FORM 10-QSB SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549 Quarterly
          Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarter Ended December 31, 2005    Commission File No. 0-9996 DOTRONIX, INC.(Exact name of registrant as specified in its charter) Minnesota
     
     41-1387074(State or other jurisdiction of
        incorporation or organization)
     
     (IRS Employer Identification No.)  160 First Street S.E, New Brighton, MN 55112(Address of
principal executive offices)  (Zip Code) (952) 541-1155(Issuers Telephone
Number) Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by section 13 or 15 (d) of the
Securities Exchange Act of 1934 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   ý    NO    ̈ Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     YES   ý    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 February 16, 2006Common stock, par value
     
     7,280,306 shares$ .05 per share Transitional Small Business Disclosure Format (check one).    YES    ̈    NO   ý




DOTRONIX, INC.INDEX Part I  Financial
Information Item 1.
     Condensed Financial StatementsBalance SheetsStatements of OperationsStatements of Cash FlowsNotes to Financial StatementsItem 2.
     Managements Discussion and Analysis ofFinancial Condition and Results of OperationsItem 3.
     Controls and Procedures  Part II  Other
Information Item 6.
     Exhibits 2




PART I.  FINANCIAL INFORMATIONITEM 1.  FINANCIAL STATEMENTS DOTRONIX , INCCONDENSED BALANCE SHEETS ASSETS:
     December 312005
        June 302005(UNAUDITED)CURRENT ASSETS:Cash
        
     $4,565
        
     $18,295Accounts receivable, less allowancefor doubtful accounts of $0 and $1,000 respectively
     21
        
     61,812Inventories
     --
        
     16,450Prepaid expenses
     --
        
     18,652TOTAL CURRENT ASSETS
     4,586
        
     115,209PROPERTY AND EQUIPMENT
     --
        
     43,566TOTAL ASSETS
     $4,586
        
     $158,775LIABILITIES AND STOCKHOLDERS DEFICITCURRENT LIABILITIES:Revolving loan payable to a related party
        
        
     $
        --
        
     $
        439,000Debt due to an affiliated party
        
        
     
        --
        
     
        150,000Accounts payable
     37,681
        
     158,302Salaries, wages and payroll taxes
     8,414
        
     7,610Other accrued liabilities
     --
        
     44,080Deferred gain on sale of building to a related party
     --
        
     182,516TOTAL CURRENT LIABILITIES
     46,095
        
     981,508STOCKHOLDERS DEFICIT:Common stock, $.05 par value,  12,000,000 authorized,7,260,306 and 6,713,141 shares issued andoutstanding, respectively
     363,015
        
     335,657Additional paid-in capital
     12,593,397
        
     11,883,029Accumulated deficit
     (12,997,921
        )
     (13,041,419
        )TOTAL STOCKHOLDERS' DEFICIT
     (41,509
        )
     (822,733
        )TOTAL LIABILITIES AND STOCKHOLDERS DEFICIT
        
     $4,586
        
     $158,775 See notes to condensed financial statements Note:  The balance sheet as of June 30, 2005 has been condensed from the audited
        financial statements. 3




DOTRONIX , INCCONDENSED STATEMENTS OF OPERATIONS(UNAUDITED) Three months ended December 31
     Six months endedDecember 312005
     2004
2005
2004REVENUES
     
     
     $
        --
        
     $
        116,196
        
    $
        65,015
        
    $
        399,738COST OF SALES
        
        
     
        --
        
     
        167,576
        

        27,531
        
        
           302,910GROSS MARGIN
        
        
     
        --
        
     
        (51,380
        )
     
        37,484
        
    
        96,828SELLING, GENERAL, ANDADMINISTRATIVE EXPENSE
        
        
     
        40,343
        
     
        330,693
        
     
        192,464
        
     
        691,960LOSS FROM OPERATIONS
        
        
     
        (40,343
        )
     
        (382,073
        )
     
        (154,980
        )
     
        (595,132
        )OTHER INCOME AND (EXPENSE)Interest expense
        
        
     
        --
        
     
        (11,628
        )
     
        (6,126
        )
     
        (23,949
        )Gain on sale of property and equipment
        
        
     
        --
        
     
        --
        
     
        204,604
        
     
        ----
        
     
        (11,628
        )
     
        198,478
        
     
        (23,949
        )NET LOSS
        
        
     $
        (40,343
        )
     $
         (393,701
        )
     $
        43,498
        
$
        (619,081
        )NET LOSS PER COMMON SHARE-BASIC AND DILUTED
        
        
     $
        (0.01
        )
     $
        (0.07
        )
$
        0.01
        
$
        (0.11
        )AVERAGE NUMBER OF COMMON SHARESOUTSTANDING - BASIC AND DILUTED
        
        
     
        7,256,828
        
     
        5,612,991
        

        7,046,672
        

        5,602,180 See notes to condensed financial statements 4




DOTRONIX, INCCONDENSED STATEMENTS OF CASH FLOWS(UNAUDITED) Six months ended December 312005
     2004CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)
     $43,498
        
     $(619,081
        )Adjustment to reconcile net income (loss) to net cashused in operating activities:Depreciation
     6,803
        
     20,390Gain on sale of property and equipment
     (22,088
        )
     --Deferred gain on sale of building
     (182,516
        )
     (23,806
        )Stock compensation
     --
        
     73,600Changes in operating assets and liabilities:Accounts receivable
     43,632
        
     1,107Inventories
     8,222
        
     82,840Prepaid expenses
     18,652
        
     (24,981
        )Accounts payable and other accrued liabilities
     23,121
        
     63,938Salaries, wages and payroll taxes
     804
        
     (28,026
        )NET CASH USED IN OPERATING ACTIVITIES
     (59,872
        )
     (454,019
        )CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of property and equipment
     --
        
     (22,197
        )Proceeds from sales of property and equipment
     1,142
        
     --NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
     1,142
        
     (22,197
        )CASH FLOWS FROM FINANCING ACTIVITIES:Borrowings on revolving loan payable to a related party
     35,000
        
     244,000Proceeds from the issuance of common stock
     10,000
        
     --NET CASH PROVIDED BY FINANCING ACTIVITIES
     45,000
        
     244,000NET DECREASE  IN CASH
     (13,730
        )
     (232,216
        )CASH AT BEGINNING OF PERIOD
     18,295
        
     245,030CASH AT END OF PERIOD
     $4,565
        
     $12,814SUPPLEMENTAL DISCLOSURES OF NONCASHFINANCING ACTIVITIESRevolving loan payable to a related party and accrued interestconverted to 318,246 shares of common stock
        
        
     $
        447,369
        
     $
        --Debt to an affiliated party and accrued interest convertedto 156,040 shares of common stock
        
        
     
        156,040
        
     
        --Lease obligation due to an affiliated party converted to66,212 shares of common stock
        
        
     
        94,317
        
     
        --Net operating assets transferred to a related party for paymentof revolving loan (operating assets of $83,700; liabilities
              of $71,700)
        
        
     
        12,000
        
     
        -- See notes to condensed financial statements 5




DOTRONIX, INC.NOTES TO CONDENSED
FINANCIAL STATEMENTS A.     Basis of
Presentation The condensed
 balance  sheet as of December 31, 2005,  the  condensed  statements of operations  for
the three and sixth month periods ended  December 31, 2005 and 2004 and the condensed
 statements  of cash flows for the six month  periods  ended  December 31, 2005 and 2004
have been  prepared by the  Dotronix,  Inc.,  (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 as of December  31, 2005 and for the three and six month  periods  ended
 December 31, 2005 and 2004  presented  herein have been made. Certain information
 and footnote  disclosures  normally  included in financial  statements  prepared in
 accordance  with  accounting principles  generally  accepted in the United States of
America have been condensed or omitted.  These financial  statements  should 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, 2005. B.     Going Concern The     accompanying
financials statements have been prepared assuming the Company will continue as a going
concern.  The Company has no current operations and has a working capital deficiency.
Current cash and cash available is not sufficient to fund operations beyond a short
period of time. These conditions create uncertainty as to the Companys ability to
continue as a going concern. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty. C.     Accounting
Policies 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. 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 6




for Stock Based Compensation, the Companys net income and income per share for
the quarter ended December 31, 2005, and the net loss and loss per share for the
quarter ended December 31, 2004, would not be materially different. Income (Loss) Per Common Share Basic net loss
per common share is computed by dividing net loss by the weighted average number of
common shares outstanding. Diluted net loss per common share assumes the exercise of
stock options and warrants using the treasury stock method, if dilutive. All stock
options and warrants have been excluded from net loss per common share calculations as
they are anti-dilutive. ITEM 2.   MANAGEMENTS DISCUSSION AND ANALYSIS 
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Plan of Operation The Company is
no longer engaged in active business operations and is seeking a business venture in
which to participate.  The selection of a business venture in which to participate is
complex and risky and will be made by Company management and directors in the exercise of
their business judgment.  There is no assurance that the Company will be able to identify
and align itself with, through a merger or other types of business relationships, any
business venture that will ultimately prove to be beneficial to the Company and its
shareholders. The Company's
current operating plan is to maintain the administrative and reporting requirements of a
public company. At present, the Company has no understandings, commitments or agreements
with respect to the acquisition of any business venture, and there can be no assurance
that the Company will identify a business venture suitable for acquisition in the future.
Further, there can be no assurance that the Company would be successful in consummating
any business venture on favorable terms, if at all, or that it will be able to profitably
manage the business venture it acquires. Financial Condition, Liquidity and
Capital Resources On September
12, 2005, a Settlement Agreement and Mutual Release was executed between the Company
and its principal creditor, Terry L. Myhre.  Under the terms of the transaction, Mr.
Myhre advanced an additional $35,000 to the Company under an existing loan agreement
established in April 2004, and the parties terminated the existing loan agreement by
converting all debt and accrued interest owed to Mr. Myhre to common stock of the Company
at a conversion price of $1.50 per share, or a total of 318,246 restricted shares of
common stock.  Under the settlement agreement the parties mutually released each other
from all claims arising under the original loan agreement.  In connection with the
transaction, Mr. Myhre signed a Securities Purchase Agreement under which he agreed to
purchase up to 26,667 restricted shares of common stock at $1.50 per share upon
notification by the Company of its need for funds. In October 2005 the Company notified
Mr. Myhre of his obligation to purchase 26,667 shares of common stock.
In November 2005 Mr. Myhre 7




purchased 6,667 shares of common stock for $10,000. In January
2006 he purchased the balance of 20,000 shares of common stock for $30,000. On September
16, 2005 a Settlement Agreement and Mutual Release was executed between the Company and
the Estate of William S. Sadler whereby the Estate agreed to convert all debt and accrued
interest owed it by the Company to common stock at a conversion price of $1.00 per share,
or a total of 156,040 restricted shares.  In addition, the Estate agreed to release all
obligations under a lease between the Estate and the Company for 66,212 restricted shares
of Company common stock.  The Company and the Estate mutually released each other from
all further claims. Two former
officers of the Company, Kurt T. Sadler and Robert V. Kling, formed a corporation under
the name Dotronix Technology, Inc. (DTI).  DTI purchased from Terry Myhre $12,000 of
the secured debt owed by the Company to Mr. Myhre.  On September 12, 2005, an agreement
was executed between the Company and DTI whereby DTI acquired $83,700 of operating assets
of the Company and assumed $71,700 of liabilities in lieu of foreclosure of the security
interest held by DTI in the assets of the Company.  The board of directors of the Company
approved the transaction based on its determination that it allows the Company to dispose
of assets that are no longer useful for the pursuit of a business with any meaningful
future potential, relieves the Company of certain liabilities, and will enable the
Company to seek a new business venture in which to participate in the future.  In this
regard, the settlement of debt with Terry Myhre described above was conditioned on the
Company disposing of its assets and putting itself in the position where it could pursue
other prospects. At December
31, 2005, the Company had cash of $4,565 and a working capital deficit of $41,509. In any event,
if the Company is unable to locate a business venture in which to participate, it is
expected that the Companys funds will be depleted in a relatively short period of time.
 Should that occur, management will attempt to raise capital for its current operational
needs through loans from related parties, debt financing, equity financing or a
combination of financing options. However, there are no existing understandings,
commitments or agreements for an infusion of capital, there are no assurances to that
effect and, if the Company cannot obtain additional financing, its ability to continue as
a going concern is doubtful. Prior Operations During the
three month period ended September 30, 2005, the Company completed the disposition of its
business assets and related operations so that it was no longer engaged in active
business operations at the beginning of the quarter ended December 31, 2005.
Consequently, a discussion and comparison of the Companys results of operations for the
three and six month periods ended December 31, 2005, to the comparable periods in fiscal
year 2004 would not be meaningful. Forward-Looking Statements The Private
Securities Litigation Reform Act of 1985 provides a safe harbor for forward-looking made by the Company, except where such statements are made in connection with an
initial 8




public offering.  All statements, other than statements of historical fact, which address
activities, actions, goals, prospects, or new developments that we expect or anticipate
will or may occur in the future, including such things as prospects for obtaining
additional capital and our goal of participating in a new business venture and other such
matters are forward-looking statements.  Any one or a combination of factors could
materially affect our financial condition and ability to achieve our goal. These factors
include competition for business opportunities, unexpected costs or expenses, legal and
regulatory initiatives affecting shell corporations, and conditions in the capital
markets. Because of the factors listed above, risk factors identified in our Annual
Report on Form 10-KSB for the year ended June 30, 2005 filed with the Securities and
Exchange Commission, and other unknown factors beyond our control, actual results may
differ from those in the forward-looking statements. Item 3.    CONTROLS AND
PROCEDURES Evaluation of disclosure controls and
procedures. The Companys
Chief Executive and Chief Financial Officer, Craig S. Laughlin, has reviewed the Companys
disclosure controls and procedures as of the end of the period covered by this report.
 Based upon this review, the officer believes 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. 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 6.   Exhibits See Exhibit
Index below 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. Date:  February 16, 2006
     Dotronix, Inc.  By
     /s/ Craig S. LaughlinCraig S. Laughlin
President and Chief
Financial Officer
(Principal Executive
Officer and Principal Financial
and accounting officer) 9




DOTRONIX, INC.EXHIBIT INDEX
QUARTERLY REPORT ON FORM 10-QSBFOR QUARTER ENDED DECEMBER 31, 2005 31.1*
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1*
        Certification of Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. *Filed herewith 10