Retirement Plans

Pension Plans

During the three and nine months ended September 30, 2013 we contributed $0.3 million and $1.0 million, respectively, to our worldwide pension plans. We presently anticipate contributing $0.0 million to $2.0 million to fund our worldwide pension plans during the remainder of 2013.

In connection with actions taken under our announced restructuring programs, the number of employees accumulating benefits under our pension plan in the United States continues to decline. Participants in our U.S. defined benefit pension plan have the option of receiving cash lump sum payments when exiting the plan, which a number of participants exiting the plan have elected to receive. Lump sum payments for the nine months ended September 30, 2013 have exceeded our expected 2013 service and interest costs. As a result, a partial settlement event occurred during the three and nine months ended September 30, 2013 and we recognized a settlement loss of $0.2 million and $1.7 million, respectively. A settlement loss of $0.5 million and $2.0 million was also recognized for the three and nine months ended September 30, 2012. These settlement losses are included in restructuring and other in our Condensed Consolidated Statements of Operations. Additionally, in connection with the settlement and as required by pension accounting, we remeasured the funded status of our U.S. defined benefit plan as of September 30, 2013 and have adjusted the funded status on our Condensed Consolidated Balance Sheets as of September 30 2013, accordingly.

We have a defined benefit pension plan located in the United Kingdom (UK Plan) for former employees with no current employees in the plan. On September 17, 2013 we settled our UK Plan by way of a transaction with Pension Insurance Corporation (PIC) whereby PIC fully assumed the projected benefit obligation and underlying plan assets. The net balance assumed by PIC represents an asset balance of $6.4 million and no cash consideration took place between Imation and PIC associated with this transaction. As a result of this transaction, we removed this net asset and related unrecognized net actuarial loss in other comprehensive loss and recorded a loss of $10.6 million in restructuring and other in the Condensed Consolidated Statements of Operations during the three and nine months ended September 30, 2013. Additionally, the settlement of the UK Plan resulted in the removal of a deferred tax liability related to the plan resulting in a $2.3 million credit to income tax expense for the three and nine months ended September 30, 2013. See Note 10 - Income Taxes for further discussion of the impact on the income tax rate. It is a standard practice in the United Kingdom (UK) for a review process by the UK government, entailing a review of the plan obligations and participant data, to occur upon a transaction such as this one involving a transfer of a pension plan. We expect that this government review will be completed within the next twelve months. Upon the conclusion of this regulatory review, we will record a true-up, if necessary, in the period in which it occurs.

Components of net periodic pension cost included the following:



	United States						International				United States						International
	Three Months Ended September 30,										Nine Months Ended September 30,
(In millions)	2013			2012			2013		2012		2013			2012			2013		2012
Service cost	$	—		$	—		$	0.1	$	0.1	$	—		$	—		$	0.3	$	0.3
Interest cost	0.9			0.8			—		—		2.4			2.4			—		—
Expected return on plan assets	(1.2		)	(1.4		)	—		—		(3.7		)	(4.3		)	—		—
Amortization of net actuarial loss	0.4			0.4			0.1		0.1		1.3			1.0			0.3		0.3
Net periodic pension cost (credit)	$	0.1		$	(0.2	)	$	0.2	$	0.2	$	—		$	(0.9	)	$	0.6	$	0.6
Settlement	0.2			0.5			10.6		—		1.7			2.0			10.6		—
Total pension cost	$	0.3		$	0.3		$	10.8	$	0.2	$	1.7		$	1.1		$	11.2	$	0.6