Document:

Exhibit
10.3

Rimage
corporation

EMPLOYMENT
AGREEMENT

This employment
AGREEMENT (the “Agreement”) is made as of October 10, 2011, between Rimage Corporation, a Minnesota corporation
(the “Company”), and Raymond R. Hood, a Texas resident (“Employee”).

background

A.                 
Employee and Qumu, Inc. are parties to that Employment Agreement, dated August 29, 2007 (the
“Prior Agreement”).

B.                 
This Agreement is entered into as a condition to the Agreement and Plan of Merger, dated the
date hereof, among Qumu, Inc., the Company, and Quick Acquisition Corp. (the “Merger Agreement”).

C.                 
The parties acknowledge and agree that upon the consummation of the transactions contemplated
by the Merger Agreement the Prior Agreement will terminate and will no longer have any force or effect.

D.                 
Employee acknowledges and agrees that he will substantially benefit, directly or indirectly,
from the consummation of the transactions contemplated by the Merger Agreement.

E.                  
Contemporaneous with the execution of this Agreement, Employee and the Company have entered
into that Executive Letter Agreement in substantially the form attached hereto as Exhibit A (the “Letter Agreement”).

AGREEMENT

NOW, THEREFORE,
in consideration of the foregoing premises and the respective agreements of the Company and Employee set forth below, the Company
and Employee, intending to be legally bound, agree as follows:

1.                
Employment. Subject to all terms and conditions hereof, effective upon the closing
of the Merger Agreement, the Company shall employ Employee at-will, which means either the Company or Employee may end the employment
relationship at any time, with or without Cause (as defined in this Agreement). Employee shall serve the Company and perform services
for the Company, until Employee’s employment is terminated in accordance with Section 10 hereof.

2.                
Position and Duties.

a.                     
Position with the Company. During the term of Employee’s employment with the
Company, Employee shall serve as the Senior Vice President and General Manager, Qumu and shall perform such duties and responsibilities
consistent with his position as the board of directors of the Company (the “Board”) shall reasonably assign to him
from time to time.

    	 

    	 

    

 

b.                  
Performance of Duties and Responsibilities. Employee shall serve the Company faithfully
and to the best of his ability and shall devote his full working time, attention and efforts to the business of the Company during
his employment. Employee shall report to the President and Chief Executive Officer of the Company. During his employment hereunder,
Employee shall not accept other employment or engage in other material business activity, except that Employee may participate
in civic, trade and charitable activities and personal investment activities to a reasonable extent, and may serve on the boards
of up to two non-public companies and on the boards of not-for-profit organizations and trade groups and participate in community
affairs, so long as such activities do not unreasonably interfere with the performance of his duties and responsibilities hereunder.
The services of the Employee shall be performed, from time to time, at offices and facilities operated by the Company and its subsidiaries,
and at other locations where the interests of the Company may be advanced or promoted; provided, Employee shall not be required
to relocate his residence from Texas without the consent of Employee.

3.                  
Compensation.

a.                  
Base Salary. While Employee is employed by the Company hereunder, the Company shall
pay to Employee a base salary at the annual rate of $300,000, which base salary shall be paid in accordance with the Company’s
normal payroll policies and procedures. 

b.                  
Target Bonus. While Employee is employed by the Company hereunder, the Company shall
maintain a bonus plan or program. Pursuant to the bonus plan or program, and subject to the Company’s achieving certain financial
targets as determined by the management of the Company, Employee shall be eligible for bonus compensation up to a maximum of 50%
of the Employee’s base salary to be paid between January 1 and March 31 of the calendar year immediately following the Company’s
fiscal year to which the bonus relates. 

c.                   
Inducement Grant. Employee shall be granted 150,000 non-qualified option shares as
of the date hereof, which shall vest in equal amounts over four years on each anniversary of the date of the grant and shall have
a term of seven years. The stock options are issued with an exercise price equal to the fair market value of the Company’s
stock on the date of the grant and will be granted outside of the Company’s 2007 Stock Incentive Plan.

d.                  
Vacation. While Employee is employed by the Company hereunder, Employee shall be entitled
to vacation and personal time consistent with the policies and procedures of the Company. Such vacation and personal time off shall
be taken by Employee at times so as not to unduly disrupt the operations of the Company. During employment, Employee will accrue
earned vacation according to the policies and procedures of the Company and will not forfeit any earned and accrued vacation that
is not taken in a calendar year. The Company will pay Employee for any earned and accrued but unused vacation upon termination
from employment.

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e.                   
Additional Employee Benefits. While Employee is employed by the Company hereunder,
Employee shall be entitled to participate in any health, disability and term life insurance plans and programs of the Company that
are made generally available to other senior employees of the Company. Employee shall also be entitled to participate in such other
employee benefit plans and programs of the Company to the extent that Employee meets the eligibility requirements for each individual
plan or program. The Company provides no assurance as to the adoption or continuance of any such other particular employee benefit
plan or program, and Employee’s participation in any such plan or program shall be subject to the provisions, rules and regulations
applicable thereto.

f.                   
Expenses. While Employee is employed by the Company hereunder, the Company shall reimburse
Employee for all reasonable and necessary out-of-pocket business, travel and entertainment expenses incurred by Employee in the
performance of the duties and responsibilities hereunder, subject to the Company’s normal policies and procedures for expense
verification and documentation. Notwithstanding anything to the contrary in this Agreement or in any Company policy with respect
to such payments, in-kind benefits and reimbursements provided under this Agreement during any taxable year of Employee that would
result in taxable compensation to Employee (i) shall not affect in-kind benefits or reimbursements to be provided in any other
taxable year of Employee, (ii) are not subject to liquidation or exchange for another benefit and (iii) shall be made no later
than the last day of Employee’s taxable year following the taxable year in which the expense was incurred. 

g.                   
Indemnification.The Employee in any capacity on behalf of the Company or any of
its subsidiaries or affiliates, shall be entitled to exculpation, indemnification, and advancement of expenses to the fullest extent
permitted by Minnesota law. So long as Employee is an officer of the Company, Employee shall also be entitled to coverage under
each directors’ and officers’ liability insurance policy, if any, maintained by or on behalf of the Company’s
directors and officers.

4.                  
Confidential Information. Except as permitted by the Company or in the ordinary course
of the performance of the Employee’s duties hereunder, Employee shall not at any time divulge, furnish or make accessible
to anyone or use in any way other than in the ordinary course of the business of the Company, any confidential, proprietary or
secret knowledge or information of the Company that Employee has acquired or shall acquire about the Company, whether developed
by himself or by others, concerning (i) any trade secrets, (ii) any confidential, proprietary or secret designs, programs, processes,
formulae, plans, devices or material (whether or not patented or patentable) directly or indirectly useful in any aspect of the
business of the Company, (iii) any customer or supplier lists, (iv) any confidential, proprietary or secret development or research
work, (v) any strategic or other business, marketing or sales plans, (vi) any financial data or plans, or (viii) any other confidential
or proprietary information or secret aspects of the business of the Company. Employee acknowledges that the above-described knowledge
and information constitutes a unique and valuable asset of the Company and represents a substantial investment of time and expense
by the Company, and that any disclosure or other use of such knowledge or information other than for the sole benefit of the Company
would be wrongful and may cause irreparable harm to the Company. Employee shall take reasonable steps to protect the confidentiality
of such knowledge and information. The foregoing obligations of confidentiality shall not apply to any knowledge or information
that (i) is now or subsequently becomes generally publicly known, other than as a result of the breach of this Agreement, (ii)
is independently made available to Employee in good faith by a third party who has not violated a confidential relationship with
the Company, or (iii) is required to be disclosed by law or legal process. Employee understands and agrees that his obligations
under this Agreement to maintain the confidentiality of the Company’s confidential information are in addition to any obligations
of Employee under applicable statutory or common law.

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5.                  
Ventures. If, during Employee’s employment with the Company, Employee is engaged
in or provides input into the planning or implementing of any project, program or venture involving the Company, all rights in
such project, program or venture shall belong to the Company. Except as approved in writing by the Board, Employee shall not be
entitled to any ownership interest in any such project, program or venture or to any commission, finder’s fee or other compensation
in connection therewith. Employee shall have no ownership interest, direct or indirect, in any customer or supplier that conducts
business with the Company except for the passive investment in less than 5% of the outstanding shares of capital stock of any corporation
listed on a national securities exchange or publicly traded in the over-the-counter market. 

6.                  
Non-solicitation Covenants. In consideration for Employee’s employment hereunder
and the compensation and benefits to be provided hereunder and otherwise in connection with Employee’s employment with the
Company, Employee agrees to the following restrictive covenants.

a.                  
Agreement Not to Solicit Employees. During Employee’s employment with the Company
and for a period of twelve (12) months from and after the termination of Employee’s employment, whether such termination
is with or without Cause, or whether such termination is at the instance of Employee or the Company, Employee shall not, directly
or indirectly, solicit or attempt to solicit any person who is then an employee, consultant or other independent contractor of
the Company or who was an employee, consultant or other independent contractor of the Company at any time during the three (3)
month period immediately preceding Employee’s termination of employment. 

b.                  
Agreement Not to Solicit Others. During Employee’s employment with the Company
for a period of twelve (12) months from and after the termination of Employee’s employment, whether such termination is with
or without Cause, or whether such termination is at the instance of Employee or the Company, Employee shall not, directly or indirectly,
in any manner or capacity, including without limitation as a proprietor, principal, agent, partner, officer, director, stockholder,
employee, member of any association, consultant or otherwise, (i) initiate contact with, solicit or attempt to solicit any person
or entity who was a customer of the Company during the last twelve (12) months of Employee’s employment, for the purposes
of selling, marketing or distributing products similar to the products sold, marketed or distributed by the Company, and (ii) solicit,
request, advise or induce any supplier, distributor or other business contact of the Company to cancel, curtail or otherwise adversely
change its relationship with the Company; or (iii) using the Company’s information about its clients' technical and business
requirements, or other confidential client information, to solicit or obtain agreements with those clients, except that Employee
may enter into agreements with the Company’s customers if the customer initiates the contact and none of the Company’s
confidential information will be used in negotiating, executing, or performing the agreement.

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c.                   
Acknowledgment. Employee hereby acknowledges that the provisions of this Section
6 are reasonable and necessary to protect the legitimate interests of the Company and that any violation of this Section
6 by Employee may cause substantial and irreparable harm to the Company to such an extent that monetary damages alone would
be an inadequate remedy therefor. 

d.                  
Blue Pencil Doctrine. If the duration of, the scope of or any business activity covered
by any provision of this Section 6 is in excess of what is determined to be valid and enforceable under applicable law,
such provision shall be construed to cover only that duration, scope or activity that is determined to be valid and enforceable.
Employee hereby acknowledges that this Section 6 shall be given the construction which renders its provisions valid and
enforceable to the maximum extent, not exceeding its express terms, possible under applicable law.

7.                
Patents, Copyrights and Related Matters.

a.                     
Disclosure and Assignment. Except as prohibited by California Labor Code Section 2870
(attached hereto as Schedule A), Employee shall promptly disclose to the Company any and all improvements and inventions
that Employee may conceive and/or reduce to practice individually or jointly or commonly with others while he is employed with
the Company with respect to (i) any methods, processes or apparatus concerned with the development, use or production of any type
of products, goods or services sold or used by the Company, and (ii) any type of products, goods or services sold or used by the
Company. Any such improvements and inventions shall be the sole and exclusive property of the Company and Employee shall promptly
assign, transfer and set over to the Company his entire right, title and interest in and to any and all of such improvement and
inventions as are specified in this Section 7(a), and in and to any and all applications for letters patent that may be
filed on such inventions, and in and to any and all letters patent that may issue, or be issued, upon such applications. In connection
therewith and for no additional compensation therefor, but at no expense to Employee, Employee shall sign any and all instruments
reasonably deemed necessary by the Company for:

i.                    
the filing and prosecution of any applications for letters patent of the United States or
of any foreign country that the Company may desire to file upon such inventions as are specified in this Section 7(a);

ii.                   
the filing and prosecution of any divisional, continuation, continuation-in-part or reissue
applications that the Company may desire to file upon such applications for letters patent; and

iii.                 
the reviving, re-examining or renewing of any of such applications for letters patent.

This Section 7(a) shall not apply to
any invention for which no equipment, supplies, facilities, confidential, proprietary or secret knowledge or information, or other
trade secret information of the Company was used and that was developed entirely on Employee’s own time, and (i) that does
not relate (A) directly to the business of the Company, or (B) to the Company’s actual or demonstrably anticipated research
or development, or (ii) that does not result from any work performed by Employee for the Company.

 

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b.                  
Copyrightable Material. All right, title and interest in all copyrightable material
that Employee shall conceive or originate individually or jointly or commonly with others, and that arise in connection with Employee’s
services hereunder or knowledge of confidential and proprietary information of the Company, shall be the property of the Company
and are hereby assigned by Employee to the Company, along with ownership of any and all copyrights in the copyrightable material.
Where applicable, works of authorship created by Employee relating to the Company and arising out of Employee’s knowledge
of confidential and proprietary information of the Company shall be considered “works made for hire,” as defined in
the U.S. Copyright Act, as amended.

8.                  
Return of Records and Property. Upon termination of Employee’s employment or
at any time upon the Company’s request, Employee shall promptly deliver to the Company any and all Company records and any
and all Company property in his possession or under his control, including without limitation manuals, books, blank forms, documents,
letters, memoranda, notes, notebooks, reports, printouts, computer disks, computer tapes, source codes, data, tables or calculations
and all copies thereof, documents that in whole or in part contain any trade secrets or confidential, proprietary or other secret
information of the Company and all copies thereof, and keys, access cards, access codes, passwords, credit cards, personal computers,
telephones and other electronic equipment belonging to the Company. 

9.                  
Remedies. Employee acknowledges that it would be difficult to fully compensate the
Company for monetary damages resulting from any breach by him of the provisions hereof. Accordingly, in the event of any actual
or threatened breach of any such provisions, the Company shall, in addition to any other remedies it may have, be entitled to injunctive
and other equitable relief to enforce such provisions, and such relief may be granted without the necessity of proving actual monetary
damages.

10.               
Termination of Employment. 

a.                  
The Employee’s employment with the Company shall terminate immediately upon:

i.                    
Employee’s receipt of written notice from the Company of the termination of his employment,
effective as of the date indicated in such notice;

ii.                   
Employee’s abandonment of his employment or notice of his resignation from the Company;

iii.                 
Employee’s Disability; or

iv.                 
Employee’s death.

b.                  
Capitalized terms used in this Section 10 and not otherwise defined in this Agreement
shall have the meaning given in the Letter Agreement.

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11.               
Payments upon Termination of Employment.

a.                  
Except as provided in the Letter Agreement or otherwise provided by law, the Company shall
have no obligations to Employee or to his beneficiary or his estate under the terms of any other applicable agreement between Employee
and the Company or under the terms of any employee benefit plans or programs then maintained by the Company in which Employee participates.

12.               
Miscellaneous.

a.                  
Taxes. The Company shall deduct from any payments made to the Employee hereunder any
withholding or other taxes which the Company is required to deduct under applicable law. 

b.                  
Governing Law. All matters relating to the interpretation, construction, application,
validity and enforcement of this Agreement shall be governed by the laws of the State of California without giving effect to any
choice or conflict of law provision or rule, whether of the State of California or any other jurisdiction, that would cause the
application of laws of any jurisdiction other than the State of California.

c.                   
Entire Agreement. This Agreement and the Letter Agreement constitute the entire agreement
of the parties relating to Employee’s employment with the Company and supersede all prior agreements and understandings with
respect to such subject matter, and the parties hereto have made no agreements, representations or warranties relating to the subject
matter of this Agreement that are not set forth herein or in the Letter Agreement. By way of clarification, the Company and Employee
agree that in calculating the average annual bonus amounts with respect to the three completed calendar years prior to the date
of Employee’s termination under Section 1(a)(ii) of the Letter Agreement, if Employee is with the Company for less than three
completed calendar years prior to the date of termination, the calculation shall be based upon the actual completed calendar years
of employment prior to the date of Employee’s termination. In addition, if the Company provides health and/or dental benefits
under a self-insured arrangement described in §105(h) of the Internal Revenue Code of 1986, as amended (“Code”),
the COBRA premium amounts referenced in the Letter Agreement to be paid by the Company on Employee’s behalf will be included
in Employee’s income. All disputes or claims arising out of or in any way related to this Agreement, including the making
of this Agreement, shall be submitted to and determined by final and binding arbitration under the terms set forth in the Letter
Agreement.

d.                  
Section 409A. Notwithstanding anything to the contrary in this Agreement or the Letter
Agreement, to the maximum extent permitted by applicable law, the severance payments payable to Employee pursuant to the Letter
Agreement shall be made in reliance upon Treasury Regulation § 1.409A-1(b)(9)(iii) (relating to separation pay plans) or Treasury
Regulation § 1.409A-1(b)(4) (relating to short-term deferrals). However, to the extent any such payments are treated as “non-qualified
deferred compensation” subject to Code § 409A and the payments become payable pursuant to Section 2 of the Letter Agreement
following a Change in Control (as defined in Schedule 1 to the Letter Agreement) that is not a “change in the ownership or
effective control of a corporation, or change in the ownership of a substantial portion of the assets of a corporation” as
described in each case in Treasury Regulation § 1.409A-3(i)(5), any such severance amount payable pursuant to Section 2 shall
be paid at the same time and in the same manner as severance is paid pursuant to Section 1 of the Letter Agreement, but without
regard to any limitations on the payments based on Employee’s subsequent employment. To the extent any severance payments
provided for under the Letter Agreement are treated as “non-qualified deferred compensation” subject to Code §
409A and such payments are conditioned on Employee’s execution of a general release, the payments will be made or will commence,
as the case may be, on the 60th day (or if applicable, the expiration of the six-month payment delay period or earlier death as
described in Section 7 of the Letter Agreement) following Employee’s separation from service (the “Payment Date”),
provided that prior to the Payment Date, Employee executes and delivers the general release to the Company and all applicable revocation
periods have expired. In this regard, the Company shall provide the form of general release to Employee on or before the 5th day
following his separation from service.

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e.                   
No Violation of Other Agreements. Employee hereby represents and agrees that neither
(i) Employee’s entering into this Agreement nor (ii) Employee’s carrying out the provisions of this Agreement, will
violate any other agreement (oral, written or other) to which Employee is a party or by which Employee is bound.

f.                   
Amendments. No amendment or modification of this Agreement shall be deemed effective
unless made in writing and signed by the parties hereto.

g.                   
No Waiver. No term or condition of this Agreement shall be deemed to have been waived,
except by a statement in writing signed by the party against whom enforcement of the waiver is sought. Any written waiver shall
not be deemed a continuing waiver unless specifically stated, shall operate only as to the specific term or condition waived and
shall not constitute a waiver of such term or condition for the future or as to any act other than that specifically waived.

h.                  
Assignment. This Agreement shall not be assignable, in whole or in part, by either
party without the prior written consent of the other party, except that the Company may, without the consent of Employee, assign
its rights and obligations under this Agreement to any corporation or other person or business entity with which the Company may
merge or consolidate or to which the Company may sell or transfer all or substantially all of its assets.

i.                    
Counterparts. This Agreement may be executed in any number of counterparts, and such
counterparts executed and delivered, each as an original, shall constitute but one and the same instrument.

j.                    
Severability. Subject to Section 6(d) hereof, to the extent that any portion
of any provision of this Agreement shall be invalid or unenforceable, it shall be considered deleted herefrom and the remainder
of such provision and of this Agreement shall be unaffected and shall continue in full force and effect.

k.                  
Captions and Headings. The captions and paragraph headings used in this Agreement are
for convenience of reference only and shall not affect the construction or interpretation of this Agreement or any of the provisions
hereof.

 

* * * * *

 

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IN WITNESS WHEREOF, Employee
and the Company have executed this Agreement as of the date set forth in the first paragraph.

 

	 	RIMAGE CORPORATION	 
	 	 	 	 
	 	 	 	 
	 	By: 	/s/ Sherman L. Black	 
	 	Name: 	Sherman L. Black	 
	 	Its:  	President and Chief Executive Officer	 
	 	 	 	 
	 	 	 	 
	 	/s/ Raymond R. Hood	 
	 	Raymond R. HoodExhibit 10.4

 

RIMAGE CORPORATION

STOCK OPTION AGREEMENT

 

THIS STOCK OPTION AGREEMENT
(this “Agreement”) is made as of the Grant Date set forth below, by and between Rimage Corporation, a Minnesota corporation
(the “Company”), and the optionee named below (“Optionee”), and is not issued pursuant to the Company’s
2007 Amended and Restated Stock Incentive Plan or any other equity incentive plan of the Company.

 

	 	 
	OPTIONEE:	Raymond R. Hood
	 	 
	GRANT DATE:	October 10, 2011
	 	 
	NUMBER OF OPTION SHARES:	150,000 shares, common stock
	 	 
	OPTION PRICE PER SHARE:	$11.50 per Share
	 	 
	EXPIRATION DATE:	October 10, 2018
	 	 

 

1. Grant of Option.
The Company hereby grants to Optionee the right and option (the “Option”) to purchase all or any part of the aggregate
number of shares of common stock of the Company set forth above (the “Option Shares”), at the Option Price per Share
set forth above, on the terms and conditions set forth in this Agreement. The Option is not intended to be an “incentive
stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).

 

2. Administration
of Option. The Option will be administered by the Compensation Committee (the “Committee”) of the Board of
Directors of the Company (the “Board”). Any or all functions of the Committee specified in this Agreement may be exercised
by the Board unless this Agreement specifically states otherwise. The Committee has the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Option as it may, from time-to-time, deem advisable, to interpret
the terms and provisions of this Agreement and to otherwise supervise the administration of the Option. The Committee may not take
any action that would be treated as a “repricing” of the Option and may not amend or alter the Option without the written
consent of Optionee. All decisions made by the Committee pursuant to this Agreement will be final, conclusive and binding on all
persons, including the Company, its shareholders, members of the Board, Optionee and their respective estates and beneficiaries.

 

3. Term and Exercise
of Option.

 

(a)         Installment
Exercise Provisions. The term of the Option shall commence on the Grant Date set forth above and shall continue until
the Expiration Date set forth above, unless earlier terminated as provided herein. Except as otherwise provided herein, the Option
will be exercisable in cumulative installments as follows:

 

(i)         Up to
25% of the Option Shares may be purchased at any time after the one-year anniversary of the Grant Date and prior to termination
of the Option;

 

(ii)         Up to
50% of the Option Shares (less any shares previously purchased pursuant to the Option) may be purchased at any time on or after
the second-year anniversary of the Grant Date and prior to termination of the Option;

 

(iii)         Up to
75% of the Option Shares (less any shares previously purchased pursuant to the Option) may be purchased at any time on or after
the third-year anniversary of the Grant Date and prior to termination of the Option; and

 

(iv)         Up to
100% of the Option Shares (less any shares previously purchased pursuant to the Option) may be purchased at any time on or after
the fourth-year anniversary of the Grant Date and prior to termination of the Option.

 

    	 

    	 

    

Neither Optionee nor Optionee’s
legal representatives, legatees or distributees, as the case may be, will be, or will be deemed to be, a holder of any Option Shares
for any purpose unless and until certificates for such shares are issued to Optionee or Optionee’s legal representatives,
legatees or distributees, under the terms of this Agreement.

 

(b)         Method of Exercise.  The
Option is exercisable by delivery of an exercise notice, in the form attached as Exhibit A (the “Exercise Notice”),
which shall state the election to exercise the Option, the number of Option Shares in respect of which the Option is being exercised
(the “Exercised Shares”) and such other representations and agreements as may be required by the Company. The Exercise
Notice shall be signed by Optionee and shall be delivered in person or by certified mail to the principal financial officer of
the Company in accordance with Section 11 of this Agreement. The Exercise Notice shall be accompanied by payment of the aggregate
Option Price per Share. The Option shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise
Notice accompanied by such aggregate Option Price per Share.

 

(c)         Method of Payment.
Payment of the aggregate Option Price per Share shall be made by certified, bank check, by delivery of other Shares owned by Optionee,
pursuant to a “same day sale” program exercised through a brokerage transaction as permitted under the provisions of
Regulation T applicable to cashless exercises (so long as the Company’s Shares are registered under Section 12 of the Exchange
Act), or by a “net exercise” arrangement pursuant to which the Company will reduce the number of Shares issued upon
exercise by the largest whole number of Shares with a Fair Market Value that does not exceed the aggregate Option Price per Share
(together with payment in cash or other payment from Optionee to the extent of any remaining balance) provided that any such Shares
used to pay the aggregate Option Price per Share shall no longer be outstanding and exercisable under this Option. Any same day
sale or cashless exercise shall comply with regulations promulgated under the Securities Exchange Act and the Federal Reserve Board.
No shares of common stock of the Company and no certificates for such shares shall be issued until full payment therefore has been
made.

 

4. Change in Control.

 

(a)         “Change in
Control” of the Company shall mean a change in control which would be required to be reported in response to Item 5.01 of
Form 8-K promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), whether or not the
Company is then subject to such reporting requirement, including without limitation, if:

 

(i)                  
any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly of securities of the Company representing
20% or more of the combined voting power of the Company’s then outstanding securities (other than an entity owned 50% or
greater by the Company or an employee pension plan for the benefit of the employees of the Company);

(ii)                
there ceases to be a majority of the Board comprised of (i) individuals who, on the date of this Agreement, constituted
the Board of the Company; and (ii) any new director who subsequently was elected or nominated for election by a majority of the
directors who held such office prior to a Change in Control; or

(iii)               
the Company disposes of at least 75% of its assets, other than (i) to an entity owned 50% or greater by the Company or any
of its subsidiaries, or to an entity in which at least 50% of the voting equity securities are owned by the shareholders of the
Company immediately prior to the disposition in substantially the same percentage or (ii) as a result of a bankruptcy proceeding,
dissolution or liquidation of the Company.

    	 

    	 

    

(b)         Except as
otherwise provided in this Agreement, if a Change in Control occurs, all previously unexercised Option Shares shall be
exercisable in full, without regard to any installment exercise provisions; provided, however, that the Committee,
in its sole and absolute discretion, may, with respect to any or all of such Option Shares, take any or all of the following actions
to be effective as of the date of the Change in Control (or as of any other date fixed by the Committee occurring within the thirty
(30) day period immediately preceding the date of the Change in Control, but only if such action remains contingent upon the effectuation
of the Change in Control) (such date referred to as the “Action Effective Date”):

(i)         Unilaterally
cancel such Option Shares in exchange for whole and/or fractional shares of the common stock of the Company (or whole shares of
common stock and cash in lieu of any fractional share of common stock) or whole and/or fractional shares of a successor (or whole
shares of a successor and cash in lieu of any fractional share) that, in the aggregate, are equal in value to the product of (1)
the excess, if any, of the Fair Market Value per share on the Action Effective Date over the Exercise Price or specified price
per share, multiplied by (2) the number of Option Shares.

(ii)         Unilaterally
cancel such Option Shares in exchange for cash or other property equal in value to the product of (1) the excess, if any, of the
Fair Market Value per share on the Action Effective Date over the Exercise Price or specified price per share, multiplied by (2)
the number of Option Shares.

(iii)         Unilaterally
cancel such Option Shares after providing the holder of such Option Shares with (i) an opportunity to exercise such Option Shares
to the extent vested within a specified period prior to the date of the Change in Control, and (ii) notice of such opportunity
to exercise prior to the commencement of such specified period. The Committee may modify or waive any condition limiting the exercise
of the Option to permit a cashless exercise of the Option.

(iv)         Provide
for the assumption or substitution of the Option in accordance with Section 11 below.

(c)         Notwithstanding
the foregoing, payment of cash in lieu of whole or fractional shares of common stock of the Company or shares of a successor may
only be made to the extent that such payment (i) has met the requirements of an exemption under Rule 16b-3 promulgated under the
Exchange Act, or (ii) is a subsequent transaction the terms of which were provided for in a transaction initially meeting the requirements
of an exemption under Rule 16b-3 promulgated under the Exchange Act. The payment of cash in lieu of whole or fractional shares
of common stock of the Company or in lieu of whole or fractional shares of a successor shall be considered a subsequent transaction
approved by the original grant of the Option.

(d)         For
the purposes of this Agreement, “Fair Market Value” of a share of the common stock of the Company shall be determined
by the Committee as follows: (i) if the common stock of the Company is listed for trading on one of more national securities exchanges,
the last reported sales price on such principal exchange on the date in question, or if such common stock shall not have been traded
on such principal exchange on such date, the last reported sales price on such principal exchange on the first day prior thereto
on which such common stock was so traded; or (b) if the common stock of the Company is not listed for trading on a national securities
exchange, but is traded in the over-the-counter market, the closing bid price for such common stock on the date in question, or
if there is no such bid price for such common stock on such date, the closing bid price on the first day prior thereto on which
such price existed; or (c) if neither (a) or (b) is applicable, a value determined by the reasonable application of a reasonable
valuation method as defined in regulations promulgated under Section 409A of Code, which determination shall be final and binding
on all parties.

    	 

    	 

    

5. Termination of
Employment.

 

(a)         If Optionee ceases
to be employed by the Company or a subsidiary of the Company as a result of retirement for age or disability, or voluntary or involuntary
separation from employment, other than a termination for Cause (as defined below), the Option may be exercised to the extent Optionee
shall have been entitled to do so at the date of termination of employment, within a period of 90 days after such termination of
employment, but in no case later than the Expiration Date set forth above.

 

(b)         If Optionee’s
employment is terminated for Cause, the right of Optionee to exercise the Option shall terminate immediately upon such termination
of employment. For purposes of this Agreement, “Cause” shall have the same meaning as in any employment or severance
agreement between Optionee and the Company governing Optionee’s termination of employment prior to a Change in Control.

 

(c)         The Option will not
confer upon Optionee any right with respect to continuance of employment by the Company, nor will it interfere in any way with
the right of the Company or a subsidiary of the Company to terminate Optionee’s employment at any time.

 

6. Death of Optionee.
In the event of the death of Optionee while in the employ of the Company, the Option may be exercised to the extent Optionee shall
have been entitled to do so at the date of death, within a period of one year after the date of death, but in no case later than
the Expiration Date set forth above. In such event, the Option shall be exercisable only by the executors or administrators of
Optionee or by the person or persons to whom Optionee’s rights under the Option shall pass by Optionee’s will or the
laws of descent and distribution.

 

7. Limitations on
Exercise of Option.

 

(a)         Except as provided
in paragraph 5 and 6 above, the Option may not be exercised unless Optionee is, at the time of such exercise, in the employ of
the Company, and shall have been continuously so employed since the Grant Date of the Option.

 

(b)         The issuance of Option
Shares upon the exercise of the Option shall be subject to all applicable laws, rules and regulations, and shares shall not be
issued except upon the approval of proper government agencies or stock exchanges as may be required. Assuming compliance with such
laws, rules and regulations, for income tax purposes the Option Shares shall be considered transferred to Optionee on the date
the Option is exercised with respect to such Option Shares.

 

8. Nontransferability
of Option. The Option shall not be transferable by Optionee, other than by will or the laws of descent and distribution.
During the lifetime of Optionee, the Option shall be exercisable only by Optionee.

 

9. Registration.
If any law or regulation of the Securities and Exchange Commission or of any other body having jurisdiction shall require the Company
or Optionee to take any action in connection with the exercise of the Option, then, notwithstanding any contrary provision of this
Agreement, the date for exercise of the Option and the delivery of the Option Shares shall be deferred until the completion of
the necessary action. In the event that the Company shall deem it necessary, the Company may condition the grant or exercise of
the Option upon the receipt of a satisfactory certificate that Optionee is acquiring the Option Shares for investment purposes
and not with the view or intent to resell or otherwise distribute the Option or Option Shares. In such event, the stock certificate
evidencing such Option Shares shall bear a legend referring to applicable laws restricting transfer of such shares. In the event
that the Company deems it necessary to register under the Securities Act of 1933, as amended, or any other applicable statute,
the Options or any Option Shares, then Optionee shall cooperate with the Company and take such action as is necessary to permit
registration or qualification of such Option or Option Shares. It is the Company’s intent, but not its obligation, to register
or qualify the offering or sale of Shares under the Securities Act of 1933 of any other applicable state, federal or foreign law.

 

    	 

    	 

    

10.         Disgorgement.

 

(a)         If the Company’s
financial statements for the year or years in which this Option is issued or outstanding are required to be restated resulting
from errors, omissions or fraud, the Committee may (in its sole discretion, but acting in good faith) direct that the Company recover
all or a portion of this Option with respect to such fiscal year of the Company the financial results of which are negatively affected
by such restatement. The operation of this Section 10(a) shall be in accordance with the provisions of Section 302 of Sarbanes-Oxley
Act of 2002 and any applicable guidance.

 

(b)         Upon
demand of the Company, Optionee shall disgorge all or any portion of this Option or other compensation paid or payable pursuant
to this Option received within 36-month period prior to the public release of the restatement of financial information due to material
noncompliance with the financial reporting requirements under the federal securities laws. The operation of this Section 10(b)
shall be in accordance with the provisions of Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and
any applicable guidance.

(c)         The amount to be recovered
from Optionee under this Section shall be the amount by which the Option exceeded the amount that would have been paid or payable
to the Optionee had the financial statements been initially filed as restated, or any greater or lesser amount (including, but
not limited to, the entire Option) that the Committee shall determine. In no event shall the amount to be recovered by the Company
be less than the amount required to be repaid or recovered as a matter of law.

11. Forfeiture
and Recoupment. Without limiting in any way the foregoing, Optionee’s rights, payments, and benefits with respect
to this Option shall be subject to reduction, cancellation, forfeiture, or recoupment by the Company upon the occurrence of any
of the following events, in addition to any otherwise applicable vesting conditions: (a) failure to accept the terms of this Option,
(b) termination of Optionee’s employment for Cause, (c) violation of material Company policies, (d) breach of any agreement
between the Company and Optionee, or (e) other conduct by Optionee that the Committee determines is detrimental to the business
or reputation of the Company or its subsidiaries.

 

12. Tax Withholding.
Upon notification of the amount due and prior to, or concurrently with, the delivery to Optionee of a certificate representing
any Option Shares purchased pursuant to the exercise of the Option, Optionee shall promptly pay to the Company any amount necessary
to satisfy applicable federal, state and local withholding requirements.

 

13. Adjustment.
In the event of a stock dividend, stock split, spin-off, rights offering, recapitalization through a large, nonrecurring cash
dividend, or a similar equity restructuring of the Company, the Committee will adjust: (a) the number of Shares subject to the
Option, rounding all fractions downward, and (d) the Exercise Price of the Option, or any combination thereof, in an equitable
manner that will equalize the fair value of the Option before and after the equity restructuring. Furthermore, in the event of
any corporate transaction described in Code Section 424(a) that provides for the substitution or assumption of this Option, the
Committee will adjust the Option in a manner that satisfies the requirements of Code Section 424(a) as to: (x) the number of Shares
subject to the Option, rounding all fractions downward, and (y) the Exercise Price of the Option, or any combination thereof. An
adjustment made under this Section by the Committee shall be conclusive and binding on all affected persons.

 

14. Notices.
Notices required hereunder shall be given in person or by first class mail to the address of Optionee shown on the records of the
Company, and to the Company at its principal executive office.

 

15. Successors
and Assigns. This Agreement shall apply to and bind Optionee and the Company and their respective permitted assignees and
transferees, heirs, legatees, executors, administrators and legal successors.

 

16. Miscellaneous.
This Agreement, together with Exhibit A, constitutes the entire agreement of the parties with respect to the subject
matter of this Agreement and supersedes in its entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be amended or altered except by means of a writing signed by the Company and
Optionee. This Agreement is governed by the internal substantive laws of but not the choice of law rules of the State of Minnesota.

 

* * * * *

 

 

    	 

    	 

    

IN WITNESS WHEREOF,
the Company has caused this Agreement to be executed in its corporate name by its duly authorized officer, and Optionee has executed
this Agreement, as of the Grant Date set forth above.

 

	COMPANY:	RIMAGE CORPORATION	 
	 	 	 	 
	 	By 	/s/  Sherman L. Black	 
	 	 	Sherman L. Black	 
	 	 	Chief Executive Officer	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	OPTIONEE:	/s/  Raymond R. Hood	 
	 	Raymond R. Hood

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