MTI TECHNOLOGY CORP
EXHIBIT 10.78
<DOCUMENT>
<TYPE>EX-10.78
<SEQUENCE>5
<FILENAME>a99978exv10w78.txt
<DESCRIPTION>EXHIBIT 10.78
<TEXT>
<PAGE>

                                                                   EXHIBIT 10.78

                                   [MTI LOGO]

                           MTI TECHNOLOGY CORPORATION

                            INDEMNIFICATION AGREEMENT

      This INDEMNIFICATION AGREEMENT (the "Agreement") is made and entered into
as of August 21, 2003 (the "Effective Date") by and between MTI Technology
Corporation, a Delaware corporation (the "Company"), and NICK BOLAND (the
"Indemnitee").

      WHEREAS, it is essential to the Company to retain and attract as officers
the most capable persons available;

      WHEREAS, Indemnitee is an officer of the Company;

      WHEREAS, both the Company and Indemnitee recognize the increased risk of
litigation and other claims being asserted against officers of public companies
in today's environment;

      WHEREAS, the Company's Amended and Restated Bylaws (the "Bylaws") require
the Company to indemnify and advance expenses to its officers to the fullest
extent permitted by law, and the Indemnitee has agreed to serve as an officer of
the Company in part in reliance on the Bylaws; and

      WHEREAS, in recognition of Indemnitee's need for (i) substantial
protection against personal liability based on Indemnitee's reliance on the
Bylaws, (ii) specific contractual assurance that the protection promised by the
Bylaws will be available to Indemnitee, regardless of, among other things, any
amendment to or revocation of the Bylaws or any change in the composition of the
Company's Board of Directors or acquisition transaction relating to the Company,
and (iii) an inducement to provide effective services to the Company as an
officer thereof, the Company wishes to provide for the indemnification of
Indemnitee and to advance expenses to Indemnitee to the fullest extent permitted
by law and as set forth in this Agreement, and, to the extent insurance is
maintained, to provide for the continued coverage of Indemnitee under the
Company's directors' and officers' liability insurance policies.

      NOW, THEREFORE, in consideration of the premises contained herein and of
Indemnitee continuing to serve the Company directly or, at its request, with
another enterprise, and intending to be legally bound hereby, the parties hereto
agree as follows:

      1. CERTAIN DEFINITIONS:

            (a) "Affiliate": any corporation that directly, or indirectly
through one or more intermediaries, controls or is controlled by, or is under
common control with, the person specified.

MTI Technology Corporation        Officer - Indemnification Agreement-NickBoland

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            (b) "Change in Control": shall be deemed to have occurred if

                  (i) any "person," as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934 (the "Exchange Act"), as amended,
other than (a) a trustee or other fiduciary holding securities under an employee
benefit plan of the Company, (b) a corporation owned, directly or indirectly, by
the stockholders of the Company in substantially the same proportions as their
ownership of stock of the Company, or (c) any current beneficial stockholder or
group, as defined by Rule 13d-5 of the Exchange Act, including the heirs,
assigns and successors thereof of beneficial ownership, within the meaning of
Rule 13d-3 of the Exchange Act, of securities possessing more than fifty percent
(50%) of the total combined voting power of the Company's outstanding
securities, hereafter becomes the "beneficial owner," as defined in Rule 13d-3
under the Exchange Act, directly or indirectly, of securities of the Company
representing twenty percent (20%) or more of the total voting power represented
by the Company's then outstanding Voting Securities, or

                  (ii) during any period of two consecutive years, individuals
who at the beginning of such period constitute the Board of Directors of the
Company and any new director whose election by the Board of Directors or
nomination for election by the Company's stockholders was approved by a vote of
at least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to constitute a
majority thereof, or

                  (iii) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than a merger or
consolidation which would result in the Voting Securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into Voting Securities of the
surviving entity) at least eighty percent (80%) of the total voting power
represented by the Voting Securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation, or the stockholders
of the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company, in one transaction or a
series of transactions, of all or substantially all of the Company's assets.

            (c) "Expense": includes attorneys' fees and all other costs,
expenses and obligations paid or incurred in connection with investigating,
defending, being a witness in or participating in (including on appeal), or
preparing to defend, be a witness in or participate in any Proceeding relating
to any Indemnifiable Event.

            (d) "Indemnifiable Event": any event or occurrence that takes place
either prior to or after the execution of this Agreement, related to the fact
that Indemnitee is or was an officer of the Company, or while an officer is or
was serving at the request of the Company as a director, officer, employee,
trustee, agent or fiduciary of another corporation, partnership, joint venture,
employee benefit plan, trust or other enterprise or by reason of anything done
or not done by Indemnitee in any such capacity.

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            (e) "Potential Change in Control": shall be deemed to have occurred
if

                  (i) the Company enters into an agreement or arrangement, the
consummation of which would result in the occurrence of a Change in Control,

                  (ii) any person, including the Company, publicly announces an
intention to take or to consider taking actions which if consummated would
constitute a Change in Control,

                  (iii) any person, other than (x) a trustee or other fiduciary
holding securities under an employee benefit plan of the Company acting in such
capacity, (y) a corporation owned, directly or indirectly, by the stockholders
of the Company in substantially the same proportions as their ownership of stock
of the Company, or (z) any current beneficial stockholder or group, as defined
by Rule 13d-5 of the Exchange Act, holding in excess of fifty percent (50%) of
the combined voting power of the Company's outstanding securities, including the
heirs, assigns and successors thereof of beneficial ownership, within the
meaning of Rule 13d-3 of the Exchange Act, of securities possessing more than
fifty percent (50%) of the total combined voting power of the Company's
outstanding securities, hereafter becomes the beneficial owner, directly or
indirectly, of securities of the Company representing ten percent (10%) or more
of the combined voting power of the Company's then outstanding Voting
Securities, increases his beneficial ownership of such securities by five
percent (5%) or more over the percentage so owned by such person on the date
hereof, or

                  (iv) the Board adopts a resolution to the effect that, for
purposes of this Agreement, a Potential Change in Control has occurred.

            (f) "Proceeding": any threatened, pending or completed action, suit
or proceeding, or any inquiry, hearing or investigation, whether conducted by
the Company or any other party, that Indemnitee in good faith believes might
lead to the institution of any such action, suit or proceeding, whether civil,
criminal, administrative, investigative or other.

            (g) "Reviewing Party": any appropriate person or body consisting of
a member or members of the Company's Board of Directors or any other person or
body appointed by the Board (including the special, independent counsel referred
to in Section 3) who is not a party to the particular Proceeding with respect to
which Indemnitee is seeking Indemnification.

            (h) "Voting Securities": any securities of the Company which vote
generally in the election of directors.

      2. AGREEMENT TO INDEMNIFY.

            (a) In the event Indemnitee was, is or becomes a party to or witness
or other participant in, or is threatened to be made a party to or witness or
other participant in, a Proceeding by reason of (or arising in part out of) an
Indemnifiable Event, the Company shall indemnify Indemnitee to the fullest
extent permitted by law, as soon as practicable but in any event no later than
thirty (30) days after written demand is presented to the Company, against any

MTI Technology Corporation        Officer - Indemnification Agreement-NickBoland

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and all Expenses, judgments, fines, penalties and amounts paid in settlement
(including all interest, assessments and other charges paid or payable in
connection with or in respect of such Expenses, judgments, fines, penalties or
amounts paid in settlement) of such Proceeding and any federal, state, local or
foreign taxes imposed on the Indemnitee as a result of the actual or deemed
receipt of any payments under this Agreement, including the creation of the
Trust pursuant to Section 4 hereof. Notwithstanding anything in this Agreement
to the contrary and except as provided in Section 5, Indemnitee shall not be
entitled to indemnification pursuant to this Agreement in connection with any
Proceeding initiated by Indemnitee against the Company or any director or
officer of the Company unless the Company has joined in or consented to the
initiation of such Proceeding. If so requested by Indemnitee, the Company shall
advance, within ten (10) business days of such request, any and all Expenses to
Indemnitee (an "Expense Advance"); provided, however, that such Expenses shall
be advanced only upon delivery to the Company of an undertaking by or on behalf
of the Indemnitee to repay such amount if it is ultimately determined that
Indemnitee is not entitled to be indemnified by the Company; provided further,
that the Company shall make such advances only to the extent permitted by law.

            (b) Notwithstanding the foregoing, (i) the obligations of the
Company under Section 2(a) shall be subject to the condition that the Reviewing
Party shall not have determined (in a written opinion, in any case in which the
special, independent counsel referred to in Section 3 hereof is involved) that
Indemnitee would not be permitted to be indemnified under applicable law, and
(ii) the obligation of the Company to make an Expense Advance pursuant to
Section 2(a) shall be subject to the condition that, if, when and to the extent
that the Reviewing Party determines that Indemnitee would not be permitted to be
so indemnified under applicable law, the Company shall be entitled to be
reimbursed by Indemnitee (who hereby agrees to reimburse the Company) for all
such amounts theretofore paid; provided, however, that if Indemnitee has
commenced legal proceedings in a court of competent jurisdiction to secure a
determination that Indemnitee should be indemnified under applicable law, any
determination made by the Reviewing Party that Indemnitee would not be permitted
to be indemnified under applicable law shall not be binding and Indemnitee shall
not be required to reimburse the Company for any Expense Advance until a final
judicial determination is made with respect thereto (as to which all rights of
appeal therefrom have been exhausted or have lapsed). Indemnitee's obligation to
reimburse the Company for Expense Advances shall be unsecured and no interest
shall be charged thereon, to the extent permitted by law. If there has not been
a Change in Control, the Reviewing Party shall be selected by the Board of
Directors, and if there has been such a Change in Control, other than a Change
in Control which has been approved by a majority of the Company's Board of
Directors who were directors immediately prior to such Change in Control, the
Reviewing Party shall be the special, independent counsel referred to in Section
3 hereof. If there has been no determination by the Reviewing Party or if the
Reviewing Party determines that Indemnitee substantively would not be permitted
to be indemnified in whole or in part under applicable law, Indemnitee shall
have the right to commence litigation in any court in the States of California
or Delaware having subject matter jurisdiction thereof and in which venue is
proper seeking an initial determination by the court or challenging any such
determination by the Reviewing Party or any aspect thereof, and the Company
hereby consents to

MTI Technology Corporation        Officer - Indemnification Agreement-NickBoland

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service of process and to appear in any such proceeding. Any determination by
the Reviewing Party otherwise shall be conclusive and binding on the Company and
Indemnitee.

      3.    CHANGE IN CONTROL. The Company agrees that if there is a Change in
Control of the Company, other than a Change in Control which has been approved
by a majority of the Company's Board of Directors who were directors immediately
prior to such Change in Control, then with respect to all matters thereafter
arising concerning the rights of Indemnitee to indemnity payments and Expense
Advances under this Agreement or any other agreement or under applicable law or
the Company's Certificate of Incorporation or Bylaws now or hereafter in effect
relating to indemnification for Indemnifiable Events, the Company shall seek
legal advice only from special, independent counsel selected by Indemnitee and
approved by the Company, which approval shall not be unreasonably withheld. Such
special, independent counsel shall not have otherwise performed services for the
Company or the Indemnitee, other than in connection with such matters, within
the last five (5) years. Such independent counsel shall not include any person
who, under the applicable standards of professional conduct then prevailing,
would have a conflict of interest in representing either the Company or
Indemnitee in an action to determine Indemnitee's rights under this Agreement.
Such counsel, among other things, shall render its written opinion to the
Company and Indemnitee as to whether and to what extent the Indemnitee would be
permitted to be indemnified under applicable law. The Company agrees to pay the
reasonable fees of the special, independent counsel referred to above and to
indemnify fully such counsel against any and all expenses (including attorneys'
fees), claims, liabilities and damages arising out of or relating to this
Agreement or the engagement of special, independent counsel pursuant hereto.

      4.    ESTABLISHMENT OF TRUST. In the event of a Potential Change in
Control, the Company shall, upon written request by Indemnitee, create a trust
for the benefit of the Indemnitee (the "Trust") and from time to time upon
written request of Indemnitee shall fund such Trust, to the extent permitted by
law, in an amount sufficient to satisfy any and all Expenses reasonably
anticipated at the time of each such request to be incurred in connection with
investigating, preparing for and defending any Proceeding relating to an
Indemnifiable Event, and any and all judgments, fines, penalties and settlement
amounts of any and all Proceedings relating to an Indemnifiable Event from time
to time actually paid or claimed, reasonably anticipated or proposed to be paid.
The amount or amounts to be deposited in the Trust pursuant to the foregoing
funding obligation shall be determined by the Reviewing Party, in any case in
which the special, independent counsel referred to above is involved. The terms
of the Trust shall provide that upon a Change in Control (i) the Trust shall not
be revoked or the principal thereof invaded, without the written consent of the
Indemnitee, (ii) the trustee shall advance, within ten (10) business days of a
request by the Indemnitee, upon Indemnitee's having made the undertaking
required under Section 2(a) hereof, any and all Expenses to the Indemnitee, to
the extent permitted by law (and the Indemnitee hereby agrees to reimburse the
Trust under the circumstances under which the Indemnitee would be required to
reimburse the Company under Section 2(b) of this Agreement), (iii) the Trust
shall continue to be funded by the Company in accordance with the funding
obligation set forth above, (iv) the trustee shall promptly pay to the
Indemnitee all amounts for which the Indemnitee shall be entitled to
indemnification pursuant to this Agreement or otherwise, and (v) all unexpended
funds in such Trust shall revert to the

MTI Technology Corporation        Officer - Indemnification Agreement-NickBoland

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Company upon a final determination by the Reviewing Party or a court of
competent jurisdiction, as the case may be, that the Indemnitee has been fully
indemnified under the terms of this Agreement. The trustee shall be chosen by
the Indemnitee. Nothing in this Section 4 shall relieve the Company of any of
its obligations under this Agreement. All income earned on the assets held in
the Trust shall be reported as income by the Company for federal, state, local
and foreign tax purposes.

      5.    INDEMNIFICATION FOR EXPENSES INCURRED IN ENFORCING THIS AGREEMENT.
The Company shall indemnify Indemnitee against any and all expenses (including
attorneys' fees), and, if requested by Indemnitee, shall, within ten (10)
business days of such request, advance such expenses to Indemnitee, to the
extent permitted by law, which are incurred by Indemnitee in connection with any
claim asserted against or action brought by Indemnitee for (i) indemnification
or advance payment of Expenses by the Company under this Agreement or any other
agreement or relating to indemnification for Indemnifiable Events and/or (ii)
recovery under any directors' and officers' liability insurance policies
maintained by the Company, regardless of whether Indemnitee ultimately is
determined to be entitled to such indemnification, advance expense payment or
insurance recovery, as the case may be. Expenses shall be advanced, however,
only upon delivery to the Company of an undertaking by or on behalf of the
Indemnitee to repay such amount if it is ultimately determined that Indemnitee
is not entitled to be indemnified by the Company.

      6.    PARTIAL INDEMNITY. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of the
Expenses, judgments, fines, penalties and amounts paid in settlement of a
Proceeding but not, however, for all of the total amount thereof, the Company
shall nevertheless indemnify Indemnitee for the portion thereof to which
Indemnitee is entitled. Moreover, notwithstanding any other provision of this
Agreement, to the extent that Indemnitee has been successful on the merits or
otherwise in defense of any or all Proceedings relating in whole or in part to
an Indemnifiable Event or in defense of any issue or matter therein, including
dismissal without prejudice, Indemnitee shall be indemnified against all
Expenses incurred in connection therewith.

      7.    DEFENSE TO INDEMNIFICATION, BURDEN OF PROOF AND PRESUMPTIONS. It
shall be a defense to any action brought by the Indemnitee against the Company
to enforce this Agreement (other than an action brought to enforce a claim for
expenses incurred in defending a Proceeding in advance of its final disposition
where the required undertaking has been tendered to the Company) that the
Indemnitee has not met the standards of conduct that make it permissible under
the Delaware General Corporation Law for the Company to indemnify the Indemnitee
for the amount claimed. In connection with any determination by the Reviewing
Party or otherwise as to whether the Indemnitee is entitled to be indemnified
hereunder, the burden of proving such right to indemnification shall be on the
Indemnitee. Neither the failure of the Company (including its Board of
Directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action by the Indemnitee that
indemnification of the claimant is proper under the circumstances because he has
met the applicable standard of conduct set forth in the Delaware General
Corporation Law, nor an actual determination by the Company (including its Board
of Directors, independent legal counsel, or its stockholders) that

MTI Technology Corporation          Officer-Indemnification Agreement-NickBoland

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the Indemnitee had not met such applicable standard of conduct, shall be a
defense to the action or create a presumption that the Indemnitee has not met
the applicable standard of conduct. For purposes of this Agreement, the
termination of any claim, action, suit or proceeding, by judgment, order,
settlement (whether with or without court approval) or conviction, or upon a
plea of nolo contendere, or its equivalent, shall not create a presumption that
Indemnitee did not meet any particular standard of conduct or have any
particular belief or that a court has determined that indemnification is not
permitted by applicable law.

      8.    NON-EXCLUSIVITY. The rights of the Indemnitee hereunder shall be in
addition to any other rights Indemnitee may have under the Company's Certificate
of Incorporation or Bylaws or the Delaware General Corporation Law or otherwise;
provided, however, that this Agreement shall supersede any prior indemnification
by agreement between the Company and the Indemnitee. To the extent that a change
in the Delaware General Corporation Law (whether by statute or judicial
decision) permits greater indemnification by agreement than would be afforded
currently under the Company's Certificate of Incorporation and Bylaws and this
Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by
this Agreement the greater benefits so afforded by such change.

      9.    LIABILITY INSURANCE. To the extent the Company maintains an
insurance policy or policies providing directors' and officers' liability
insurance, Indemnitee shall be covered by such policy or policies, in accordance
with its or their terms, to the maximum extent of the coverage available for any
Company director or officer.

      10.   PERIOD OF LIMITATIONS. No legal action shall be brought and no cause
of action shall be asserted by or on behalf of the Company or any affiliate of
the Company against Indemnitee, Indemnitee's spouse, heirs, executors or
personal or legal representatives after the expiration of two years from the
date of accrual of such cause of action, or such longer period as may be
required by state law under the circumstances, and any claim or cause of action
of the Company or its affiliate shall be extinguished and deemed released unless
asserted by the timely filing of a legal action within such period; provided,
however, that if any shorter period of limitations is otherwise applicable to
any such cause of action, such shorter period shall govern.

      11.   AMENDMENT OF THIS AGREEMENT. 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.
Except as specifically provided herein, no failure to exercise or any delay in
exercising any right or remedy hereunder shall constitute a waiver thereof.

      12.   SUBROGATION. In the event of payment under this Agreement, the
Company shall be subrogated to the extent of such payment to all of the rights
of recovery of Indemnitee, who shall execute all papers required and shall do
everything that may be necessary to secure such rights, including the execution
of such documents necessary to enable the Company effectively to bring suit to
enforce such rights.

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      13.   NO DUPLICATION OF PAYMENTS. The Company shall not be liable under
this Agreement to make any payment in connection with any claim made against
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under any insurance policy, Bylaw or otherwise) of the amounts otherwise
indemnifiable hereunder.

      14.   SETTLEMENT OF CLAIMS. The Company shall not be liable to indemnify
Indemnitee under this Agreement for any amounts paid in settlement of any action
or claim effected without the Company's written consent. The Company shall not
settle any action or claim in any manner which would impose any penalty or
limitation on Indemnitee without Indemnitee's written consent. Neither the
Company nor the Indemnitee will unreasonably withhold their consent to any
proposed settlement. The Company shall not be liable to indemnify the Indemnitee
under this Agreement with regard to any judicial award if the Company was not
given a reasonable and timely opportunity, at its expense, to participate in the
defense of such action.

      15.   BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of and be enforceable by the parties hereto and their respective
successors, assigns, including any direct or indirect successor by purchase,
merger, consolidation or otherwise to all or substantially all of the business
and/or assets of the Company, spouses, heirs, and personal and legal
representatives. The Company shall require and cause any successor (whether
direct or indirect by purchase, merger, consolidation or otherwise) to all,
substantially all, or a substantial part, of the business and/or assets of the
Company, by written agreement in form and substance satisfactory to the
Indemnitee, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place. This Agreement shall continue in effect
regardless of whether Indemnitee continues to serve as a director or officer of
the Company or of any other enterprise at the Company's request.

      16.   SEVERABILITY. The provisions of this Agreement shall be severable in
the event that any of the provisions hereof (including any provision within a
single section, paragraph or sentence) is held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.
Furthermore, to the fullest extent possible, the provisions of this agreement
(including, without limitation, each portion of this Agreement containing any
provision held to be invalid, void or otherwise unenforceable, that is not
itself invalid, void or unenforceable) shall be construed so as to give effect
to the intent manifested by the provision held invalid, illegal or
unenforceable.

      17.   GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware applicable to
contracts made and to be performed in such State without giving effect to the
principles of conflicts of laws.

      18.   COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

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      19.   NOTICES. All notices, demands, and other communications required or
permitted hereunder shall be made in writing and shall be deemed to have been
duly given if delivered by hand, against receipt, or mailed, postage prepaid,
certified or registered mail, return receipt requested, and addressed to the
Company at:

                                        MTI Technology Corporation
                                        14661 Franklin Avenue
                                        Anaheim, California 92780
                                        Attention: Corporate Secretary

 and to Indemnitee at:

                                       WOODFIEW
                                       ---------------------------
                                       CARPENTERSTOWN ROAD
                                       CASTLERMOCK,DUBLIN 15-IRELAND
                                       Attention: Nick Boland

      Notice of change of address shall be effective only when done in
accordance with this Section. All notices complying with this Section shall be
deemed to have been received on the date of delivery or on the third business
day after mailing.

      IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the day first set forth above.

                                      MTI TECHNOLOGY CORPORATION

                                     By:/s/Thomas P. Raimondi, Jr.
                                        -----------------------------------
                                           Thomas P. Raimondi, Jr.
                                           President and Chief Executive Officer

                                        /s/Nick Boland
                                        -----------------------------------
                                           Nick Boland
                                           Indemnitee

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