EXHIBIT 10.1

                               SECURITY AGREEMENT


        THIS SECURITY AGREEMENT (the "Security Agreement") is entered into as of
the  __ day  of  March,  2003  (the  "Effective  Date")  by  and  between  nSTOR
TECHNOLOGIES,  INC., a Delaware corporation (the "Company"),  nSTOR CORPORATION,
INC., a Delaware  corporation (the "Subsidiary" and along with the Company,  the
Debtor"),  having offices at 100 Century Boulevard, West Palm Beach, Florida and
Bernard A. Marden,  individually ("Marden") and as agent for the Secured Parties
(the  "Agent"),  The  Charlotte  Marden  1993 Trust (the  "Trust"),  Alan Miller
("Miller")  and WRS Advisors III LLC ("WRS" and together with Marden,  the Trust
and Miller, the "Secured Parties").

                                    RECITALS:

        WHEREAS,  Debtor has made (i) that certain  promissory note of even date
herewith in the original  principal amount of $1,700,000 in favor of Marden (the
"Marden Note"),  (ii) that certain  promissory note of even date herewith in the
original  principal amount of $500,000 in favor of the Trust (the "Trust Note"),
(iii)  that  certain  promissory  note of even  date  herewith  in the  original
principal  amount of $250,000 in favor of Miller  (the  "Miller  Note") and (iv)
that certain  promissory  note of even date  herewith in the original  principal
amount of  $250,000  in favor of WRS (the "WRS Note" and  together  with the WRS
Note, Marden Note and Trust Note, the "Notes");

        WHEREAS, pursuant to the terms of the Notes, and as security for payment
of the Notes,  Debtor has agreed to grant to the Agent,  for the  benefit of the
Secured  Parties a security  interest,  as  defined in Article 9 of the  Uniform
Commercial Code, as enacted in the State of Florida, in the collateral described
herein, on the terms and conditions set forth in this Security Agreement.

        NOW,  THEREFORE,  in  consideration  of the  mutual  promises  contained
herein, and other good and valuable  considerations,  the receipt,  adequacy and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

        1.  Incorporation  of  Recitals.  The  foregoing  Recitals  are true and
correct and are incorporated herein by this reference, as if set forth herein.

        2. Security Interest in Assets.  As collateral  security for the payment
of all of the  obligations of Debtor owing to or in favor of the Secured Parties
under the Notes (such indebtedness and all other terms,  conditions,  covenants,
representations  and  warranties  of  all  of the  foregoing  instruments  being
hereinafter  called the  "Obligations"),  Debtor  hereby  pledges,  assigns  and
hypothecates  to the  Agent,  and grants to the  Agent,  for the  benefit of the
Secured Parties,  a first-priority  security  interest in those assets of Debtor
described in Exhibit "A" attached  hereto and made a part hereof and any and all
proceeds  (as defined in Article 9 of the Uniform  Commercial  Code),  products,
replacements,  refurbishments,  extensions,  accessions,  insurance proceeds and
modifications  thereto and/or arising  therefrom  (all  hereinafter  referred to
herein as the "Collateral").

        3. Security for Obligations.  This Security Agreement,  and the grant of
the security interest in the Collateral granted hereunder,  is made to the Agent
for the benefit of the Secured Parties,  as security for the Obligations for the
benefit of the Secured  Parties,  all as contemplated by the Recitals hereto and
paragraph 2 hereof.

        4. Secured Parties' Right to Cure. Debtor will pay promptly when due all
taxes and assessments  upon the Collateral or for its use or operation  thereof.
At its option,  the Agent may discharge  taxes,  liens or security  interests or
other encumbrances at any time levied or placed on the Collateral. Debtor agrees
to  reimburse  the Agent on demand for any such  payments  made,  or any expense
incurred, by the Agent, pursuant to the foregoing authorization.  Until default,
Debtor may have possession of the Collateral and use it in any lawful manner not
inconsistent with this Security Agreement.


        5. Events of Default.  Any of the following shall be an Event of Default
under this Security Agreement:

               (a) Default in Payment.  The failure to make any payment required
under any Note; and

               (b) Default under this Security Agreement.  Any default or breach
of a representation, warranty or covenant under this Security Agreement.

        6.  Remedies in Case of an Event of  Default.  Upon an Event of Default,
the Agent shall have the following  rights and remedies (to the extent permitted
by  applicable  law) on behalf of the Secured  Parties in addition to the rights
and remedies  granted to the Secured  Parties in the Notes  (including,  without
limitation,  acceleration of the balance due thereunder),  as well as those of a
secured  party  under the  Uniform  Commercial  Code as  enacted in the State of
Florida,  all such  rights and  remedies  being  cumulative,  non-exclusive  and
enforceable alternatively, successively or concurrently:

               (a)  Realization  and  Disposition of Collateral.  The Agent,  on
behalf  of the  Secured  Parties,  may  demand,  sue  for,  collect  or make any
compromise  or  settlement  which the Agent  deems  suitable  in  respect of any
Collateral  encumbered by the security  interest granted to the Agent hereunder.
The Agent may sell, resell,  assign and deliver,  or otherwise dispose of any or
all  of  the  Collateral,  for  cash  and/or  credit,  upon  such  terms  as are
reasonable, and at such place or places and to such persons, firms, companies or
corporations as the Agent deems  reasonably  expedient,  provided that the Agent
gives notice to Debtor of the time and place of public or private  sale.  Debtor
hereby agrees that the sending of ten (10) days' written  notice by  first-class
mail,  postage prepaid,  to Debtor pursuant to Section 12 hereof of the time and
place of any public  sale,  or of the time after which any private sale or other
intended  disposition  is to be made,  shall be deemed  commercially  reasonable
notice thereof.

               (b)  Enforcement  of Rights.  The Agent may enforce the rights of
the Secured  Parties  hereunder  without the  necessity of any judicial or other
hearing and without  compliance with any other condition,  unless such condition
is hereafter imposed by statute or rule of law. If any of the Collateral is sold
by the Agent upon credit or for future  delivery,  the Agent shall not be liable
for the failure of the purchaser to pay for same and in such event the Agent may
resell such  Collateral.  The Agent may buy any part or all of the Collateral on
behalf of the  Secured  Parties at any public sale and if any part or all of the
Collateral  is of a type  customarily  sold in a recognized  market or is of the
type which is the subject of widely distributed  standard price quotations,  the
Agent may buy at a private sale and may make payments therefor by any means.

        7. Agency.

               (a)   Management  of   Collateral.   Each  Secured  Party  hereby
irrevocably  designates  and appoints  Marden as the Agent of such Secured Party
under this  Security  Agreement.  Each Secured Party agrees that the Agent shall
have the  exclusive  right to  manage,  perform  and  enforce  the terms of this
Security  Agreement  with respect to the  Collateral and to exercise and enforce
all  privileges  and  rights  thereunder  according  to its  discretion  and the
exercise of its business judgment,  including, without limitation, the exclusive
right  to  enforce  or  settle  insurance  claims,  take or  retake  control  or
possession of such  Collateral  and to hold,  prepare for sale,  process,  sell,
lease,  dispose of, or liquidate such Collateral;  provided,  however,  that the
Agent must  receive the consent of Secured  Parties  holding at least  fifty-one
percent  (51%)  of the  outstanding  principal  amount  of the  Notes  prior  to
enforcing the rights of the Secured Parties granted hereunder in the Collateral.
In connection  therewith,  each of the Secured Parties waives any and all rights
it may have as a  secured  creditor  to  affect  the  method  or  challenge  the
appropriateness  of any action by Agent.  The Agent must provide prior notice to
all of the Secured  Parties with respect to any action  related to enforcing the
Secured  Parties' rights to the Collateral.  The Agent shall not have any duties
or  responsibilities,  except those expressly set forth herein, or any fiduciary
relationship  with any  Secured  Party,  and no  implied  covenants,  functions,
responsibilities,  duties,  obligations or  liabilities  shall be read into this
Security Agreement or otherwise exist against the Agent.

               (b) Sale of Collateral.  Notwithstanding anything to the contrary
contained  in this  Security  Agreement,  only  Agent  shall  have the  right to
restrict  or permit,  or  approve or  disapprove,  the sale,  transfer  or other
disposition of Collateral.  The Agent may first apply the cash proceeds actually
received from any sale or other  disposition of the Collateral to the reasonable
expenses  which  may be  incurred  by the Agent in  attempting  to  collect  the
Obligations  or to enforce this  Security  Agreement.  Each Secured Party agrees
that the remaining  proceeds  received from the sale of any Collateral  shall be
(i)  distributed  pro  rata  to  each  Secured  Party  based  on the  sum of the
outstanding  principal balance of, and accrued but unpaid interest on, each Note
and (ii) applied first against unpaid interest  accrued on each Note and then to
reduce principal thereof. The Secured Parties will, immediately upon the request
of Agent,  release or otherwise terminate any liens upon the Collateral,  to the
extent such  Collateral  is sold or otherwise  disposed of either by Agent,  its
agents or  Company  with the  consent of Agent,  and the  Secured  Parties  will
promptly  deliver such  release  documents  as Agent may  reasonably  require in
connection therewith.

               (c) Remedies.  In no event shall the Secured Parties exercise any
remedies  available  under this agreement  without  consent of the Agent. In the
event a Secured  Party shall  receive any  payment or  distribution  of any kind
representing proceeds of any Collateral, such sums shall be held in trust by the
Secured  Party for the benefit and on account of Agent and such amounts shall be
paid to Agent.

               (d) Exculpatory Provisions. The Agent shall not be liable for any
action  lawfully  taken or  omitted  to be taken by it in  connection  with this
Security  Agreement (except to the extent that any of the foregoing are found by
a final and nonappealable  decision of a court of competent jurisdiction to have
resulted from its or such person's own gross negligence or willful misconduct).

               (e)  Authorization  to Release  Liens.  The Agent may release any
lien covering any Collateral that is the subject of a sale or other  disposition
upon  consent of the Secured  Parties  holding  fifty-one  percent  (51%) of the
outstanding principal amount of the Notes. .

        8. Transfer, etc. by Debtor. Without the prior written consent of all of
the Secured  Parties,  after the date hereof,  Debtor shall not,  without  first
obtaining all of the Secured Parties' written consent,  which may be withheld in
a Secured  Party's  sole and  absolute  discretion,  sell,  assign,  transfer or
otherwise  dispose of,  grant any option with respect to, or pledge or grant any
security  interest in or otherwise  encumber any of the  Collateral  except such
transfers  of the  Collateral  which  are in the  ordinary  course  of  Debtor's
business.

        9. Further Assurances. Debtor will do all such acts, and will furnish to
the Secured Parties all such financing  statements,  certificates,  opinions and
other documents,  and will do or cause to be done all such things as the Secured
Parties may  reasonably  require in order to give full  effect to this  Security
Agreement at any time while any of the Obligations remain unpaid.

        10.  Termination.  Upon  the  payment  in  full  of the  Obligations  in
accordance with their terms,  then, and in such event,  this Security  Agreement
shall  terminate  and  Debtor  shall be  entitled  to the  return of such of the
Collateral  in the  possession  or  control of the  Secured  Parties as have not
theretofore been disposed of pursuant to the provisions  hereof and a release of
the security agreement granted by this Security Agreement.

        11.  Financing  Statements.  Debtor  agrees  that it shall  execute  and
deliver UCC-1 Financing  Statements,  to be filed with the Secretary of State of
the states of Florida,  Delaware and California, to perfect the Agent's security
interest in the Collateral for the benefit of the Secured Parties. Debtor agrees
that  it  shall  execute  and  deliver  such  additional  financing  statements,
extension statements and other documents and instruments in order to perfect and
extend,  as may be necessary,  the security  interest granted herein, so long as
any of the Obligations  hereunder remain unpaid. The Secured Parties agree that,
upon the payment in full of the  Obligations  in  accordance  with their  terms,
then,  and in such event,  the Secured  Parties will direct the Agent to execute
and deliver a UCC-3  Termination  Statement,  to be filed with the  Secretary of
State of the states of  Florida,  Delaware  and  California,  to  terminate  the
Agent's security interest in the Collateral.

        12. Notices.  All notices,  requests,  consents and other communications
required or  permitted  under this  Security  Agreement  shall be in writing and
shall be hand delivered by messenger or courier service,  sent by facsimile,  or
mailed  (airmail if  international)  by  registered  or certified  mail (postage
prepaid),  return receipt  requested,  addressed to the addresses of the parties
first  above  written or to such other  address  as any party may  designate  by
notice  complying  with the terms of this  Section.  Each such  notice  shall be
deemed delivered (a) on the date delivered if by personal  delivery;  (b) on the
date of transmission  with  confirmation of receipt if by facsimile;  and (c) on
the date upon which the return  receipt is signed or  delivery is refused or the
notice is designated by the postal  authorities as not deliverable,  as the case
may be, if mailed.

        13. Miscellaneous Matters.

               (a) Waiver; Subsequent Modification. Except as expressly provided
herein,  no waiver by any party or any  failure or refusal of the other party to
comply with its  obligations  under this  Security  Agreement  shall be deemed a
waiver of any other or subsequent  failure or refusal to so comply by such other
party.  No waiver or  modification  of the terms hereof shall be valid unless in
writing  and  signed by the  party to be  charged  and then  only to the  extent
therein set forth.

               (b)  Governing  Law;  Venue.  This  Security  Agreement  shall be
governed by and construed in  accordance  with the laws of the State of Florida.
Venue for any action arising out of this Security  Agreement shall be Palm Beach
County, Florida.

               (c) Cumulative  Remedies.  Unless  expressly  provided  otherwise
herein,  the remedies of the parties provided for herein shall be cumulative and
concurrent, and may be pursued singularly, successively or together, at the sole
discretion  of the party for whose  benefit such remedy is provided,  and may be
exercised as often as occasion therefor shall arise.

               (d) Parties Not  Partners.  Nothing  contained  in this  Security
Agreement, or any of the documents to be executed pursuant hereto, shall operate
to make the  Secured  Parties  or any of  their  successors,  administrators  or
assigns a  partner(s)  with,  agent(s)  for,  or  principal(s)  of  Debtor,  its
successors or assigns and vice-versa.

               (e)  Attorneys'  Fees;  Costs  and  Expenses.  In any  action  or
proceeding  arising out of this Security  Agreement the prevailing party in such
action or proceeding,  shall be entitled to recover from the other party thereto
the  reasonable  attorneys'  fees,  including one or more appeals,  court costs,
filing fees,  publication  costs and other  expenses  incurred by the prevailing
party.

               (f)  Captions.  The  title  of this  Security  Agreement  and the
headings of the various  articles,  sections and  subsections  of this  Security
Agreement have been inserted only for the purposes of convenience,  are not part
of this  Security  Agreement  and shall not be deemed in any  manner to  modify,
explain, expand or restrict any of the provisions of this Security Agreement.

               (g) Entire  Agreement.  Except as  otherwise  expressly  provided
herein, the Note and this Security Agreement  constitute the entire agreement of
the parties  hereto with respect to the matters  addressed  herein and supersede
all prior or contemporaneous contracts,  promises,  representations,  warranties
and statements, whether written or oral, with respect to such matters.

               (h)  WAIVER  OF JURY  TRIAL.  THE  PARTIES  HERETO  MUTUALLY  AND
WILLINGLY  WAIVE THE RIGHT TO A TRIAL BY JURY OF ANY AND ALL CLAIMS MADE BETWEEN
THEM  WHETHER  NOW  EXISTING  OR  ARISING  IN  THE  FUTURE,  INCLUDING,  WITHOUT
LIMITATION,  ANY AND ALL CLAIMS,  DEFENSES,  COUNTERCLAIMS,  CROSS CLAIMS, THIRD
PARTY CLAIMS AND  INTERVENOR'S  CLAIMS,  WHETHER  ARISING FROM OR RELATED TO THE
NEGOTIATION,  EXECUTION  AND  PERFORMANCE  OF THE  TRANSACTIONS  TO  WHICH  THIS
DOCUMENT RELATES.

               (i) Counterparts.  This Security Agreement may be executed in two
or more  counterparts,  each of which  shall be deemed an  original,  but all of
which together shall constitute one and the same instrument.

                             [SIGNATURES TO FOLLOW]


        IN WITNESS  WHEREOF,  the  Secured  Parties  and  Debtor  have each duly
executed this Security Agreement as of the day and year first above written.

                                     SECURED PARTIES:

                                     The Charlotte Marden 1993 Trust

                                     By: /s/ Bernard A. Marden
                                     Name & Title: Trustee

                                     /s/ Alan Miller
                                     Alan Miller, individually

                                     WRS Advisors III LLC

                                     By: /s/ William Mack
                                     Name & Title: William Mack, President

                                     -----------------------------
                                     Bernard A. Marden, individually


                                     AGENT:

                                     By: /s/ Bernard A. Marden
                                     Bernard A. Marden, individually as agent
                                     for the Secured Parties

                                     DEBTOR:

                                     nSTOR TECHNOLOGIES, INC.,
                                     a Delaware corporation

                                     By: /s/ Jack Jaiven
                                     Name & Title: Jack Jaiven, VP/Treasurer

                                     nSTOR CORPORATION, INC.,
                                     a Delaware corporation

                                     By: /s/ Jack Jaiven
                                     Name & Title: Jack Jaiven, VP/Treasurer


                             EXHIBIT A - COLLATERAL


               "Collateral," as used in this Security Agreement,  shall mean all
of Debtor's  presently  owned or hereafter  acquired  Equipment,  Chattel Paper,
Documents,  Instruments and General Intangibles,  as those terms are hereinafter
defined, together with the proceeds and products of all of the foregoing.

               Equipment shall mean all of Debtor's goods, machinery, equipment,
fixtures,  furniture, office equipment, tools, parts and other items of personal
property  of every kind and  description,  now owned or  hereafter  acquired  by
Debtor,   wheresoever  located,   together  with  all  additions,   attachments,
accessions, parts, replacements and substitutions thereto and thereof.

               Chattel Paper shall mean a writing or writings  evidencing both a
monetary  obligation to Debtor and a security interest in or a lease of specific
goods.

               Documents shall have the meaning ascribed to said term in Section
679.105(1)(f) of the Florida Statutes, Uniform Commercial Code.

               Instruments  shall mean  negotiable  instruments or securities as
defined by the Uniform  Commercial  Code or any other writing which  evidences a
right by Debtor to payment of monies and is not itself a security  agreement  or
lease.

               General  Intangibles shall have the meaning ascribed to said term
in Section 679.106 of the Florida Statutes, Uniform Commercial Code.

               "Collateral," as used in this Security Agreement,  shall not mean
any of Debtor's presently owned or hereafter acquired Accounts or Inventory,  as
those terms are hereinafter defined:

               Accounts  shall mean a right to payment  for goods sold or leased
and for services  rendered  which is not  evidenced by an  Instrument or Chattel
Paper, whether or not it has been earned by performance.

               Inventory  shall mean all goods,  merchandise  and other personal
property now or hereafter  acquired by Debtor,  wheresoever  located,  which are
held for sale or lease or are raw  materials,  work in process or materials used
or consumed or to be used or consumed in Debtor's business.

               Account  Debtors  shall mean the parties who are  obligated on or
under any Account.