8-K/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

Amendment No. 1

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): July 9, 2007

Imation Corp.

(Exact name of registrant as specified in its charter)

DELAWARE	1-14310	41-1838504
(State or other jurisdiction	(Commission File Number)	(IRS Employer
of incorporation)		Identification Number)
1 IMATION WAY
OAKDALE, MINNESOTA		55128
(Address of principal executive		(Zip Code)
offices)

Registrant’s telephone number, including area code: (651) 704-4000

None

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

Consent of Berkowitz Dick Pollack & Brant

Consolidated Financial Statements and Independent Auditors' Report

Unaudited Financial Information

Pro Forma Condensed Combined Financial Statements

This Amendment No. 1 on Form 8-K/A amends and supplements the Current Report on Form 8-K of Imation Corp., a Delaware corporation (“Imation”), filed with the Securities and Exchange Commission (the “Commission”) on July 13, 2007 (the “Initial Form 8-K”) to include financial statements and pro forma financial information permitted pursuant to Item 9.01 of Form 8-K to be excluded from the Initial Form 8-K and filed by amendment to the Initial Form 8-K no later than 71 days after the date on which the Initial Form 8-K was required to be filed. As previously reported in the Initial Form 8-K, on July 9, 2007, Imation completed the acquisition of certain assets of Memcorp, Inc. and Memcorp Asia Limited (together “Memcorp”, subsidiaries of Hopper Radio of Florida, Inc., a Florida corporation (“Hopper”)), pursuant to an Asset Purchase Agreement dated as of May 7, 2007 (the “Purchase Agreement”). Imation paid cash of $27.3 million at closing and issued three-year notes of $37.5 million. Certain inventory purchases will be finalized post-closing, and earn-out payments may be paid over the course of the next three fiscal years of up to an aggregate of $20 million, dependent on financial performance of the purchased business. As provided in the Purchase Agreement, Imation acquired the assets of Memcorp used in or relating to the sourcing and sale of consumer electronics products, principally sold under the Memorex brand name, including inventories, equipment and other tangible personal property, intellectual property and contract rights.

Item 9.01 Financial Statements and Exhibits.

(a)	Financial Statements of Businesses Acquired.
	Hopper Radio of Florida, Inc. and Subsidiaries Consolidated Financial Statements Year Ended December 31, 2006 and Independent Auditors’ Report
	Independent Auditors’ Report Consolidated Balance Sheet at December 31, 2006 Consolidated Statement of Income for the year ended December 31, 2006 Consolidated Statement of Shareholders’ Equity and Comprehensive Income for the year ended December 31, 2006 Consolidated Statement of Cash Flows for the year ended December 31, 2006 Notes to Consolidated Financial Statements
	See Exhibit 99.1
	Hopper Radio of Florida, Inc. and Subsidiaries Unaudited Financial Information as of March 31, 2007 and December 31, 2006 and the Three-Month Periods Ended March 31, 2007 and 2006
	Unaudited Condensed Consolidated Balance Sheets at March 31, 2007 and December 31, 2006 Unaudited Condensed Consolidated Statements of Income for the three months ended March 31, 2007 and 2006 Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2007 and 2006 Notes to Unaudited Condensed Consolidated Financial Statements
	See Exhibit 99.2
(b)	Pro Forma Financial Information.
	Unaudited Pro Forma Condensed Combined Balance Sheet at March 31, 2007 Unaudited Pro Forma Condensed Combined Statement of Operations for the year ended December 31, 2006 Unaudited Pro Forma Condensed Combined Statement of Operations for the three months ended March 31, 2007 Notes to Unaudited Pro Forma Condensed Combined Financial Statements
	See Annex A
(d)	Exhibits.

2.1	Asset Purchase Agreement dated May 7, 2007, among Imation Corp. and Hopper Radio of Florida, Inc., Memcorp, Inc. and Memcorp Asia Limited (incorporated by reference to Exhibit 2.1 of Imation’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2007)
23.1	Consent of Berkowitz Dick Pollack & Brant
99.1	Hopper Radio of Florida, Inc. and Subsidiaries Consolidated Financial Statements Year Ended December 31, 2006 and Independent Auditors’ Report
99.2	Hopper Radio of Florida, Inc. and Subsidiaries Unaudited Financial Information at March 31, 2007 and December 31, 2006 and the Three-Months Ended March 31, 2007 and 2006

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Imation Corp. (REGISTRANT)
Date: September 24, 2007	/s/ Paul R. Zeller
	Paul R. Zeller
	Vice President, Chief Financial Officer

EXHIBIT INDEX

Exhibit	Description of Exhibit
23.1	Consent of Berkowitz Dick Pollack & Brant
99.1	Hopper Radio of Florida, Inc. and Subsidiaries Consolidated Financial Statements Year Ended December 31, 2006 and Independent Auditors’ Report
99.2	Hopper Radio of Florida, Inc. and Subsidiaries Unaudited Financial Information at March 31, 2007 and December 31, 2006 and the Three-Months Ended March 31, 2007 and 2006

EX-23.1

Exhibit 23.1

Consent of Independent Auditor

We consent to the incorporation by reference in Registration Statements Nos. 333-15273, 333-15275, 333-15277, 333-35591, 333-38196, 333-66030 and 333-124634 of Imation Corp. on Form S-8 of our report dated September 24, 2007, relating to the consolidated financial statements of Hopper Radio of Florida, Inc. for the year ended December 31, 2006 appearing in this Form 8-K/A of Imation Corp.

/s/ Berkowitz Dick Pollack & Brant
Fort Lauderdale, FL
September 24, 2007

EX-99.1

Exhibit 99.1

HOPPER RADIO OF FLORIDA, INC.
AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

Year Ended December 31, 2006

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

Year Ended December 31, 2006

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page
Independent Auditors’ Report		2
Consolidated Balance Sheet		3
Consolidated Statement of Income		4
Consolidated Statement of Shareholders’ Equity and Comprehensive Income		5
Consolidated Statement of Cash Flows		6
Notes to Consolidated Financial Statements		7

1

INDEPENDENT AUDITORS’ REPORT

To the Shareholders
      of Hopper Radio of Florida, Inc.

          We have audited the accompanying consolidated balance sheet of Hopper Radio of Florida, Inc. and Subsidiaries as of December 31, 2006 and the related consolidated statements of income, shareholders’ equity and comprehensive income and cash flows for the year then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

          We conducted our audit in accordance with the auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

          In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Hopper Radio of Florida, Inc. and Subsidiaries as of December 31, 2006, and the results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/ Berkowitz Dick Pollack & Brant
Fort Lauderdale, Florida
September 24, 2007

2

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

December 31, 2006

ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	61,701,622
Investments		33,687,827
Accounts receivable, net		31,470,759
Inventories		16,662,639
Prepaid expenses and other current assets		98,792
TOTAL CURRENT ASSETS		143,621,639
RESTRICTED CASH		926,886
PROPERTY AND EQUIPMENT, net		6,415,092
OTHER ASSETS		7,755
TOTAL ASSETS	$	150,971,372
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	17,395,519
Accrued liabilities		8,573,346
Current portion of bond payable		270,000
Income taxes payable		3,286,427
TOTAL CURRENT LIABILITIES		29,525,292
LONG-TERM BOND PAYABLE, less current portion		2,950,000
TOTAL LIABILITIES		32,475,292
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Common stock, par value $.01 per share, 10,000 shares authorized, 1,000 shares issued and outstanding		10
Additional paid-in capital		1,710,088
Accumulated other comprehensive income		56,145
Retained earnings		116,729,837
Non-controlling interest in Equity		—
TOTAL SHAREHOLDERS’ EQUITY		118,496,080
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	150,971,372

See notes to consolidated financial statements.

3

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF INCOME

Year ended December 31, 2006

NET SALES	$	288,899,618
COST OF SALES		242,657,147
GROSS PROFIT		46,242,471
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES		11,039,742
INCOME FROM OPERATIONS		35,202,729
OTHER INCOME (EXPENSE):
Interest income		2,128,579
Interest expense		(257,838	)
Other income		93,821
TOTAL OTHER INCOME		1,964,562
INCOME BEFORE INCOME TAX EXPENSE		37,167,291
INCOME TAX EXPENSE		1,959,072
NET INCOME	$	35,208,219

See notes to consolidated financial statements.

4

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY AND COMPREHENSIVE INCOME

Year ended December 31, 2006

					Accumulated
					Other
			Additional Paid-in		Comprehensive						Non-controlling
	Common Stock		Capital		Income			Retained Earnings			interest in Equity		Total
Balance at December 31, 2005	$	10	$	1,710,088	$	70,761		$	92,793,750		$	—	$	94,574,609
Comprehensive income:
Net income for the year									35,208,219			—		35,208,219
Other comprehensive income:
Unrealized gain on securities						113,942								113,942
Translation adjustment						(128,558	)							(128,558	)
Total comprehensive income														35,193,603
Distributions		—		—		—			(11,272,132	)		—		(11,272,132	)
Balance at December 31, 2006	$	10	$	1,710,088	$	56,145		$	116,729,837		$	—	$	118,496,080

See notes to consolidated financial statements.

5

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

Year ended December 31, 2006

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	35,208,219
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		1,050,430
Loss on sale of investments		17,389
Loss on disposal of property and equipment		631,502
Changes in assets and liabilities:
Accounts receivable		(1,793,666	)
Inventories		6,862,596
Prepaid expenses and other current assets		1,163,317
Restricted cash		(8,260	)
Other assets		114,258
Accounts payable		10,772,745
Accrued expenses		(2,991,107	)
Income taxes payable		(5,457,196	)
TOTAL ADJUSTMENTS		10,362,008
NET CASH PROVIDED BY OPERATING ACTIVITIES		45,570,227
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales and maturities of investments		9,397,533
Purchase of investments		(27,039,545	)
Expenditures for equipment		(1,463,377	)
NET CASH USED IN INVESTING ACTIVITIES		(19,105,389	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to shareholders		(11,272,132	)
Repayment of bond payable		(250,000	)
NET CASH USED IN FINANCING ACTIVITIES		(11,522,132	)
Effect of exchange rate changes on cash		(14,616	)
NET INCREASE IN CASH AND CASH EQUIVALENTS		14,928,090
CASH AND CASH EQUIVALENTS — BEGINNING OF YEAR		46,773,532
CASH AND CASH EQUIVALENTS — END OF YEAR	$	61,701,622
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
Interest	$	57,000
Income tax	$	7,120,000

See notes to consolidated financial statements.

6

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business: Hopper Radio of Florida, Inc. (“Hopper”) and Subsidiaries (the “Company”), are the exclusive importers of Memorex electronic products manufactured for distribution to large retailers and distributors in the United States, Canada, South America and Central America. The Company also imports and distributes certain electronic products under the Disney name pursuant to a licensing agreement. In April 2007, the Company entered into an agreement whereby the Company will be the exclusive importer and distributor of consumer electronic products under brand names associated with MTV Networks.

Basis of Presentation: The consolidated financial statements include the accounts of Hopper and its wholly-owned subsidiary Memcorp, Inc., (“Memcorp”), Memcorp’s wholly-owned subsidiaries Memcorp Asia Limited (“Memcorp Asia”), a Hong Kong Corporation and Hopper Asia Limited (“Hopper Asia”), a Hong Kong Corporation. In addition, Hopper leases the warehouse and office building in which its Florida operations are conducted from BJS Family Limited Partnership (“BJS”). BJS was established for the sole purpose of constructing and leasing a warehouse and office building. Under FASB Interpretation No. 46, BJS is a variable interest entity and Hopper is the primary beneficiary. Therefore, BJS has been included in the consolidated financial statements. The non-controlling interest in the equity of BJS is not significant to the consolidated financial statements as of December 31, 2006. The land and building have a carrying amount of approximately $6,380,000, with related nonrecourse debt of $3,220,000. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and all intercompany account balances and transactions between these companies are eliminated in consolidation.

Use of Estimates: The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Estimates that are particularly susceptible to significant change in the near term are the reserve for sales returns and the allowance for doubtful accounts.

Cash and Cash Equivalents: The Company considers time deposits and other highly liquid investments with original maturities of three months or less to be cash equivalents.

7

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE A—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES—Continued

Investments: The Company has classified all of its investments as available for sale securities, which are carried at fair value, with unrealized gains and losses reported as a separate component of shareholders’ equity. Realized gains and losses and declines in value judged to be other than temporary are included in earnings. The specific identification method is used to determine the cost of each security at the time of sale.

Accounts Receivable: In the normal course of business, the Company provides credit to its customers and maintains a reserve for potential credit losses which, when realized, have been within the range of management’s allowance for doubtful accounts. The Company establishes an allowance for uncollectible accounts receivable based on historical experience and any specific customer collection issues that the Company has identified. As of December 31, 2006, the allowance for doubtful accounts amounted to $494,000. The reserve for sales returns amounting to approximately $6,898,000 has been netted against accounts receivable balances at December 31, 2006.

Inventories: Inventories, consisting of electronic equipment products and parts, are stated at the lower of cost (determined on the weighted average cost method) or market. Provisions for obsolete and excess items are recorded as write-downs of inventory in the period identified, and included in cost of sales.

Property and Equipment: Property and equipment is recorded at cost less accumulated depreciation. Depreciation is computed utilizing the straight-line method over the estimated useful lives of the assets, which range from 3 to 39 years.

The Company continually evaluates long-lived assets based on the net future cash flow expected to be generated from the asset on an undiscounted cash flow basis, after consideration of significant events or changes in circumstances which indicate the recorded balance may not be recoverable. If that analysis indicates that impairment has occurred, the Company measures the impairment based on a comparison of discounted cash flows or fair values, whichever is more readily determinable, to the carrying value of the related asset.

8

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE A—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES—Continued

Income Taxes: Hopper and Memcorp have elected S corporation status under the Internal Revenue Code, and accordingly, the shareholders report the taxable income or loss of Hopper and Memcorp in their individual income tax returns. BJS is taxed as a partnership for Federal and State income tax purposes and, accordingly, the payment of income taxes is the obligation of the individual partners. Therefore, no provision for United States income taxes is reflected in the Company’s consolidated financial statements. Memcorp’s wholly-owned subsidiaries Memcorp Asia and Hopper Asia are subject to income taxes in their respective jurisdictions on income earned, as defined in those jurisdictions. There are no foreign temporary differences thus, no deferred taxes have been recorded in the consolidated financial statements.

Fair Value of Financial Instruments: The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable, due from related parties, accounts payable and accrued liabilities approximates fair value due to the short-term nature of these instruments.

Foreign Currency Transactions and Translation: Local currencies are the functional currencies for subsidiaries outside the United States. For operations in local currency environments, assets and liabilities of foreign operations are translated into U.S. dollars at current rates of exchange, and revenues and expenses are translated using weighted average rates. Foreign currency transaction gains and losses have not been significant. The cumulative translation adjustment is included in the Company’s accumulated other comprehensive income in shareholders’ equity.

Accumulated Other Comprehensive Income: Accumulated other comprehensive income amounting to approximately $56,000 as of December 31, 2006, consists of unrealized gains on investment securities amounting to approximately $19,000 and translation adjustments amounting to approximately $37,000.

Revenue Recognition: The Company recognizes revenue in accordance with Staff Accounting Bulletin No. 104, Revenue Recognition, which requires that persuasive evidence of an arrangement exists, shipment has occurred, the sales price is fixed or determinable, and collectibility of the related receivable is reasonably assured. Generally, these criteria are met upon shipment of products and transfer of title and risk of loss to customers. Product sales to certain customers are subject to agreements allowing certain limited rights of return, marketing related rebates and price protection on unsold merchandise. Accordingly, the Company records an allowance for these items, as well as other product returns, in the period of the sale based on contractual terms and historical data.

9

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE A—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES—Continued

Shipping and Handling Costs: Shipping and handling costs associated with inbound freight and outbound freight are included in cost of sales. Shipping and handling costs included in cost of sales amounted to approximately $1,866,000 for the year ended December 31, 2006.

Advertising Costs: The Company expenses advertising costs as incurred. Advertising expense for the year ended December 31, 2006 amounted to approximately $971,000.

NOTE B—INVESTMENTS

At December 31, 2006, the Company’s investments consist of the following:

					Financial		Gross
			Fair		Reporting		Unrealized
	Cost		Value		Basis		Gain
Municipal Bonds — (Note F)	$	33,668,643	$	33,687,827	$	33,687,827	$	19,184

The municipal bonds have maturity dates ranging from 2007 to 2038. Proceeds from the sales of investments were approximately $27,040,000 for the year ended December 31, 2006. Gross realized gains on those sales for the year ended December 31, 2006 were approximately $21,400. Gross realized losses on those sales for the year ended December 31, 2006 were approximately $38,800.

10

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE C—PROPERTY AND EQUIPMENT

Property and equipment at December 31, 2006 consists of the following:

Building and building improvements	$	4,664,745
Land		1,712,000
Computer equipment		482,050
Machinery and equipment		438,397
Tooling equipment		1,165,548
Vehicles		46,335
Furniture and fixtures		175,998
		8,685,073
Less: accumulated depreciation		(2,269,981	)
	$	6,415,092

Depreciation expense charged to operations for the year ended December 31, 2006 amounted to approximately $1,050,000.

NOTE D—ACCRUED LIABILITIES

At December 31, 2006, accrued liabilities consist of the following:

Royalties and licensing fees	$	3,741,887
Price reduction allowances		599,335
Foreign tax penalties (Note G)		1,032,000
Promotional and advertising customer programs		861,618
Other accruals		2,338,506
	$	8,573,346

NOTE E—BOND PAYABLE

At December 31, 2006, BJS has a bond payable to a bank in the amount of $3,220,000. The bond matures on June 1, 2015, bears interest based on the taxable lower floater bond rate (approximately 5% at December 31, 2006) and is collateralized by the building. Principal payments are escrowed and made annually while interest is paid monthly.

11

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE E—BOND PAYABLE—Continued

The Company is required to maintain cash accounts with the bank and principal payments are escrowed from the Company’s general bank account into a restricted cash account automatically by the bank for annual payment. At December 31, 2006, the balance of the restricted cash account was approximately $127,000.

The maturities of the bond payable for years subsequent to December 31, 2006 are as follows:

2007	$	270,000
2008		300,000
2009		300,000
2010		330,000
Thereafter		2,020,000
	$	3,220,000

NOTE F—LINES OF CREDIT

Hopper: Hopper has a line of credit with a bank that provides for maximum borrowings of $20,000,000 for the opening of import letters of credit. The letters of credit are payable at sight or can be refinanced via acceptances at 30 days sight. Interest on direct borrowings is payable monthly at prime (8.25% at December 31, 2006) plus one percent and is payable on demand. No import letters of credit were open at December 31, 2006 associated with this line of credit.

Hopper has an additional $35,000,000 line of credit with a bank for the opening of trade letters of credit payable at sight. Payments on amounts drawn are due on demand and Hopper pays fees and costs as stipulated by the bank. At December 31, 2006, Hopper had approximately $4,545,000 of open trade letters of credit and $2,947,000 of open standby letters of credit associated with this line of credit. Borrowings under this line of credit are guaranteed by one of the shareholders. At December 31, 2006, approximately $16,423,000 of municipal bonds (Note B) and approximately $2,689,000 of money market funds serve as collateral for this line of credit.

12

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE F—LINES OF CREDIT—Continued

Memcorp Asia: Memcorp Asia has a line of credit agreement with a financial institution consisting of an overdraft facility, an import facility and a letter of credit facility. The overdraft facility provides for overdraft protection of approximately $30,000. Interest is payable monthly at the financial institution’s prime rate (8.25% at December 31, 2006) plus one percent. The import facility provides for short-term loans to suppliers for up to 30 days. The maximum amount of loans outstanding under this facility is $1,500,000. Interest on such direct borrowings is payable monthly at the financial institution’s prime rate (8.25% at December 31, 2006). The letter of credit facility provides $2,000,000 for the opening of letters of credit opened on a back-to-back basis. This facility includes certain provisions for commissions that vary depending on the amount of the letters of credit opened. At December 31, 2006, $300,000 of cash on deposit was restricted by the financial institution as collateral against this line of credit.

Memcorp Asia has an on demand short-term line of credit agreement with a financial institution that provides for maximum borrowings of $25,000,000. Borrowings under this agreement bear interest at the United States prime rate (8.25% at December 31, 2006). This credit line is guaranteed by Memcorp and Hopper and provides for the payment of commissions that vary based on the face amount of the letters of credit opened. At December 31, 2006, $500,000 of cash on deposit was restricted by the financial institution as collateral against this line of credit.

At December 31, 2006, there was approximately $2,529,000 of trade letters of credit and $5,900,000 of open standby letters of credit associated with this line of credit.

NOTE G—INCOME TAXES

No provision for United States income taxes is reflected in the consolidated financial statements since Hopper and Memcorp have elected S corporation status under the Internal Revenue Code and BJS is taxed as a partnership for Federal and State income tax purposes.

The Company’s Hong Kong subsidiary was formed for the sole purpose of facilitating the sales of product to customers of the Company’s United States subsidiary directly from Hong Kong. In doing so, the Company’s Hong Kong subsidiary employs sales representatives to conclude trading contracts outside the territorial boundaries of Hong Kong.

13

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE G—INCOME TAXES—Continued

Based upon Hong Kong’s territorial tax principal, trading profits derived from sales revenue that is considered sourced outside of Hong Kong will not be subject to Hong Kong profits tax provided that both the purchase and sales contracts are negotiated, signed and executed outside Hong Kong.

During 2004, the Hong Kong Inland Revenue Department (“IRD”) commenced an examination of the Hong Kong subsidiary’s Hong Kong tax filings for the tax years ended March 31, 1998 through 2006. As a result of this examination, the IRD has issued assessments for tax amounting to approximately $14,426,000 relating to certain offshore income and provision for warranty expenses arising in prior years in respect of which the IRD has challenged the tax treatment adopted by the Company’s Hong Kong subsidiary. Through December 31, 2006, the Company has paid approximately $9,938,000 of assessments and subsequent to December 31, 2006, the Company has paid the remaining $4,405,000 of such assessments.

The Company challenged such assessments and during 2007, a settlement was reached amounting to approximately $12,274,000 for taxes and approximately $1,032,000 for penalties. This settlement resulted in the Company receiving a net refund of taxes paid of approximately $2,152,000 in 2007.

The Company has recorded income tax expense amounting to approximately $9,886,000 and penalty expense of approximately $1,032,000 during the year ended December 31, 2005 related to this examination. No accrual of income tax or penalties was recorded in the Company’s Hong Kong subsidiary’s audited statutory financial statements as of and for the year ended March 31, 2006 issued in November 2006. This matter was disclosed in the footnotes to those financial statements.

NOTE H—STOCKHOLDERS’ EQUITY

The total authorized common stock consists of 5,000 shares of Class A Voting Common Stock, par value $.01 per share (10 shares issued and outstanding at December 31, 2006), and 5,000 shares of Class B Non-Voting Common Stock, par value $.01 per share (990 shares issued and outstanding at December 31, 2006). In all respects, except voting rights, Class A Voting Common Stock and Class B Non-Voting Common Stock have equal rights with respect to all distributions and rights upon the liquidation of the Company.

14

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE I—COMMITMENTS AND CONTINGENCIES

Agreements: In June 1995, the Company entered into an exclusive agreement to sell and distribute consumer electronic products under the Memorex name through December 31, 2018. This agreement provides that Memcorp purchase products with an aggregate purchase price of at least $150,000,000 in each of the years from 2004 through 2018.

The agreement provides that from the year 2004 through 2018, the minimum yearly purchase requirement shall be adjusted for inflation, based upon the greater of five percent (5%) or the United States Consumer Price Index using 1998 and 2004 as the base years, respectively. If the minimum purchase amounts are not met, the Company is required to pay a percentage of the difference between the minimum purchase amount and the amount purchased. At December 31, 2006, if the yearly purchases are between $100,000,000 and $150,000,000, Hopper is required to pay one and three quarters percent of the difference.

At December 31, 2006, if the yearly purchases are below $100,000,000, Hopper is required to pay two percent of the difference. Total purchases amounted to approximately $162,017,000.

The agreement also provides that the Company must purchase the products at certain specified prices as defined in the agreement that are based on annual purchase volume. Hopper has the right in June of any year to provide notice of cancellation to terminate the agreement.

In July 2002, Hopper entered into an agreement to sell and distribute electronic equipment under the Disney name through March 31, 2005. This agreement required Hopper to pay royalties ranging from 4% to 8% with a minimum royalty guarantee of $2,750,000. The agreement also provided for Hopper to pay certain marketing and development costs. Hopper subsequently negotiated extensions of the agreement through March 2007, at which time the agreement terminated. Under the terms of the amended agreement, Hopper was required to pay royalties averaging 5.5% with a minimum royalty guarantee based on geographical regions. The minimum royalty guarantee was $5,500,000 from April 30, 2005 through September 30, 2006 with no minimum from October 1, 2006 through March 31, 2007. The agreement also provided for Hopper to pay certain marketing and product development costs. Sales of electronic equipment under the Disney name for the year ended December 31, 2006 were approximately $94,702,000 and royalty expense amounted to approximately $6,317,000.

15

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE I—COMMITMENTS AND CONTINGENCIES—Continued

In December 2006, the Company entered into an agreement to sell and distribute consumer electronic products under brand names associated with MTV Networks through June 30, 2010. This agreement requires Hopper to pay royalties ranging from 4% to 8% with a minimum royalty guarantee of $2,000,000 payable in three installments as follows: $400,000 on or before June 30, 2008; $600,000 on or before June 30, 2009; and $1,000,000 on or before December 31, 2009. The excess royalties paid in any of the years cannot be credited toward future minimum royalty guarantee amounts. The agreement also provides for Hopper to pay certain marketing and product development costs.

General litigation: The Company is subject to potential claims encountered in the normal course of business. In the opinion of management, the resolution of such claims will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows.

NOTE J—EMPLOYEE BENEFIT PLANS

Hopper has established a 401(k) plan (the “Plan”) covering substantially all employees who are at least twenty-one years of age and have completed one full year of service. The Plan allows eligible participants to defer a portion of their current compensation and have these amounts contributed to the Plan on their behalf. The Company provides a matching contribution based upon a percentage of compensation as further defined in the Plan. Hopper may also make discretionary contributions to the Plan as authorized by Hopper’s board of directors. Amounts contributed to the Plan by employees are fully vested when contributed and contributions made by Hopper, if any, vest on a graded schedule as further outlined in the Plan. Contributions made by Hopper during the year ended December 31, 2006 amounted to approximately $6,000.

Memcorp Asia operates a defined contribution plan whose assets are held in an independently administered fund. Contributions are charged to income as they become payable in accordance with the provisions of this plan. Certain of Memcorp Asia’s employees have completed the required number of years of service to Memcorp Asia in order to be eligible for retirement payments under the Hong Kong Employment Ordinance (the “Employment Ordinance”) in the event of the termination of their employment. Accordingly, Memcorp Asia may be required to make certain retirement payments in the event that such termination of employment meets the circumstances specified in the Employment Ordinance.

16

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE J—EMPLOYEE BENEFIT PLANS—Continued

A provision has been recorded based on an estimate of the probable future benefits earned by eligible employees from their service to Memcorp Asia through December 31, 2006 in the event of the termination of their employment.

NOTE K—CONCENTRATIONS

Cash Balances: The Company maintains cash balances at certain financial institutions that, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes they are not exposed to any significant credit risk on cash and cash equivalents.

Major Customers: Three customers accounted for approximately 42%, 20% and 10% of total net sales for the year ended December 31, 2006. Three customers accounted for 34%, 21% and 14% of total accounts receivable at December 31, 2006.

Major Suppliers: Three vendors accounted for approximately 26%, 17% and 10% of total purchases for the year ended December 31, 2006. Three vendors accounted for approximately 19%, 13% and 12% of total accounts payable at December 31, 2006. Management does not believe that the Company’s operations would be disrupted by the loss of any of these suppliers.

NOTE L—SUBSEQUENT EVENTS

On May 7, 2007, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Imation Corp. (“Imation”). The Purchase Agreement provides for the acquisition by Imation of certain assets of the Company used in or relating to the sourcing and sale of branded consumer electronics products, principally under the Memorex brand name (the “Memcorp Business”).

17

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued

NOTE L—SUBSEQUENT EVENTS—Continued

The purchase price for the Memcorp Business is approximately $60 million, consisting of approximately $27.3 million in cash at closing and $37.5 million in promissory notes. In addition, there is a potential earn-out payment three years after closing of up to $20 million dependent on financial performance of the purchased business. With respect to the promissory notes, $30 million will be paid through the issuance of a promissory note payable to the Company in quarterly installments over three years from the closing date, with an interest rate of 6% per annum, and not subject to offset. Payment of the $30 million obligation is further provided for by an irrevocable letter of credit to be issued by Imation. The remaining $7.5 million will be paid through the issuance of a promissory note payable to the Company in a lump sum payment 18 months from the closing date, with an interest rate of 6% per annum, which shall be unsecured and subject to offset to satisfy any claims to indemnification; provided that if an existing obligation of the Company is satisfied prior to the 18-month maturity date, $3.75 million of such note shall be paid in advance of the maturity date, and provided further that if the existing obligation is not satisfied prior to the 18-month maturity date, $3.75 million of such note shall be withheld until such obligation is satisfied or the third anniversary of the closing date, whichever occurs first. The acquired assets and assumed liabilities do not include cash on hand, accounts receivable, accounts payable, accrued liabilities or income taxes payable.

The Company and Imation have made customary representations, warranties and covenants in the Purchase Agreement, including, among others, covenants to cause the Company to conduct the Memcorp Business in the ordinary course during the interim period between signing and closing. Among other covenants, the Company has agreed not to compete with the Memcorp Business for three years, and a shareholder and certain key employees of the Company have also agreed not to compete with the Memcorp Business for three years from the termination of their consulting services to Imation. A number of employees of the Memcorp Business also are expected to transfer to Imation upon closing. The acquisition closed during the third quarter of calendar year 2007.

18

EX-99.2

Exhibit 99.2

               HOPPER RADIO OF FLORIDA, INC.
               AND SUBSIDIARIES
               UNAUDITED FINANCIAL INFORMATION
               at March 31, 2007 and December 31, 2006 and the
               Three Months Ended March 31, 2007 and 2006

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES
INDEX TO UNAUDITED FINANCIAL INFORMATION

	PAGE
Unaudited Condensed Consolidated Balance Sheets at March 31, 2007 and December 31, 2006		2
Unaudited Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2007 and 2006		3
Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2007 and 2006		4
Notes to Unaudited Condensed Consolidated Financial Statements		5

1

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)

	March 31,		December 31,
	2007		2006
	(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	70,470	$	61,702
Investments		34,965		33,688
Accounts receivable, net		19,634		31,471
Inventories, net		13,780		16,663
Other current assets		957		98
TOTAL CURRENT ASSETS		139,806		143,622
PROPERTY PLANT AND EQUIPMENT, NET		6,213		6,415
OTHER ASSETS		1,026		934
TOTAL ASSETS	$	147,045	$	150,971
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	11,145	$	17,396
Accrued liabilities		4,948		8,573
Current portion of bond payable		270		270
Income taxes payable		3,631		3,286
TOTAL CURRENT LIABILITIES		19,994		29,525
LONG-TERM BOND PAYABLE, LESS CURRENT PORTION		2,950		2,950
TOTAL LIABILITIES		22,944		32,475
COMMITMENT AND CONTINGENCIES
SHAREHOLDERS’ EQUITY		124,101		118,496
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	147,045	$	150,971

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

2

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands )

	Three Months Ended
	March 31,
	2007		2006
NET SALES	$	34,131	$	35,357
COST OF SALES		26,663		26,254
GROSS PROFIT		7,468		9,103
SELLING GENERAL AND ADMINISTRATIVE EXPENSES		3,352		1,608
INCOME FROM OPERATIONS		4,116		7,495
OTHER INCOME		1,826		677
INCOME BEFORE INCOME TAXES		5,942		8,172
INCOME TAX EXPENSES		343		934
NET INCOME	$	5,599	$	7,238

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

3

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

	Three Months Ended
	March 31,
	2007			2006
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	5,599		$	7,238
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		217			42
Loss (gain) on sale of investments		18			(2	)
Changes in operating assets and liabilities:
Accounts receivable		11,837			12,280
Inventories		2,882			7,751
Prepaid expenses and other current assets		(858	)		623
Other assets		(91	)		(22	)
Accounts payable		(6,250	)		(523	)
Accrued expenses		(3,625	)		(3,777	)
Income taxes payable		344			(4,856	)
NET CASH PROVIDED BY OPERATING ACTIVITIES		10,073			18,754
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales and maturities of investments		1,861			220
Purchase of investments		(3,055	)		—
Expenditures for equipment		(15	)		(124	)
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES		(1,209	)		96
CASH FLOW FROM FINANCING ACTIVITIES
Distributions to shareholders		—			(8	)
NET CASH USED IN FINANCING ACTIVITIES		—			(8	)
Effect of exchange rate changes on cash and cash equivalents		(96	)		(12	)
NET INCREASE IN CASH AND CASH EQUIVALENTS		8,768			18,830
CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD		61,702			46,773
CASH AND CASH EQUIVALENTS — END OF PERIOD	$	70,470		$	65,603

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

4

HOPPER RADIO OF FLORIDA, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE A — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business: Hopper Radio of Florida, Inc. (“Hopper”) and Subsidiaries (the “Company”), are the exclusive importers of Memorex electronic products manufactured for distribution to large retailers and distributors in the United States, Canada, South America and Central America. The Company also imports and distributes certain electronic products under the Disney name pursuant to a licensing agreement. In April 2007, the Company entered into an agreement whereby the Company will be the exclusive importer and distributor of consumer electronic products under brand names associated with MTV Networks.

Basis of Presentation: The interim consolidated financial statements include the accounts of Hopper and its wholly-owned subsidiary Memcorp, Inc., (“Memcorp”), Memcorp’s wholly owned subsidiaries Memcorp Asia Limited (“Memcorp Asia”), a Hong Kong Corporation and Hopper Asia Limited (“Hopper Asia”), a Hong Kong Corporation. In addition, Hopper has been leasing the building that houses Hopper’s offices and warehouse in Florida from BJS Family Limited Partnership (“BJS”). BJS was established for the sole purpose of acquiring the land and building and leasing the building. Under FASB Interpretation No. 46, BJS is a variable interest entity and Hopper is the primary beneficiary. Therefore, BJS has been included in the consolidated financial statements. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and all intercompany account balances and transactions between these companies are eliminated in consolidation.

The interim condensed consolidated financial statements of Hopper are unaudited but, in the opinion of management, reflect all adjustments necessary for a fair statement of financial position, results of operations and cash flows for the periods presented. The results of operations for any interim period are not necessarily indicative of full year results.

Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. Actual results could differ from those estimates. Estimates that are particularly susceptible to significant change in the near term are the reserve for sales returns and the allowance for doubtful accounts.

Accounts Receivable: In the normal course of business, the Company provides credit to its customers and maintains a reserve for potential credit losses which, when realized, have been within the range of management’s allowance for doubtful accounts. The Company establishes an allowance for uncollectible accounts receivable based on historical experience and any specific customer collection issues that the Company has identified. As of March 31, 2007 and December 31, 2006, the allowance for doubtful accounts amounted to $188,000 and $494,000, respectively. Reserve for sales returns amounting to approximately $759,000 and $6,898,000 has been netted against accounts receivable balances at March 31, 2007 and December 31, 2006, respectively.

NOTE B — INVESTMENTS

At March 31, 2007, the Company’s investments consist of the following:

					Financial		Gross
			Fair		Reporting		Unrealized
	Cost		Value		Basis		Losses
	(In thousands)
Municipal Bonds — (Note C)	$	35,037	$	34,965	$	34,965	$	82

5

The municipal bonds have maturity dates ranging from 2007 to 2038. Proceeds from the sales of investments were approximately $1,900,000 for the three months ended March 31, 2007. Gross realized gains on those sales for the three months ended March 31, 2007 were approximately $5,000. Gross realized losses on those sales for the three months ended March 31, 2007 were approximately $25,000.

NOTE C — LINES OF CREDIT

Hopper: Hopper has a line of credit with a bank that provides for maximum borrowings of $20,000,000 for the opening of import letters of credit. No import letters of credit were open at March 31, 2007 associated with this line of credit.

Hopper has an additional $35,000,000 line of credit with a bank for the opening of trade letters of credit payable at sight. Payments on amounts drawn are due on demand and Hopper pays fees and costs as stipulated by the bank. At March 31, 2007, Hopper had approximately $7,885,000 of open trade letters of credit and $4,000,000 of open standby letters of credit associated with this line of credit. Borrowings under this line of credit are guaranteed by one of the shareholders. At March 31, 2007, approximately $17,221,000 of municipal bonds (Note B) and approximately $2,091,000 of money market funds serve as collateral for this line of credit.

Memcorp Asia: Memcorp Asia has a line of credit agreement with a financial institution consisting of an overdraft facility, an import facility, and a letter of credit facility. At March 31, 2007, $300,000 of cash on deposit was restricted by the financial institution as collateral against this line of credit.

Memcorp Asia has an on demand short-term line of credit agreement with a financial institution that provides for maximum borrowings of $25,000,000. At March 31, 2007, $500,000 of cash on deposit was restricted by the financial institution as collateral against this line of credit.

At March 31, 2007, there was approximately $16,266,000 of trade letters of credit and $2,335,000 of open standby letters of credit associated with this line of credit.

NOTE D — ACCUMULATED OTHER COMPREHENSIVE INCOME

Accumulated other comprehensive income amounting to approximately $61,000 as of March 31, 2007, consists of unrealized losses on investment securities amounting to approximately $82,000 and translation adjustments amounting to approximately $143,000.

NOTE E — COMMITMENTS AND CONTINGENCIES

Agreements: In June 1995, the Company entered into an exclusive agreement to sell and distribute consumer electronic products under the Memorex name through December 31, 2018. This agreement provides that Memcorp purchase products with an aggregate purchase price of at least $150,000,000 in each of the years from 2004 through 2018. The agreement provides that from the year 2004 through 2018, the minimum yearly purchase requirement shall be adjusted for inflation, based upon the greater of five percent (5%) or the United States Consumer Price Index using 1998 and 2004 as the base years, respectively. If the minimum purchase amounts are not met, the Company is required to pay a percentage of the difference between the minimum purchase amount and the amount purchased. At March 31, 2007, if the yearly purchases are between $100,000,000 and $150,000,000, Hopper is required to pay one and three quarter’s percent of the difference.

At March 31, 2007, if the yearly purchases are below $100,000,000, Hopper is required to pay two percent of the difference. Total purchases amounted to approximately $10,704,000 for the three months ended March 31, 2007.

6

The agreement also provides that the Company must purchase the products at certain specified prices as defined in the agreement that are based on annual purchase volume. Hopper has the right in June of any year to provide notice of cancellation to terminate the agreement.

In July 2002, Hopper entered into an agreement to sell and distribute electronic equipment under the Disney name through March 31, 2005. This agreement required Hopper to pay royalties ranging from 4% to 8% with a minimum royalty guarantee of $2,750,000. The agreement also provided for Hopper to pay certain marketing and development costs. Hopper subsequently negotiated extensions of the agreement through March 2007, at which time the agreement terminated. Under the terms of the amended agreement, Hopper was required to pay royalties averaging 5.5% with a minimum royalty guarantee based on geographical regions. The minimum royalty guarantee was $5,500,000 from April 30, 2005 through September 30, 2006 with no minimum from October 1, 2006 through March 31, 2007. The agreement also provided for Hopper to pay certain marketing and product development costs. Sales of electronic equipment under the Disney name for the three months ended March 31, 2007 were approximately $2,454,000 and royalty expense amounted to approximately $167,000.

In December 2006, the Company entered into an agreement to sell and distribute consumer electronic products under brand names associated with MTV Networks through June 30, 2010. This agreement requires Hopper to pay royalties ranging from 4% to 8% with a minimum royalty guarantee of $2,000,000 payable in three installments as follows: $400,000 on or before June 30, 2008; $600,000 on or before June 30, 2009; and $1,000,000 on or before December 31, 2009. The excess royalties paid in any of the years cannot be credited toward future minimum royalty guarantee amounts. The agreement also provides for Hopper to pay certain marketing and product development costs.

General litigation: The Company is subject to potential claims encountered in the normal course of business. In the opinion of management, the resolution of such claims will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows.

NOTE F — SUBSEQUENT EVENTS

On May 7, 2007, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Imation Corp. (“Imation”). The Purchase Agreement provides for the acquisition by Imation of certain assets of the Company used in or relating to the sourcing and sale of branded consumer electronics products, principally under the Memorex brand name (the “Memcorp Business”).

The purchase price for the Memcorp Business is approximately $60 million, consisting of approximately $27.3 million in cash at closing and $37.5 million in promissory notes. In addition, there is a potential earn-out payment three years after closing of up to $20 million dependent on financial performance of the purchased business. With respect to the promissory notes, $30 million will be paid through the issuance of a promissory note payable to the Company in quarterly installments over three years from the closing date, with an interest rate of 6% per annum, and not subject to offset. Payment of the $30 million obligation is further provided for by an irrevocable letter of credit to be issued by Imation. The remaining $7.5 million will be paid through the issuance of a promissory note payable to the Company in a lump sum payment 18 months from the closing date, with an interest rate of 6% per annum, which shall be unsecured and subject to offset to satisfy any claims to indemnification; provided that if an existing obligation of the Company is satisfied prior to the 18-month maturity date, $3.75 million of such note shall be paid in advance of the maturity date, and provided further that if the existing obligation is not satisfied prior to the 18-month maturity date, $3.75 million of such note shall be withheld until such obligation is satisfied or the third anniversary of the closing date, whichever occurs first. The acquired assets and assumed liabilities do not include cash on hand, accounts receivable, accounts payable, accrued liabilities or income taxes payable.

The Company and Imation have made customary representations, warranties and covenants in the Purchase Agreement, including, among others, covenants to cause the Company to conduct the Memcorp Business in the ordinary course during the interim period between signing and closing. Among other covenants, the Company has agreed not to compete with the Memcorp Business for three years, and a shareholder and certain key employees of the Company have also agreed not to compete with the Memcorp Business for three years from the termination of their consulting services to Imation. A number of employees of the Memcorp Business also are expected to transfer to Imation upon closing. The acquisition closed during the third quarter of calendar year 2007.

7

EX-99.A

Annex A

INTRODUCTION TO
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

     On July 9, 2007, Imation Corp. (Imation, we, us or our) completed the acquisition of certain assets of Memcorp, Inc., a Florida corporation, and Memcorp Asia Limited, a corporation organized under the laws of Hong Kong (together Memcorp, subsidiaries of Hopper Radio of Florida, Inc. (Hopper), a Florida corporation), pursuant to an Asset Purchase Agreement dated as of May 7, 2007 (the Purchase Agreement) filed as Exhibit 2.1 to our quarterly report on Form 10-Q for the quarter ended March 31, 2007. As provided in the Purchase Agreement, Imation acquired the assets of Memcorp used in or relating to the sourcing and sale of consumer electronics products, principally sold under the Memorex brand name, including inventories, equipment and other tangible personal property and intellectual property. The acquisition included existing brand licensing agreements, including Memcorp’s agreements with MTV Networks, a division of Viacom International, to design and distribute specialty consumer electronics under certain Nickelodeon properties and brands. We paid cash of $27.3 million at closing and issued three-year promissory notes in the aggregated amounts of $37.5 million. This amount excludes cash paid for direct acquisition costs related to the transaction. We are also required to purchase the remaining Memorex, Nickelodeon and Vextra branded returned products inventory at the end of the 90-day period following the close of the acquisition at a discounted price. In addition, there is a potential earn-out payment three years after closing of up to $20 million, dependent on financial performance of the purchased business.

     With respect to the promissory notes, $30 million will be paid to Memcorp in quarterly installments over three years from the closing date, with an interest rate of six percent per annum, and not subject to offset. Payment of the $30 million obligation is secured by an irrevocable letter of credit issued pursuant to Imation’s Credit Agreement. The remaining $7.5 million will be paid to Memcorp in a lump sum payment 18 months from the closing date, with an interest rate of six percent per annum, which shall be unsecured and subject to offset to satisfy any claims to indemnification; provided that if an existing obligation of Memcorp is satisfied prior to the 18-month maturity date, $3.75 million of such note shall be paid in advance of the maturity date, and provided further that if the existing obligation is not satisfied prior to the 18-month maturity date, $3.75 million of such note shall be withheld until such obligation is satisfied or the third anniversary of the closing date, whichever occurs first.

     During the year ended December 31, 2006, Memcorp sold consumer electronics products under the Disney brand pursuant to a licensing agreement, which expired on March 31, 2007. Accordingly we did not purchase any assets related to the Disney business and we will not sell Disney branded products subsequent to the acquisition. The Disney brand revenue and pre tax income for the year ended December 31, 2006 was $94.7 million and $11.0 million, respectively.

     The following unaudited pro forma condensed combined balance sheet as of March 31, 2007, combines the historical condensed consolidated balance sheet of Imation as of March 31, 2007 as filed with the Securities and Exchange Commission (“SEC”) on Form 10-Q, with the historical condensed consolidated balance sheet of Hopper as of March 31, 2007, giving effect to the acquisition as if it had occurred on March 31, 2007. The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2006 and the three months ended March 31, 2007 combines the historical condensed consolidated statement of operations of Imation for the year ended December 31, 2006, as filed with the SEC in its annual report on Form 10-K, and for the three months ended March 31, 2007, as filed with the SEC in its quarterly report on Form 10-Q, with the condensed historical statement of operations of Hopper for the year ended December 31, 2006, and the three months ended March 31, 2007, giving effect to the acquisition as though it had occurred at the beginning of the periods presented, using the purchase method of accounting and applying the assumptions and adjustments described in the accompanying notes to the unaudited pro forma condensed combined financial statements.

     The acquisition has been accounted for under the purchase method of accounting in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 141, Business Combinations. Under the purchase method of accounting, the total estimated purchase price, calculated as described in Note 2 to these unaudited pro forma condensed combined financial statements, is allocated to the net tangible and intangible assets of Memcorp acquired in connection with the acquisition, based on their estimated fair values. Management has made a preliminary allocation of the estimated purchase price to the tangible and intangible assets acquired and liabilities assumed based on various preliminary estimates. The allocation of the estimated purchase price is preliminary pending finalization of various estimates and valuation analyses.

1

     The unaudited pro forma condensed combined financial statements have been prepared by management for illustrative purposes only and are not necessarily indicative of the financial position or results of operations in future periods or the results that actually would have been realized had Imation and Hopper been a combined company during the specified periods. The pro forma adjustments are based on the preliminary information available at the time of the preparation of this document. The unaudited pro forma condensed combined financial statements, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with, the historical consolidated financial statements of Imation included in its annual report on Form 10-K for the year ended December 31, 2006, and in its quarterly report on Form 10-Q for the three months ended March 31, 2007. In addition, the unaudited pro forma condensed combined financial statements, including the notes thereto, are based on the historical financial statements of Hopper for the year ended December 31, 2006 and for the three months ended March 31, 2007, which are included in Exhibits 99.1 and 99.2, respectively, to this current report on Form 8-K/A.

     Pro forma adjustments are necessary to reflect the initial purchase price and purchase accounting adjustments based on preliminary estimates of the fair values of the Memcorp assets acquired. The unaudited pro forma condensed combined financial statements do not reflect any operating efficiencies and cost savings that may be realized with respect to the combined companies, nor do they include the effects of restructuring activities, which are planned but not yet completed.

2

IMATION CORP.
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF MARCH 31, 2007
(In millions)

			Pro Forma Adjustments
			Memcorp
			Net Assets						Pro
	Historical		Acquired		Pro Forma				Forma
	Imation		(Note 3)		Adjustments			Note 5	Combined
ASSETS
Current assets
Cash and cash equivalents	$	259.4	$	—	$	(28.5	)	(a)	$	230.9
Accounts receivable, net		283.2		—		—				283.2
Inventories, net		301.4		9.6		—				311.0
Other current assets		69.7		—		—				69.7
Total current assets		913.7		9.6		(28.5	)			894.8
Property, plant and equipment, net		176.4		—		—				176.4
Intangible assets, net		226.6		—		15.7		(b)		242.3
Goodwill		59.9		—		43.7		(c)		103.6
Other assets		30.9		—		—				30.9
Total assets	$	1,407.5	$	9.6	$	30.9			$	1,448.0
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	242.6	$	—	$	—			$	242.6
Accrued payroll		12.7		—		—				12.7
Current portion of long term notes payable		—		—		10.0		(d)		10.0
Other current liabilities		131.3		3.0		—				134.3
Total current liabilities		386.6		3.0		10.0				399.6
Other liabilities		46.1		—		—				46.1
Notes payable, less current portion		—		—		27.5		(d)		27.5
Total shareholders’ equity		974.8		—		—				974.8
Total liabilities and shareholders’ equity	$	1,407.5	$	3.0	$	37.5			$	1,448.0

The accompanying Notes to Unaudited Pro Forma Condensed Combined Financial Statements
are an integral part of these financial statements.

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IMATION CORP.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2006

				Historical							Pro
	Historical			Memcorp			Pro Forma				Forma
	Imation			(Note 4)			Adjustments			Note 5	Combined
	(In millions, except per share amounts)
Net revenue	$	1,584.7		$	288.9		$	(2.9	)	(e)	$	1,870.7
Cost of goods sold		1,240.6			242.7			(2.7	)	(e)(f)		1,480.6
Gross profit		344.1			46.2			(0.2	)			390.1
Operating expenses		235.9			11.0			2.4		(f)(g)		249.3
Operating income		108.2			35.2			(2.6	)			140.8
Other (income) expense, net		(3.6	)		(2.0	)		3.0		(f)(h)(j)		(2.6	)
Income from continuing operations before income taxes		111.8			37.2			(5.6	)			143.4
Income tax provision		36.6			2.0			10.1		(k)		48.7
Income from continuing operations	$	75.2		$	35.2		$	(15.7	)		$	94.7
Earnings per common share from continuing operations
Basic	$	2.17									$	2.74
Diluted	$	2.14									$	2.69
Weighted average basic shares outstanding		34.6										34.6
Weighted average diluted shares outstanding		35.2										35.2

The accompanying Notes to Unaudited Pro Forma Condensed Combined Financial Statements
are an integral part of these financial statements.

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IMATION CORP.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2007

				Historical							Pro
	Historical			Memcorp			Pro Forma				Forma
	Imation			(Note 4)			Adjustments			Note 5	Combined
	(In millions, except per share amounts)
Net revenue	$	421.9		$	34.1		$	(0.6	)	(e)	$	455.4
Cost of goods sold		340.1			26.6			(0.5	)	(e)(f)		366.2
Gross profit		81.8			7.5			(0.1	)			89.2
Operating expenses		58.2			3.4			0.6		(f)(g)		62.2
Operating income		23.6			4.1			(0.7	)			27.0
Other (income) expense, net		(1.5	)		(1.8	)		0.9		(f)(i)(j)		(2.4	)
Income before income taxes		25.1			5.9			(1.6	)			29.4
Income tax provision		9.4			0.3			1.4		(k)		11.1
Net income	$	15.7		$	5.6		$	(3.0	)		$	18.3
Earnings per common share
Basic	$	0.45									$	0.52
Diluted	$	0.44									$	0.52
Weighted average basic shares outstanding		34.9										34.9
Weighted average diluted shares outstanding		35.4										35.4

The accompanying Notes to Unaudited Pro Forma Condensed Combined Financial Statements
are an integral part of these financial statements.

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IMATION CORP.
NOTES TO UNAUDITED PRO FORMA
CONDENSED COMBINED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

     The unaudited pro forma condensed combined consolidated balance sheet gives effect to the acquisition, which was accounted for under the purchase method of accounting, as if it had been consummated on March 31, 2007.

     The unaudited pro forma condensed combined consolidated statements of operations for the year ended December 31, 2006 have been prepared to reflect the acquisition as if it occurred on January 1, 2006. The unaudited proforma condensed combined consolidated statements of operations for the three months ended March 31, 2007 have been prepared to reflect the acquisition as if it occurred on January 1, 2007. Pro forma earnings per share have been computed using the Imation weighted average shares of common stock outstanding. The acquisition was financed with cash and notes payable. Since no common stock was issued, there is no pro forma impact on Imation’s weighted average shares outstanding.

2. ACQUISITION AND PURCHASE PRICE ALLOCATION

     On July 9, 2007, Imation Corp. (Imation, we, us or our) completed the acquisition of certain assets of Memcorp, Inc., a Florida corporation, and Memcorp Asia Limited, a corporation organized under the laws of Hong Kong (together Memcorp, subsidiaries of Hopper Radio of Florida, Inc. (Hopper), a Florida corporation), pursuant to an Asset Purchase Agreement dated as of May 7, 2007 (the Purchase Agreement) previously filed by Imation as exhibit 2.1 to the quarterly report on Form 10-Q for the period ended March 31, 2007. As provided in the Purchase Agreement, Imation acquired the assets of Memcorp used in or relating to the sourcing and sale of consumer electronics products, principally sold under the Memorex brand name, including inventories, equipment and other tangible personal property and intellectual property. The acquisition also included existing brand licensing agreements, including Memcorp’s agreements with MTV Networks, a division of Viacom International, to design and distribute specialty consumer electronics products under certain Nickelodeon properties and brands. Memcorp is engaged in the design, marketing, distribution, and sale of consumer electronics products under the Memorex brand name, as well as products sold under other proprietary brands pursuant to specific licensing agreements.

     We paid cash of $27.3 million at closing and issued three-year promissory notes in the aggregated amounts of $37.5 million. This amount excludes cash paid for direct costs related to the transaction. We are also required to purchase the remaining Memorex, Nickelodeon and Vextra branded returned products inventory at the end of the 90-day period following the close of the acquisition at a discounted price. We have not accounted for the effect of this additional inventory purchase, as the amount is not estimable at this time. In addition, there is a potential earn-out payment three years after closing of up to $20 million, dependent on financial performance of the purchased business.

     With respect to the promissory notes, $30 million will be paid to Memcorp in quarterly installments over three years from the closing date, with an interest rate of six percent per annum, and not subject to offset. Payment of the $30 million obligation is secured by an irrevocable letter of credit issued pursuant to Imation’s Credit Agreement. The remaining $7.5 million will be paid to Memcorp in a lump sum payment 18 months from the closing date, with an interest rate of six percent per annum, which shall be unsecured and subject to offset to satisfy any claims to indemnification; provided that if an existing obligation of Memcorp is satisfied prior to the 18-month maturity date, $3.75 million of such note shall be paid in advance of the maturity date, and provided further that if the existing obligation is not satisfied prior to the 18-month maturity date, $3.75 million of such note shall be withheld until such obligation is satisfied or the third anniversary of the closing date, whichever occurs first.

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     The following table summarizes our preliminary estimated purchase price of Memcorp:

(In millions)
Cash consideration	$	27.3
Notes payable issued to sellers		37.5
Direct acquistion costs		1.2
Total purchase price	$	66.0

     The following table summarizes our preliminary allocation of the purchase price to the assets acquired:

(In millions)
Net assets acquired	$	6.6
Identifiable intangible assets		15.7
Goodwill		43.7
	$	66.0

     The components of the identifiable intangible assets, which are amortized on a straight-line basis, are as follows:

			Weighted
			Average
(In millions)			Life
Customer relationships	$	14.3	6 years
Licensing agreement		1.2	6 years
Non-compete agreement		0.2	3 years
Identifiable intangible assets acquired	$	15.7

     In accordance with SFAS No. 142, we will not amortize the goodwill, but will evaluate it for impairment on an annual basis or whenever events or circumstances occur, which indicate that goodwill might be impaired.

     A final determination of fair values may differ materially from the preliminary estimates and will include management’s final valuation of the fair values of assets acquired and liabilities assumed. This final valuation will be based on the actual net tangible assets of Memcorp that exist as of the completion date of the acquisition. The final valuation may change the allocation of purchase price, which could affect the fair value assigned to the assets and liabilities and could result in a change to the unaudited pro forma condensed combined financial statements.

3. ADJUSTMENTS FOR NET ASSETS ACQUIRED

     In accordance with the Purchase Agreement, we acquired limited assets of the Memcorp business. Assets acquired included (a) certain inventory to be sold under the “Memorex,” “Nickelodeon” or “Vextra” brand name and (b) intangible assets related to the business that had no recorded book value in the Memcorp financial statements. Liabilities assumed were for product returns and other related obligations. Accordingly, the historical Memcorp condensed consolidated balance sheet includes only the net assets acquired as of March 31, 2007.

4. TERMINATED LICENSING AGREEMENT WITH DISNEY

     During the year ended December 31, 2006, Memcorp sold consumer electronics products under the Disney brand pursuant to a licensing agreement, which expired on March 31, 2007. Accordingly we did not purchase any assets related to the Disney business and we will not sell Disney branded products subsequent to the acquisition. The Disney brand revenue and pre tax income for the year ended December 31, 2006 was $94.7 million and $11.0 million, respectively.

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5. PRO FORMA ADJUSTMENTS

     The following is a summary of pro forma adjustments reflected in the unaudited pro forma condensed combined consolidated financial statements based on preliminary estimates, which may change as additional information is obtained.

Pro Forma Balance Sheet Adjustments

(a)	Represents cash paid for acquisition, including direct acquisition costs of $1.2 million.
(b)	Represents estimated fair value of identifiable intangible assets acquired of $15.7 million.
(c)	Represents preliminary estimated Goodwill originating from the acquisition of $43.7 million.
(d)	Represents current portion of long-term notes payable to Hopper of $10.0 million and long-term portion of notes payable to Hopper of $27.5 million issued in connection with the acquisition.

Pro Forma Income Statements Adjustments

(e)	To eliminate intercompany revenue and expense. Memcorp incurred royalty expense of $2.9 million and $0.6 million related to Memcorp’s sale of consumer electronics products under the Memorex brand name during the year ended December 31, 2006 and three-month period ended March 31, 2007, respectively.
(f)	To record lease expense for a lease contract entered into in conjunction with the Purchase Agreement.
(g)	To record incremental amortization expense of $2.7 million and $0.7 million for the year ended December 31, 2006 and the three-month period ended March 31, 2007, respectively, related to the intangible assets recorded as a result of the Memcorp acquisition.
(h)	To reduce Imation’s interest income by $1.4 million for the year ended December 31, 2006, assuming that the cash portion of the acquisition price had been paid on January 1, 2006, which would have reduced cash available for investment during the year ended December 31, 2006.
(i)	To reduce Imation’s interest income by $0.4 million for the three-month period ended March 31, 2007, assuming that the cash portion of the acquisition price had been paid on January 1, 2007, which would have reduced cash available for investment during the three-month period ended March 31, 2007.
(j)	To record interest expense of $1.8 million and $0.5 million for the year ended December 31, 2006 and the three-month period ended March 31, 2007, respectively, related to the notes payable issued to Hopper in connection with the acquisition.
(k)	To record the income tax provision associated with Memcorp’s U.S. operating results and the pro forma adjustments. Memcorp had elected S corporation status under the Internal Revenue Code and consequently all U.S. taxes were borne directly by the shareholders. The pro forma adjustment provides taxes on the Memcorp historical earnings and the pro forma adjustments impacting income at a statutory tax rate of 38.25 percent, which is the expected tax rate applicable to these earnings subsequent to acquisition.

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