Document:

Exhibit 10.10

 

FOURTH
EXTENSION AND AMENDMENT

OF
SECURED PROMISSORY NOTE

 

THIS
AGREEMENT, made to be effective this 27th day of August, 2003, between Dorothy
E. Sadler, Jill D. Sadler, and Kurt T. Sadler, the personal representatives of
the Estate of William S. Sadler, deceased, and Dotronix, Inc., a Minnesota
corporation.

 

Reference is
hereby made to that Secured Promissory Note dated February 23, 2000, from
Dotronix, Inc., a Minnesota corporation ( “Borrower”),  in favor of William S.  Sadler (“Lender”), in the original principal
amount of One Million Dollars ($1,000,000) as amended by First, Second and
Third Extensions and Amendments thereto, the Second of which previously
increased principal amount of the Note to One Million Five Hundred Thousand
Dollars ($1,500,000) (hereinafter, collectively referred to as the
“Note”).  Capitalized terms which are
used in this Fourth Extension and Amendment and which are not otherwise defined
herein have the meanings assigned to them in the Note.

 

The parties
hereby agree to amend the Note as follows:

 

1.                                       As a result of
the death of William S. Sadler, the Borrower hereby acknowledges that the Note
is now payable to Kurt T. Sadler, Jill D. Sadler and Dorothy E. Sadler, as
personal representatives of the Estate of William S. Sadler, and hereby agree
to substitute said personal representatives as the Lender under the Note.

 

2.                                       The phrase set
out at the top left of the Note is amended to read “Not to

 

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exceed One Million Dollars and no/100
($1,000,000.00).

 

3.                                       The dollar
amount set forth in the first paragraph of the Note is amended to read

One Million Dollars and no/100 ($1,000,000.00).

 

4.                                       The date set
forth in (i) in the first paragraph of the Note is amended to read

November 30, 2003.

 

5.                                       The clause set
forth in (ii) in the first paragraph of the Note is amended to read as 

follows:      “or an earlier date on which
the Loan Agreement terminates by its terms or is terminated by either party in
accordance with its terms.

 

The Note, as
amended, and this Fourth Extension and Amendment are hereby ratified and
confirmed.

 

This Agreement
is only a revision and not a novation. 
Except as provided in this Agreement, all terms and conditions of the
Secured Promissory Note, the Loan and Security Agreement as amended, and any
other documents given in connection therewith shall remain in full force and
effect.

 

IN WITNESS
WHEREOF, the parties who signed this Agreement effective the day and year first
above written.

 

 

	
   

  	
  /s/ Dorothy E. Sadler

  	
   

  
	
   

  	
  Dorothy E.  Sadler, personal
  representative

  of the Estate of William S. Sadler

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Jill D. Sadler

  	
   

  
	
   

  	
  Jill D. Sadler, personal representative of the

  Estate of William S. Sadler

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Kurt T. Sadler

  	
   

  
	
   

  	
  Kurt T. Sadler, personal representative of

  the Estate of William S. Sadler

  

 

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  DOTRONIX, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By: /s/ Robert V. Kling

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:  Chief Financial Officer

  

 

3Exhibit 10.11

 

EMPLOYMENT AGREEMENT

 

THIS  EMPLOYMENT AGREEMENT, dated as of September
8, 2003, is made by and between Dotronix, Inc., a Minnesota corporation
(hereinafter “Dotronix”) and Kurt T. Sadler, a resident of the State of
Minnesota (hereinafter “Sadler”).

 

WITNESSETH THAT:

 

WHEREAS,
Dotronix desires to employ the services of Sadler by reason of his ability and
experience in the business of Dotronix; and

 

WHEREAS,
Sadler desires to continue to be employed by Dotronix and is willing to accept
employment in accordance with the provisions hereinafter set forth.

 

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

 

1.             Duties.  Dotronix hereby employs Sadler as President
of Dotronix to supervise and direct various operations of the business
conducted and to be conducted by Dotronix, subject to the direction and control
of the Board of Directors of Dotronix, and 
Sadler does hereby accept such employment.

 

2.             Term.  This Agreement and Sadler’s employment shall
commence on the date hereof and expire on June 30, 2006, unless sooner
terminated as provided for herein.

 

3.             Base Compensation.  Dotronix shall pay, and Sadler shall accept,
as base compensation for the services to be performed by Sadler hereunder, a
monthly salary of six thousand six hundred fifty dollars ($6,650) adjusted
annually at the same rate as the average annual salary adjustment of all
Dotronix employees; provided, however, that such salary shall at no time be
less than of six thousand six hundred fifty dollars ($6,650) per month.

 

4.             Bonus
Compensation.

 

In addition to
the base compensation described in Section 3, Sadler shall be paid a cash
incentive payment within 30 days of the end of each reporting quarter in
accordance with the details set  forth
below. The calculation of pre-tax earnings or loss for such fiscal years shall
not take into account the accrual or payment of any bonuses

 

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payable to Sadler under this
Section 4. or to Robert V. Kling under an employment agreement.

 

	
  Quarterly pre-tax earnings

  	
   

  	
  % of
  quarterly pre-tax earnings to

  
	
   

  	
   

  	
   

  
	
  $50,000 to $89,999

  	
   

  	
  3%

  
	
   

  	
   

  	
   

  
	
  $90,000 or greater

  	
   

  	
  5%

  

 

 

5.                                       Stock option
grants

 

Dotronix agrees to issue stock options for 50,000 shares of common
stock to Sadler under the 1999 Stock Incentive Plan, in increments of 12,500
shares, starting October 1, 2003, and continuing every six months thereafter
until options for 50,000 has been granted. 
The option price for each increment of 12,500 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.

 

6.             Severance
Benefit.

 

(a)                                                                              In
the event Sadler’s employment terminates following a Change of Control as
defined in Section 11 below, he shall be paid a severance benefit equal to one
year of the base compensation which would be due under Section 3 (as adjusted,
if applicable, pursuant to Section 3) through the expiration date set forth in
Section 2.  This severance benefit shall
be due and payable immediately upon such termination of employment.

 

(b)                                                                             In
the event Sadler’s employment terminates following a Change of Control as
defined in Section 11 below, he shall be issued the balance of the un-issued
stock options pursuant to section 5. 
This severance benefit shall be due and payable immediately upon such
termination of employment.

 

(c)                                                                              Sadler
shall not be entitled to a severance benefit pursuant to this Section 6 in the
event of his termination for “cause” as defined in Section 10 below or in the
event of his resignation (other than a resignation following a Change of
Control, as contemplated by the last sentence of Section 11).

 

7.                                       Activities
During Employment.  Sadler does
hereby warrant and represent to Dotronix that he is not subject to any
agreement or arrangement that would preclude him from carrying out the terms of
this Agreement.  Sadler and Dotronix
acknowledge and agree that Sadler shall be permitted, during

 

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the term of this Agreement, to devote such time as is necessary to the
fulfillment of his obligations as President of Dynetic Systems, Inc., a
Minnesota corporation.  Sadler agrees
that he shall at all times devote his full time, energy and skill during
reasonable business hours to the performance of his duties as President of
Dotronix and as President of Dynetic Systems, but that the majority of his time
and efforts shall be devoted to the business affairs of Dotronix.

 

8.                                       Benefits.  Sadler shall be entitled to participate in
any insurance, pension and other benefits which may be afforded by Dotronix to
its employees engaged in a supervisory or management position.

 

9.                                       Covenant Not
to Compete.  Sadler agrees that,
during the term of this Agreement, he will not, directly or indirectly, on his
own behalf or as a partner, officer, employee, consultant, stockholder,
director, or trustee of any person, firm or corporation solicit, accept or service
any customers of Dotronix, nor engage in any business which would compete with,
or be of a similar nature to, the business being carried on by Dotronix.  The parties hereto hereby recognize that
money damages would not be an adequate remedy for the breach of this covenant
and Sadler hereby agrees to the grant of specific performance of this covenant
or other appropriate equitable relief by a court of competent jurisdiction in
the event of its breach.

 

10.                                 Termination.  Notwithstanding any other provision
contained herein, this Agreement may be terminated by (a) the mutual agreement
of the parties hereto; (b) the death of Sadler, or the disability of Sadler
which prevents him from performing his normal duties for a period of six
consecutive months or more; or (c) Dotronix for cause.  For purposes of this Agreement, the term
“cause” shall mean deliberate misconduct on the part of Sadler which is
seriously injurious to the interests of Dotronix, which misconduct shall be
specified in a written notice of termination delivered to Sadler by the Board
of Directors of Dotronix.

 

11.                                 Change of Control.  A “Change of Control” shall have occurred if

 

(i)                                     Sadler’s
employment with Dotronix thereafter is terminated (other than (A) for “cause”
as defined in Section 10 above, or (B) by virtue of the death or disability of
Sadler, or (C) by means of the resignation of Sadler), or

 

(ii)                                   Sadler’s
responsibilities with Dotronix thereafter are materially reduced without his
agreement, or Sadler is required to relocate without his agreement.

 

A resignation by Sadler following the occurrence of an event specified
in (ii) above shall not be deemed a resignation by Sadler for purposes of
(i)(C) above or for purposes of Section 6(b).

 

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12.                                 Entire Agreement
and Governing Law.  This Agreement
contains the entire agreement between the parties hereto and it shall be
amended or modified only by written instruments signed by both parties
hereto.  This Agreement shall in all
respects be governed, enforced and interpreted in accordance with the laws of
the State of Minnesota.

 

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

 

	
   

  	
  DOTRONIX, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By 

  	
  /s/ Robert V. Kling

  	
   

  
	
   

  	
   

  
	
   

  	
  Its Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Kurt T. Sadler

  	
   

  
					

 

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