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                                                                   EXHIBIT 10.21

                              BRIDGE LOAN AGREEMENT

     THIS BRIDGE LOAN AGREEMENT ("Agreement") is made and entered into effective
as of March 8, 2001, by and among Optical Sensors Incorporated, a Delaware
corporation (the "Company"), with its principal place of business at 7615 Golden
Triangle Drive, Suite A, Eden Prairie, Minnesota 55344, and Circle F Ventures
LLC (the "Investor").

     A. The Company currently needs up to $150,000 to fund its operation until
such time as it is able raise additional equity capital.

     B. The Investor desires to make an investment in the Company on the terms
and conditions set forth in this Agreement.

     Accordingly, in consideration of the foregoing, the mutual promises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

1.   Purchase of Convertible Promissory Note. Upon the terms and subject to the
     conditions set forth in this Agreement, the Company agrees to issue to the
     Investor, and the Investor agrees to purchase from the Company, a
     convertible promissory note in the form attached hereto as Exhibit A in the
     principal amount of up to one hundred fifty thousand Dollars ($150,000)
     (the "Note"). The Note shall not bear interest and shall be due and payable
     in full one (1) year from the date of issuance (the "Maturity Date") unless
     converted into shares of Common Stock of the Company prior to the Maturity
     Date. After April 30, 2001, the Company shall have the right to prepay the
     Note, in whole or in part, at any time or from time to time, on ten (10)
     days' prior written notice to the Investors, without premium or penalty
     pursuant to Section 1 of the Note.

2.   Conversion. The Investor shall have the right to convert all or any portion
     of principal balance and accrued interest under the Note, at the option of
     the Investor, into shares of Common Stock of the Company at any time, and
     from time to time. If the Company completes a private placement of equity
     securities (the "Financing") by April 30, 2001, the conversion price of the
     Note shall be equal to the per share price of the securities sold in the
     Financing. If the Company does not complete the Financing by April 30,
     2001, the conversion price of the Note shall be $.25 per share. The shares
     of Common Stock issuable upon conversion of the Note are referred to as the
     "Conversion Securities."

3.   Representations and Warranties of the Company. The Company represents and
     warrants to the Investor as follows:

     (a)  Organization. The Company is a corporation duly organized, validly
          existing and in good standing under the laws of the State of Delaware
          and has the requisite corporate power and authority to own, lease or
          operate its properties and to carry on its business as it is now being
          conducted and as it is proposed to be conducted. The Company has no
          subsidiaries or direct or indirect ownership in any firm, corporation
          or business which either, individually or in the aggregate, is
          material
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          to the business of the Company. The Company is qualified to do
          business and is in good standing as a foreign corporation in every
          jurisdiction in which its ownership of property or conduct of business
          requires it so to be qualified and in which the failure to so qualify
          would have a material adverse effect on the financial condition or
          business of the Company.

     (b)  Authorization. The Company has the corporate power and authority to
          execute and deliver this Agreement and the Note and to perform its
          obligations hereunder and thereunder, including the issuance of the
          Note and the Conversion Securities. This Agreement and the Note have
          been duly authorized by all necessary corporate action on behalf of
          the Company, have been duly executed and delivered by authorized
          officers of the Company, are valid and binding agreements on the part
          of the Company and are enforceable against the Company in accordance
          with their respective terms, except as the enforceability thereof may
          be limited by bankruptcy, insolvency, moratorium, reorganization or
          other similar laws affecting the enforcement of creditors rights
          generally and to judicial limitations on the enforcement of the remedy
          of specific performance and other equitable remedies. All corporate
          actions necessary for reservation and issuance of the Conversion
          Securities has been taken. The Conversion Securities when issued
          pursuant to conversion of the Note will be duly authorized, validly
          issued, fully paid and nonassessable, free and clear of any and all
          liens, charges, claims, encumbrances and preemptive rights.

     (c)  No Violation. Neither the execution and delivery of this Agreement or
          the Note by the Company, nor the performance by the Company of its
          obligations hereunder or thereunder, nor the consummation of the
          transactions contemplated hereby or thereby will: (a) conflict with or
          result in any breach of any provision of the Certificate of
          Incorporation or By-Laws of the Company; (b) result in a default (or
          give rise to any right of termination, cancellation or acceleration)
          under any of the terms, conditions or provisions of any note, lease,
          mortgage, license, agreement or other instrument or obligation to
          which the Company is a party or by which any of its assets may be
          bound, except for such defaults (or rights of termination,
          cancellation or acceleration) as to which requisite waivers or
          consents have been obtained or which, in the aggregate, would not
          result in a material adverse effect on the Company; (c) violate any
          order, writ, injunction, decree, statute, rule or regulation
          applicable to the Company or any of its assets, except for violations
          which would not result in a material adverse effect on the Company; or
          (d) result in the creation or imposition of any liens, charges or
          encumbrances upon any assets of the Company.

     (d)  SEC Reports. The Company has filed all reports, registration
          statements and other filings with the Securities and Exchange
          Commission (the "Commission") required to be filed by it pursuant to
          the Securities Act of 1933, as amended (the "Securities Act"), and the
          Securities Exchange Act of 1934, as amended (the "Exchange Act"). All
          such reports, registration statements and other filings (including all
          notes, exhibits and schedules thereto, all documents incorporated by
          reference therein, and any amendments thereto) are collectively
          referred to herein


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          as the "SEC Reports." As of their respective dates of filing with the
          Commission, the SEC Reports complied in all material respects with all
          of the rules and regulations of the Commission and did not 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 light of the circumstances under which
          they were made, not misleading.

     (e)  Financial Statements. The financial statements of the Company included
          in the SEC Reports (the "Financial Statements") have been prepared in
          accordance with United States generally accepted accounting principles
          consistently applied and fairly present the financial position of the
          Company at the dates thereof and the results of the Company's
          operations and cash flows for the periods then ended (subject, in the
          case of unaudited statements, to normal adjustments and the omission
          of footnotes). The Company has no material liabilities, known or
          unknown, absolute, contingent or otherwise, except for (i) liabilities
          that are set forth in the Financial Statements, the notes thereto or
          the SEC Reports and (ii) liabilities that have been incurred in the
          ordinary course of business since September 30, 2000.

     (f)  No Material Adverse Change. There have not been any changes in the
          assets, properties, liabilities, financial condition, business or
          operations of the Company from that reflected in the Financial
          Statements except for (i) changes in the ordinary course of business
          which have not been, either individually or in the aggregate,
          materially adverse and (ii) the Company's continued operating losses
          and negative cash flow.

     (g)  Authorized Capital Stock. The authorized capital stock of the Company
          is as set forth in the SEC Reports. The issued and outstanding shares
          of capital stock of the Company have been duly authorized, validly
          issued and are fully paid and nonassessable. As of the date hereof,
          the Company has outstanding options and warrants to purchase 1,824,084
          shares of Common Stock, convertible promissory notes in the aggregate
          principal amount of One Million Four Hundred Thousand Dollar
          ($1,400,000), warrant to purchase an aggregate of 875,000 shares of
          Common Stock that are issuable upon conversion of the foregoing
          convertible promissory notes. Except as set forth in the preceding
          sentence, there are no other outstanding warrants, options or other
          rights to acquire any shares of capital stock of the Company, except
          for the shares issued upon conversion of the Note and as disclosed in
          the SEC Reports. All of the above securities of the Company were
          issued in compliance with all applicable federal and state securities
          laws and were not issued in violation of or subject to any preemptive
          rights or other rights to subscribe for or purchase securities.
          [Except for Instrumentation Laboratory Company ("IL"),] no holder of
          any security of the Company is entitled to any preemptive or similar
          rights to purchase any securities of the Company.

     (h)  Intellectual Property. The Company owns or possesses adequate rights
          to use all patents, patent rights, inventions, trademarks, trade
          names, copyrights, licenses, domain names, governmental
          authorizations, trade secrets and know-how that are


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          used or necessary for the conduct of its business; the Company has not
          received any notice of, and has no knowledge of, any infringement of
          or conflict with asserted rights of others with respect to any
          patents, patent rights, inventions, trademarks, trade names,
          copyrights, licenses, governmental authorizations, trade secret or
          know-how that, individually or in the aggregate, if the subject of an
          unfavorable decision, ruling or finding, would have a material adverse
          effect on the condition (financial or otherwise), earnings, operations
          or business of the Company and its subsidiaries considered as a whole.

     (i)  Securities Laws. Subject to the accuracy of the representations of the
          Investor in Section 4, no consent, authorization, approval, permit or
          order of or filing with any governmental or regulatory authority is
          required under current laws and regulations in connection with the
          execution and delivery of this Agreement or the offer, issuance, sale
          or delivery to the Investor of the Note or the Conversion Securities
          other than the filing with the Commission of a Form D pursuant to
          Regulation D under the Securities Act, and the qualification thereof,
          if required, under applicable state securities laws, which
          qualification has been or will be effected as a condition of the sale
          of the Shares and the issuance of the Conversion Securities. Under the
          circumstances contemplated by this Agreement, the offer, issuance,
          sale and delivery of the Note will not, under current laws and
          regulations, require compliance with the prospectus delivery or
          registration requirements of the Securities Act.

     (j)  Litigation. There are no actions, suits, proceedings or investigations
          pending or, to the best of the Company's knowledge, threatened against
          the Company or any of its properties before or by any court or
          arbitrator or any governmental body, agency or official in which there
          is a reasonable likelihood (in the judgment of the Company) of an
          adverse decision that (a) would have a material adverse effect on the
          Company's properties or assets or the business of the Company as
          presently conducted or proposed to be conducted or (b) would impair
          the ability of the Company to perform in any material respect its
          obligations under this Agreement. The Company is not in default with
          respect to any judgment, order or decree of any court or governmental
          agency or instrumentality which, individually or in the aggregate,
          would have a material adverse effect on the assets, properties or
          business of the Company.

     (k)  Properties. The Company has good and marketable title to all the
          properties and assets reflected as owned in the Financial Statements,
          subject to no lien, mortgage, pledge, charge or encumbrance of any
          kind except (i) those, if any, reflected in such Financial Statements,
          or (ii) those which are not material in amount and do not adversely
          affect the use made and promised to be made of such property by the
          Company. The Company holds its leased properties under valid and
          binding leases, with such exceptions as are not materially significant
          in relation to the business of the Company. The Company owns or leases
          all such properties as are necessary to its operations as now
          conducted or as proposed to be conducted.


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     (l)  Brokers or Finders. To the knowledge of the Company, no person, firm
          or corporation has or will have, as a result of any act or omission of
          the Company, any right, interest or valid claim against the Investor
          for any commission, fee or other compensation as a finder or broker in
          connection with the transactions contemplated by this Agreement. The
          Company shall indemnify and hold the Investor harmless for any claims
          made for any commission, fee or other compensation concerning the
          transactions contemplated by this Agreement.

4.   Representations and Warranties of the Investor. The Investor represents and
     warrants to the Company as follows:

     (a)  The Note is being purchased for investment for the Investor's own
          account and not with the view to, or for resale in connection with,
          any distribution or public offering thereof. The Investor understands
          that neither the Note nor the Conversion Securities have been
          registered under the Securities Act or any state securities laws by
          reason of their contemplated issuance in transactions exempt from the
          registration requirements of the Securities Act and applicable state
          securities laws and that the reliance of the Company and others upon
          these exemptions is predicated in part upon this representation by the
          Investor. The Investor further understands that the Note and the
          Conversion Securities may not be transferred or resold without
          registration under the Securities Act and any applicable state
          securities laws, or pursuant to an exemption from the requirements of
          the Securities Act and applicable state securities laws.

     (b)  The Investor's principal place of business is located at the address
          set forth on the signature page hereto. The Investor qualifies as an
          "accredited investor," as defined in Rule 501 of Regulation D under
          the Securities Act. The Investor acknowledges that the Company has
          made available to the Investor at a reasonable time prior to the
          execution of this Agreement the opportunity to ask questions and
          receive answers concerning the business, operations and financial
          condition of the Company and the terms and conditions of the sale of
          securities contemplated by this Agreement and to obtain any additional
          information requested by such Investor. The Investor is able to bear
          the loss of its entire investment in the Shares and the Conversion
          Securities and has such knowledge and experience of financial and
          business matters that he is capable of evaluating the merits and risks
          of the investment to be made pursuant to this Agreement. However,
          neither the foregoing nor any other due diligence investigation
          conducted by such Investor or on its behalf shall limit, modify or
          affect the representations and warranties of the Company set forth in
          Section 3 of this Agreement or the right of such Investor to rely
          thereon.

     (c)  This Agreement has been duly authorized by all necessary action on the
          part of the Investor, has been duly executed and delivered by such
          Investor and is a valid and binding agreement of such Investor.


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5.   Registration Rights. The Company shall register the Conversion Securities
     with Securities and Exchange Commission on the registration statement filed
     by the Company pursuant to Section 7 of the Securities Purchase Agreement,
     dated as of August 11, 2000, between the Company and the Investor.

6.   Miscellaneous.

     (a)  The Company will file with the Commission, on a timely basis, all SEC
          Reports required to be filed under the Exchange Act and any other
          documents required to meet the public information requirements of Rule
          144(c) under the Securities Act.

     (b)  This Agreement and the rights and obligations of the parties hereunder
          shall not be assignable, in whole or in part, by the Company without
          the prior written consent of the Investor. This Agreement and the
          rights and obligations of the parties hereunder shall not be
          assignable, in whole or in part, by the Investor without the prior
          written consent of the Company, except that the Investor may assign
          its rights under this Agreement to any affiliate without the prior
          written consent of the Company. This Agreement shall inure to the
          benefit of and be binding upon and be enforceable by the successors
          and permitted assigns of the parties hereto. Neither this Agreement
          nor any provision hereof may be amended, modified, waived or
          discharged without the written consent of the parties hereto.

     (c)  This Agreement, including the exhibits attached hereto, constitutes
          the entire agreement of the parties relative to the subject matter
          hereof and supersedes any and all other agreements and understanding,
          whether written or oral, relative to the matters discussed herein.

     (d)  All representations and warranties contained herein shall survive
          after the execution and delivery of this Agreement for a period of two
          (2) years from the date hereof. All covenants and agreements which by
          their terms are to be performed after the date hereof will survive
          indefinitely, unless such covenants and agreements by their terms
          expire at an earlier date, in which case they will expire on such
          earlier date.

     (e)  All notices, requests, consents and other communications required or
          permitted hereunder shall be in writing and shall be given in writing
          by personal delivery, facsimile, commercial air delivery service or by
          registered or certified mail, postage prepaid, return receipt
          requested, addressed to the Company at the address set forth in the
          introductory paragraph to this Agreement and to the Investor at the
          addresses set forth on the signature page hereto, or at such other
          address as the respective parties may designate by like notice from
          time to time. Notices so given shall be effective upon the earlier of:
          (a) receipt by the party to which notice is given (which, in the
          instance of a facsimile, shall be deemed to have occurred at the time
          that the machine transmitting the facsimile verifies a successful
          transmission of the facsimile); (b) on the fifth business day
          following the date such notice was deposited in the mail; or (c) on
          the second business day following the date such notice was delivered
          to a commercial air delivery service.


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     (f)  This Agreement shall be construed and enforced in accordance with the
          laws of the State of Minnesota.

     (g)  This Agreement may be executed in two or more counterparts, each of
          which shall be deemed an original, but all of which together shall
          constitute one and the same instrument. This Agreement may be executed
          by facsimile.


                          [NEXT PAGE IS SIGNATURE PAGE]


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     IN WITNESS WHEREOF, the Company and the Investor have executed this
Agreement effective as of the date first written above.

                                       OPTICAL SENSORS INCORPORATED


                                       By /s/ Paulita LaPlante
                                          --------------------------------------
                                          Paulita LaPlante,
                                          President and Chief Executive Officer


                                       CIRCLE F VENTURES LLC


                                       By /s/ Hayden R. Fleming
                                          --------------------------------------
                                       Its
                                           -------------------------------------
                                       Address:
                                       17797 North Perimeter Drive
                                       Suite 105
                                       Scottsdale, Arizona 85255


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