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF GRANTEE

         Grantee represents and warrants to each of the Grantors:

         SECTION 3.01. POWER AND AUTHORITY. Grantee has all requisite power and
authority to enter into this Agreement and to perform Grantee's obligations
hereunder. The execution, delivery, and performance by Grantee of this
Agreement, including the exercise of the Option and purchase of the Optioned
Shares hereunder, (i) have been duly authorized by Grantee and no other action
on the part of Grantee is necessary to authorize the execution, delivery, or
performance by Grantee of this Agreement and the consummation by Grantee of the
transactions contemplated hereby and (ii) require no action by or in respect of,
or filing with, any governmental body, agency, or official. This Agreement has
been duly executed and delivered by Grantee and is a valid and binding agreement
of Grantee, enforceable against Grantee in accordance with its terms, except as
enforcement may be limited by bankruptcy, insolvency, moratorium, or other
similar laws relating to creditors' rights generally.

         SECTION 3.02. INVESTMENT REPRESENTATIONS.

         (a) Concurrently with the execution and delivery of this Agreement,
Grantee is entering into certain separate transactions directly with the
Company. In connection with those transactions, Grantee has requested and
received from the Company such information concerning the Company as he has
deemed necessary or appropriate for the purpose of entering into such
transactions and for the purpose of entering into this Agreement. Grantee
represents and warrants that he is not relying on any statements or
representations made by either Grantor, other than those set forth in Article 2
above, in entering into this Agreement. Grantee represents and warrants that he
is an "accredited investor" within the meaning of Rule 501(a) under the
Securities Act.

         (b) Grantee understands and acknowledges that neither Grantor is making
any representation or warranty to Grantee concerning whether the Grantors might
be deemed "affiliates" of the Company for purposes of Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), or whether Grantor,
upon the execution and delivery of this Agreement or upon his exercise of the
Option granted hereunder, might be deemed such an "affiliate." Grantor further
understands and acknowledges that neither the Option nor the Optioned Shares
have been registered under the Securities Act or any state securities laws,


                                       62


and that neither the Option nor the Optioned Shares may be transferred by
Grantee except pursuant to an available exemption from the registration
requirements of the Securities Act and such state securities laws or pursuant to
such registration. Grantee agrees that he shall not transfer the Option or any
Optioned Shares except pursuant to such an exemption or registration, and shall
not transfer the Option except pursuant to Section 4.05 hereof.

ARTICLE 4
MISCELLANEOUS

         Section 4.01. EXPENSES. Each party hereto agrees to pay the
out-of-pocket expenses incurred by such party in connection with the
transactions contemplated hereby.

         Section 4.02. FURTHER ASSURANCES. Grantee and the Grantors will each
execute and deliver or cause to be executed and delivered all further documents
and instruments and take all such further action as may be reasonably necessary
in order to consummate the transactions contemplated hereby.

         Section 4.03. NOTICES. Unless otherwise provided, any notice required
or permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or three
(3) days following deposit with the United States Post Office, by registered or
certified mail, postage prepaid and addressed to the party to be notified, or
one (1) day following timely deposit with a reputable overnight courier with
next day delivery instructions (including, but not limited to, Federal Express,
DHL or UPS), at the address indicated below or at such other address as such
party may designate by ten (10) days' advance written notice to the other
parties.

            To Grantee:                 Terry L. Myhre
                                        9691 101st Street North
                                        Stillwater, MN  55082

            With a copy to;             Robert W. Junghans
                                        2 Skillman Lane
                                        North Oaks, MN 55127

            To Grantors:                Minnesota River Aviation, Inc.
                                        1370 West Ryan Avenue
                                        Roseville, MN 55113

                                        William S. Sadler Estate
                                        1370 West Ryan Avenue
                                        Roseville, MN 55113

         Section 4.04. AMENDMENTS AND WAIVERS. This Agreement may not be
modified, amended, altered, or supplemented, except upon the execution and
delivery of a written agreement executed by each of the parties hereto. Any
provision of this Agreement may be waived if, but only if, such waiver is in
writing and is signed by the party against whom the waiver is to be effective.

         Section 4.05. SUCCESSORS AND ASSIGNS. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; PROVIDED, HOWEVER, that no party may assign,
delegate, or otherwise transfer any


                                       63


of its rights or obligations under this Agreement without the consent of the
other parties hereto; AND, PROVIDED, FURTHER, that the Estate may assign,
delegate, or otherwise transfer any of its rights or obligations under this
Agreement pursuant to the Will of William S. Sadler, Deceased, without the
consent of the other parties hereto, PROVIDED, THAT the transferee of such
rights or obligations signs an agreement to be bound and abide by the terms of
this Agreement and that Grantee is notified of the name and address of the
transferee.

         Section 4.06. GOVERNING LAW. This Agreement shall construed in
accordance with and governed by the law of the State of Minnesota without giving
effect to the principles of conflicts of laws thereof.

         Section 4.07. JURISDICTION. Any legal action or proceeding with respect
to this Agreement and any action for enforcement of any judgment in respect
thereof may be brought exclusively in the courts of the State of Minnesota or of
the United States of America for the District of Minnesota, and, by execution
and delivery of this Agreement, the parties hereby accept for themselves and in
respect of their property, generally and unconditionally, the exclusive
jurisdiction of the aforesaid courts. The parties further irrevocably consent to
the service of process out of any of the aforementioned courts in any such
action or proceeding by the mailing of copies thereof by registered or certified
mail, postage prepaid, to the parties at their addresses referred to in Section
4.03. The parties hereby irrevocably waive any objection which they may now or
hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement brought in the
aforementioned courts and hereby further irrevocably waive and agree, to the
extent permitted by applicable law, not to plead or claim in any such court that
any such action or proceeding brought in any such court has been brought in an
inconvenient forum.

         Section 4.08. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

         Section 4.09. COUNTERPARTS; EFFECTIVENESS. This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement shall become effective as of the date hereof when each party
hereto shall have received counterparts hereof signed by all of the other
parties hereto.

         Section 4.10. SATURDAYS, SUNDAYS, HOLIDAYS, ETC. If the last or
appointed day for the taking of any action or the expiration of any right
required or granted herein shall be a Saturday or a Sunday or shall be a legal
holiday within the State of Minnesota, then such action may be taken or such
right may be exercised on the next succeeding weekday not a legal holiday.

         Section 4.11. SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provisions shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provisions were so excluded and the balance shall be
enforceable in accordance with its terms.

         Section 4.12. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement and understanding of the parties hereto with respect to the subject
matter hereof, and supersedes all prior and contemporaneous agreements and
understandings, whether oral or written, between the parties hereto with respect
to the subject matter hereof.

         [Remainder of page intentionally left blank]


                                       64


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.



                                        GRANTEE:


                                        /s/ Terry L. Myhre
                                        Terry L. Myhre


                                        GRANTORS:

                                        MINNESOTA RIVER AVIATION INC., a
                                        Minnesota corporation

                                        By /s/ Dorothy E. Sadler
                                        Dorothy E. Sadler, Vice President


                                        WILLIAM S. SADLER ESTATE

                                        By /s/ Dorothy E. Sadler
                                        Dorothy E.Sadler,
                                        Personal Representative

                                        By /s/ Jill D. Sadler
                                        Jill D. Sadler, Personal Representative

                                        By /s/ Kurt T. Sadler
                                        Kurt T. Sadler,
                                        Personal Representative













                                       65

EX-10.12

EXHIBIT 10.12

                            FIRST AMENDMENT TO LEASE

         This First Amendment to Lease is entered into as of this 7th day of
April 2004 by and among Dorothy E. Sadler, Jill D. Sadler and Kurt T. Sadler,
personal representatives of the Estate of William S. Sadler (collectively,
"Landlord") and Dotronix, Inc., a Minnesota corporation ("Tenant").

                                    RECITALS

         A. William S. Sadler and Tenant originally entered into that certain
Lease dated as of April 26, 1999 (the "Lease") covering certain real property
located in New Brighton, Minnesota as legally described on Exhibit A to the
Lease.

         B. Landlord and Tenant desire to amend the terms of the Lease as set
forth herein.

         C. All defined terms not otherwise defined herein shall be defined as
set forth in the Lease.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

         1.       OPTION TO TERMINATE. Tenant shall have the option to terminate
                  the Lease upon delivery of written notice to Landlord (the
                  "Termination Notice"). The effective date of termination shall
                  be the last day of the month following the expiration of the
                  twelve (12) month period after Tenant's delivery of the
                  Termination Notice to Landlord (the "Termination Date"). In
                  the event Tenant exercises the option to terminate, then (i)
                  Base Rent and Additional Rent shall be paid and apportioned
                  through the Termination Date; and (ii) neither Landlord nor
                  Tenant shall have any rights, liabilities or obligations under
                  this Lease, except such rights, liabilities or obligations
                  that, by the provisions of this Lease, expressly survive
                  expiration or termination of this Lease.

         2.       BALANCE OF TERMS. Except as set forth herein, the Lease
                  remains unmodified and in full force and effect.



                  [Remainder of page intentionally left blank.]














                                       66


         IN WITNESS WHEREOF, the parties have executed this First Amendment to
Lease as of the day and year first above written.

LANDLORD:                              WILLIAM S. SADLER ESTATE

                                       By /s/ Dorothy E. Sadler
                                       Dorothy E.Sadler,
                                       Personal Representative

                                       By /s/ Jill D. Sadler
                                       Jill D. Sadler, Personal Representative

                                       By /s/ Kurt T. Sadler
                                       Kurt T. Sadler,
                                       Personal Representative



TENANT:                                DOTRONIX, INC.

                                       By /s/ Robert V. Kling
                                       Its Chief Financial Officer




























                                       67

EX-31.1

EXHIBIT 31.1

                    SARBANES-OXLEY SECTION 302 CERTIFICATION

I, Kurt T. Sadler, President and Chief Executive Officer of Dotronix, Inc.,
certify that:

1.       I have reviewed this report on Form 10-QSB of Dotronix, Inc.;

2.       Based on my knowledge, this report does not contain any untrue
         statement of a material fact or omit to state a material fact necessary
         to make the statements made, in light of the circumstances under which
         such statements were made, not misleading with respect to the period
         covered by this report;

3.       Based on my knowledge, the financial statements, and other financial
         information included in this report, fairly present in all material
         respects the financial condition, results of operations and cash flows
         of the small business issuer as of, and for, the periods presented in
         this report;

4.       The small business issuer's other certifying officer and I are
         responsible for establishing and maintaining disclosure controls and
         procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
         for the small business issuer and have:

         a) Designed such disclosure controls and procedures, or caused such
         disclosure controls and procedures to be designed under our
         supervision, to ensure that material information relating to the small
         business issuer, including its consolidated subsidiaries, is made known
         to us by others within those entities, particularly during the period
         in which this report is being prepared;

         b) Evaluated the effectiveness of the small business issuer's
         disclosure controls and procedures as of the end of the period covered
         by this report based on such evaluation; and

         c) Disclosed in this report any change in the small business issuer's
         internal control over financial reporting that occurred during the
         small business issuer's most recent fiscal quarter (the small business
         issuer's fourth fiscal quarter in the case of an annual report) that
         has materially affected, or is reasonably likely to materially affect,
         the small business issuer's internal control over financial reporting;
         and

5.       The small business issuer's other certifying officer and I have
         disclosed, based on our most recent evaluation of internal control over
         financial reporting, to the small business issuer's auditors and the
         audit committee of small business issuer's board of directors (or
         persons performing the equivalent functions):

         a) All significant deficiencies and material weaknesses in the design
         or operation of internal control over financial reporting which are
         reasonably likely to adversely affect the small business issuer's
         ability to record, process, summarize and report financial information;
         and

         b) Any fraud, whether or not material, that involves management or
         other employees who have a significant role in the small business
         issuer's internal control over financial reporting.

Date:  May 14, 2004                          /s/ Kurt T. Sadler
                                             Kurt T. Sadler
                                             Chief Executive Officer


                                       68

EX-31.2

EXHIBIT 31.2

                    SARBANES-OXLEY SECTION 302 CERTIFICATION

I, Robert V. Kling, Chief Financial Officer of Dotronix, Inc., certify that:

1.       I have reviewed this report on Form 10-QSB of Dotronix, Inc.;

2.       Based on my knowledge, this report does not contain any untrue
         statement of a material fact or omit to state a material fact necessary
         to make the statements made, in light of the circumstances under which
         such statements were made, not misleading with respect to the period
         covered by this report;

3.       Based on my knowledge, the financial statements, and other financial
         information included in this report, fairly present in all material
         respects the financial condition, results of operations and cash flows
         of the small business issuer as of, and for, the periods presented in
         this report;

4.       The small business issuer's other certifying officer and I are
         responsible for establishing and maintaining disclosure controls and
         procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
         for the small business issuer and have:

         a) Designed such disclosure controls and procedures, or caused such
         disclosure controls and procedures to be designed under our
         supervision, to ensure that material information relating to the small
         business issuer, including its consolidated subsidiaries, is made known
         to us by others within those entities, particularly during the period
         in which this report is being prepared;

         b) Evaluated the effectiveness of the small business issuer's
         disclosure controls and procedures as of the end of the period covered
         by this report based on such evaluation; and

         c) Disclosed in this report any change in the small business issuer's
         internal control over financial reporting that occurred during the
         small business issuer's most recent fiscal quarter (the small business
         issuer's fourth fiscal quarter in the case of an annual report) that
         has materially affected, or is reasonably likely to materially affect,
         the small business issuer's internal control over financial reporting;
         and

5.       The small business issuer's other certifying officer and I have
         disclosed, based on our most recent evaluation of internal control over
         financial reporting, to the small business issuer's auditors and the
         audit committee of small business issuer's board of directors (or
         persons performing the equivalent functions):

         a) All significant deficiencies and material weaknesses in the design
         or operation of internal control over financial reporting which are
         reasonably likely to adversely affect the small business issuer's
         ability to record, process, summarize and report financial information;
         and

         b) Any fraud, whether or not material, that involves management or
         other employees who have a significant role in the small business
         issuer's internal control over financial reporting.

Date:  May 14, 2004                         /s/ Robert V. Kling
                                            Robert V. Kling
                                            Chief Financial Officer



                                       69

EX-32.1

EXHIBIT 32.1


                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


         In connection with the Quarterly Report of Dotronix, Inc. (the
"Company") on Form 10-QSB for the quarter ended March 31, 2004 as filed with the
Securities and Exchange Commission (the "Report"), I, Kurt T. Sadler, Chief
Executive Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, as
adopted pursuant to ss.906 of the Sarbanes-Oxley Act of 2002, that:

         (1) The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

         (2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.

         Dated:  May 14, 2004

                                                     /s/ Kurt T. Sadler
                                                     Kurt T. Sadler
                                                     Chief Executive Officer




















                                       70

EX-32.2

EXHIBIT 32.2

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

         In connection with the Quarterly Report of Dotronix, Inc. (the
"Company") on Form 10-QSB for the year ended March 31, 2004 as filed with the
Securities and Exchange Commission (the "Report"), I, Robert V. Kling, Chief
Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, as
adopted pursuant to ss.906 of the Sarbanes-Oxley Act of 2002, that:

         (1) The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

         (2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.

         Dated:  May 14, 2004
                                                   /s/ Robert V. Kling
                                                   Robert V. Kling
                                                   Chief Financial Officer


























                                       71