Exhibit 4.2(e)



April 13, 2004


Dr. Anil Jain
APA Optics, Inc.
2950 NE 84th Lane
Blaine, MN 55449


Dear Dr. Jain,

The Aberdeen Development Corporation and APA Optics, Inc. acknowledge and agree
to the following terms and conditions regarding the outstanding loans between
the two parties:

     -    Aberdeen Development Corporation acknowledges receipt of $89,305.00
          from APA Optics, Inc. to ADC's Wells Fargo bank account
     -    Aberdeen Development Corporation agrees to the release of the UCC
          Filing in the State of Minnesota #1859487 dated June 24, 1996 on the
          equipment located in Blaine, Minnesota which was renewed August 20,
          2001 ( UCC Filing #20013130900028)
     -    Aberdeen Development Corporation will retain the UCC Filing in the
          State of South Dakota #20013130900028 dated November 9, 2001 on the
          equipment located in Aberdeen, SD
     -    APA Optics, Inc. will pay the Aberdeen Development Corporation
          $140,000 payable in seven equal payments of $20,000 starting June 30,
          2004
     -    The interest rate on the loan will remain at 0% interest
     -    All other terms and conditions of the loan will remain in affect.

The above is correct and accurate and we consent to these terms and conditions.

APA Optics, Inc.                        Aberdeen Development Corporation

By:                                     By:
     -----------------------------           -----------------------------
     Dr. Anil K. Jain                        Larry Frost
     Its:  Chairman and President            Its:  President

                                       By:
                                            ------------------------------
                                            James C. Barringer
                                            Its:  Executive Vice-President