EXHIBIT 10.12

IMATION CORP.

1996 DIRECTORS STOCK COMPENSATION PROGRAM
(AS AMENDED - JANUARY 24, 1997)

SECTION 1. PURPOSE

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. It is intended that the 1996 Directors Stock Compensation Program will provide for the granting to participants of stock options, restricted stock, restricted stock units, common stock and/or other stock-based awards.

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.

SECTION 2. DEFINITIONS

(a) "Accounting Date" shall mean the first business day following the annual meeting of stockholders of the Company; provided, that for the Plan Year that begins on the Effective Date, Accounting Date shall mean the Effective Date.

(b) "Basic Fee" shall mean the annual retainer payable to an Eligible Director with respect to each Plan Year (at the annual rate in effect on the Accounting Date of such Plan Year) for such Eligible Director's services on the Board and as the chairperson of any committee of the Board (exclusive of any Meeting Fees).

(c) "Board" shall mean the Board of Directors of the Company.

(d) "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 (as defined in Section 10) and (ii) the Fair Market Value of the Common Stock as of the last trading day preceding the date of the Change in Control.

(e) "Committee" shall mean the Compensation Committee of the Board.

(f) "Common Stock" shall mean the common stock, par value $.01 per share, of the Company.

(g) "Company" shall mean Imation Corp.

(h) "Distribution" shall mean the distribution by Minnesota Mining and Manufacturing Company to its stockholders of shares of Common Stock of the Company.

(i) "Dividend Equivalent Right" shall mean a right, described in
Section 7(b) hereof, of a holder of Restricted Stock Units with respect to certain dividends paid on outstanding shares of Common Stock.

(j) "Effective Date" shall mean the effective date of the Distribution.

(k) "Election Form" shall mean the Election Form attached as Exhibit A hereto or such other form as may be deemed acceptable by the Secretary of the Company from time to time.

(l) "Eligible Director" shall mean each member of the Board who is not at the time of reference an employee of the Company or any of its subsidiaries.

(m) "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.

(n) "Fair Market Value" as of any date shall mean the average of the high and low prices for Common Stock on such date, as reported on the New York Stock Exchange Composite Transactions, rounded upwards to the nearest $0.05; provided, however that the Fair Market Value as of the Effective Date shall mean the average of the daily averages of the high and low prices for Common Stock, as reported on the New York Stock Exchange Composite Transactions, on each day during the five consecutive trading days commencing on the Effective Date, rounded upwards to the nearest $0.05.

(o) "Meeting Fees" shall mean the amounts payable to an Eligible Director in arrears on any Quarterly Payment Date with respect to attendance at meetings of the Board or any committee of the Board (exclusive of any Basic Fee).

(p) "Options" shall mean the stock options issued pursuant to Section 5 or 8 hereof.

(q) "Plan Year" shall mean the twelve-month period commencing on the Accounting Date; provided, that the first Plan Year of the Program shall commence on the Effective Date and end on the date of the first annual meeting of stockholders of the Company.

(r) "Program" shall mean the Company's 1996 Directors Stock Compensation Program, as amended from time to time.

(s) "Proration Fraction" shall mean 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" shall mean 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 three-month period.

(u) "Restricted Stock Unit" shall mean a right to receive payment of the Fair Market Value of one share of Common Stock in accordance with the conditions set forth in Section 7 hereof or conditions established by the Committee pursuant to Section 8 hereof.

(v) "Restricted Stock" shall mean Common Stock subject to the restrictions set forth in Section 6 hereof or restrictions established by the Committee pursuant to Section 8 hereof.

(w) "Rule 16b-3" shall mean Rule 16b-3 under the Exchange Act, as such Rule may be amended from time to time.

SECTION 3. ADMINISTRATION

The Program shall be administered by the Committee. 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:

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

(b) 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;

(c) 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

(d) Grant other stock-based awards under the Program, as provided in
Section 8 hereof.

SECTION 4. SHARES SUBJECT TO THE PROGRAM

(a) No more than 800,000 shares of Common Stock, subject to adjustment pursuant to Section 9 hereof, shall be available for issuance under the Program.

(b) Shares of Common Stock issued under the Program may consist in whole or in part of authorized and unissued shares or of treasury shares, and no fractional shares shall be issued under the Program. Cash shall be paid in lieu of any fractional shares issuable under the Program.

SECTION 5. ANNUAL GRANT OF OPTIONS

(a) Annual Grant.

(i) As of the Effective Date, each Eligible Director shall automatically be granted an Option pursuant to the Program to purchase 10,000 shares of Common Stock.

(ii) Following the Effective Date, each new Eligible Director (one who has not previously been granted Options under this Section 5) shall automatically be granted an Option pursuant to this Section 5 to purchase the number of whole shares of Common Stock equal to 10,000 multiplied by the Proration Fraction, as of the date such Eligible Director first becomes an Eligible Director.

(iii) Following the Effective Date, each Eligible Director who continues to serve on the Board immediately following an annual meeting of stockholders shall be granted an Option to purchase 10,000 shares of Common Stock as of the date of such meeting.

(iv) All Options granted under this Section 5 shall be granted at an option price equal to the Fair Market Value of the Common Stock on the date of grant.

(b) Terms and Conditions of Options.

(i) Subject to paragraph (ii) below, each Option granted under this Section 5 shall vest and become exercisable as to all shares of Common Stock underlying such Option on the date of the annual meeting of stockholders next succeeding the date of grant.

(ii) Notwithstanding paragraph (i) above, all outstanding and previously unvested Options of an Eligible Director granted under this Section 5 shall immediately vest and become fully exercisable upon the Eligible Director's death or disability or upon a Change of Control (as defined in
Section 10). If an Eligible Director otherwise terminates service as an Eligible Director, any Options granted under this Section 5 that have not become exercisable shall be forfeited as of the date of such termination of service. Subject to the foregoing, each Option shall expire on the date that is ten years following the date of grant (the "Expiration Date").

(iii) Options shall be exercised by written notice to the Secretary of the Company in such form as is from time to time prescribed by the Committee and by the payment in full, in cash or previously owned shares of Common Stock, of the aggregate option price of the shares of Common Stock for which the Option is being exercised. To the extent that an Option is not exercised by an optionee when it becomes initially exercisable, it shall not expire but shall be carried forward and shall be exercisable until the Expiration Date. Partial exercise shall be permitted from time to time, provided that partial exercises shall be in multiples of one hundred shares of Common Stock.

(iv) If for any reason during the term of a vested, unexercised and unexpired Option, the Eligible Director shall cease to be a member of the Board, such Option may be exercised, to the extent exercisable at the time of such termination of service, by the Eligible Director (or, in the event of such Eligible Director's death, such Eligible Director's estate) until the earlier of (A) the second anniversary of the date that the Eligible Director ceases to be a member of the Board and (B) the Expiration Date.

SECTION 6. ANNUAL GRANT OF RESTRICTED STOCK

(a) Annual Grant.

(i) As of each Accounting Date commencing with the Effective Date, each Eligible Director shall automatically be granted a number of shares of Restricted Stock (excluding fractional shares, which shall be paid in cash), the number of which shall be calculated by dividing 25% of his or her Basic Fee payable with respect to the Plan Year that commences on such Accounting Date by the Fair Market Value of one share of Common Stock on such Accounting Date.

(ii) Each new Eligible Director who is first elected to the Board between annual meetings of stockholders shall automatically be granted a number of shares of Restricted Stock (excluding fractional shares, which shall be paid in cash), the number of which shall be calculated by (A) multiplying 25% of his or her Basic Fee payable with respect to the Plan Year in 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 is first elected to the Board.

(b) Terms and Conditions of Restricted Stock.

(i) Vesting. Each share of Restricted Stock granted under this Section 6 shall vest in full on the third anniversary of the date of grant; provided, however, that all outstanding and previously unvested shares of Restricted Stock of an Eligible Director granted under this Section 6 shall immediately vest in full upon the Eligible Director's death or disability or upon a Change of Control (as defined in Section 10).

(ii) Restrictions on Transfer. Until shares of Restricted Stock vest in accordance with paragraph (b)(i) of this Section 6, such shares may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of or encumbered, and no attempt to transfer such shares, whether voluntary or involuntary, by operation of law or otherwise, shall vest the transferee with any interest or right in or with respect to such shares.

(iii) Issuance and Custody of Certificate. The Company shall cause to be issued one or more stock certificates, registered in the name of the Eligible Director, evidencing the shares of Restricted Stock. Each such certificate shall bear the following legend:

"The transferability of this certificate and the shares of Common Stock represented hereby are subject to the restrictions, terms and conditions (including restrictions against transfer) contained in the Imation Corp. 1996 Directors Stock Compensation Program. Copies of such Program are on file with the Secretary of Imation Corp. at the principal executive offices of Imation Corp."

Each certificate issued pursuant to this Section 6 shall be deposited by the Company with the Secretary of the Company or a custodian designated by the Secretary. Upon request, the Secretary or such custodian shall issue a receipt to the Eligible Director evidencing the certificate or certificates held which are registered in the name of the Eligible Director. After any shares of Restricted Stock vest in accordance with paragraph (b)(i) of this Section 6, the Company shall promptly cause to be issued a certificate or certificates evidencing such vested shares, free of the legend provided above and shall cause such certificate or certificates and any additional shares of Common Stock, any securities and any other property held in custody with respect to such vested shares pursuant to paragraph (b)(iv) of this Section 6 to be delivered to the Eligible Director or the Eligible Director's legal representatives, beneficiaries or heirs.

(iv) Distributions and Adjustments. If all or any portion of the shares of Restricted Stock vest in the Eligible Director subsequent to any change in the number or character of the shares of Common Stock (through merger, consolidation, reorganization, recapitalization, stock dividend or otherwise), the Eligible Director shall then receive upon such vesting the number and type of securities or other consideration which the Eligible Director would have received if such shares had vested prior to the event changing the number or character of outstanding shares of Common Stock. Any additional shares of Common Stock, any other securities of the Company and any other property (except for cash dividends or other cash distributions) distributed with respect to the shares of Restricted Stock prior to the date the shares of Restricted Stock vest shall be subject to the same restrictions, terms and conditions as the shares of Restricted Stock. Any cash dividends or other cash distributions payable with respect to the shares of Restricted Stock shall be distributed to the Eligible Director at the same time cash dividends or other cash distributions are distributed to stockholders of the Company generally. Any additional shares of Common Stock, any securities and any other property (except for cash dividends or other cash distributions) distributed with respect to the shares of Restricted Stock prior to the date such shares vest shall be promptly deposited with the Secretary or the custodian designated by the Secretary to be held in custody in accordance with paragraph (b)(iii) of this Section 6.

(v) Rights of Holder. Eligible Directors shall have none of the rights of a shareholder with respect to shares of Restricted Stock until such shares shall have vested in the Eligible Director as provided herein, except the rights to receive all cash dividends or other cash distributions and the right to vote.

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

(a) Elections.

(i) For the Plan Year commencing with the Effective Date, each Eligible Director shall have the option, at his or her election, to receive as of November 14, 1996, in lieu of cash payment therefor, a number of shares of Common Stock (excluding fractional shares, which shall be paid in cash) and/or Restricted Stock Units (including fractional Restricted Stock Units), up to the number which is calculated by dividing 50% of his or her Basic Fee payable with respect to such Plan Year by the Fair Market Value of one share of Common Stock on November 14, 1996. 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 November 14, 1996.

(ii) As of each Accounting Date following the Effective Date, each Eligible Director shall have the option, at his or her election, to receive, in lieu of cash payment therefor, a number of shares of Common Stock (excluding fractional shares, which shall be paid in cash) and/or Restricted Stock Units (including fractional Restricted Stock Units) up to the number which is calculated by dividing 75% of his or her Basic Fee payable with respect to the Plan Year that commences on such Accounting Date by the Fair Market Value of one share of Common Stock on such Accounting 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 such Accounting Date.

(iii) Each new Eligible Director who is first elected to the Board between annual meetings of stockholders shall have the option, at his or her election, to receive, in lieu of cash payment therefor, a number of shares of Common Stock (excluding fractional shares, which shall be paid in cash) and/or Restricted Stock Units (including fractional Restricted Stock Units) up to the number owhich is calculated by (A) multiplying 75% of his or her Basic Fee payable with respect to the Plan Year in 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 is first elected to the Board. 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 is first elected to the Board.

(iv) As of each Quarterly Payment Date following November 14, 1996, each Eligible Director shall have the option, at his or her election, to receive, in lieu of cash payment therefor, a number of shares of Common Stock (excluding fractional shares, which shall be paid in cash) and/or Restricted Stock Units (including fractional Restricted Stock Units) up to the number which is calculated by dividing the amount of his or her Meeting Fees payable on such Quarterly Payment Date by the Fair Market Value of one share of Common Stock on such 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 immediately preceding Quarterly Payment Date or, in the case of the first Quarterly Payment Date following November 14, 1996, prior to November 14, 1996.

(b) Terms and Conditions of Restricted Stock Units.

(i) Restricted Stock Unit 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.

(ii) Dividend Equivalent Rights. Outstanding Restricted Stock Units shall be credited with Dividend Equivalent Rights based upon dividends paid on outstanding shares of Common Stock from the date such Restricted Stock Units are granted to the date of payment in respect of such Restricted Stock Units. Such Dividend Equivalent Rights, once credited, shall be converted into an equivalent number of Restricted Stock Units (including fractional Restricted Stock Units). 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 payment 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 Rights 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 payment date, had such shares been owned 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 date the Eligible Director has elected to receive payment pursuant to the applicable Election Form and (B) the occurrence of a Change in Control.

(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 equal the Change in Control Price multiplied by the number of shares (including fractional shares) of Common Stock relating to the Restricted Stock Units with respect to which such cash payment is being made.

SECTION 8. OTHER STOCK-BASED AWARDS

The Committee is hereby authorized to grant Eligible Directors such other awards under the Program that are denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, shares of Common Stock, as are deemed by the Committee to be consistent with the purpose of the Program (including, without limitation, Options, Restricted Stock or Restricted Stock Units in lieu of or in addition to those granted pursuant to Sections 5, 6 and 7 hereof, respectively); provided, however, that such grants must comply with Rule 16b-3 and applicable law. Subject to the terms of the Program and any applicable award agreement, the Committee shall determine the terms and conditions of any such awards.

SECTION 9. EFFECTS OF CERTAIN CHANGES IN CAPITALIZATION

In the event of any recapitalization, stock split, reverse stock split, stock dividend, reorganization, merger, consolidation, spin-off, combination, repurchase, or share exchange, or other similar corporate transaction or event affecting the Common Stock, the maximum number or class of shares available under the Program, the number or class of shares, and exercise price, of Common Stock subject to outstanding Options, the number or class of shares of Common Stock to be subject to Options automatically granted to Eligible Directors, the number or class of shares of Restricted Stock or Restricted Stock Units to be granted, delivered or credited hereunder, and the number or class of shares and the terms of any other outstanding stock-based awards granted hereunder, as the case may be, shall be adjusted by the Committee to reflect any such event.

SECTION 10. CHANGE IN CONTROL

(a) For purposes of this Section 10, the following words and phrases shall have the meanings indicated below, unless the context clearly indicates otherwise:

(i) "Person" shall have the meaning associated with that term as it is used in Sections 13(d) and 14(d) of the Act.

(ii) "Affiliates and Associates" shall have the meanings assigned to such terms in Rule 12b-2 promulgated under Section 12 of the Act.

(iii) "Act" shall mean the Securities Exchange Act of 1934.

(iv) "Continuing Directors" shall have the meaning assigned to such term in Article Thirteenth of the Company's Restated Certificate of Incorporation.

(v) "Code" shall mean the Internal Revenue Code of 1986, as amended.

(b) For purposes of the Program, a Change in Control of the Company shall be deemed to have occurred if:

(i) any Person (together with its Affiliates and Associates), other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company, is or becomes the "beneficial owner" (as that term is defined in Rule 13d-3 promulgated under the Act), directly or indirectly, of securities of the Company representing thirty percent (30%) or more of the combined voting power of the Company's then outstanding securities, unless a majority of the Continuing Directors of the Company's Board of Directors prior to that time have determined in their sole discretion that, for purposes of this Program, a Change in Control of the Company has not occurred; or

(ii) the Continuing Directors of the Company's Board of Directors shall at any time fail to constitute a majority of the members of such Board of Directors.

SECTION 11. TERM OF PROGRAM

The Program was approved by Minnesota Mining and Manufacturing Company, as sole stockholder of the Company, and shall become effective as of the Effective Date. This Program shall remain in effect until all authorized shares have been issued, unless sooner terminated by the Board.

SECTION 12. 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 13. 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 14. 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. Unless otherwise determined by the Committee, awards under this Program shall not be transferable by an Eligible Director other than by the laws of descent and distribution or pursuant to a qualified domestic relations order as defined in the Code, or Title I of ERISA, or the rules thereunder.

SECTION 15. 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 to be withheld with respect to such payment or delivery.

SECTION 16. GOVERNING LAW

The Program and all rights hereunder shall be construed in accordance with and governed by the laws of the State of Minnesota.

SECTION 17. UNFUNDED PROGRAM

Unless otherwise determined by the Committee, 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 18. 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.

EXHIBIT A
IMATION CORP.
1996 DIRECTORS STOCK COMPENSATION PROGRAM
(As Amended - January 24, 1997)

ELECTION TO RECEIVE COMMON STOCK OR RESTRICTED STOCK UNITS

THIS ELECTION is made by ___________________ (the "Eligible Director"), as of the ____ day of _________, 19___.

WHEREAS, Imation Corp., a Delaware corporation (the "Company") has adopted the Imation Corp. 1996 Directors Stock Compensation Program (As Amended) (the "Program");

WHEREAS, the Eligible Director has the option under the Program to receive Common Stock and/or Restricted Stock Units (as defined in the Program) 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:

1. 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.

2. Election to Receive Common Stock

Subject to the terms and conditions of the Program, the Eligible Director hereby elects to receive shares of Common Stock in lieu of certain cash compensation payable for service as a director of the Company as follows:

____% of the prorated Basic Fee (excluding the portion of the prorated Basic Fee automatically granted in the form of Restricted Stock) payable on the date first elected to the Board of Directors (if other than at an annual meeting of stockholders)

____% of the Basic Fee (excluding the portion of the Basic Fee automatically granted in the form of Restricted Stock) payable on each Accounting Date after the date hereof

____% of Meeting Fees payable on each Quarterly Payment Date after the date hereof

3. Election to Receive Restricted Stock Units

Subject to the terms and conditions of the Program, the Eligible Director hereby elects to receive Restricted Stock Units in lieu of certain cash compensation payable for service as a director of the Company as follows:

____% of the prorated Basic Fee (excluding the portion of the prorated Basic Fee automatically granted in the form of Restricted Stock) payable on the date first elected to the Board of Directors (if other than at an annual meeting of stockholders)

____% of the Basic Fee (excluding the portion of the Basic Fee automatically granted in the form of Restricted Stock Units) payable on each Accounting Date after the date hereof

____% of Meeting Fees payable on each Quarterly Payment Date after the date hereof

Such Restricted Stock Units shall be payable as set forth in the Program on the earlier to occur of a Change in Control or the following date:

____ _______ anniversary of the grant date (please specify)

____ the date the Eligible Director's service on the Board terminates for any reason

____ other (please specify):_____________________________

4. 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.

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

Accepted and Agreed to by IMATION CORP.

By: _________________________

EXHIBIT 10.13

INDEMNITY AGREEMENT

This Indemnity Agreement, dated as of July 1, 1996, by and between Imation Corp., a Delaware corporation (the "Company") and ______________, a director of the Company (the "Indemnitee").

RECITALS

A. The Company is aware that competent and experienced persons are increasingly reluctant to serve as directors of corporations unless they are protected by comprehensive liability insurance or indemnification, due to increased exposure to litigation costs and risks resulting from their service to such corporations, and due to the fact that the exposure frequently bears no reasonable relationship to the compensation of such directors;

B. The statutes and judicial decisions regarding the duties of directors are often difficult to apply, ambiguous, or conflicting, and therefore fail to provide such directors with adequate, reliable knowledge of legal risks to which they are exposed or information regarding the proper course of action to take;

C. Plaintiffs often seek damages in such large amounts and the costs of litigation may be so enormous (whether or not the case is meritorious), that the defense and/or settlement of such litigation is often beyond the personal resources of directors;

D. The Company believes that it is unfair for its directors to assume the risk of huge judgments and other expenses which may occur in cases in which the director received no personal profit and in cases where the director was not culpable;

E. Based upon their experience, the Board of Directors of the Company (the "Board") has concluded that, to retain and attract talented and experienced individuals to serve as directors of the Company and to encourage such individuals to take the business risks necessary for the success of the Company and its subsidiaries, it is necessary for the Company to contractually indemnify its directors, and to assume for itself maximum liability for expenses and damages in connection with claims against such directors in connection with their service to the Company, and has further concluded that the failure to provide such contractual indemnification could result in harm to the Company and its shareholders;

F. The Delaware General Corporation Law under which the Company is organized empowers the Company to indemnify its officers, directors, employees and agents by agreement and to indemnify persons who serve, at THE request of the Company, as the directors, officers, employees or agents of other corporations or enterprises, and expressly provides that the indemnification provided by Section 145 is not exclusive;

G. As a result of circumstances that may have no relation to, or that may be beyond the control of, the Company or the Indemnitee, there can be no assurance of the adequacy of, or continuation or renewal of current liability insurance coverage for its directors. The Company believes, therefore, that the interests of the Company's shareholders would best be served by a combination of such insurance and the indemnification by the Company of the directors of the Company;

H. The Company desires and has requested the Indemnitee to serve or continue to serve as a director of the Company free from undue concern for claims for damages arising out of or related to such services to the Company; and

I. The Indemnitee is willing to serve, or to continue to serve, the Company, provided that he or she is furnished the Indemnity provided for herein.

AGREEMENT

NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows:

1. Definitions.

(a) Agent. For the purposes of this Agreement, "agent" of the Company means any person who is or was a director, officer, employee or other agent of the Company or a subsidiary of the Company; or is or was serving at the request of, for the convenience of, or to represent the interests of the Company or a subsidiary of the Company as a director, officer, employee or agent of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise; or was a director, officer, employee or agent of a foreign or domestic corporation which was a predecessor corporation of the Company or a subsidiary of the Company, or was a director, officer, employee or agent of another enterprise at the request of, for the convenience of, or to represent the interests of such predecessor corporation.

(b) Expenses. For purposes of this Agreement, "expenses" includes all direct and indirect costs of any type or nature whatsoever (including, without limitation, all attorneys' fees and related disbursements and other out-of-pocket costs) actually and reasonably incurred by the Indemnitee in connection with either the investigation, defense or appeal of a proceeding or establishing or enforcing a right to indemnification under this Agreement, Section 145, or otherwise; provided, however, that expenses shall not include amounts for which the Company is prohibited by law from providing indemnification.

(c) Proceeding. For the purpose of this Agreement, "proceeding" means any threatened, pending, or completed action, suit or other proceeding, whether civil, criminal, administrative, investigative or any other type whatsoever.

(d) Subsidiary. For purposes of this Agreement, "subsidiary" means any corporation of which more than 50% of the outstanding voting securities is owned directly or indirectly by the Company, by the Company and one or more subsidiaries, or by one or more subsidiaries.

2. Agreement to Serve. The Indemnitee agrees to serve and/or continue to serve as a director of the Company, so long as the Indemnitee is duly appointed or elected and qualified in accordance with the applicable provisions of the by-laws of the Company or until such time as the Indemnitee tenders his or her resignation in writing, provided, however, that nothing contained in this Agreement is intended to create any right to continued employment or Board membership by Indemnitee.

3. Maintenance of Liability Insurance.

(a) The Company hereby covenants and agrees that, so long as the Indemnitee shall continue to serve as an agent of the Company and thereafter so long as the Indemnitee shall be subject to any possible proceeding by reason of the fact that the Indemnitee was an agent of the Company, the Company, subject to Section 3(c), shall promptly obtain and maintain in full force and effect directors' and officers' liability insurance ("D&O Insurance") in reasonable amounts from established and reputable insurers.

(b) In all policies of D&O Insurance, the Indemnitee shall be named as an insured in such a manner as to provide the Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company's directors.

(c) Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain D&O Insurance if the Company determines in good faith that such insurance is not reasonably available, the premium costs for such insurance are disproportionate to the amount of coverage provided, the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or the Indemnitee is covered by similar insurance maintained by a subsidiary of the Company.

4. Mandatory Indemnification. The Company shall indemnify the Indemnitee:

(a) Third Party Actions. If the Indemnitee is a person who was or is a party or is threatened to be made a party to any proceeding (other than an action by or in the right of the Company) by reason of the fact that the Indemnitee is or was an agent of the Company, or by reason of anything done or not done by him or her in any such capacity, against any and all expenses and liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) actually and reasonably incurred by him or her in connection with the investigation, defense, settlement or appeal of such proceeding if the Indemnitee acted in good faith and in a manner the Indemnitee reasonably believed to be in the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful; and

(b) Derivative Actions. If the Indemnitee is a person who was or is a party or is threatened to be made a party to any proceeding by or in the right of the Company to procure a judgment in its favor by reason of the fact that the Indemnitee is or was an agent of the Company, or by reason of anything done or not done by the Indemnitee in any such capacity, against any and all expenses actually and reasonably incurred by the Indemnitee in connection with the investigation, defense, settlement, or appeal of such proceeding if the Indemnitee acted in good faith and in a manner the Indemnitee reasonably believed to be in the best interests of the Company; such indemnification shall also be granted if the Court of Chancery or the court in which such proceeding was brought shall determine upon application, that, in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such amounts which the Court of Chancery or such other court shall deem proper; and

(c) Actions where Indemnitee is Deceased. If the Indemnitee dies before his or her right to indemnification is determined or, after determination, but before indemnification is paid, the Indemnitee's right to indemnification shall survive and shall be determined and paid as if the Indemnitee had survived.

5. Partial Indemnification. If the Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) incurred by the Indemnitee in the investigation, defense, settlement or appeal of a proceeding but not entitled, however, to indemnification for all of the total amount thereof, the Company shall nevertheless indemnify the Indemnitee for such total amount except as to the portion thereof to which the Indemnitee is not entitled.

6. Mandatory Advancement of Expenses. Subject to Section 8(a) below, the Company shall advance all reasonable expenses incurred by the Indemnitee in connection with the investigation, defense, settlement or appeal of any proceeding to which the Indemnitee is a party or is threatened to be made a party by reason of the fact that the Indemnitee is or was an agent of the Company. Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined pursuant to Section 8 hereof that the Indemnitee is not entitled to be indemnified by the Company as authorized hereby. The advances to be made hereunder shall be paid by the Company to the Indemnitee within twenty (20) days following delivery of a written request therefor by the Indemnitee to the Company. Any such request shall reasonably evidence the expenses and costs incurred or to be incurred by Indemnitee hereunder. Any dispute concerning the advancement of expenses may, at the election of Indemnitee, be resolved by binding arbitration before one neutral arbitrator in accordance with the Center for Public Resources, New York, New York ("CPR") Rules for Non-Administered Arbitration of Business Disputes. If the Company and the Indemnitee encounter difficulty in agreeing on an arbiter, they will seek the assistance of CPR in the selection process. In any dispute concerning Indemnitee's right to the advancement of expenses, Indemnitee shall be presumed to be entitled to such advancement and the Company shall bear the burden to prove by clear and convincing evidence that Indemnitee is not so entitled.

7. Notice and Other Indemnification Procedures.

(a) Promptly after receipt by the Indemnitee of notice of the commencement of or the threat of commencement of any proceeding, the Indemnitee shall, if the Indemnitee believes that indemnification with respect thereto may be sought from the Company under this Agreement, notify the Company of the commencement or threat of commencement thereof. Indemnitee will be presumed to have met the standard of conduct entitling him or her to indemnification; the Company shall be entitled to attempt to rebut the presumption in accordance with the procedures set forth in Section 8 below.

(b) If, at the time of the receipt of a notice of the commencement of a proceeding pursuant to Section 7(a) hereof, the Company has D&O Insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

(c) If the Company shall be obligated to pay the expenses of any proceeding against the Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel reasonably approved by the Indemnitee, upon the delivery to the Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by the Indemnitee and the retention of such counsel by the Indemnitee and the retention of such counsel by the Company, the Company will not be liable to the Indemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemnitee with respect to the same proceeding, provided that
(i) the Indemnitee shall have the right to employ counsel in any such proceeding at the Indemnitee's expense; and (ii) if (A) the employment of counsel by the Indemnitee has been previously authorized by the Company, (B) the Indemnitee or counsel selected by the Company shall have concluded that there may be a conflict of interest between the Company and the Indemnitee or among Indemnitees jointly represented in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then fees and expenses of Indemnitee's counsel shall be at the expense of the Company.

8. Determination of Right to Indemnification.

(a) To the extent the Indemnitee has been successful on the merits or otherwise in defense of any proceeding referred to in subsections
4(a), 4(b) or 4(c) of this Agreement or in the defense of any claim, issue or matter described therein, the Company shall indemnify the Indemnitee against expenses actually and reasonably incurred by the Indemnitee in connection with the investigation, defense, or appeal of such proceeding.

(b) To determine Indemnitee's right to indemnification other than as provided in subsection 8(a), Indemnitee shall be presumed to have met the standard of care entitling him or her to indemnification. The Company shall bear the burden to prove that Indemnitee is not entitled to indemnification. Such determination shall be made by:

(1) A majority vote of a quorum of the Board consisting of directors who are not parties to the proceeding for which indemnification is being sought;

(2) Legal counsel selected by the Board, and reasonably approved by the Indemnitee, which counsel shall make such determination in a written opinion; or

(3) One neutral arbitrator who shall be a litigation or corporate attorney with experience in the area of director or officer indemnification. The arbitrator shall be selected within 30 days of the demand for arbitration and shall render his or her decision within 60 days after the Company and the Indemnitee have completed the submission of their respective cases, unless good cause be shown as to why a longer time for decision is necessary. The arbitration shall be conducted in accordance with the CPR Rules for Non-Administered Arbitration or Business Disputes. If the Company and the Indemnitee encounter difficulty in agreeing on an arbiter, they will seek assistance of CPR in the selection process.

(c) As soon as practicable, and in no event later than 60 days after written notice of the Indemnitee's choice of forum pursuant to Section 8(b) above, the Company shall, at its own expense, submit to the selected forum in such manner as the indemnitee or the Indemnitee's counsel may reasonably request, its claim that the Indemnitee is not entitled to indemnification, and the Company shall act in good faith to assure the Indemnitee a complete opportunity to defend such claim.

(d) Notwithstanding any other provision in this Agreement to the contrary, the Company shall indemnify the Indemnitee against all expenses incurred by the Indemnitee in connection with any hearing or proceeding under this Section 8 involving the Indemnitee and against all expenses incurred by the Indemnitee in connection with any other proceeding between the Company and the Indemnitee involving the interpretation or enforcement of the rights of the Indemnitee under this Agreement unless a court of competent jurisdiction finds that each of the claims and/or defenses of the Indemnitee in any such proceeding was frivolous or made in bad faith, in which case Indemnitee will repay the amounts previously paid, and will do so within 20 days following written demand. The indemnification provided to Indemnitee in this section shall be paid by Company on a current basis (i.e., no later than 20 days following written demand).

9. Exceptions. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement;

(a) Claims Initiated by Indemnitee. To indemnify or advance expenses to the Indemnitee with respect to proceedings or claims initiated or brought voluntarily by the Indemnitee and not by way of defense ("defense" includes contribution or indemnification or proceedings to enforce proportionate fault rules where applicable), except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or law or otherwise, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors finds it to be appropriate; or

(b) Lack of Good Faith. To indemnify the Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by the Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; or

(c) Unauthorized Settlements. To indemnify the Indemnitee under this Agreement for any amounts paid in settlement of a proceeding unless the Company consents to such settlement, which consent shall not be unreasonably withheld.

10. Non-exclusivity. The provisions for indemnification and advancement of expenses set forth in this Agreement shall not be deemed exclusive of any other rights which the Indemnitee may have under any provision of law, the Company's certificate of incorporation or bylaws, the vote of the Company's shareholders or disinterested directors, other agreements, or otherwise, both as to action in the Indemnitee's official capacity and to action in another capacity while occupying his or her position as an agent of the Company, and the Indemnitee's rights hereunder shall continue after the Indemnitee has ceased acting as an agent of the Company and shall inure to the benefit of the heirs, executors and administrators of the Indemnitee.

11. Interpretation of Agreement. It is understood that the parties hereto intend this Agreement to be interpreted and enforced so as to provide indemnification to the Indemnitee to the fullest extent now or hereafter permitted by law.

12. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever,
(i) the validity, legality and enforceability of the remaining provisions of the Agreement (including without limitation, all portions of any paragraphs of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby, and (ii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, all portions of any paragraph of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable and to give effect to Section 12 hereof.

13. Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

14. Successors and Assigns. The terms of this Agreement shall bind, and shall inure to the benefit of, the successors and assigns of the parties hereto.

15. Notice. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee or (ii) if mailed by certified or registered mail with postage prepaid, on the third business day after the mailing date. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice.

16. Governing Law. This Agreement shall be governed exclusively by and construed according to the laws of the State of Delaware, as applied to contracts between Delaware residents entered into and to be performed entirely within Delaware.

17. Consent to Jurisdiction. The Company and the Indemnitee each hereto irrevocably consent to the jurisdiction of the courts of the State of Minnesota for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be brought only in the state courts of the State of Minnesota, or in arbitration as set forth herein.

The parties hereto have entered into this Indemnity Agreement effective as of date first above written.

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

By _____________________           Address:
     William T. Monahan
     Chairman, President           1 Imation Place
     and Chief Executive           Oakdale, MN  55128
     Officer