Document:

EXHIBIT 10.4   2001 EMPLOYEE STOCK PURCHASE PLAN OF THE REGISTRANT

                        ONTRACK DATA INTERNATIONAL, INC.
                        2001 EMPLOYEE STOCK PURCHASE PLAN

         WHEREAS, ONTRACK Data International, Inc. established on August 6,
1996, an employee stock purchase plan in accordance with Section 423 of the
Internal Revenue Code and authorized 250,000 shares of its common stock to be
reserved for issuance under the plan; and

         WHEREAS, the plan encountered a shortfall in available reserved shares
during fourth quarter of 2001 thereby resulting in automatic termination of said
plan; and

         WHEREAS, the Board of Directors, as of September 27, 2001, and subject
to the approval of its shareholders, authorized a new stock purchase plan to be
established to provide employees the opportunity to continue to purchase shares
under such a plan.

                  THEREFORE, ONTRACK Data International, Inc. hereby establishes
         this Plan as set forth herein:

1. ESTABLISHMENT OF PLAN. ONTRACK Data International, Inc. (hereinafter referred
to as the "Company") proposes to grant to certain employees of the Company and
its subsidiaries the opportunity to purchase common stock of the Company. Such
common stock shall be purchased pursuant to the plan herein set forth which
shall be known as the "ONTRACK Data international, Inc. Employee Stock Purchase
Plan" (hereinafter referred to as the "Plan"). The Company intends that the Plan
shall qualify as an "Employee Stock Purchase Plan" under Section 423 of the
Internal Revenue Code of 1986, as amended, and shall be construed in a manner
consistent with the requirements of said Section 423 and the regulations
thereunder.

2. PURPOSE. The Plan is intended to encourage stock ownership by employees of
the Company and any of its Subsidiaries to which the Company and such respective
Subsidiaries by action of their Boards of Directors shall make this Plan
applicable. The Plan is further intended as an incentive to them to remain in
employment, improve operations, increase profits, and contribute more
significantly to the Company's success, and to permit the Company to compete
with other corporations offering similar plans in obtaining and retaining the
services of competent employees.

3. ADMINISTRATION.

                  (a) The Plan shall be administered by a stock purchase
         committee (hereinafter referred to as the "Committee"), consisting of
         two or more directors or employees of the Company, as designated by the
         Board of Directors of the Company (hereinafter referred to as the
         "Board of Directors"). The Board of Directors shall fill all vacancies
         in the Committee and may remove any member of the Committee at any
         time, with or without cause.

                  (b) Unless the Board of Directors limits the authority
         delegated to the Committee in its appointment, the Committee shall be
         vested with full authority to make, administer, and interpret such
         rules and regulations as it deems necessary to administer the Plan. For
         all purposes of this Plan other than this Paragraph 3(b), references to
         the Committee shall also refer to the Board of Directors.

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                  (c) The Committee shall select its own chairman and hold its
         meetings at such times and places as it may determine. All
         determinations of the Committee shall be made by a majority of its
         members. Any decision which is made in writing and signed by a majority
         of the members of the Committee shall be effective as fully as though
         made by a majority vote at a meeting duly called and held.

                  (d) The determinations of the Committee shall be made in
         accordance with its judgment as to the best interests of the Company,
         its employees and its shareholders and in accordance with the purposes
         of the Plan; provided, however, that the provisions of the Plan shall
         be construed in a manner consistent with the requirements of Section
         423 of the Internal Revenue Code, as amended. Such determinations shall
         be binding upon the Company and the participants in the Plan unless
         otherwise determined by the Board of Directors.

                  (e) The Company shall pay all expenses of administering the
         Plan. No member of the Board of Directors or the Committee shall be
         liable for any action or determination made in good faith with respect
         to the Plan or any option granted under it. The Company shall indemnify
         each member of the Committee against any and all claims, loss, damages,
         expenses (including counsel fees approved by the Committee), and
         liability (including any amounts paid in settlement with the
         Committee's approval) arising from any loss or damage or depreciation
         which may result in connection with the execution of his or her duties
         or the exercise of his or her discretion, or from any other action or
         failure to act hereunder, except when the same is judicially determined
         to be due to gross negligence or willful misconduct of such member.

4. DURATION AND PHASES OF THE PLAN.

                  (a) The Plan will commence on October 1, 2001 (the "Effective
         Date") and will terminate September 30, 2010, except that any Phase
         commenced prior to such termination shall, if necessary, be allowed to
         continue beyond such termination until completion. Notwithstanding the
         foregoing and except as provided at the end of this sentence, this Plan
         shall be considered of no force or effect and any options granted shall
         be considered null and void unless the holders of a majority of all of
         the issued and outstanding shares of the common stock of the Company
         approve the Plan within twelve (12) months after the date of its
         adoption by the Board of Directors; provided, however, if prior to
         receipt of such shareholder approval the Board of Directors accelerates
         the Termination Date of any Phase pursuant to Section 4(c), shareholder
         approval will not be required and this Plan and all options granted
         hereunder shall remain in full force and effect.. The Plan year shall
         be the same as the Company's fiscal year, ending each December 31.

                  (b) The Plan shall be carried out in one or more Phases, each
         Phase being for a period of three months, or such shorter or longer
         period of time (not to exceed 27 months) as may be determined by the
         Committee prior to the commencement of a Phase. The existence and date
         of commencement of a Phase (the "Commencement Date") shall be
         determined by the Committee and shall terminate on a date (the
         "Termination Date") determined by the Committee consistent with the
         limitation specified above, provided that the commencement of the first
         Phase shall be within twelve months before or after the date of
         approval of the Plan by the shareholders of the Company. In the event

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         all of the stock reserved for grant of options hereunder is issued
         pursuant to the terms hereof prior to the commencement of one or more
         Phases scheduled by the Committee or the number of shares remaining is
         so small, in the opinion of the Committee, as to render administration
         of any succeeding Phase impracticable, such Phase or Phases shall be
         canceled. Phases shall be numbered successively as Phase 1, Phase 2,
         Phase 3, etc.

                  (c) The Board of Directors may elect to accelerate the
         Termination Date of any Phase effective on the date specified by the
         Board of Directors in the event of (i) any consolidation or merger of
         the Company in which the Company is not the continuing or surviving
         corporation or pursuant to which shares would be converted into cash,
         securities or other property, other than a merger of the Company in
         which shareholders immediately prior to the merger have the same
         proportionate ownership of stock in the surviving corporation
         immediately after the merger; or (ii) any sale, lease, exchange or
         other transfer (in one transaction or a series of related transactions)
         of all or substantially all of the assets of the Company. Subject to
         any required action by the shareholders, if the Company shall be
         involved in any merger or consolidation, in which it is not the
         surviving corporation, and if the Board of Directors does not
         accelerate the Termination Date of the Phase, each outstanding option
         shall pertain to and apply to the securities or other rights to which a
         holder of the number of shares subject to the option would have been
         entitled.

                  (d) A dissolution or liquidation of the Company shall cause
         each outstanding option to terminate, provided in such event that,
         immediately prior to such dissolution or liquidation, each Participant
         shall be repaid the payroll deductions credited to his account without
         interest.

5. ELIGIBILITY. All Employees, as defined in Paragraph 18 hereof who are
employed by the Company on the Commencement Date of a Phase and who have
completed at least 30 days of continuous employment service for the Company
prior to the Commencement Date of a Phase shall be eligible to participate in
such Phase ("Eligible Employees"). Any Employee who is a member of the Board of
Directors of the Company who satisfies the above requirements shall be eligible
to participate in the Plan.

6. PARTICIPATION.

                  (a) Participation in the Plan is voluntary. An Eligible
         Employee may elect to participate in the Plan, and thereby become a
         "Participant" in the Plan, by completing the enrollment form provided
         by the Company and delivering it to the Company or its designated
         representative at least ten days prior to the Commencement Date of that
         Phase. The first Commencement Date shall be October 1, 2001. Payroll
         deductions for a Participant shall commence on the first payday after
         the Commencement Date of the Phase and shall terminate on the last
         payday immediately prior to or coinciding with the Termination Date of
         that Phase unless sooner terminated by the Participant as provided in
         Paragraph 9 hereof. A Participant who ceases to be an eligible
         Employee, although still employed by the Company, thereupon shall be
         deemed to discontinue his or her participation in the Plan and shall
         have the rights provided in Section 9.

                  (b) All Eligible Employees who were participants in the final
         Purchase Period (as defined in the 1996 Plan) of the Company's 1996
         Employee Stock Purchase Plan shall automatically be enrolled in the
         first Phase under this Plan, unless such Participant withdraws from
         participation pursuant to Section 9. Once enrolled in the Plan, a
         Participant will continue to participate in the Plan until he or she
         ceases to be an Eligible Employee, withdraws from the Plan pursuant to

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         Section 9 or reaches the end of the Plan Period. A Participant who
         withdraws from the Plan pursuant to Section 9 may again become a
         Participant, if he or she is then an Eligible Employee, by proceeding
         as provided in Section 6(a) above. A Participant whose payroll
         deductions were discontinued because of Section 8(a)(iv)(A) will
         automatically resume participation at the beginning of the earliest
         Phase of the Plan ending in the next calendar year, if he or she is
         then an Eligible Employee.

7. PAYROLL DEDUCTIONS.

                  (a) Upon enrollment, a Participant shall elect to make
         contributions to the Plan by payroll deductions, in full dollar amounts
         and in amounts calculated to be as uniform as practicable throughout
         the Phase, in the aggregate amount not less than 1% nor in excess of
         10% of such Participant's Pay (as determined in accordance with
         Paragraph 18 hereof) for the term of the Phase or smaller percentage as
         may be determined by the Committee prior to the commencement of a
         Phase).

                  (b) In the event that the Participant's compensation for any
         pay period is terminated or reduced from the compensation rate for such
         a period as of the Commencement Date of the Phase for any reason so
         that the amount actually withheld on behalf of the Participant as of
         the Termination Date of the Phase is less than the amount anticipated
         to be withheld over the Phase as determined on the Commencement Date of
         the Phase, then the extent to which the Participant may exercise his
         option shall be based on the amount actually withheld on his behalf. In
         the event of a change in the pay period of any Participant, such as
         from bi-weekly to monthly, an appropriate adjustment shall be made to
         the deduction in each new pay period so as to ensure the deduction of
         the proper amount authorized by the Participant.

                  (c) A Participant may discontinue his participation in the
         Phase and terminate his payroll deduction authorized at such times as
         determined by the Committee and shall have the rights provided in
         Section 9. No change can be made during a Phase of the Plan which would
         either change the time or increase or decrease the rate of his payroll
         deductions.

                  (d) All payroll deductions made for Participants shall be
         credited to their respective accounts under the Plan. A Participant may
         not make any separate cash payments into such account.

8. Options.

                  (a) Grant of Option.

                           (i) A Participant who is employed by the Company as
                  of the Commencement Date of a Phase shall be granted an option
                  as of such date to purchase a number of shares of Company
                  common stock to be determined by dividing the total amount
                  credited to that Participant's account under Paragraph 7
                  hereof by the option price set forth in Paragraph 8(a)(ii)
                  hereof, subject to the limitations of Paragraph 8(a)(iv) and
                  Paragraph 10 hereof.

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                           (ii) The option price (rounded to the nearest whole
                  cent) for such shares of common stock shall be the lower of:

                                    A. Eighty-five percent (85%) of the Fair
                           Market Value of such shares of common stock on the
                           Commencement Date of the Phase; or

                                    B. Eighty-five percent (85%) of the Fair
                           Market Value of such shares of common stock on the
                           Termination Date of the Phase.

                           (iii) Stock options granted pursuant to the Plan may
                  be evidenced by agreements in such form as the Committee shall
                  approve, provided that all Employees shall have the same
                  rights and privileges and provided further that such options
                  shall comply with and be subject to the terms and conditions
                  set forth herein. The Committee may conclude that agreements
                  are not necessary.

                           (iv) Anything herein to the contrary notwithstanding,
                  no Employee shall be granted an option hereunder:

                                    A. Which permits his rights to purchase
                           stock under all employee stock purchase plans of the
                           Company, its Subsidiaries or its parent, if any, to
                           accrue at a rate which exceeds the lesser of
                           Twenty-Five Thousand Dollars ($25,000) of the Fair
                           Market Value of such stock (determined at the time
                           such option is granted) for each calendar year in
                           which such option is outstanding at any time or
                           20,000 shares per Phase under the Plan; or

                                    B. If immediately after the grant such
                           Employee would own and/or hold outstanding options to
                           purchase stock possessing five percent (5%) or more
                           of the total combined voting power or value of all
                           classes of stock of the Company, its parent, if any,
                           or of any subsidiary of the Company. For purposes of
                           determining stock ownership under this Paragraph, the
                           rules of Section 424(d) of the Internal Revenue Code,
                           as amended, shall apply.

                           (v) The grant of an option pursuant to this Plan
                  shall not affect in any way the right or power of the Company
                  to make adjustments, reclassifications, reorganizations or
                  changes of its capital or business structure or to merge or to
                  consolidate or to dissolve, liquidate or sell, or transfer all
                  or any part of its business or assets.

                  (b) EXERCISE OF OPTION.

                           (i) Unless a Participant gives written notice to the
                  Company pursuant to Paragraph 9 prior to the Termination Date
                  of a Phase, his option for the purchase of shares will be
                  exercised automatically for him as of such Termination Date
                  for the purchase of the number of full shares of Company
                  common stock which the accumulated payroll deductions in his
                  account at that time will purchase at the applicable option
                  price, but in no event shall the number of full shares be
                  greater than the number of full shares to which a Participant
                  would have been eligible to purchase under Section 8(a)(i),
                  and subject to the limitations set forth in Paragraph 10
                  hereof.

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                           (ii) The Company shall, in addition, return to the
                  Participant a cash payment equal to the balance, if any, in
                  his account which was not used for the purchase of common
                  stock, without interest, as promptly as practicable after the
                  Termination Date of any Phase.

                           (iii) The Committee may appoint a registered broker
                  dealer to act as agent for the Company in holding and
                  performing ministerial duties in connection with the Plan,
                  including, but not limited to, maintaining records of stock
                  ownership by Participants and holding stock in its own name
                  for the benefit of the Participants. No trust or escrow
                  arrangement shall be express or implied by the exercise of
                  such duties by the agent. A Participant may, at any time,
                  request of the agent that any shares allocated to the
                  Participant be registered in the name of the Participant or in
                  joint tenancy with the Participant, in which event the agent
                  shall issue a certificate for the whole number of shares in
                  the name of the Participant (and his joint tenant, if any) and
                  shall deliver to the Participant any cash for fractional
                  shares, based on the then Fair Market Value of the shares on
                  the date of issuance.

                  (c) DIVIDEND REINVESTMENT. Unless the Committee designates
         otherwise, and except as provided in this section, dividends on a
         Participant's shares will automatically be reinvested in additional
         shares of stock of the Company. If a Participant desires to receive
         dividends in the form of cash, he must request that a certificate for
         such shares be issued in the name of the Participant by filing an
         appropriate form with the Company. Any shares purchased through the
         reinvestment of dividends may be issued from the shares authorized
         under this Plan or purchased on the open market, as directed by the
         Committee. If the shares are purchased directly from the Company, the
         purchase price shall be the Fair Market Value of a share or the date
         such dividends are paid. Otherwise, the purchase price may be an
         average of shares purchased on the open market with the aggregate
         amount of dividends.

9. WITHDRAWAL OR TERMINATION OF PARTICIPATION.

                  (a) A Participant may, at any time prior to the Termination
         Date of a Phase, withdraw all payroll deductions then credited to his
         account by giving written notice to the Company. Promptly upon receipt
         of such notice of withdrawal, all payroll deductions credited to the
         Participant's account will be paid to him without interest accrued
         thereon and no further payroll deductions will be made during the
         Phase. In such event, the option granted the Participant under that
         Phase of the Plan shall lapse immediately. Partial withdrawals of
         payroll deductions hereunder may not be made.

                  (b) Notwithstanding the provisions of Section 9(a) above, if a
         Participant files reports pursuant to Section 16 of the Securities
         Exchange Act of 1934 (at the Commencement Date of a Phase or becomes
         obligated to file such reports during a Phase) then such a
         Participant's participation, including the ability to make changes and
         withdrawals, in a Phase and in the Plan shall be in accordance with
         Section 10b5-1 promulgated under the Securities Exchange Act of 1934.

                  (c) In the event of the death of a Participant, the person or
         persons specified in Paragraph 14 may give notice to the Company within
         sixty (60) days of the death of the Participant electing to purchase
         the number of full shares which the accumulated payroll deductions in

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         the account of such deceased Participant will purchase at the option
         price specified in Paragraph 8(a)(ii) and have the balance in the
         account distributed in cash without interest accrued thereon to the
         person or persons specified in Paragraph 14. If no such notice is
         received by the Company within said sixty (60) days, the accumulated
         payroll deductions will be distributed in full in cash without interest
         accrued thereon to the person or persons specified in Paragraph 14.

                  (d) Upon termination of Participant's employment for any
         reason other than death of the Participant, the payroll deductions
         credited to his account, without interest, shall be returned to him.

                  (e) The Committee shall be entitled to make such rules,
         regulations and determination as it deems appropriate under the Plan in
         respect of any leave of absence taken by or disability of any
         Participant. Without limiting the generality of the foregoing, the
         Committee shall be entitled to determine:

                           (i) whether or not any such leave of absence shall
                  constitute a termination of employment for purposes of the
                  Plan; and

                           (ii) the impact, of any, of any such leave of absence
                  on options under the Plan theretofore granted to any
                  Participant who takes such leave of absence.

                  (f) A Participant who discontinues his participation during a
         Phase shall not be permitted to recommence participation until the next
         Commencement Date. A Participant's withdrawal will not have any effect
         upon his eligibility to participate in any succeeding Phase of the Plan
         that commences after the next Commencement Date or in any similar plan
         which may hereafter be adopted by the Company.

10. STOCK RESERVED FOR OPTIONS.

                  (a) The maximum number of shares of the Company's common stock
         to be issued upon the exercise of options to be granted under the Plan
         shall be Two Hundred Fifty Thousand (250,000). Such shares may, at the
         election of the Board of Directors, be either shares authorized but not
         issued or shares acquired in the open market by the Company. Shares
         subject to the unexercised portion of any lapsed or expired option may
         again be subject to option under the Plan.

                  (b) If the total number of shares of the Company common stock
         for which options are to be granted for a given Phase as specified in
         Paragraph 8 exceeds the number of shares then remaining available under
         the Plan (after deduction of all shares for which options have been
         exercised or are then outstanding) and if the Committee does not elect
         to cancel such Phase pursuant to Paragraph 4, the Committee shall make
         a pro rata allocation of the shares remaining available in as uniform
         and equitable a manner as it shall consider practicable. In such event,
         the options to be granted and the payroll deductions to be made
         pursuant to the Plan which would otherwise be effected may, in the
         discretion of the Committee, be reduced accordingly. The Committee
         shall give written notice of such reduction to each Participant
         affected.

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                  (c) The Participant (or a joint tenant named pursuant to
         Paragraph 10(d) hereof) shall have no rights as a shareholder with
         respect to any shares subject to the Participant's option until the
         date of the issuance of a stock certificate evidencing such shares. No
         adjustment shall be made for dividends (ordinary or extraordinary,
         whether in cash, securities or other property), distributions or other
         rights for which the record date is prior to the date such stock
         certificate is actually issued, except as otherwise provided in
         Paragraph 12 hereof.

                  (d) The shares of the Company common stock to be delivered to
         a Participant pursuant to the exercise of an option under the Plan will
         be registered in the name of the Participant or, if the Participant so
         directs by written notice to the Committee prior to the Termination
         Date of that Phase of the Plan, in the names of the Participant and one
         other person the Participant may designate as his joint tenant with
         rights of survivorship, to the extent permitted by law.

11. AcCOUNTING AND USE OF FUNDS. Payroll deductions for each Participant shall
be credited to an account established for him under the Plan. Such account shall
be solely for bookkeeping purposes and no separate fund or trust shall be
established hereunder and the Company shall not be obligated to segregate such
funds. All funds from payroll deductions received or held by the Company under
the Plan may be used, without limitation, for any corporate purpose by the
Company.

12. ADJUSTMENT PROVISION.

                  (a) Subject to any required action by the shareholders of the
         Company, the number of shares covered by each outstanding option, and
         the price per share thereof in each such option, shall be
         proportionately adjusted for any increase or decrease in the number of
         issued shares of the Company common stock resulting from a subdivision
         or consolidation of shares or the payment of a share dividend (but only
         on the shares) or any other increase or decrease in the number of such
         shares effected without receipt of consideration by the Company.

                  (b) In the event of a change in the shares of the Company as
         presently constituted, which is limited to a change of all its
         authorized shares with par value into the same number of shares with a
         different par value or without par value, the shares resulting from any
         such change shall be deemed to be the shares within the meaning of this
         Plan.

                  (c) To the extent that the foregoing adjustments relate to
         shares or securities of the Company, such adjustments shall be made by
         the Committee, and its determination in that respect shall be final,
         binding and conclusive, provided that each option granted pursuant to
         this Plan shall not be adjusted in a manner that causes the option to
         fail to continue to qualify as an option issued pursuant to an
         "employee stock purchase plan" within the meaning of Section 423 of the
         Code.

                  (d) Except as hereinbefore expressly provided in this
         Paragraph 12, the optionee shall have no right by reason of any
         subdivision or consolidation of shares of any class or the payment of
         any stock dividend or any other increase or decrease in the number of
         shares of any class or by reason of any dissolution, liquidation,
         merger, or consolidation or spin-off of assets or stock of another
         corporation, and any issue by the Company of shares of any class, or
         securities convertible into shares of any class, shall not affect, and
         no adjustment by reason thereof shall be made with respect to, the
         number or price of shares subject to the option.

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13. NON-TRANSFERABILITY OF OPTIONS.

                  (a) Options granted under any Phase of the Plan shall not be
         transferable except under the laws of descent and distribution and
         shall be exercisable only by the Participant during his lifetime and
         after his death only by his beneficiary of the representative of his
         estate as provided in Paragraph 9(c) hereof.

                  (b) Neither payroll deductions credited to a Participant's
         account, nor any rights with regard to the exercise of an option or to
         receive common stock under any Phase of the Plan may be assigned,
         transferred, pledged or otherwise disposed of in any way by the
         Participant. Any such attempted assignment, transfer, pledge or other
         disposition shall be null and void and without effect, except that the
         Company may, at its option, treat such act as an election to withdraw
         funds in accordance with Paragraph 9.

14. DESIGNATION OF BENEFICIARY. A Participant may file a written designation of
a beneficiary who is to receive any cash to the Participant's credit without
interest thereon under any Phase of the Plan in the event of such Participant's
death prior to exercise of his option pursuant to Paragraph 9(b) hereof, or to
exercise his option and become entitled to any stock and/or cash upon such
exercise in the event of the Participant's death prior to exercise of the option
pursuant to Paragraph 9(b) hereof. The beneficiary designation may be changed by
the Participant at any time upon receipt of a written notice by the Company.

         Upon the death of a Participant and upon receipt by the Company of
proof deemed adequate by it of the identity and existence at the Participant's
death of a beneficiary validly designated under the Plan, the Company shall in
the event of the Participant's death, allow such beneficiary to exercise the
Participant's option pursuant to Paragraph 9(c) if such beneficiary is living on
the Termination Date of the Phase and deliver to such beneficiary the
appropriate stock and/or cash after exercise of the option. In the event there
is not validly designated beneficiary under the Plan who is living at the time
of the Participant's death or in the event the option lapses, the Company shall
deliver the cash credited to the account of the Participant without interest to
the executor or administrator of the estate of the Participant, or if no such
executor or administrator has been appointed to the knowledge of the Company, it
may, in its discretion, deliver such cash to the spouse (or, if no surviving
spouse, to any one or more children of the Participant), or if no spouse or
child is known to the Company, then to such relatives of the Participant known
to the Company as would be entitled to such amounts, under the laws of intestacy
in the deceased Participant's domicile as though named as the designated
beneficiary hereunder. The Company will not be responsible for or be required to
give effect to the disposition of any cash or stock or the exercise of any
option in accordance with any will or other testamentary disposition made by
such Participant or in accordance with the provision of any law concerning
intestacy, or otherwise. No designated beneficiary shall, prior to the death of
a Participant by whom he has been designated, acquire any interest in any stock
or in any option or in the cash credited to the Participant under any Phase of
the Plan.

15. AMENDMENT AND TERMINATION. The Plan may be terminated at any time by the
Board of Directors provided that, except as permitted in Paragraph 4(c) with
respect to an acceleration of the Termination Date of any Phase, no such
termination will take effect with respect to any options then outstanding. Also,
the Board may, from time to time, amend the Plan as it may deem proper and in
the best interests of the Company or as may be necessary to comply with Section
423 of the Internal Revenue Code of 1986, as amended, or other applicable laws
or regulations; provided, however, that no such amendment shall, without prior

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approval of the shareholders of the Company (1) increase the total number of
shares for which options may be granted under the Plan (except as provided in
Paragraph 12 herein), (2) permit aggregate payroll deductions in excess of ten
percent (10%) of a Participant's compensation as of the Commencement Date of a
Phase, or (3) impair any outstanding option.

16. NOTICES. All notices or other communications in connection with the Plan or
any Phase thereof shall be in the form specified by the Committee and shall be
deemed to have been duly given when received by the Participant or his
designated personal representative or beneficiary or by the Company or its
designated representative, as the case may be.

17. PARTICIPATION OF SUBSIDIARIES. The Employees of any Subsidiary of the
Company, shall be entitled to participate in the Plan on the same basis as
Employees of the Company, unless the Board of Directors determines otherwise.
Effective as of the date of coverage of any Subsidiary, any references herein to
the "Company" shall be interpreted as referring to such Subsidiary as well as to
ONTRACK Data International, Inc.

         In the event that any Subsidiary which is covered under the Plan ceases
to be a Subsidiary of the Company, the employees of such Subsidiary shall be
considered to have terminated their employment for purposes of Paragraph 9
hereof as of the date such Subsidiary ceases to be such a Subsidiary.

18. DEFINITIONS.

                  (a) "Subsidiary" shall include any domestic corporation
         defined as a subsidiary of the Company in Section 424(f) of the
         Internal Revenue Code of 1986, as amended.

                  (b) "Employee" shall mean any employee, including an officer,
         of the Company who as of the day immediately preceding the Commencement
         Date of a Phase is customarily employed by the Company for more than
         twenty (20) hours per week and more than five (5) months in a calendar
         year.

                  (c) "Fair Market Value" of a share of stock of the Company
         shall be the last sale price, or if unavailable, the average of the
         closing bid and asked prices, of the stock on the applicable date or
         the nearest prior business day on which trading occurred on the
         exchange on which the stock is traded or on the Nasdaq Stock Market. If
         the common stock is not traded on any exchange or listed on the Nasdaq
         Stock Market, the Fair Market Value of a share of common stock of the
         Company shall be determined by the Committee for each valuation date in
         a manner acceptable under Section 423 of the Internal Revenue Code of
         1986, as amended.

                  (d) "Pay" is the regular pay for employment for each employee
         as annualized for a twelve (12) month period, including salary
         reduction contributions by the Participant under any plan of the
         Employer pursuant to Code ss.ss. 401(k) or 125, including overtime,
         commissions, bonuses, and vacation pay, to which has been added (a) any
         elective deferral amounts by which the Employee has had his or her
         current remuneration reduced for the purposes of funding a contribution
         to any plan sponsored by the Company and satisfying the requirements of
         section 401(k) of the Code and (b) any amounts by which the Employee's
         compensation has been reduced pursuant to a compensation reduction
         agreement between the Employee and the Company for the purpose of
         funding benefits through any cafeteria plan sponsored by the Company
         meeting the requirements of section 125 of the Code, determined during
         the applicable period of reference. There shall be excluded from "Pay"
         for the purposes of the Plan, whether or not reportable as income by

                                       10
<PAGE>

         the Employee, expense reimbursements of all types, payments in lieu of
         expenses, the Company contributions to any qualified retirement plan or
         other program of deferred compensation (except as provided above), the
         Company contributions to Social Security or worker's compensation, the
         costs paid by the Company in connection with fringe benefits and
         relocation, including gross-ups, and any amounts accrued for the
         benefit of Employee, but not paid, during the period of reference.

19. MISCELLANEOUS.

                  (a) No Employment Rights. The Plan shall not, directly or
         indirectly, create any right for the benefit of any Employee or class
         of Employees to purchase any shares under the Plan, or create in any
         Employee or class of Employees any right with respect to continuation
         of employment by the Company, and it shall not be deemed to interfere
         in any way with the Company's right to terminate, or otherwise modify,
         an Employee's employment at any time.

                  (b) Effect of Plan. The provisions of the Plan shall, in
         accordance with its terms, be binding upon, and inure to the benefit
         of, all successors of each Employee participating in the Plan,
         including, without limitation, such Employee's estate and the
         executors, administrators or trustees thereof, heirs and legatees, and
         any receiver, trustee in bankruptcy, or representative of creditors of
         such Employee.

                  (c) Governing Law. The law of the State of Minnesota will
         govern all matters relating to this Plan except to the extent it is
         superseded by the laws of the United States.

                  (d) Registration and Qualification of Shares. The offering of
         the shares hereunder shall be subject to the effecting by the Company
         of any registration or qualification of the shares under any federal or
         state law or the obtaining of the consent or approval of any
         governmental regulatory body which the Company shall determine, in its
         sole discretion, is necessary or desirable as a condition to or in
         connection with, the offering or the issue or purchase of the shares
         covered thereby. The Company shall make every reasonable effort to
         effect such registration or qualification or to obtain such consent or
         approval.

                  (e) Plan Preconditions. Except as provided in Section 4(a),
         this Plan is expressly made subject to (i) the approval by shareholders
         of the Company, and (ii) at its election, the receipt by the Company
         from the Internal Revenue Service of a determination letter or ruling,
         in scope and content satisfactory to counsel, respecting the
         qualification of the Plan within the meaning of Section 423 of the
         Code. If the Plan is not so approved by the shareholders and if, at the
         election of the Company, the aforesaid determination letter or ruling
         from the Internal Revenue Service is not received on or before one year
         after this Plan's adoption by the Board of Directors, this Plan shall
         not come into effect. In such case, the accumulated payroll deductions
         credited to the account of each Participant shall forthwith be repaid
         to him without interest.

Approved by Board of Directors: September 27, 2001
Amended by Board of Directors: October 22, 2001
Approved by Stockholders: May __, 2002

                                       11EXHIBIT 10.7   EMPLOYMENT AGREEMENT AS AMENDED BETWEEN MICHAEL W.
               ROGERS AND THE REGISTRANT

                               EMPLOYMENT CONTRACT
                                     Between
             ONTRACK Data International, Inc. and Michael W. Rogers

This AGREEMENT, made effective as of June 28, 2001, between ONTRACK Data
International, Inc., a Minnesota corporation (the "Company"), a corporation
having its principal office at 9023 Columbine Road, Eden Prairie, Minnesota
55347, and Michael W. Rogers ("Executive").

                                    RECITALS

         WHEREAS, the Company and Executive previously entered into an
Employment Agreement, dated August 6, 1996, which provided for the employment of
the Executive as the Chairman of the Board and Chief Executive Officer of the
Company; and

WHEREAS, the Company and Executive now desire to memorialize certain
understandings and agreements for the continued employment of Executive on the
Company's own behalf and on behalf of its affiliated companies for the period
provided in this Agreement, and Executive is willing to accept employment by the
Company for such period, upon the terms and conditions hereinafter set forth;
and

         WHEREAS, Executive ratifies and affirms his obligations under that
certain Confidentiality Agreement and Covenant Not To Compete, dated August 27,
1996 (the "Confidentiality Agreement and Covenant Not to Compete"); and

         WHEREAS, the execution of this Agreement, and the terms of compensation
contained herein have been duly recommended and approved by the Compensation
Committee of the Board (the "Committee").

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

1. Position and Responsibilities; Term of Agreement. Executive hereby
voluntarily surrenders his position as Chief Executive Officer of the Company
and shall, effective the date of this Agreement, serve as Chairman of the Board.
This Agreement shall commence upon the effective date and shall continue through
June 28, 2006 (the "Term"); provided, however, that all obligations and benefits
of this Agreement, which by their nature extend beyond the Term of this
Agreement, shall continue to bind the parties hereto.

2. Duties. During the Term and except for illness, reasonable vacation periods,
and reasonable leaves of absence, Executive shall devote his best efforts and
substantially all his business time, attention, skill and efforts to the
business and affairs of the Company and its affiliated companies, as such
business affairs now exist and as they may be hereafter changed or added to,
under and pursuant to the general direction of the Board; provided, however,
that Executive may serve, or continue to serve, on the boards of the directors
of and hold any other offices or positions in, companies or organizations which
will not present any conflict of interest with, or impair Executive's fiduciary
obligations to, the Company or any of its subsidiaries or affiliates or
divisions, or materially affect the performance of Executive's duties pursuant
to this Agreement. The services which are to be rendered by Executive hereunder
are to be rendered in the State of Minnesota, or in such other place or places
in the United States or elsewhere as may be determined from time to time by the
Board, but are to be rendered primarily at the headquarters of the Company in
the City of Eden Prairie, State of Minnesota.

<PAGE>

3. Compensation and Reimbursement of Expenses; Other Benefits.

         (a) Compensation. The Company shall compensate Executive during the
term of this Agreement as follows:

                  (1) Base Salary. Executive shall be paid a base salary,
adjusted as provided in Section 3(b), ("Base Salary") of not less than Two
Hundred Twenty Thousand Dollars ($220,000) per year in installments consistent
with the Company's usual payroll practices. The Company and the Executive
further agree that so long as the Executive is receiving compensation as an
employee of the Company the Executive shall not receive cash, stock options or
other compensation for serving as a director of the Company, but shall be
entitled to receive reimbursement or payment of his expenses for such service
under the same conditions as set forth in section 3(c) below.

                  (2) Cash Incentive Compensation. Executive shall be paid cash
incentive compensation as determined from time to time by the Board, in its
discretion and in consultation with the Compensation Committee.

                  (3) Other Benefits. During the period of employment under this
Agreement, Executive shall be entitled to receive all other benefits of
employment generally available to other members of the Company's executive
management and those benefits for which key executives are or shall become
eligible from time to time. Executive shall be entitled to five (5) weeks of
paid vacation each year of his employment.

         (b) Base Salary Review. The Board, in its discretion and in
consultation with the Compensation Committee of the Board, shall review
Executive's Base Salary from time to time during the term of this Agreement.

         (c) Reimbursement of Expenses. The Company shall pay or reimburse
Executive for all reasonable travel and other expenses incurred by Executive in
performing his obligations under this Agreement. All such reimbursement shall be
supported by receipts and be otherwise in compliance with the Company's expense
reimbursement procedures applicable from time to time to all employees. The
Company further agrees to furnish Executive with such assistance and office
accommodations as shall be suitable to the character of Executive's position
with the Company and adequate for the performance of his duties hereunder.

4. Obligations of Executive Regarding Confidentiality and Non-Competition During
and After Employment; Non-Solicitation. Executive affirms his obligations to the
Company under the Confidentiality Agreement and Covenant Not to Compete, a copy
of which is attached hereto as Exhibit A and made a part hereof by reference.
The Executive agrees that the provisions regarding confidentiality and
non-competition contained in the Confidentiality Agreement and Covenant Not to
Compete shall survive and continue in full force and effect, in accordance with
and for the time periods specified in such provisions, after termination of the
Executive's employment with the Company for any reason. Executive further agrees
that during the term of this Agreement and for a period of one (1) year
thereafter, he shall not, either directly or indirectly, alone or in concert
with others, induce or attempt to induce any employee of the Company to
terminate his or her employment relationship with the Company, or recruit or
attempt to recruit such person(s) to accept employment or a contract with
another business that would have the effect of terminating his or her employment
relationship with the Company.

<PAGE>

5. Termination By Company.

         (a) Termination For Cause. The Company may terminate the employment of
Executive "for Cause" at any time upon written Notice of Termination to
Executive specifying the cause of termination. If terminated pursuant to this
Section 5(a), then Executive shall not be entitled to any payments or extensions
of benefits under this Agreement. For purposes of this Agreement, "for Cause"
shall mean the discharge resulting from a determination by the Board that
Executive (i) has been convicted of a crime involving moral turpitude, including
fraud, theft or embezzlement, (ii) has habitually neglected his duties for
reasons unrelated to a mental or physical disability, (iii) has failed or
refused (in a material respect) to follow reasonable policies or directives
established by the Board, which failure or refusal continues for twenty (20)
days following written notice thereof to the Executive, or (iv) has continued to
engage, after twenty (20) days written notice, in any act that constitutes a
breach of his fiduciary duties to, or involves a conflict of interest with, the
Company or involves a usurpation of a material opportunity of the Company. A
termination by the Company under this Section 5(a) shall not prejudice any
remedy to which the Company may be entitled either at law, in equity, or under
this Agreement, nor shall it prejudice any of Executive's rights to any
compensation or benefit which is payable notwithstanding a Termination for
Cause. Stock options which by the terms of the applicable stock option grant are
exercisable by Executive on or before the Date of Termination may be exercised
for an additional thirty (30) days following the Date of Termination, or for the
relevant period set forth in the individual option grant agreement, whichever is
longer. Any options, which by the terms of the applicable stock option grant do
not become exercisable until after the Date of Termination shall expire as of
the Date of Termination.

         (b) Termination Without Cause. The Company may terminate the employment
of Executive without Cause at any time upon written Notice of Termination given
to Executive; provided, however, that the Company shall be obligated to pay
Executive, as severance, two (2) years base salary at the level earned by
Executive immediately prior to the date of the written Notice of Termination,
payable in installments consistent with the Company's normal pay practices for
salaried employees. In addition, Executive shall be entitled to the continuation
of all of Executive's Company health insurance and other benefits in effect at
the date of the Notice of Termination, at the sole cost and expense of the
Company, which benefits shall continue during the time period of such
installment payments set forth above. All stock options held by Executive on the
Date of Termination shall immediately become fully exercisable and fully vested.
Such options shall remain exercisable for the longer of, three (3) years or the
remaining term under the individual option agreement.

         (c) Resignation with Advance Notice to and Consent of the Board. The
parties agree that Executive is free to resign or terminate his employment with
the Company (for any reason or no reason) at any time. If Executive terminates
his employment hereunder while in good standing (which shall be defined
hereunder as the absence of any condition which, if known to the Company at the
time of Executive's resignation or Notice of Termination, would have permitted
the Company to terminate Executive's employment For Cause under Section 5(a)
above), and with advance notice to and the active participation and consent of
the Board, then Executive shall be eligible for severance, in the discretion of
the Board upon the recommendation of the Compensation Committee, of up to two
(2) years' base salary at the level earned by Executive immediately prior to the
date of the written resignation or Notice of Termination, payable in
installments consistent with the Company's normal pay practices for salaried
employees. In addition, Executive shall be entitled to the continuation of all
of Executive's Company health insurance and other benefits in effect at the date

<PAGE>

of the resignation or Notice of Termination, at the sole cost and expense of the
Company, which benefits shall continue during the time period of such severance
installment payments set forth above. Stock options which by the terms of the
applicable stock option grant are exercisable by Executive on or before the date
of resignation or Notice of Termination may be exercised for an additional
thirty (30) days following the last date of such severance installment payments
set forth above, or for the relevant period set forth in the individual option
grant agreement, whichever is longer. The Compensation Committee and the Board
shall exercise their discretion in awarding severance of up to two (2) full
years base salary and benefits as set forth above by considering all relevant
factors, including (without limitation) Executive's contributions to the Company
both prior to and after his assumption of the sole position of Chairman, the
advance notice given to the Board of his intention to resign the position of
Chairman, and his commitment to assist the Board and the Company in identifying
and procuring his replacement as Chairman.

6. Change in Control.

         (a) No compensation shall be payable under Sections 6-8 unless and
until there shall have been a Change of Control of the Company while Executive
is still an employee of the Company.

         (b) For the purposes of this Agreement, a Change of Control shall be
deemed to have occurred if (i) there shall be consummated (aa) any
reorganization, consolidation or merger of the Company in which the Company is
not the continuing or surviving corporation or pursuant to which shares of the
Company's Common Stock would be converted into cash, securities or other
property, in either case other than a merger of the Company in which the holders
of the Company's Common Stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving corporation immediately
after the merger, or (bb) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
of the assets of the Company, or (ii) any "person" (as defined in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), shall become the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of 50% or more of the Company's
outstanding Common Stock, or (iii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the entire Board
shall cease for any reason to constitute at least one-half of the membership
thereof unless the election, or the nomination for election by the Company's
shareholders, of each new director was approved by a vote of at least one-half
of the directors then still in office who were directors at the beginning of the
period.

7. Compensation Following Change in Control. If a Change in Control occurs while
Executive is still an employee of the Company, Executive shall be entitled to
the compensation provided in Section 5(b) hereof upon the resultant termination
of Executive's employment with the Company.

8. Acceleration of Options. All options granted to Executive may, in the sole
discretion of the Executive, be accelerated and become immediately exercisable
and fully-vested sufficiently prior to a Change in Control of the Company as to
permit Executive to exercise all such options upon any such Change in Control of
the Company; provided, however, that if Executive elects to remain with the
Company, Executive's discretionary right to the acceleration and vesting
provisions of this Section 9 shall also remain in effect until ninety (90) days
after Executive's termination for any reason (except Termination for Cause as
defined herein, in which case Executive's rights to options shall be exclusively
determined under Section 5(a)).

<PAGE>

9. No Obligation to Mitigate Damages; Pre-existing Agreements & Conditions.

         (a) Executive shall not be required to mitigate damages or the amount
of any payment provided for under this Agreement by seeking other employment or
otherwise, nor shall the amount of any payment provided for under this Agreement
be reduced by any compensation earned by Executive as a result of employment by
another employer or by payment to him of retirement benefits after the date of
termination of his employment.

         (b) The provisions of this Agreement, and any payment provided for
hereunder, shall not reduce any amounts otherwise payable, or in any way
diminish Executive's existing rights, or rights which would accrue solely as a
result of the passage of time, under any Company 401(k) plan or other Company
benefit applicable generally to employees or executives generally as a result of
employment by the Company; provided, however, that Executive and Company
specifically acknowledge that the execution of this Agreement shall replace in
its entirety and constitute a conclusive waiver by Executive of any rights or
benefits under certain resolution regarding severance set forth and adopted by
the Board of Directors of the Company as reflected on page 6 of the Board
Minutes of December 20, 1995.

10. Arbitration. With the exception of matters arising under Section 4 of this
Agreement, any controversy, dispute or claim between Company and Executive or
between any employee of Company and Executive, including, but not limited to
claims of race, age, gender, religious or national origin discrimination under
the Title VII of the Civil Rights Act of 1964, as amended; the Age
Discrimination in Employment Act of 1967, as amended; the Americans with
Disabilities Act, as amended; any other federal, state or local laws; and those
involving the construction or application of any of the terms, provisions or
conditions of this Agreement or otherwise arising out of or relating to this
Agreement, shall be settled by arbitration in accordance with the then current
employment dispute resolution rules of the American Arbitration Association, and
judgment on the award rendered by the arbitrator(s) may be rendered by any court
having jurisdiction thereof. The location of the arbitration shall be in
Hennepin County, Minnesota.

In the event of a breach by Employee of any of the covenants contained in
Section 4 of this Agreement, it is recognized that Company shall be entitled to
institute or prosecute proceedings in any court of competent jurisdiction,
either in law or in equity, to obtain damages for any breach of this Agreement,
the Confidentiality Agreement and Covenant Not to Compete, or any subsequent
similar agreement, and to sue for specific performance, or injunction against
performance of any acts or to seek any other available remedy.

11. Notice. For purposes of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have
been duly given when delivered or mailed by United States registered mail,
return receipt requested, postage prepaid, as follows:

If to the Company:                ONTRACK Data International, Inc.
                                  9023 Columbine Road
                                  Eden Prairie, MN 55347

If to Executive:                  Michael W. Rogers
                                  4026 Thrushwood Lane
                                  Minnetonka, MN 55345

or such other address as either party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.

<PAGE>

Any purported termination of Executive's employment by either party shall be
communicated by notice of termination to the other party in accordance with this
Section 11, and shall state the specific termination provisions in this
Agreement relied upon and set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of Executive's
employment ("Notice of Termination").

For all purposes, "date of termination" or "termination date" shall mean the
date on which a Notice of Termination is given.

12. Non-Waiver; Complete Agreement; Governing Law. No provisions of this
Agreement may be modified, waived or discharged except in writing signed by both
parties. No waiver by either party at any time of any breach by the other party
of, or compliance with, any condition or provision of this Agreement shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same or
at any prior to subsequent time. Except for the Confidentiality Agreement and
Covenant Not to Compete, this Agreement contains the entire agreement of the
parties relating to the subject matter hereof and supersedes all prior
agreements and understandings with respect to such subject matter (including the
Employment Agreement between the Company and Executive dated August 6, 1996),
and the parties hereto have made no agreements, representations or warranties
relating to the subject matter of the Agreement which are not set forth herein.
This Agreement shall be governed by and construed in accordance with the laws of
the State of Minnesota.

13. Legal Fees and Expenses. The Company shall pay all reasonable legal fees and
expenses which Executive may incur as a result of the Company's contesting the
validity, enforceability or Executive's good faith interpretation of, or good
faith determination under, this Agreement; provided, however, that the Company
shall not pay any legal fees and expenses incurred by Executive in contesting
the termination of Executive's employment for Cause if, as a result of such
contest, it is determined that Executive was in fact terminated for Cause.

14. Severability. The invalidity or unenforceability of any provisions of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.

15. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original but all of which, when
delivered, together shall constitute one and the same instrument.

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

17. Assignment. This Agreement shall not be assignable in connection with a
Change in Control or otherwise, in whole or in part, by either party without the
written consent of the other party.

18. Survival. The terms of Sections 4, 10, 11 and 12 shall survive the
expiration or termination of this Agreement (whether such expiration or
termination occurs as a result of the expiration of the Term as provided herein,
by mutual agreement, as a result of the Executive's resignation, termination by
the Company with or without Cause, or any other reason), and continue in full
force and effect in accordance with their terms.

<PAGE>

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

ONTRACK Data International, Inc.

By:
     -------------------------------         ---------------------------------
                                             Michael W. Rogers, Executive
Its:
     -------------------------------
Dated:                                       Dated:
       -----------------------------                --------------------------

<PAGE>

                        ONTRACK DATA INTERNATIONAL, INC.
                               9023 Columbine Road
                             Eden Prairie, MN 55347

                                February 18, 2002
                                                                    CONFIDENTIAL
Mr. Michael W. Rogers
4026 Thrushwood Lane
Minnetonka, MN 55345

         Re:      Amendment to Employment Contract dated June 28, 2001 (the
                  "Employment Contract")

Dear Mike:

         This letter agreement will confirm our mutual agreement and
understanding regarding the terms of your resignation as Chairman of the Board
of Directors of ONTRACK Data International, Inc. (the "Company"). You and the
Board have discussed the advisability of you resigning as Chairman and declining
to stand for reelection to the Board in order to better facilitate transition of
management of the Company. This letter confirms the terms of your departure.

         You will resign as an employee of the Company effective February 22,
2002. You also will resign as Chairman of the Board of Directors (a non-officer
position you will hold following the date of this letter agreement) on the date
of the next meeting of shareholders, currently expected in May, 2002 and you
will decline to stand for reelection to the Board at such shareholders meeting.
The Company will provide you the two-year compensation and health insurance and
other benefits provided by Section 5(b) of the Employment Contract as though you
were terminated without cause on this date rather than Section 5(c) or any other
provision of the Employment Contract. You and the Company will mutually agree on
the text of a press release announcing your resignation, to be issued as soon as
practicable following both parties execution of this letter agreement. The
compensation, health insurance and other benefits that will be provided by the
Company to you, as referenced in Section 5(b) of the Employment Contract,
includes, without limitation, the following:

         a.       compensation of $220,000 per year for two years (reported on
                  W-2 and payable in accordance with the Company's normal
                  payroll policies);

         b.       health care family coverage as currently in effect;

         c.       disability insurance coverage as currently in effect;

         d.       life insurance coverage as currently in effect;

         e.       accrued vacation benefit in the amount of $15,865, (150 hours
                  at $105.77 per hour) payable 16 days from the date of this
                  agreement;

         With respect to all options to purchase Company common stock currently
held by you, all such options will immediately vest and become fully
exercisable, and such options will remain exercisable for the longer of three
years or the remaining term under the individual option agreements, as amended.
A schedule of such options is attached hereto as Schedule A.

<PAGE>

         The Company covenants and agrees that it will not discriminate against
you relative to the other officers and directors of the Company when renewing,
replacing or allowing to lapse the directors' and officers' liability insurance
policies or errors and omissions insurance policies.

         This letter also confirms our mutual understanding regarding the
purpose of the severance payments provided under the Employment Contract. The
Employment Contract, among other things, reiterated the understanding previously
set forth in a 1996 agreement and Board resolutions regarding your severance
payments, if any, upon departure from the Company. The Employment Contract did
not, however, describe the rationale for providing the severance payments. It
was intended that 18 months of severance payments be allocated to separation
benefits which commenced with execution of the Employment Contract and the
concurrent surrender of your position as Chief Executive Officer. The remainder
was intended to be allocated to your noncompete obligations. Today you have
received approximately half (9 of the total 18 months) of the separation
benefits (i.e., the 9 months from June 2001 through February 2002). Thus, of the
24 months payments you will receive beginning on the effective date of your
departure as indicated above as contemplated under Section 5(b) of the
Employment Contract, 9/24 should be allocated to separation benefits and 15/24
should be allocated to the noncompete agreement. With the payments allocated in
this manner to the noncompete, you hereby reconfirm your obligations thereunder.
The parties agree that the noncompete obligations shall terminate two years
after the date of this agreement.

         In consideration for the severance benefits and payments provided by
the Company as set forth above, and as consideration for the release given by
the Company as set forth below, the receipt and sufficiency of which is hereby
acknowledged, you hereby release the Company, its past and present subsidiaries,
and its and their past and present officers, directors, agents, shareholders,
employees, attorneys, insurers and indemnitors, acting in their capacity as such
(collectively, the "Company Affiliates") from any and all claims and causes of
action, known or unknown, which you may have against any and all of them arising
from or relating to your employment relationship with, or position as an officer
or member of the Board of Directors of the Company or any of its past or present
subsidiaries. Through this release, you extinguish all causes of action against
the Company and the Company Affiliates occurring up to the date on which you
sign this agreement, including but not limited to any contract, compensation or
benefit claims; intentional infliction of emotional distress, defamation or any
other tort claims arising from your employment relationship with or position of
officer or director of the Company; all claims relating to your status as an
employee, director and officer of the Company and its past and present
subsidiaries, including but not limited to any claims arising under Minnesota
Statutes, Chapter 302A and common law (other than claims for indemnification
otherwise available to you by the Company or its insurance carriers which shall
remain available) and all claims arising from any federal, state or municipal
law or ordinance, including the Family and Medical Leave Act and the Fair Labor
Standards Act and all Minnesota labor and employment law statutes. This release
extinguishes any potential claims of employment discrimination arising from your
employment with and resignation from the Company and any of its past and present
subsidiaries, including specifically any claims under the Minnesota Human Rights
Act, the Americans With Disabilities Act, Title VII of the Civil Rights Act of
1964, the Older Workers Benefit Protection Act, and the Age Discrimination in
Employment Act.

         Notwithstanding the foregoing, the Company shall indemnify you to the
fullest extent authorized or permitted by law if you are made, or threatened to
be made, a party to any threatened, pending or completed civil, criminal,
administrative, arbitration or investigative proceeding, by reason of the fact
that are or were a director, chairman, officer or employee of the Company, or by
reason of the fact that while a director, chairman, officer or employee of the
Company, you are or were serving in any official capacity at the request of the
Company (including trustee of any employee benefit plan), against all judgments,
penalties, fines and reasonable expenses, including reasonable attorney fees and
disbursements, if you: (i) acted in good faith; (ii) in the case of a criminal
proceeding, had no reasonable cause to believe that the conduct was unlawful;
and (iii) reasonably believed that the conduct was in the best interests of the
Company; provided, however, that the Company shall not indemnify you in
connection with (a) a proceeding by the Company in which you were adjudged
liable to the Company, or (b) any proceeding charging improper personal benefit
to you in violation of conflict of interest laws and in which you are adjudged
liable on the basis that personal benefit was improperly received by you.

<PAGE>

         In consideration for the release given by you, the Company, both for
itself and for the Company Affiliates, as defined in this agreement, hereby
releases and forever discharges you from any and all claims and causes of
action, known or unknown, which any or all may have against you arising from or
relating to your employment relationship with, or position as an officer or
member of the Board of Directors of the Company or any of its past or present
subsidiaries. Through this release, the Company, for itself and for the Company
Affiliates, extinguishes all causes of action against you occurring up to the
date on which you sign this agreement, including but not limited to any
contract, compensation or benefit claims; intentional infliction of emotional
distress, defamation or any other tort claims arising from your employment
relationship with or position of officer or director of the Company arising out
of your status as an employee, director and officer of the Company and its past
and present subsidiaries.

         Under the Age Discrimination in Employment Act, you have 21 days to
review and consider this offer. If you sign this letter before 21 days have
elapsed from the date on which you first receive it (the date of this letter),
then you will be voluntarily waiving your right to the full 21-day review
period. You also have the right to rescind this agreement within 15 calendar
days of the date upon which you sign it. You understand that if you desire to
rescind this agreement, you must put the rescission in writing and deliver it to
ONTRACK Data International, Inc., attn: Ben F. Allen, 9023 Columbine Road, Eden
Prairie, MN 55347, by hand or by mail within 15 calendar days of the date on
which you sign this agreement. If you deliver the rescission by mail, it must be
postmarked within 15 calendar days of the date on which you sign this agreement
and sent by certified mail, return receipt requested.

         If you rescind this agreement, all of the Company's obligations to you
under this letter Amendment will immediately cease, and the Company and you will
remain bound by the terms of the Employment Contract.

         This agreement supercedes the option agreements between you and the
Company to the extent of the subject matter covered herein. This agreement shall
be binding and enforceable against all successors in interests of the parties
hereto and may not be assigned without the prior written consent of each of the
parties hereto.

         If the foregoing accurately reflects our understanding and amendment to
the Employment Contract, please so indicate by signing below.

                                        Sincerely,

                                        Ben F. Allen, Chief Executive Officer

Agreed:

------------------------------------
Michael W. Rogers

<PAGE>

                                                ONTRACK CONFIDENTIAL INFORMATION

<TABLE>
<S>                  <C>        <C>       <C>                 <C>       <C>     <C>  <C>
Rogers, Michael W    320525016  00000383   9/3/1998 1996/NQ   25,000    $7.88   0    25,000
                                00000384   9/3/1998 1996/NQ   50,000    $7.88   0    50,000
                                00000385   9/3/1998 1996/NQ   25,000    $7.88   0    25,000
                                00000995  1/22/2001 1996/NQ   30,000    $7.75   0     7,500

                                                           ---------          -------------
                                   T O T A L S               130,000            0   107,500
</TABLE>

--------

(1) Does not give effect to vesting provisions of letter agreement dated
    February 18, 2002.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}]]