Document:

exv10w9

 

EXHIBIT 10.9

IMATION CORP.

DIRECTORS COMPENSATION PROGRAM

EFFECTIVE MAY 4, 2005

(As amended February 8, 2006)

SECTION 1. PURPOSE

     (a) The purpose of the Program is to attract and retain well-qualified persons for service as
nonemployee directors of the Company and to promote identity of interest between directors and
stockholders of the Company. The Program is designed and intended to comply with Rule 16b-3 under
the Securities Exchange Act of 1934, as amended, as such Rule may be amended from time to time, and
shall be interpreted in a manner consistent with the requirements thereof, as now or hereafter
construed, interpreted and applied by regulations, rulings and cases.

     (b) The Program is also intended to comply in form and operation with Section 409A of the
Internal Revenue Code.

SECTION 2. DEFINITIONS

     The following words and phrases have the meaning indicated below, unless the context clearly
indicates otherwise.

     (a) “Accounting Date” means the first business day following the annual meeting of
stockholders of the Company.

     (b) “Basic Fee” means the annual retainer payable to an Eligible Director at the annual rate
in effect on the Accounting Date for such Eligible Director’s services on the Board (exclusive of
any Chairperson Fee, Lead Director Fee or Meeting Fees.)

     (c) “Board” means the Board of Directors of the Company.

     (d) “Chairperson Fee” means the annual retainer payable to an Eligible Director at the annual
rate in effect on the Accounting Date for such Eligible Director’s services as the chairperson of
any committee of the Board.

     (e) “Change in Control” has the meaning given it in Section 8(b) to the extent it is
consistent with and satisfies the definition of “Change of Control” under Code section 409A.

     (f) “Change in Control Price” of the Common Stock shall equal the higher of (i) if applicable,
the price paid for the Common Stock in the transaction constituting a Change in Control and (ii)
the Fair Market Value of the Common Stock as of the last trading day preceding the date of the
Change in Control.

 

 

     (g) “Code” means the Internal Revenue Code of 1986, as amended, and any applicable regulations
or binding rules promulgated thereunder.

     (h) “Committee” means the Compensation Committee of the Board.

     (i) “Common Stock” means the common stock, par value $.01 per share, of the Company.

     (j) “Company” means Imation Corp.

     (k) “Dividend Equivalent Credit” has the meaning given it in Section 7(b).

     (l) “Election Form” means the Election Form attached as Exhibit B hereto or such other form as
may be deemed acceptable by the Secretary of the Company from time to time.

     (m) “Eligible Director” means each member of the Board who is not at the time of reference an
employee of the Company or any of its subsidiaries.

     (n) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

     (o) “Fair Market Value” as of any date means, the fair market value as defined under the Stock
Plan.

     (p) “Lead Director Fee” means the annual retainer payable to the Eligible Director who is
selected to be the lead director at the annual rate in effect on the Accounting Date for such
Eligible Director’s services as the lead director.

     (q) “Meeting Fees” means the amounts payable to an Eligible Director in arrears on any
Quarterly Payment Date for attendance at meetings or participation in teleconferences of the Board
or any committee of the Board (exclusive of any Basic Fee, Chairperson Fee or Lead Director Fee).

     (r) “Program” means the Company’s Directors Compensation Program, as amended from time to
time.

     (s) “Proration Fraction” means a fraction, the numerator of which is the number of days from
the date an Eligible Director first becomes an Eligible Director to the date of the next succeeding
annual meeting of stockholders and the denominator of which is 365.

     (t) “Quarterly Payment Date” means the date established by the Company from time to time for
payment, in arrears, of all Meeting Fees earned by Eligible Directors during the preceding calendar
quarter, provided such date shall not be later than two and one-half (21/2) months from the end of
such calendar quarter.

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     (u) “Restricted Stock Unit” means a right to receive payment of one share of Common Stock in
accordance with the conditions set forth in Section 7 hereof or conditions established by the
Committee.

     (v) “Rule 16b-3” means Rule 16b-3 under the Exchange Act, as such Rule may be amended from
time to time.

     (w) “Stock Plan” means the then current stock incentive plan of the Company used to grant
stock based awards to Eligible Directors.

SECTION 3. ADMINISTRATION

     (a) The Program shall be administered by the Committee.

     (b) In administering the Program, it will be necessary to follow various laws and regulations.
It may be necessary from time to time to change or waive requirements of the Program to conform
with the law, to meet special circumstances not anticipated or covered in the Program, or to carry
on successful operation of the Program, and in connection therewith, the Committee shall have the
full power and authority to:

     (i) Prescribe, amend, and rescind rules and regulations relating to the Program,
establish procedures deemed appropriate for its administration, interpret the provisions of
the Program, remedy ambiguities, and make any and all other determinations not herein
specifically authorized which may be necessary or advisable for its effective
administration;

     (ii) Make any amendments to or modifications of the Program which may be required or
necessary to make the Program set forth herein comply with the provisions of any laws,
federal or state, or any regulations issued thereunder, and to cause the Company at its
expense to take any action related to the Program which may be required under such laws or
regulations;

     (iii) Contest on behalf of the Eligible Directors or the Company, at the sole
discretion of the Committee and at the expense of the Company, any ruling or decision on any
issue related to the Program, and conduct any such contest and any resulting litigation to a
final determination, ruling, or decision; and

     (iv) Grant stock-based awards under the Program, as provided in Section 5 hereof.

     (c) Unless otherwise expressly provided in the Program, all designations, determinations,
interpretations and other decisions under or with respect to the Program or any award shall be
within the sole discretion of the Committee, may be made at any time and shall be final, conclusive
and binding upon any Eligible Director or beneficiary, and any employee of the Company.

3

 

SECTION 4. FEES/EXPENSES

     (a) Each Eligible Director who is first elected to the Board at, or who continues to serve on
the Board immediately following an annual meeting of stockholders, is entitled to receive a Basic
Fee and a Chairperson Fee for serving as chairperson of a committee of the Board (as applicable).

     (b) Any Eligible Director who is designated as the lead director is entitled to receive a Lead
Director Fee for services as the lead director.

     (c) Each Eligible Director who joins the Board or becomes a chairperson of a committee of the
Board or Lead Director after the annual meeting of stockholders is entitled to receive a Basic Fee,
Chairperson Fee or Lead Director Fee (as applicable) multiplied by the Proration Fraction, as of
the date such Eligible Director first becomes an Eligible Director, chairperson of a committee of
the Board or Lead Director.

     (d) Each Eligible Director is entitled to receive a Meeting Fee for attendance at a meeting of
the Board or a Committee of the Board or participation in a teleconference in lieu of such meeting.
The Meeting Fees are payable in arrears on the Quarterly Payment Date. Any member of the Board who
interviews a Board candidate shall be entitled to receive compensation in an amount equal to the
Meeting Fee for an in person Board meeting for each such interview.

     (e) The current rate of the Basic Fee, Chairperson Fee, Lead Director Fee and Meeting Fees are
set forth on the attached Exhibit A, and may be amended from time to time by the Board or any
committee given responsibility for determining Board of Director compensation.

     (f) Each Eligible Director is entitled to reimbursement for reasonable travel costs of
attending Board and committee meetings and interviews of Board candidates. Such reimbursement shall
be payable in cash after receipt of documentation by the Company from such Eligible Director.

SECTION 5. ANNUAL GRANT OF STOCK BASED AWARD

     (a) Each Eligible Director who is first elected to the Board at, or continues to serve on the
Board immediately following an annual meeting of stockholders shall be granted a stock based award
(i.e., options, restricted stock, etc.) as of the date of such meeting in type, proportion and
amount to be determined by the Committee and under, and in accordance with, the terms of the Stock
Plan.

     (b) Each Eligible Director who joins the Board after an annual meeting of stockholders, shall
be granted a stock based award pursuant to this Section 5 as of the date such Eligible Director
first becomes an Eligible Director based on the number of whole shares of Common Stock equal to the
number granted other Eligible Directors at the time of the immediately preceding annual meeting of
stockholders, multiplied by the Proration Fraction.

4

 

     (c) Terms and conditions of stock based awards (such as grant price, vesting schedule, etc.)
shall be as determined by the Committee and under, and in accordance with, the terms of the Stock
Plan.

     (d) The amount and composition of the current annual stock based award are set forth on the
attached Exhibit A, which may be amended from time to time by the Board or any committee given
responsibility for determining Board of Director compensation.

SECTION 6. MATCHING GIFT PROGRAM

     Each Eligible Director is entitled to a matching gift from the Company of up to $15,000 per
calendar year to qualifying charitable institutions, prorated for any calendar year that Eligible
Director joins the Board. Each Eligible Director must submit evidence of such gift to the Company
and the Company will send the matching contribution directly to the qualifying charitable
institution on behalf of the Eligible Director.

SECTION 7. ELECTIONS TO RECEIVE COMMON STOCK OR RESTRICTED STOCK UNITS

     (a) Elections.

     (i) Common Stock. Each Eligible Director who is not covered by clause (iii)
below, may elect to receive, in lieu of a cash payment for his or her Basic Fee, Chairperson
Fee, Lead Director Fee and/or Meeting Fees (or a portion thereof, as elected by the Eligible
Director), a number of shares of Common Stock (excluding fractional shares, which shall be
paid in cash (or carried over to the next payment if an Eligible Director elects to be paid
all in Common Stock)), which is calculated by dividing his or her Basic Fee, Chairperson
Fee, Lead Director Fee and/or Meeting Fees (or a portion thereof), by the Fair Market Value
of one share of Common Stock on the Accounting Date or Quarterly Payment Date, as
applicable. To be effective, any such election shall be made by submitting a completed and
executed Election Form to the Secretary of the Company prior to the relevant Accounting Date
or Quarterly Payment Date, as applicable.

     (ii) Restricted Stock Units.

     (A) Each Eligible Director who is not covered by clause (iii) below, may elect
to receive, in lieu of cash payment for his or her Basic Fee, Chairperson Fee, Lead
Director Fee and/or Meeting Fees, Restricted Stock Units (including fractional
Restricted Stock Units) calculated by dividing his or her Basic Fee, Chairperson
Fee, Lead Director Fee and/or Meeting Fees (or a portion thereof, as elected by the
Eligible Director) for services to be performed in the following the calendar year
by the Fair Market Value of one share of Common Stock on the Accounting Date or
Quarterly Payment Date, as applicable. To be effective, any such election relating
to the Basic Fee, Chairperson Fee, Lead Director Fee or Meeting Fees shall be made
by submitting a completed and
executed Election Form to the Secretary of the Company prior to the calendar year in
which the Eligible Director wishes the election to be in effect and such election
shall be irrevocable for such calendar year.

5

 

     (B) Each Eligible Director who is not covered by clause (iii) below may elect
to receive, in lieu of cash payment for his or her Meeting Fees (or a portion
thereof, as elected by the Eligible Director), Restricted Stock Units (including
fractional Restricted Stock Units) calculated by dividing his or her Meeting Fees
(or portion thereof) by the Fair Market Value of one share of Common Stock on the
Quarterly Payment Date. To be effective, any such election relating to the Meeting
Fees shall be made by submitting a completed and executed Election Form to the
Secretary of the Company prior to the calendar year in which the Eligible Director
wishes the election to be in effect and such election shall be irrevocable for such
calendar year.

     (iii) New Directors. Each Eligible Director who joins the Board between annual
meetings of stockholders may elect prior to first becoming an Eligible Director to receive,
in lieu of cash payment for his or her Basic Fee, Chairperson Fee and/or Lead Director Fee,
a number of shares of Common Stock (excluding fractional shares, which shall be paid in cash
(or carried over to the next payment if an Eligible Director elects to be paid all in Common
Stock)) and/or Restricted Stock Units (including fractional Restricted Stock Units) up to
the number which is calculated by (A) multiplying the sum of his or her Basic Fee,
Chairperson Fee, Lead Director Fee (or a portion thereof, as elected by the Eligible
Director) payable with respect to the time prior to the next annual meeting of stockholders
which the Eligible Director is first elected to the Board by the Proration Fraction and (B)
dividing the product resulting from clause (A) by the Fair Market Value of one share of
Common Stock on the date that the Eligible Director becomes an Eligible Director. Each
Eligible Director may also elect to receive, in lieu of cash payment for his or her Meeting
Fees (or a portion thereof, as elected by the Eligible Director), Common Stock (excluding
fractional shares, which shall be paid in cash (or carried over to the next payment if an
Eligible Director elects to be paid all in Common Stock)) Restricted Stock Units (including
fractional Restricted Stock Units) calculated by dividing his or her Meeting Fees (or
portion thereof) by the Fair Market Value of one share of Common Stock on the Quarterly
Payment Date. To be effective, any such election shall be made by submitting a completed and
executed Election Form to the Secretary of the Company prior to the date that the Eligible
Director becomes an Director, and such Election Form shall be irrevocable for that calendar
year with respect to any election (or lack of election) to receive Restricted Stock Units.

(b) Restricted Stock Units.

     (i) Account. Upon the grant of Restricted Stock Units to an Eligible Director,
such units shall be credited to an account established for such Eligible Director. Each
Eligible Director shall receive an annual statement showing the number of Restricted Stock
Units that have been credited to the Eligible Director’s account under the Program.

6

 

     (ii) Dividend Equivalent Credits. An Eligible Director’s account shall be
credited with Dividend Equivalent Credits equivalent to the amount of dividends paid by the
Company to holders of outstanding shares of Common Stock based on the number of Restricted
Stock Units credited to the Eligible Director’s account on the dividend record date for
shares of Common Stock. Such Dividend Equivalent Credit shall be converted into an
equivalent number of Restricted Stock Units (including fractional Restricted Stock Units)
based on the fair market value of one share of Common Stock on the related dividend payment
date and such Restricted Stock Units shall be subject to the same distribution timing as the
underlying Restricted Stock Units to which the Dividend Equivalent Credits related. If a
dividend is paid in cash, each Eligible Director shall be credited, as of each applicable
dividend payment date, in accordance with the following formula:

(A X B) / C

     in which “A” equals the number of Restricted Stock Units held by the Eligible Director
on the dividend record date, “B” equals the cash dividend per share and “C” equals the Fair
Market Value per share of Common Stock on the dividend payment date. If a dividend is paid
in property other than cash, Dividend Equivalent Credits shall be credited, as of the
applicable dividend payment date, in accordance with the formula set forth above, except
that “B” shall equal the fair market value per share of the property that the Eligible
Director would have received in respect of the number of shares of Common Stock equal to the
number of Restricted Stock Units held by the Eligible Director as of the dividend record
date, had such shares been owned by the Eligible Director as of the record date for such
dividend.

     (iii) Time of Payment. All payments in respect of an Eligible Director’s
Restricted Stock Units shall be made as soon as practicable following the earlier of (A) the
Eligible Director’s death (B) the occurrence of a Change in Control, and (C) the specific
date the Eligible Director has elected to receive payment pursuant to the applicable
Election Form pursuant to which such Eligible Director elected to receive such Restricted
Stock Units in lieu of cash.

     (iv) Form of Payment. Payment in respect of Restricted Stock Units shall be
made in one lump sum payment in the form of shares of Common Stock. For purposes of the
preceding sentence, any payment made upon the occurrence of a Change in Control in full or
partial payment of Restricted Stock Units shall be made in cash in an amount equal the
Change in Control Price multiplied by the number of Restricted Stock Units (including
fractional units).

(c) Stock Plan.

     All shares of Common Stock and all Restricted Stock Units awarded pursuant to this Section 7
shall be awarded under, and in accordance with, the terms of the Stock Plan. Restricted Stock Units
awarded hereunder shall be considered Other Stock-Based Awards under the Plan.

7

 

SECTION 8. CHANGE IN CONTROL

     (a) For purposes of this Section 8, “Act” shall mean the Securities Exchange Act of 1934.

     (b) For purposes of the Program, a “Change in Control” of the Company shall be deemed to have
occurred if any one of the following events shall occur:

     (i) the consummation of a transaction or series of related transactions during a
12-month period in which a person, entity or group (within the meaning of Section 13(d)(3)
or 14(d)(2) of the Act) that owns (after application of the attribution rules of Section 318
of the Code) less than 35% of the combined voting power of the Company’s outstanding voting
stock prior to such transaction or the first of such series of related transactions), other
than the Company or a subsidiary of the Company, or any employee benefit plan of the Company
or a subsidiary of the Company, acquires ownership (after application of the attribution
rules of Section 318 of the Code) of 35% or more of the combined voting power of the
Company’s then outstanding voting stock (other than in connection with a Business
Combination in which clauses (1) and (2) of Section 8(b) (iii) apply); or

     (ii) a majority of the members of the Company’s Board of Directors is replaced during
any 12-month period by directors whose appointment or election is not endorsed by a majority
of the members of the Company’s Board of Directors prior to the date of the election or
appointment; or

     (iii) the consummation of a reorganization, merger, statutory share exchange,
consolidation or similar transaction involving the Company, a sale or other disposition in
a transaction or series of related transactions within a 12-month period of all or
substantially all of the Company’s assets or the issuance by the Company of its stock in
connection with the acquisition of assets or stock of another entity (each, a “Business
Combination”) in each case unless, following such Business Combination, (1) all or
substantially all of the individuals and entities that were the owners of the Company’s
outstanding voting stock immediately prior to such Business Combination own (after
application of the attribution rules of Section 318 of the Code) immediately after the
transaction or transactions more than 50% of the combined voting power of the then
outstanding voting stock (or comparable equity interests) of the entity resulting from such
Business Combination (including an entity that, as a result of such transaction, owns the
Company or all or substantially all of the Company’s assets either directly or through one
of more subsidiaries), and (2) no person, entity or group (other than a direct or indirect
parent entity of the Company that, after giving effect to the Business Combination,
beneficially owns 100% of the outstanding voting securities (or comparable equity interests)
of the entity resulting from the Business Combination) has acquired, during a 12-month
period, ownership (after application of the attribution rules of Section 318 of the Code) of
35% or more of the combined voting power of the then outstanding voting stock (or comparable
equity interests) of the entity resulting from such Business Combination.

8

 

     Notwithstanding anything herein stated, no Change in Control shall be deemed to occur unless
it would be deemed to constitute a change in ownership or effective control, or a change in the
ownership of a substantial portion of the assets, of a business under Section 409A of the Code.

SECTION 9. AMENDMENT; TERMINATION

     The Board may at any time and from time to time alter, amend, suspend, or terminate the
Program in whole or in part; provided, however, that no amendment which requires stockholder
approval in order for the exemptions available under Rule 16b-3 to be applicable to the Program and
the Eligible Directors shall be effective unless the same shall be approved by the stockholders of
the Company entitled to vote thereon.

SECTION 10. RIGHTS OF ELIGIBLE DIRECTORS

     Nothing contained in the Program or with respect to any grant shall interfere with or limit in
any way the right of the stockholders of the Company to remove any Eligible Director from the Board
pursuant to the bylaws of the Company, nor confer upon any Eligible Director any right to continue
in the service of the Company as a director.

SECTION 11. GENERAL RESTRICTIONS

     (a) Investment Representations. The Company may require any Eligible Director to whom
Common Stock is issued, as a condition of receiving such Common Stock, to give written assurances
in substance and form satisfactory to the Company and its counsel to the effect that such person is
acquiring the Common Stock for his or her own account for investment and not with any present
intention of selling or otherwise distributing the same, and to such other effects as the Company
deems necessary or appropriate in order to comply with federal and applicable state securities
laws.

     (b) Compliance with Securities Laws. Each issuance shall be subject to the requirement
that, if at any time counsel to the Company shall determine that the listing, registration or
qualification of the shares upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, is necessary as a condition of, or in
connection with, the issuance of shares thereunder, such issuance may not be accepted or exercised
in whole or in part unless such listing, registration, qualification, consent or approval shall
have been effected or obtained on conditions acceptable to the Committee. Nothing herein shall be
deemed to require the Company to apply for or to obtain such listing, registration or
qualification.

     (c) Nontransferability. Except as otherwise provided by the Committee, Restricted
Stock Units under this Program shall not be transferable by an Eligible Director other than by the
laws of descent and distribution.

9

 

     (d) No Acceleration of Distribution of Restricted Stock Units. The distribution of
Restricted Stock Units may not be accelerated, including upon termination of the Program, if such
acceleration would cause the distribution to become subject to tax under Code Section 409A.

SECTION 12. WITHHOLDING

     The Company may defer making payments or delivering shares of Common Stock under the Program
until satisfactory arrangements have been made for the payment of any federal, state or local
income or employment taxes required which the Company reasonably determines in its sole discretion
are to be withheld with respect to such payment or delivery.

SECTION 13. GOVERNING LAW

     The Program and all rights hereunder shall be construed in accordance with and governed by the
internal law, and not the law of conflicts, of the State of Delaware.

SECTION 14. UNFUNDED PROGRAM

     The Program shall be unfunded and shall not create (or be construed to create) a trust or a
separate fund or funds. The Program shall not establish any fiduciary relationship between the
Company and any Eligible Director or other person. To the extent any person holds any rights by
virtue of a grant under the Program, such right shall be no greater than the right of an unsecured
general creditor of the Company.

SECTION 15. HEADINGS

     The headings of sections and subsections herein are included solely for convenience of
reference and shall not affect the meaning of any of the provisions of the Program.

10

 

EXHIBIT A

FEES

(as of May 2005)

	 	 
	  Basic Fee

	  $34,000
	 
	 
	  Lead Director

	  $15,000
	 	 
	  Committee Chair

	  Audit
& Finance: $10,000
  Compensation/Nominating

    &Governance: $5,000

	 
	 
	  Board Meetings/Teleconferences

	  $1,500/$1,000
	 
	 
	  Audit & Finance

  Meetings/Teleconferences

	  $1,500/$1,000
	 
	 
	  Compensation Committee

  Meetings/Teleconferences

	  $1,000/$1,000
	 
	 
	  Nomination & Governance

  Meetings/Teleconferences

	  $1,000/$1,000
	 
	 
	  Annual Stock Based Grants

	  Dollar value $175,000 in options and
restricted stock, with 75% as options and

  25% as restricted stock (calculated using

Black-Scholes model)

 

 

EXHIBIT B

IMATION
CORP.

DIRECTORS COMPENSATION PROGRAM

ELECTION FORM

     THIS ELECTION is made by                      (the “Eligible Director”), effective as of the ___day of
___, 200_.

     WHEREAS, Imation Corp., a Delaware corporation (the “Company”) has a director compensation
program (the “Program”);

     WHEREAS, the Eligible Director has the option under the Program to receive Common Stock and/or
Restricted Stock Units in lieu of payment of certain cash compensation for service as a director of
the Company;

     NOW, THEREFORE, in accordance with the terms and conditions of the Program, the Eligible
Director hereby agrees as follows:

The Program 

     This Election is entered into pursuant to the Program, which is incorporated herein by
reference and made a part hereof. The Eligible Director hereby acknowledges receipt of a copy of
the Program. All capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to them in the Program.

Basic Fee, Chairperson Fee and Lead Director Fee (“Annual Grant”)

     The Basic Fee, Chairperson Fee and Lee Director Fee is payable (and prorated) on the date
first elected to the Board of Directors (if other than at an annual meeting of stockholders).
Thereafter, the Basic Fee, Chairperson Fee and Lead Director Fee is payable on each Accounting Date
following the Annual Meeting of Stockholders.

** Special Tax Rules Relating to Election to Receive Restricted Stock Units

          Due to new Internal Revenue Code Section 409A relating to the taxation of deferred
compensation, an election to receive Restricted Stock Units under the Program can only be made for
services performed and payments to be received following the calendar year in which the election is
made (e.g., an election made in 2005 is not effective until January 1, 2006). Also, the election
must remain in effect for the ENTIRE calendar year. Any change in or termination of the election
can only be made the year before it is to go in effect (e.g., a change for 2007 must be made before
the end of 2006.)

DUE TO THE SPECIAL TAX RULE NOTED ABOVE, AN ELECTION MUST BE MADE FOR 2005 (WHICH CANNOT
INCLUDE PAYMENT IN RESTRICTED STOCK UNITS)

 

 

AND FOR 2006 (WHICH CAN, AT THE ELIGIBLE DIRECTOR’S ELECTION, INCLUDE RESTRICTED STOCK
UNITS.)

     Subject to the terms and conditions of the Program, the Eligible Director hereby elects to
receive the Basic Fee, the Chairperson and Lead Director Fee, if applicable, in the following
manner:

BASIC FEE

For 2005 calendar year:

	 	 	 	 	 	 	 
	 

	 	 	 	___%
	 	Election to receive Common Stock in lieu of Cash
	 
	 	 	 	 	 	 
	 

	 	 	 	___%
	 	Election to receive Cash
	 
	 

	 	Total:
	 	100%	 	 

For 2006 Calendar year (and thereafter)**:

	 	 	 	 	 
	 

	 	___%
	 	Election to receive Common Stock in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Restricted Stock Units in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Cash
	 
	 	 	 	 
	Total:

	 	100 %	 	 

CHAIRPERSON FEE: (if applicable)

For 2005 calendar year:

	 	 	 	 	 
	 

	 	___%
	 	Election to receive Common Stock in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Cash
	 
	Total:

	 	100 %	 	 

For 2006 Calendar year (and thereafter)**:

	 	 	 	 	 
	 

	 	___%
	 	Election to receive Common Stock in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Restricted Stock Units in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Cash
	 
	Total:

	 	100 %	 	 

2

 

MEETING FEES:

     Subject to the terms and conditions of the Program, the Eligible Director elects to receive
Meeting Fees compensation in the following manner, with such fees payable on each Quarterly Payment
Date:

	 	 	 	 	 
	 

	 	___%
	 	Election to receive Common Stock in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Cash
	 
	Total:

	 	100 %	 	 

For 2006 Calendar year (and thereafter)**:

	 	 	 	 	 
	 

	 	___%
	 	Election to receive Common Stock in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Restricted Stock Units in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Cash
	 
	Total:

	 	100 %	 	 

LEAD DIRECTOR FEE: (if applicable-please complete this section even if you are not currently lead
director)

	 	 	 	 	 
	 

	 	___%
	 	Election to receive Common Stock in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Cash
	 
	Total:

	 	100 %	 	 

For 2006 Calendar year (and thereafter)**:

	 	 	 	 	 
	 

	 	___%
	 	Election to receive Common Stock in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Restricted Stock Units in lieu of Cash
	 
	 	 	 	 
	 

	 	___%
	 	Election to receive Cash
	 
	Total:

	 	100 %	 	 

3

 

DISTRIBUTION ELECTION FOR RESTRICTED STOCK UNITS: (Must be completed if Eligible Director
has made an Election to Receive Restricted Stock Units.)

     The Eligible Director hereby elects to receive payment of his or her Restricted Stock Units on
the earlier to occur of a Change in Control, his or her death or the following date:

	 	 	 	 	 
	 

	 	___
	 	___-year anniversary of the grant date (please specify)
	 
	 	 	 	 
	 

	 	___
	 	The date the Eligible Director incurs a “separation from service” with
Company (within the meaning of Section 409A of the Internal Revenue
Code).
	 
	 	 	 	 
	 

	 	___
	 	Other (please specify date only):                                                                                 

Term of Election 

     This Election will remain in effect until terminated or changed by the Eligible Director
pursuant to written notice to the Secretary of the Company or filing of a new Election Form. Note:
A change or termination of an Election to receive Restricted Stock Units will not become effective
until January 1 of the calendar year following the calendar year the change or termination is filed
with the Secretary of the Company.

     IN WITNESS WHEREOF, the Eligible Director has entered into this Election on the day and year
first above written, and the Company has accepted this Election as of such day and year.

	 	 	 	 	 
	 	 	ELIGIBLE DIRECTOR
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 	 	Signature
	 
	 	 	 	 
	 	 	Accepted and Agreed to by IMATION CORP.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 

4exv10w10

 

EXHIBIT 10.10

Imation Corp. 2005 Stock Incentive Plan

Stock Option Agreement 

     This STOCK OPTION AGREEMENT (the “Agreement”) effective as of «GrantDt» is between Imation
Corp., a Delaware corporation (the “Company”), and «Name», an employee of the Company or one of its
Affiliates (the “Participant”), pursuant to and subject to the terms and conditions of the Imation
Corp. 2005 Stock Incentive Plan (the “Plan”).

     The Company desires to provide the Participant with an opportunity to purchase shares of the
Company’s common stock, par value $.01 per share (the “Common Stock”), as provided in this
Agreement in order to carry out the purpose of the Plan. The purpose of this Agreement is to
evidence the terms and conditions of a Non-Qualified Stock Option granted to the Participant under
the Plan.

     Accordingly, for good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Company and the Participant hereby agree as follows:

     Section 1. Grant of Non-qualified Stock Option. Effective «GrantDt» (the “Effective
Date”), the Company granted to the Participant the right and option to purchase all or any part of
an aggregate of «Shares» («NbrShares») shares of Common Stock on the terms and conditions set forth
in this Agreement and in accordance with the terms of the Plan (the “Option”). 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”).

     Section 2. Purchase Price. The purchase price of the shares of Common Stock subject to
the Option shall be «Price» per share.

     Section 3. Term of the Option. The term of the Option (the “Option Period”) shall be
for a period of ten (10) years from the Effective Date, terminating at the close of business on the
tenth anniversary of the Effective Date (the “Expiration Date”) or such shorter period as provided
in Section 6 hereof.

     Section 4. Vesting of the Option. Subject to Section 6 hereof, the Option may be
exercised at any time or from time to time during the Option Period, as to any part or all of the
shares covered thereby in accordance with the following vesting schedule:

          (a) twenty five percent (25%) of the Option may be exercised at any time on or after the first
anniversary of the Effective Date;

          (b) fifty percent (50%) of the Option may be exercised at any time on or after the second
anniversary of the Effective Date;

          (c) seventy five percent (75%) of the Option may be exercised at any time on or after the
third anniversary of the Effective Date; and

 

 

          (d) one hundred percent (100%) of the Option may be exercised at any time on or after the
fourth anniversary of the Effective Date.

     Section 5. Transferability. The Option may not be assigned, transferred (other than by
will or the laws of descent and distribution), pledged, hypothecated (whether by operation of law
or otherwise) or otherwise conveyed or encumbered, and shall not be subject to execution,
attachment or similar process. Any attempted assignment, transfer, pledge, hypothecation or other
disposition of the Option contrary to the provisions of the Plan or this Agreement, or the levy of
any execution, attachment or similar process upon the Option, shall be void and unenforceable
against the Company and shall constitute an immediate cancellation of the Option.

     Section 6. Effect of Termination of Employment.

          (a) In the event the Participant shall cease to be employed by the Company and all
subsidiaries of the Company for any reason other than (i) Termination for Cause, (ii) Retirement,
(iii) death or Disability or (iv) termination by the Company or a subsidiary of the Participant’s
employment with the Company and its subsidiaries within two (2) years following a Change of
Control, the Participant may exercise the Option to the extent of (but only to the extent of) the
number of vested shares the Participant was entitled to purchase under the Option on the date of
such termination of employment, and the exercise of the Option to that limited extent may be
effected at any time within thirty (30) days after the date of such termination of employment but
not thereafter; provided, however, that the Option may not be exercised after the Expiration Date.

          (b) In the event the Participant shall cease to be employed by the Company and its
subsidiaries upon Termination for Cause, the Option shall be terminated as of the date of such
termination.

          (c) Except as otherwise provided in Sections 6(b), 6(d) and 6(e), in the event the Participant
shall cease to be employed by the Company and all subsidiaries of the Company because of
Retirement, the Option, to the extent not previously exercised or forfeited, shall be exercisable
to the extent of (but only to the extent of) the number of vested shares the Participant was
entitled to purchase under the Option on the date of the Participant’s Retirement, and the exercise
of the Option to that limited extent may be effected at any time within three (3) years after the
date of the Participant’s Retirement but not thereafter; provided, however, that the Option may not
be exercised after the Expiration Date. If a Participant who has thus retired dies within three (3)
years after the date of the Participant’s Retirement and prior to the Expiration Date, the exercise
of the Option to the limited extent provided for in the first sentence of this Section 6(c) may be
effected by the Participant’s estate or by any Person or Persons to whom the Option has been
transferred by will or the applicable laws of descent and distribution at any time within two (2)
years after the date of the Participant’s death, but not after the Expiration Date.

          (d) In the event the Participant dies or is deemed to suffer a Disability while employed by
the Company or a subsidiary, the Option, to the extent not previously exercised or forfeited, shall
be exercisable to the extent of (but only to the extent of) the number of vested shares the
Participant was entitled to purchase under the Option on the date of the Participant’s
 death or Disability. In the event of Participant’s death,

2

 

the exercise of the Option to the limited
extent provided for in the first sentence of this Section 6(d) may be effected by the Participant’s
estate or by any Person or Persons to whom the Option has been transferred by will or the
applicable laws of descent and distribution at any time within two (2) years after the date of the
Participant’s death, but not after the Expiration Date. In the event of the Participant’s
Disability, the exercise of the Option to the limited extent provided for in the first sentence of
this Section 6(d) may be effected by the Participant at any time within two (2) years after the
date of the Participant’s Disability, but not after the Expiration Date.

          (e) In the event the Company or a subsidiary terminates the Participant’s employment with the
Company and all subsidiaries of the Company for any reason other than death, Disability or
Termination for Cause within two (2) years following a Change of Control, the Option shall become
immediately exercisable in full on the date of such termination of employment, and the exercise of
the Option may be effected at any time within six (6) months after the date of the Participant’s
termination of employment, but not after the Expiration Date. In the event that the provisions of
this Section 6(e) result in “payments” that are finally and conclusively determined by a court or
Internal Revenue Service proceeding to be subject to the excise tax imposed by Section 4999 of the
Code, and the Participant has not received any additional cash payment from the Company relating
thereto under the provisions of Section 6 of the Severance Agreement between the Company and the
Participant (the “Severance Agreement”), the Company shall pay to the Participant an additional
amount such that the net amount retained by the Participant following realization of all
compensation under the Plan that resulted in such “payments,” after allowing for the amount of such
excise tax and any additional federal, state and local income and employment taxes paid on the
additional amount, shall be equal to the net amount that would otherwise have been retained by the
Participant if there were no excise tax imposed by Section 4999 of the Code. If the Participant
receives any additional cash payment from the Company under Section 6 of the Severance Agreement,
the foregoing sentence shall be of no force or effect and the provisions of the Severance Agreement
shall be deemed to supersede the foregoing sentence in its entirety.

     Section 7. Anti-Dilution and Fundamental Change Adjustments.

          (a) In the event that the Committee shall determine that any dividend or other distribution
(whether in the form of cash, shares of Common Stock, other securities or other property),
recapitalization, stock split, reverse stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase or exchange of shares or other securities of the
Company, issuance of warrants or other rights to purchase shares of Common Stock or other
securities of the Company or other similar corporate transaction or event affects the shares of
Common Stock covered by the Option such that an adjustment is determined by the Committee to be
appropriate in order to prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under this Agreement, then the Committee shall, in such manner as it
may deem equitable, in its sole discretion, adjust any or all of the number and type of the shares
covered by the Option and the exercise price of the Option.

3

 

          (b) In the event of a proposed Fundamental Change, the Committee may, but shall not be
obligated to:

     (i) with respect to a Fundamental Change that involves a merger or
consolidation, make appropriate provision for the protection of the Option by the
substitution of options and appropriate voting common stock of the corporation
surviving any such merger or consolidation or, if appropriate, the “parent
corporation” (as defined in Section 424(e) of the Code, or any successor provision)
of the Company or such surviving corporation, in lieu of the Option and shares of
Common Stock of the Company, or

     (ii) with respect to any Fundamental Change, including, without limitation, a
merger or consolidation, declare, prior to the occurrence of the Fundamental Change,
and provide written notice to the holder of the Option of the declaration, that the
Option, whether or not then exercisable, shall be canceled at the time of, or
immediately prior to the occurrence of, the Fundamental Change in exchange for
payment to the holder of the Option, within 20 days after the Fundamental Change, of
cash (or, if the Committee so elects in lieu of solely cash, of such form(s) of
consideration, including cash and/or property, singly or in such combination as the
Committee shall determine, that the holder of the Option would have received as a
result of the Fundamental Change if the holder of the Option had exercised the
Option immediately prior to the Fundamental Change) equal to, for each share of
Common Stock covered by the canceled Option, the amount, if any, by which the Fair
Market Value (as defined in this Section 7(b)) per share of Common Stock exceeds the
exercise price per share of Common Stock covered by the Option. At the time of the
declaration provided for in the immediately preceding sentence, the Option shall
immediately become exercisable in full and the holder of the Option shall have the
right, during the period preceding the time of cancellation of the Option, to
exercise the Option as to all or any part of the shares of Common Stock covered
thereby in whole or in part, as the case may be. In the event of a declaration
pursuant to this Section 7(b), the Option, to the extent that it shall not have been
exercised prior to the Fundamental Change, shall be canceled at the time of, or
immediately prior to, the Fundamental Change, as provided in the declaration.
Notwithstanding the foregoing, the holder of the Option shall not be entitled to the
payment provided for in this Section 7(b) if such Option shall have expired or been
forfeited. For purposes of this Section 7(b) only, “Fair Market Value” per share of
Common Stock means the fair market value, as determined in good faith by the
Committee, of the consideration to be received per share of Common Stock by the
shareholders of the Company upon the occurrence of the Fundamental Change,
notwithstanding anything to the contrary provided in this Agreement.

     Section 8. Manner of Exercise. Subject to the terms and conditions of this Agreement,
the Option may be exercised by delivering written notice to the Stock Plan Administrator pursuant
to procedures prescribed by the Company from time to time. Such notice shall state the election to
exercise the Option and the number of shares in respect of which it is being exercised and shall be signed by the Participant or

4

 

such other Person entitled to
exercise the Option. Such notice shall be accompanied by payment of the full purchase price of such
shares and applicable federal, state, local and foreign withholding taxes, if any. The Participant
shall deliver to the Company consideration with a value equal to such purchase price and applicable
withholding taxes, if any, payable in whole or in part as follows: (a) cash, check, bank draft,
money order or wire transfer payable to the order of the Company, (b) shares of Common Stock owned
by the Participant at the time of exercise and/or (c) in any other form of valid consideration that
is acceptable to the Committee in its sole discretion. The value of any share of Common Stock
delivered in payment of all or part of the purchase price or applicable withholding taxes upon the
exercise of the Option shall be the closing sale price of a share of Common Stock on the New York
Stock Exchange as reported on the consolidated transaction reporting system on the date the Option
shall be exercised or, if such Exchange is not open for trading on such date, on the most recent
preceding date on which such Exchange is open for trading. In the event that the Option shall be
exercised pursuant to Section 6(c) or 6(d) hereof by any Person or Persons other than the
Participant, such notice shall be accompanied by appropriate proof of the right of such Person or
Persons to exercise the Option. If the Participant fails to pay the full purchase price of such
shares or applicable withholding taxes, then the Option, and right to purchase such shares, may be
forfeited by the Participant, in the sole discretion of the Committee. The Option may be exercised
in whole or in part to the extent the Option is exercisable in accordance with the terms of this
Agreement, but only with respect to full shares of Common Stock. No fractional shares of Common
Stock shall be issued upon exercise of the Option, but the Company will pay, in lieu thereof, the
Fair Market Value of such fractional share.

     Section 9. Issuance of Shares. Upon exercise of all or any portion of the Option, the
Company will cause to be issued to the Participant the shares of Common Stock purchased.
Notwithstanding anything to the contrary in this Agreement, the Company’s obligation to issue
shares of Common Stock shall be subject to (i) all applicable laws, rules and regulations and such
approvals by any governmental agencies as may be required, including, without limitation, the
effectiveness of a registration statement under the Securities Act of 1933, as amended, and (ii)
the condition that such shares shall have been duly listed on the New York Stock Exchange. The
Participant shall not have any of the rights and privileges of a shareholder of the Company with
respect to the shares of Common Stock subject to this Option unless and until such shares are
issued to the Participant upon due exercise of the Option.

     Section 10. Taxes. The Participant acknowledges that the Participant will consult with
the Participant’s personal tax adviser regarding the income tax consequences of exercising the
Option or any other matters related to this Agreement. In order to comply with all applicable
federal, state, local or foreign income tax laws or regulations, the Company may take such action
as it deems appropriate to ensure that all applicable federal, state, local or foreign payroll,
withholding, income or other taxes, which are the Participant’s sole and absolute responsibility,
are withheld or collected from the Participant.

5

 

     Section 11. Definitions. Terms not defined in this Agreement shall have the meanings
given to them in the Plan, and the following terms shall have the following meanings when used in
this Agreement:

          (a) “Change of Control” means any one of the following events:

     (i) the consummation of a transaction or series of related transactions in
which a person, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than
the Company or a subsidiary of the Company, or any employee benefit plan of the
Company or a subsidiary of the Company, acquires beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of the
Company’s then outstanding shares of Common Stock or the combined voting power of
the Company’s then outstanding voting securities (other than in connection with a
Business Combination in which clauses (1), (2) and (3) of paragraph (a)(iii) apply);
or

     (ii) individuals who, as of the Effective Date hereof, constitute the Board of
Directors of the Company (the “Incumbent Board”) cease for any reason to constitute
at least a majority of the Board of Directors of the Company; provided, however,
that any individual becoming a director subsequent to the Effective Date hereof
whose election, or nomination for election by the Company’s stockholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board (other than a nomination of an individual whose initial assumption
of office is in connection with a solicitation with respect to the election or
removal of directors of the Company in opposition to the solicitation by the Board
of Directors of the Company) shall be deemed to be a member of the Incumbent Board;
or

     (iii) the consummation of a reorganization, merger, statutory share exchange,
consolidation or similar transaction involving the Company, a sale or other
disposition in a transaction or series of related transactions of all or
substantially all of the Company’s assets or the issuance by the Company of its
stock in connection with the acquisition of assets or stock of another entity (each,
a “Business Combination”) in each case unless, following such Business Combination,
(1) all or substantially all of the individuals and entities that were the
beneficial owners of the Company’s outstanding Common Stock and the Company’s
outstanding voting securities immediately prior to such Business Combination
beneficially own immediately after the transaction or transactions, directly or
indirectly, more than 50% of the then outstanding shares of common stock and more
than 50% of the combined voting power of the then outstanding voting securities (or
comparable equity interests) of the entity resulting from such Business Combination
(including an entity that, as a result of such transaction, owns the Company or all
or substantially all of the Company’s assets either directly or through one of more
subsidiaries) in substantially the same proportions as their ownership of the
Company’s Common Stock and voting securities

6

 

immediately prior to such Business Combination, (2) no person, entity or group
(other than a direct or indirect parent entity of the Company that, after giving
effect to the Business Combination, beneficially owns 100% of the outstanding voting
securities (or comparable equity interests) of the entity resulting from the
Business Combination) beneficially owns, directly or indirectly, 35% or more of the
outstanding shares of common stock or the combined voting power of the then
outstanding voting securities (or comparable equity interests) of the entity
resulting from such Business Combination and (3) at least a majority of the members
of the board of directors (or similar governing body) of the entity resulting from
such Business Combination were members of the Incumbent Board at the time of the
execution of the initial agreement or of the action of the Board of Directors of the
Company providing for such Business Combination; or

     (iv) approval by the stockholders of the dissolution of the Company.

          (b) “Fundamental Change” means a dissolution or liquidation of the Company, a sale of
substantially all of the assets of the Company, or a merger or consolidation of the Company with or
into any other corporation, regardless of whether the Company is the surviving corporation.

          (c) “Disability” shall be as defined under the Imation Corp. Long Term Disability Income
Protection Plan.

          (d) “Retirement” means retirement as defined under the Imation Corp. Cash Balance Pension
Plan.

          (e) “Stock Plan Administrator” means the Committee or any Director, officer or agent of the
Company designated by the Committee from time to time.

          (f) “Termination for Cause” means termination of Participant’s employment with the Company or
an Affiliate for the following acts: (i) the Participant’s gross incompetence or substantial
failure to perform his or her duties, (ii) misconduct by the Participant that causes or is likely
to cause harm to the Company or that causes or is likely to cause harm to the Company’s reputation,
as determined by the Company’s Board of Directors in its sole and absolute discretion (such
misconduct may include, without limitation, insobriety at the workplace during working hours or the
use of illegal drugs), (iii) failure to follow directions of the Company’s Board of Directors that
are consistent with the Participant’s duties, (iv) the Participant’s conviction of, or entry of a
pleading of guilty or nolo contendre to, any crime involving moral turpitude, or the entry of an
order duly issued by any federal or state regulatory agency having jurisdiction in the matter
permanently prohibiting the Participant from participating in the conduct of the affairs of the
Company or (v) any breach of this Agreement that is not remedied within thirty (30) days after
receipt of written notice from the Company specifying such breach in reasonable detail.

7

 

     Section 12. Governing Law. The internal law, and not the law of conflicts, of the
State of Delaware will govern all questions concerning the validity, construction and effect of
this Agreement.

     Section 13. Plan Provisions. This Agreement is made under and subject to the
provisions of the Plan, and all of the provisions of the Plan are also provisions of this
Agreement. If there is a difference or conflict between the provisions of this Agreement and the
provisions of the Plan, the provisions of the Plan will govern. By accepting this Option, the
Participant confirms that the Participant has received a copy of the Plan and represents that the
Participant is familiar with the terms and provisions thereof, and hereby accepts this Option
subject to all the terms and provisions of the Plan.

     Section 14. No Right to Continue Service or Employment. Nothing herein shall be
construed as giving the Participant the right to continue in the employ or to provide services to
the Company or any Affiliate, whether as an employee or as a consultant or otherwise, or interfere
with or restrict in any way the right of the Company or any Affiliate to discharge the Participant,
whether as an employee or consultant or otherwise, at any time, with or without cause. In addition,
the Company or any Affiliate may discharge the Participant free from any liability or claim under
this Agreement, unless otherwise expressly provide herein.

     Section 15. Entire Agreement. Except as specifically provided herein with regard to
the Severance Agreement, (i) this Agreement together with the Plan supersede any and all other
prior understandings and agreements, either oral or in writing, between the parties with respect to
the subject matter hereof and constitute the sole and only agreements between the parties with
respect to said subject matter; (ii) all prior negotiations and agreements between the parties with
respect to the subject matter hereof are merged into this Agreement; and (iii) each party to this
Agreement acknowledges that no representations, inducements, promises or agreements, orally or
otherwise, have been made by any party or by anyone acting on behalf of any party, which are not
embodied in this Agreement or the Plan and that any agreement, statement or promise that is not
contained in this Agreement or the Plan shall not be valid or binding or of any force or effect.

     Section 16. Modification. No change or modification of this Agreement shall be valid
or binding upon the parties unless the change or modification is in writing and signed by the
parties. Notwithstanding the preceding sentence, the Plan, this Agreement and the Option may be
amended, altered, suspended, discontinued or terminated to the extent permitted by the Plan.

     Section 17. Shares Subject to Agreement. The shares covered by the Option shall be
subject to the terms and conditions of this Agreement. Except as otherwise provided in Section 7,
no adjustment shall be made for dividends or other rights for which the record date is prior to the
issuance of such shares. The Company shall at all times during the Option Period reserve and keep
available such number of shares of Common Stock as will be sufficient to satisfy the requirements
of this Agreement.

     Section 18. Severability. In the event that any provision that is contained in the
Plan or this Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any
jurisdiction or would disqualify the Plan or this Agreement for any reason and under any law as

8

 

deemed applicable by the Committee, the invalid, illegal or unenforceable provision shall be
construed or deemed amended to conform to applicable laws, or if it cannot be so construed or
deemed amended without, in the determination of the Committee, materially altering the purpose or
intent of the Plan or this Agreement, such provision shall be stricken as to such jurisdiction or
Option, and the remainder of the Plan or this Agreement shall remain in full force and effect.

     Section 19. Headings. Headings are given to the sections and subsections of this
Agreement solely as a convenience to facilitate reference. Such headings shall not be deemed in any
way material or relevant to the construction or interpretation of this Agreement or any provision
hereof.

     Section 20. Participant’s Acknowledgments. The Participant hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Committee or the Board of
Directors of the Company, as appropriate, upon any questions arising under the Plan or this
Agreement. Notwithstanding any of the provisions hereof, the Participant hereby agrees that the
Participant will not exercise the Option granted hereby, and that the Company will not be obligated
to issue any shares to the Participant hereunder, if the exercise thereof or the issuance of such
shares shall constitute a violation by the Participant or the Company of any provision of any law
or regulation of any governmental authority. Any determination in this connection by the Company,
including the Board of Directors of the Company or the Committee, shall be final, binding and
conclusive. The obligations of the Company and the rights of the Participant are subject to all
applicable laws, rules and regulations.

     Section 21. Parties Bound. The terms, provisions, and agreements that are contained in
this Agreement shall apply to, be binding upon, and inure to the benefit of the parties and their
respective heirs, executors, administrators, legal representatives and permitted successors and
assigns, subject to the limitation on assignment expressly set forth herein. This Agreement shall
have no force or effect unless it is duly executed and delivered by the Company.

     The Company has caused this Agreement to be signed and delivered as of the date set forth
above.

	 	 	 	 	 
	 	 	IMATION CORP.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Name:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 

9

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