Document:

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EXHIBIT 10.3

BRADY CORPORATION

NONQUALIFIED STOCK OPTION AGREEMENT

     Option granted on                      ___, 20___, by Brady Corporation, a Wisconsin corporation (the
“Corporation”), to                      (the “Employee”).

WITNESSETH:

     WHEREAS, the Board of Directors of the Corporation, desiring to provide increased long-term
incentives for key salaried employees of the Corporation and any present or future Subsidiary of
the Corporation and desiring to facilitate the efforts of the Corporation and its Subsidiaries to
obtain and retain employees of outstanding ability, adopted the Brady Corporation                      Omnibus
Incentive Stock Plan on                                          (“the Plan”);

     NOW, THEREFORE, it is agreed as follows:

	1.	 	Number of Shares Optioned; Option Price
	 
	 	 	The Corporation grants to the Employee the right and option to purchase, on the terms and
conditions hereof, all or any part of an aggregate of                      (___) shares of the
presently authorized Class A Common Stock of the Corporation, $.01 par value, whether
unissued or issued and reacquired by the Corporation, at the price of $___.___per share (the
“Option Price”).
	 
	2.	 	Conditions of Exercise of Options During Employee’s Lifetime; Vesting of Option
	 
	 	 	Except as provided hereinafter in this paragraph and in paragraph 3, this Option may not be
exercised (a) unless Employee is at the date of the exercise in the employ of the
Corporation or a Subsidiary, and (b) until Employee shall have been continuously so employed
for a period of at least one year from the date hereof. Thereafter, this Option shall be
exercisable for any amount of shares up to the maximum percentage of shares covered by this
Option (rounded up to the nearest whole share), as follows (but in no event shall this
Option be exercisable for any shares after the expiration date provided in paragraph 7):

	 	 	 	 	 
	 	 	Maximum
	 	 	Percentage
	 	 	of Shares For
	Number of Completed Years After	 	Which Option is
	Date of Grant of this Option	 	Exercisable
	Less than 1
	 	Zero
	At least 1 but less than 2
	 	 	33-1/3	%
	At least 2 but less than 3
	 	 	66-2/3	%
	At least 3
	 	 	100	%

 

 

	 	 	If Employee shall cease to be employed by the Corporation or a Subsidiary for any reason
other than as provided in paragraph 3 after Employee shall have been continuously so
employed for one year after the grant of this Option, Employee may, at any time within 90
days of such termination, but in no event later than the date of expiration of this Option,
exercise this Option to the extent Employee was entitled to do so on the date of such
termination. However, if Employee was dismissed for cause, of which the Compensation
Committee of the Board of Directors of the Corporation (the “Committee”) shall be the sole
judge, this Option shall forthwith expire. This Agreement does not confer upon Employee any
right of continuation of employment by the Corporation or a Subsidiary, nor does it impair
any right the Corporation or any Subsidiary may have to terminate the Employee’s employment
at any time.

	3.	 	Termination of Employment
	 
	 	 	Notwithstanding the provisions of paragraph 2 hereof, if the Employee:

	 	(a)	 	is terminated by the death of the Employee, any unexercised, unexpired Stock
Options granted hereunder to the Employee shall be 100% vested and fully exercisable,
in whole or in part, at any time within one year after the date of death, by the
Employee’s personal representative or by the person to whom the Stock Options are
transferred under the Employee’s last will and testament or the applicable laws of
descent and distribution;
	 
	 	(b)	 	dies within 90 days after termination of employment by the Corporation or its
Affiliates, other than for cause, any unexercised, unexpired Stock Options granted
hereunder to the Employee and exercisable as of the date of such termination of
employment shall be exercisable, in whole or in part, at any time within one year after
the date of death, by the Employee’s personal representative or by the person to whom
the Stock Options are transferred under the Employee’s last will and testament or the
applicable laws of descent and distribution;
	 
	 	(c)	 	is terminated as a result of the disability of the Employee (a disability means
that the Employee is disabled as a result of sickness or injury, such that he or she is
unable to satisfactorily perform the material duties of his or her job, as determined
by the Board of Directors, on the basis of medical evidence satisfactory to it), any
unexercised, unexpired Stock Options granted hereunder to the Employee shall become
100% vested and fully exercisable, in whole or in part, at any time within one year
after the date of disability; or
	 
	 	(d)	 	is terminated as a result of the Employee’s retirement (after age 55 with ten
years of employment with the Corporation or an Affiliate or after age 65), any
unexercised, unexpired Stock Options granted hereunder to the Employee shall continue
to vest as provided in paragraph 2 hereof and any option that is or becomes vested may
be exercised within the term of such option.

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	4.	 	Deferral of Exercise
	 
	 	 	Although the Corporation intends to exert its best efforts so that the shares purchasable
upon the exercise of this Option will be registered under, or exempt from, the registration
requirements of, the Securities Act of 1933 (the “Act”) and any applicable state securities
law at the time or times this Option (or any portion of this Option) first becomes
exercisable, if the exercise of this Option would otherwise result in a violation by the
Corporation of any provision of the Act or of any state securities law, the Corporation may
require that such exercise be deferred until the Corporation has taken appropriate action to
avoid any such violation.
	 
	5.	 	Method of Exercising Option
	 
	 	 	This Option shall be exercised by delivering to the Corporation, at the office of its
Treasurer, a written notice of the number of shares with respect to which this Option is at
the time being exercised and by paying the Corporation in full the Option Price of the
            shares being acquired at the time.
	 
	6.	 	Method of Payment
	 
	 	 	Payment shall be made either (i) in cash; (ii) by delivering shares of the Corporation’s
Class A Common Stock which have been beneficially owned by the Employee, the spouse of the
Employee, or both of them, for a period of at least six months prior to the time of exercise
(“Delivered Stock”); or (iii) by delivering a combination of cash and Delivered Stock.
Payment in the form of Delivered Stock shall be in the amount of the Fair Market Value of
the stock at the date of exercise, determined in accordance with paragraph 9.
	 
	7.	 	Expiration Date
	 
	 	 	This Option shall expire ten years after the date on which this Option was granted.
	 
	8.	 	Withholding Taxes
	 
	 	 	The Corporation may require, as a condition to the exercise of this Option, that the
Employee concurrently pay to the Corporation any taxes which the Corporation is required to
withhold by reason of such exercise. In lieu of part or all of any such payment, the
Employee may elect, subject to such rules and regulations as the Committee may adopt from
time to time, to have the Corporation withhold from the shares to be issued upon exercise
that number of shares having a Fair Market Value, determined in accordance with paragraph 9,
equal to the amount which the Corporation is required to withhold.
	 
	9.	 	Method of Valuation of Stock
	 
	 	 	The “Fair Market Value” of the Class A Common Stock of the Corporation on any date shall
mean, if the stock is then listed and traded on a registered national securities exchange,
or is quoted in the NASDAQ National Market System, the average of the high

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	 	 	and low sales price recorded in composite transactions for such date or, if such date is not
a business day or if no sales of shares shall have been reported with respect to such date,
the next preceding business date with respect to which sales were reported. In the absence
of reported sales or if the stock is not so listed or quoted, but is traded in the
over-the-counter market, Fair Market Value shall be the average of the closing bid and asked
prices for such shares on the relevant date.
	 
	10.	 	No Rights in Shares Until Certificates Issued
	 
	 	 	Neither the Employee nor his heirs nor his personal representative shall have any of the
rights or privileges of a stockholder of the Corporation in respect of any of the shares
issuable upon the exercise of the Option herein granted, unless and until certificates
representing such shares shall have been issued.
	 
	11.	 	Option Not Transferable
	 
	 	 	No portion of the Option granted hereunder shall be transferable or assignable (or made
subject to any pledge, lien, obligation or liability of an Employee) except (a) by last will
and testament or the laws of descent and distribution (and upon a transfer or assignment
pursuant to an Employee’s last will and testament or the laws of descent and distribution,
any Option must be transferred in accordance therewith); (b) during the Employee’s lifetime,
nonqualified stock Options may be transferred by an Employee to the Employee’s spouse,
children or grandchildren or to a trust for the benefit of such spouse, children or
grandchildren, provided that the terms of any such transfer prohibit the resale of shares
acquired upon exercise of the option at a time during which the transferor would not be
permitted to sell such shares under the Corporation’s policy on trading by insiders.
	 
	12.	 	Prohibition Against Pledge, Attachment, Etc.
	 
	 	 	Except as otherwise herein provided, the Option herein granted and the rights and privileges
pertaining thereto shall not be transferred, assigned, pledged or hypothecated in any way
(whether by operation of law or otherwise) and shall not be subject to execution, attachment
or similar process.
	 
	13.	 	Changes in Stock
	 
	 	 	In the event there are any changes in the Class A Common Stock of the Corporation through
merger, consolidation, reorganization, recapitalization, stock dividend, stock split,
combination or exchange of shares, rights offering or any other change affecting the Class A
Common Stock of the Corporation, appropriate changes may be made by the Committee, subject
to approval of the Board of Directors of the Corporation, in the aggregate number of shares
and the purchase price and kind of shares subject to this Option, to prevent substantial
dilution or enlargement of the rights granted to or available for Employee.

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	14.	 	Dissolution or Merger
	 
	 	 	Anything contained herein to the contrary notwithstanding, upon the dissolution or
liquidation of the Corporation, or upon any merger in which the Corporation is not the
surviving corporation, at any time prior to the expiration date of the termination of this
Option, the Employee shall have the right within 60 days prior to the effective date of such
dissolution, liquidation or merger, to surrender all or any unexercised portion of this
Option to the Corporation for cash, subject to the discretion of the Committee as to the
exact timing of said surrender. Notwithstanding the foregoing, however, in the event
Employee has retired or died, Employee’s right to surrender all or any unexercised portion
of this Option under this paragraph shall be available only to the extent that at the time
of any such surrender, Employee would have been entitled to exercise this Option under
paragraphs 2 or 3 hereof, as the case may be. The amount of cash to be paid to Employee for
the portion of this Option so surrendered, shall be equal to the number of shares of Class A
Common Stock subject to the surrendered Option multiplied by the difference between the
Option Price per share, as described in paragraph 1 hereof, and the Fair Market Value per
share, determined in accordance with paragraph 9 hereof, as of the time of surrender.
	 
	15.	 	Notices
	 
	 	 	Any notice to be given to the Corporation under the terms of this Agreement shall be
addressed to the Corporation in care of its Vice President and Chief Financial Officer, and
any notice to be given to the Employee may be addressed at the address as it appears on the
Corporation’s records, or at such other address as either party may hereafter designate in
writing to the other. Except as provided in paragraph 5 hereof, any such notice shall be
deemed to have been duly given, if and when enclosed in a properly sealed envelope addressed
as aforesaid, and deposited, postage prepaid, in the United States mail.
	 
	16.	 	Provisions of Plan Controlling
	 
	 	 	This Option is subject in all respects to the provisions of the Plan. In the event of any
conflict between any provisions of this Option and the provisions of the Plan, the
provisions of the Plan shall control. Terms defined in the Plan where used herein shall
have the meanings as so defined. Employee acknowledges receipt of a copy of the Plan.
	 
	17.	 	Wisconsin Contract
	 
	 	 	This Option has been granted in Wisconsin and shall be construed under the laws of that
state.

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     IN WITNESS WHEREOF, the Corporation has caused these presents to be executed on its behalf by
its President and to be sealed with its corporate seal, and attested by the Secretary and the
Employee has hereunto set his hand and seal, all as of the day and year first above written, which
is the date of the granting of this Option evidenced hereby.

	 	 	 	 	 
	BRADY CORPORATION	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

President and Chief Executive Officer
	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Chairman, Compensation Committee	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 

	 	Secretary	 	 
	 
	 	 	 	 
	EMPLOYEE:
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	Employee Name (Country)	 	 

6exv10w1

 

Exhibit 10.1

SEVERANCE AND RELEASE AGREEMENT

     This Severance and Release Agreement (the “Agreement”) by and between MTI Technology
Corporation (“MTI” or “the Company”) and Richard Ruskin (“Ruskin”) documents the terms and
conditions of Ruskin’s termination from the Company, and is effective September 30, 2006, (the
“Effective Date”).

Recitals

     On or about September 22, 2003, Ruskin commenced employment with MTI. Ruskin was formerly the
Company’s Executive Vice President of US Sales and Marketing.

     MTI terminated Ruskin’s employment effective on September 30, 2006 (the “Termination Date”).
MTI does not have a uniform policy or practice of granting particular severance benefits to its
employees or executives. However, in accordance with the terms set forth under the offer letter
between MTI and Ruskin, MTI agrees to pay Ruskin those severance benefits described in the
paragraphs that follow in exchange for Ruskin’s release of all claims against the Company and
performance of his other obligations hereunder. Ruskin accepted this offer.

     NOW, THEREFORE, in consideration of the recitals listed above, and the mutual promises
contained in this Agreement, Ruskin and the Company agree, covenant, and represent as follows:

Agreement

  1. Termination of Employment and Severance Payment

     In consideration of the covenants and promises in this Agreement, and for the good and
valuable consideration, the sufficiency of which are hereby acknowledged, the Parties agree as
follows:

          a. Within a reasonable period after the Effective Date of the Agreement, and subject to the
condition that seven days have passed and Ruskin has not revoked this Agreement pursuant to
Paragraph 3(b), MTI shall pay Ruskin’s in the total gross amount of $154,500.00 (six months base
salary, six months draw, and six months auto allowance) minus all applicable taxes, social
security, and other government required deductions (the “Severance Payment”). The Severance
Payment shall be paid in eleven equal payments in the gross amount of $14,045.46, beginning on
MTI’s first scheduled payroll date following October 1, 2006 and concluding with the payment on
March 2, 2007. Notwithstanding any provision herein to the contrary, in no event will the
Severance Payment be paid to Ruskin later than two and one-half (21/2) months following January 1,
2007.

 

 

          b. Ruskin acknowledges that, as of Employment Termination Date, he may be eligible to obtain
continuing coverage under MTI’s group medical, vision and dental plans pursuant to the provisions
of the Consolidated Omnibus Reconciliation Act and its implementing regulations (“COBRA”). MTI
agrees that for a six month period beginning on October 1, 2006, MTI will pay the monthly premium
for any COBRA continuation coverage that Ruskin elects to obtain. In no event shall MTI be liable
for, or be required to pay premiums for any COBRA continuation coverage Ruskin may elect or be
eligible to obtain thereafter. Beginning April 1, 2007, Ruskin shall be solely responsible for
paying any and all premiums and administrative fees necessary to continue such COBRA benefits.

          c. Subject to the approval of the Compensation Committee of MTI’s Board of Directors, the
parties agree that 50,000 shares of the 250,000 unvested shares of Restricted Stock awarded to
Ruskin on June 21, 2006, under the Company’s 2001 Stock Incentive Plan, as amended (the “2001
Plan”), shall vest and released on June 21, 2007 and the remaining 200,000 unvested shares shall be
forfeited, cancelled and become null and void on the Termination Date.

               All vested Stock Options granted to Ruskin under the 2001 Plan are fully exercisable until the
date 90 days after the Termination Date and all unvested Stock Options shall be cancelled on the
date of Termination.

          d. Ruskin agrees that from the Termination Date to and including June 30, 2007, he will be
available to consult with MTI as needed by MTI (the “Consulting Period) in accordance with the
Consulting Agreement attached to this Agreement as Exhibit “A.” Ruskin further agrees, covenants
and represents that during the Consulting Period and thereafter he shall cooperate in good faith
with MTI in the defense of any action that has been or will be brought against MTI that arises out
of, or relates in any way to his employment with MTI. MTI agrees covenants and represents that it
shall indemnify and hold Ruskin harmless to the extent required by law for all that Ruskin
necessarily expends or loses in direct consequence of the discharge of his duties under this
paragraph.

          e. Ruskin and MTI agree, covenant and represent that Ruskin shall not be eligible for, or
entitled to, any benefits of employment other than those specifically identified in this Agreement.

2. General Release And Covenant Not To Sue

          a. Ruskin, for himself and his heirs, assigns, executors, administrators, and agents, past and
present (collectively, the “Ruskin Affiliates”), hereby fully and without limitation releases,
covenants not to sue, and forever discharges MTI and its respective subsidiaries, divisions,
affiliated corporations, affiliated partnerships, parents, trustees, directors, officers,
shareholders, partners, agents, employees, representatives, consultants, attorneys, heirs, assigns,
executors and administrators, predecessors and successors, past and present (collectively, the “MTI
Releasees”), both

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individually and collectively, from any and all rights, claims, demands, liabilities, actions
and causes of action whether in law or in equity, suits, damages, losses, attorneys’ fees, costs,
and expenses, of whatever nature whatsoever, known or unknown, fixed or contingent, suspected or
unsuspected (“Claims”), that Ruskin or the Ruskin Affiliates now have, or may ever have, against
any of the MTI Releasees that arise out of, or are in any way related to: (i) Ruskin’s employment
by MTI or any of the other MTI Releasees; (ii) the termination of Ruskin’s employment by MTI or any
of the other MTI Releasees; and (iii) any transactions, occurrences, acts or omissions by MTI or
any of the other MTI Releasees occurring prior to the Effective Date of this Agreement.

          b. Without limiting the generality of the foregoing, Ruskin specifically and expressly
releases any Claims occurring prior to the Effective Date of this Agreement arising out of or
related to violations of any federal or state employment discrimination law, including the
California Fair Employment and Housing Act; Title VII of the Civil Rights Act of 1964; the
Americans with Disabilities Act; the Age Discrimination In Employment Act; the National Labor
Relations Act; the Equal Pay Act; the Employee Retirement Income Security Act of 1974; as well as
Claims arising out of or related to violations of the provisions of the California Labor Code;
state and federal wage and hour laws; breach of contract; fraud; misrepresentation; common counts;
unfair competition; unfair business practices; negligence; defamation; infliction of emotional
distress; invasion of privacy; assault; battery; false imprisonment; wrongful termination; and any
other state or federal law, rule, or regulation.

3. Older Workers Benefit Protection Act

          a. This Agreement is subject to the terms of the Older Workers Benefit Protection Act of 1990
(the “OWBPA”). The OWBPA provides that an individual cannot waive a right or claim under the Age
Discrimination in Employment Act (“ADEA”) unless the waiver is knowing and voluntary. Pursuant to
the terms of the OWBPA, Ruskin acknowledges and agrees that he has executed this Agreement
voluntarily, and with full knowledge of its consequences.

          b. In addition, Ruskin hereby acknowledges and agrees that: (a) this Agreement has been
written in a manner that is calculated to be understood, and is understood, by him; (b) the release
provisions of this Agreement apply to rights and claims that Ruskin may have under the ADEA,
including the right to file a lawsuit against the Company for age discrimination; (c) the release
provisions of this Agreement do not apply to any rights or claims that Ruskin may have under the
ADEA that arise after the date he executes this Agreement; (d) Ruskin has been advised in writing
to consult with an attorney prior to executing this Agreement; (e) Ruskin shall have a period of 21
days in which to consider the terms of this Agreement prior to its execution; and (f) Ruskin shall
have a period of seven days after execution of this Agreement in which to revoke this Agreement.

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     4. Release Of Unknown Claims

          Ruskin acknowledges that he is aware of and familiar with the provisions of Section 1542 of
the California Civil Code, which provides as follows:

     “A general release does not extend to claims which the creditor
does not know or suspect to exist in his favor at the time of executing the
release, which if known by him or her, must have materially affected his or her
settlement with the debtor.”

Ruskin hereby waives and relinquishes all rights and benefits which he may have under Section 1542
of the California Civil Code, or the law of any other state or jurisdiction, or common law
principle, to the same or similar effect.

     5. Representations And Warranties

          a. Ruskin represents and warrants that he has the capacity and the authority to enter into
this Agreement on his own behalf, to bind all persons and entities claiming through him, and to
release all Claims on behalf of the Ruskin Affiliates.

          b. Ruskin represents and warrants that he has not assigned or transferred any Claims or any
interest in any Claims that he or the Ruskin Affiliates have or may have against any of the MTI
Releasees. Ruskin agrees to defend, indemnify and hold the MTI Releasees harmless from any
liability, claims, demands, damages, expenses, and attorneys’ fees incurred as a result of any
person or entity who successfully asserts such assignment or transfer.

          c. Ruskin represents and warrants that no person, firm, or other entity has asserted,
currently asserts, or to his knowledge will assert a lien or claim of lien with respect to the
Severance Payment provided for in this Agreement. Ruskin represents and warrants that he has the
authority to enter into this Agreement and to bind all persons and entities claiming through him.

          d. Ruskin represents that he has not suffered any work-related injuries while employed by the
Company and accordingly, he has not filed and does not intend to file any claim for workers’
compensation benefits of any type against the Company. Ruskin acknowledges that the Company has
relied upon these representations, and that the Company would not have entered into this Agreement
but for these representations. As a result, Ruskin agrees, covenants, and represents that the
Company may, but is not obligated to, submit this Agreement to the Workers’ Compensation Appeals
Board for approval as a full compromise and release as to any workers’ compensation claims in the
event that Ruskin files such a claim.

     6. Confidentiality and Non-Disparagement

          a. As of the Effective Date, Ruskin agrees, covenants and represents that the facts relating
to the existence of this Agreement, the negotiations leading to the execution of this Agreement,
the terms of this Agreement, and the amounts of the Severance Payment shall be held in confidence,
and shall not be disclosed, communicated

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or divulged to any person other than those who must perform tasks to effectuate this
Agreement, without first obtaining the MTI’s written consent to each disclosure. Notwithstanding
the foregoing, Ruskin may disclose the terms of this Agreement to those persons to whom disclosure
is necessary for the preparation of tax returns and other financial reports, the obtaining of legal
advice, and to whom disclosure is ordered by a court of competent jurisdiction or otherwise
required by law.

          b. Ruskin further agrees, covenants and represents that he shall not take any action or make
any comments that actually or potentially disparage, disrupt, damage, impair, or otherwise
interfere with MTI’s business interests or reputation.

     7. Trade Secrets

          Ruskin acknowledges that he executed a Proprietary Information Agreement and that he shall
continue to be bound by this Proprietary Information Agreement following the termination of his
employment with MTI. A copy of the Proprietary Information Agreement is attached to this Agreement
as Exhibit “B.”

     8. Non-Admission of Liability

          Ruskin agrees, covenants and represents that this Agreement shall not be treated as an
admission of liability by MTI, at any time, for any purpose, and that this Agreement shall not be
admissible in any proceeding between the parties except a proceeding relating to a breach of its
provisions after execution, or a proceeding to obtain approval of the Agreement as a compromise and
release as provided in Paragraph 2(b) of this Agreement

     9. Non-Solicitation

          Ruskin acknowledges that, because of his responsibilities at the Company, he helped to
develop, learned of, and was exposed to the Company’s business strategies, information on customers
and clients, and other valuable proprietary information, and that use or disclosure of such
proprietary information in breach of the Employee’s obligations to the Company would be extremely
difficult to detect or prove. Employee also acknowledges that the Company’s relationships with its
employees are valuable business assets. In light of these facts, Ruskin agrees that he shall not,
for a period of one year following the Termination Date directly or indirectly, solicit, or induce
any executive, administrative, or other employee of the Company, or any of its affiliates,
divisions, or subsidiaries, to leave the Company’s employment.

     10. Arbitration of Disputes

          All disputes between Ruskin (and his attorneys, successors, and assigns) and MTI (and its
affiliates, shareholders, directors, officers, employees, agents, successors, attorneys, and
assigns) relating in any manner whatsoever to Ruskin’s employment with, or the termination of his
employment from, MTI (“Arbitrable Claims”) including, without limitation, all disputes relating to
the validity, interpretation, or

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enforcement of this Agreement, shall be resolved exclusively by arbitration in Orange County,
California, by the Judicial Arbitration & Mediation Services, Inc. (the “JAMS”). Such arbitration
shall be conducted in accordance with the then-existing arbitration rules of JAMS, with the cost of
such arbitration to be borne equally by the parties. The parties to this Agreement, and all who
claim thereunder, shall be (i) conclusively bound by the arbitrator’s decision or award, which
shall not be subject to appeal; and (ii) have the right to have any decision or award rendered in
accordance with this provision entered as a judgment in a court in the State of California or any
other court having jurisdiction. The arbitrator shall have the authority to award or grant legal,
equitable, and declaratory relief. The parties hereby waive any rights they may have to trial by
jury. The Federal Arbitration Act will govern the interpretation and enforcement of this Section
pertaining to arbitration, unless it is found inapplicable in which case California law shall
control.

     11. Successors and Assigns

          This Agreement shall be binding upon and shall inure to the benefit of the respective heirs,
assigns, executors, administrators, successors, subsidiaries, divisions and affiliated corporations
and partnerships, past and present, and trustees, directors, officers, shareholders, partners,
agents and employees, past and present, of Ruskin and MTI.

     12. Ambiguities

          This Agreement has been reviewed by the parties. The parties have had a full opportunity to
negotiate the terms and conditions of this Agreement. Accordingly, the parties expressly waive any
common-law or statutory rule of construction that ambiguities should be construed against the
drafter of this Agreement, and agree, covenant, and represent that the language in all parts of
this Agreement shall be in all cases construed as a whole, according to its fair meaning.

     13. Choice of Law

          This Agreement has been negotiated and executed in the State of California and is to be
performed in Orange County, California. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of California, including all matters of construction,
validity, performance, and enforcement, without regard to California’s conflict of laws rules.

     14. Integration And Modifications

          a. This Agreement, and the Proprietary Information Agreement attached as Exhibits “A” and “B,”
constitute a single, integrated written contract expressing the entire agreement of the parties.
There is no other agreement, written or oral, express or implied, between the parties with respect
to the subject matter hereof.

          b. This Agreement may not be modified orally. This Agreement may only be modified in a
written instrument signed by all parties.

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     15. Severability

          The parties to this Agreement agree, covenant and represent that each and every provision of
this Agreement shall be deemed to be contractual, and that they shall not be treated as mere
recitals at any time or for any purpose. Therefore, the parties further agree, covenant and
represent that each and every provision of this Agreement shall be considered severable, except for
the Release provisions of Sections 2 and 3 of this Agreement. If a court of competent jurisdiction
finds the release provisions of Sections 2 through 4 of this Agreement to be unenforceable or
invalid, then this Agreement shall become null and void, and the Severance Payment paid pursuant to
paragraph 1 shall be returned to MTI within a reasonable period of time, not to exceed 15 days from
the day or the finding that Ruskin violated the terms of the Release. If a court of competent
jurisdiction finds any provision other than the release provisions of Sections 2 through 4, or part
thereof, to be invalid or unenforceable for any reason, that provision, or part thereof, shall
remain in force and effect to the extent allowed by law, and all of the remaining provisions of
this Agreement shall remain in full force and effect and enforceable.

     16. Execution of Counterparts

          This Agreement may be executed in counterparts, and if so executed and delivered, all of the
counterparts together shall constitute one and the same Agreement.

     17. Captions

          The captions and section numbers in this Agreement are inserted for the readers’ convenience,
and in no way define, limit, construe or describe the scope or intent of the provisions of this
Agreement.

     18. Miscellaneous Provisions

          a. The parties represent that they have read this Agreement and fully understand all of its
terms; that they have conferred with their attorneys, or have knowingly and voluntarily chosen not
to confer with their attorneys about this Agreement; that he has executed this Agreement without
coercion or duress of any kind; and that he understands any rights that he has or may have and
signs this Agreement with full knowledge of any such rights.

          b. The parties acknowledge that no representations, statements or promises made by the other
party, or by their respective agents or attorneys, have been relied on in entering into this
Agreement.

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     19. Effective Date

     The Effective Date of this Agreement shall be seven days after Ruskin executes the Agreement
and delivers it to MTI.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement, which consists of 8
pages, on the dates indicated below.

	 	 	 
	RICHARD RUSKIN

	 	MTI TECHNOLOGY CORPORATION
	 
	 	 
	Signature: /s/ Richard L. Ruskin

	 	Signature: /s/ Huan Huynh
	 
	 	 
	Date: 12/1/06

	 	Date: 12/1/06

8

 

Agreement No.        

CONSULTING AGREEMENT

THIS AGREEMENT is made between MTI Technology Corporation (“MTI”), a Delaware corporation, at
17595 Cartwright Rd., Irvine, California and Richard Ruskin an independent consultant,
(“Consultant”).

WHEREAS, Consultant has general experience in the area of service operations management, and
direct experience in the tactical and strategic service operations of MTI.

WHEREAS, MTI in reliance on Consultant’s representations, is willing to engage Consultant as an
independent contractor, and not as an employee.

The parties agree to the following terms and conditions:

	1.0	 	SCOPE OF SERVICES

	 	1.1	 	Consultant will provide consulting services, as directed and requested by MTI in
its sole discretion, in the area of general sales operation management, as described in
Exhibit A.
	 
	 	1.2	 	All work will be performed at MTI’s facilities and/or at specified customer
sites and will be performed in a workmanlike and professional manner by Consultant.
Consultant will at all times observe security and safety policies of MTI, including,
but not limited to, the use of Security I.D. Badges.
	 
	 	1.3	 	The parties acknowledge and agree that MTI has no right to control the manner,
means, or method by which Consultant performs the services called for by this
Agreement. MTI will be entitled only to: (1) direct Consultant with respect to the
elements of the services to be performed by Consultant and the results to be derived by
MTI, (2) to inform Consultant as to where and when such services will be performed, and
(3) to review and assess the performance of the services by Consultant for the limited
purposes of assuring that the services have been performed and confirming that results
are satisfactory.

	2.0	 	TERM OF AGREEMENT

	 	2.1	 	The term of this Agreement is shown in Exhibit B.
	 
	 	2.2	 	Additional assignments may be incorporated into this Agreement by an executed
Addendum to Exhibit A.
	 
	 	2.3	 	The cure period for any failure of MTI to pay fees and charges due will be
forty-five (45) days from the date MTI receives notice.
	 
	 	2.4	 	If this Agreement is terminated for any reason, Consultant will promptly return
to MTI all copies of any MTI data, records, or materials, including all materials
incorporating the propriety information of MTI. Consultant will also furnish to MTI
all work in progress, including all incomplete work.
	 
	 	2.5	 	Within fifteen (15) days of termination of this Agreement for any reason,
Consultant will submit to MTI an itemized invoice for any outstanding fees or expenses
under this Agreement. MTI, upon payment of the amounts invoiced, will have
no further liability or obligation to Consultant.

	3.0	 	FEES

1

 

Agreement No.        

	 	3.1	 	In Consideration of the services to be performed by Consultant, MTI will pay
Consultant the fees shown in Exhibit B.

	4.0	 	RIGHTS IN DATA

	 	4.1	 	Any MTI Work Product will be considered a “work for hire” and will remain the
exclusive property of MTI.

	 	4.2	 	“MTI Work Product” means the ideas, processes methods, programming aids,
reports, programs, manuals, tapes, software, flowcharts, systems or improvements,
enhancements, or modifications, that the Consultant utilizes, produces, develops,
prepares, conceives, makes, or suggest in the performance of the services under this
Agreement, including all related developments originated or conceived during the term
of the Agreement but completed or reduced to practice after termination.

	 	4.4	 	All right, title, and interest in and to any programs, systems, data, and
materials furnished to MTI and/or developed, at private expense, by Consultant outside
the scope of this Agreement are and will remain the exclusive property of Consultant.
These “Consultant Products,” if any are listed in Exhibit “D.”

	5.0	 	PROPRIETARY INFORMATION

	 	5.1	 	Consultant acknowledges that in order to perform the services called for in this
Agreement, it will be necessary for MTI to disclose to Consultant certain Trade Secrets
that have been developed by MTI at great expense and that have required considerable
effort of skilled professionals. Consultant further acknowledges that the Deliverables
will, of necessity, incorporate such Trade Secrets. Consultants agrees that it will
not disclose, transfer, use, copy, or allow access to any Trade Secrets to any
employees or to any third parties, unless they have a need to know and are consistent
with the requirements of this Agreement and have signed a
Confidentiality/Non-Disclosure Agreement shown in Exhibit C.

	 	5.2	 	In no event will Consultant disclose any Trade Secrets to any competitors of
MTI.

	 	5.3	 	The term “Trade Secrets” means any scientific of technical data, information,
design, process, procedure, formula, or improvement that is commercially valuable to
MTI and not generally known in the industry.

	 	5.4	 	The obligation contained in this Section will survive the termination of this
Agreement and continue for as long as the material remains Trade Secrets.

	 	5.5	 	The obligations contained in this Section shall not in any way diminish or
limit Consultant’s obligations and duties under his Proprietary Agreement with
MTI .

	6.0	 	CONFIDENTIALITY OF AGREEMENT; PUBLICITY; USE OF MARKS

	 	6.1	 	Consultant will not disclose the nature of the effort undertaken for MTI or the
terms of this Agreement to any other person or entity, except as many be necessary to
fulfill Consultant’s obligations.
	 
	 	6.2	 	Consultant will not at any time use MTI’s name or any MTI trademark(s) or trade
name(s) in any advertising or publicity without the prior written consent of MTI.

2

 

Agreement No.        

	7.0	 	WARRANTIES

	 	7.1	 	Consultant warrants that:

	 	a.	 	Consultant’s performance of the services and any programs,
systems, data, or materials furnished to MTI under this Agreement will not
violate any applicable law, rule, or regulation; any contracts with third
parties; or any third-part rights in any patent, trademark, copyright, trade
secret; or similar rights.
	 
	 	b.	 	Any and all rights, title, and ownership interest, including
copyright, that Consultant may have in or to a MTI Work Product or any tangible
media embodying a MTI Work Product, as described in Section 4.2, are assigned to
MTI as part of this Agreement.

	8.0	 	LIMITAION OF LIABILITY

	 	8.1	 	Except as provided in Section 8, in no event will either party be liable to the
other for any special, incidental, consequential damages, or lost profits of the other
party.

	9.0	 	ARBITRATION

	 	9.1	 	At the option of either party, any and all disputes regarding this Agreement will
be decided according to the rules and regulation of the American Arbitration
Association.
	 
	 	9.2	 	The arbitrators will be selected as follows: If MTI and Consultant agree on one
arbitrator, that arbitrator will conduct the arbitration. If MTI and Consultant do not
agree, MTI and Consultant will each select one arbitrator and the selected arbitrators
will select the third arbitrator. All three arbitrators will conduct the arbitration.
MTI reserves the right to reject any individual arbitrator employed by or affiliated
with a competing organization.
	 
	 	9.3	 	Arbitration will take place at Orange County, California, or any other location
mutually agreeable to the parties. At the request of either party, arbitration
proceedings will be conducted in secrecy. All documents, testimony and record will be
received, heard and maintained by the arbitrator(s) in secrecy under seal, available
for the inspection only of MTI or Consultant, and their respective attorneys and
experts who agree in advance and in writing to hold the information in secrecy until
the information becomes greatly known.
	 
	 	9.4	 	The arbitrator(s), acting by majority vote, will be able to decree any and all
relief of an equitable nature, including, but now limited to, relief of temporary
retraining order, and/or a temporary or permanent injunction. The arbitrator(s) will
also be able to award damages, with or without an accounting and cost. The decree or
judgment of an award rendered by the arbitrator(s) will be binding and may be entered
in any court having jurisdiction thereof.

	10.0	 	MISCELLANEOUS

	 	10.1	 	This agreement will be governed by substantive laws of the State of California.
	 
	 	10.2	 	The parties are independent contractors to one another. Nothing in this
Agreement creates any agency, partnership, or joint venture between the parties.
Except as expressly provided in this Agreement, MTI will not be liable for any debts,
accounts, obligations, or other liabilities of Consultant, including (without
limitation) Consultant’s obligations to withhold Social Security and income taxes for
itself or any of its employees.

3

 

Agreement No.        

	 	10.3	 	All remedies available to either party for one or more breaches by the other
party are cumulative and may be exercised separately or concurrently without waiver of
any other remedies. The failure of either party to act on a breach of this Agreement
by the other will not be deemed a waiver of the breach or a waiver of future breaches,
unless the waiver is in writing and signed by the party against whom enforcement is
sought.
	 
	 	10.4	 	All notices will be in writing and will be delivered by hand or by registered
or certified mail, postage prepaid, as follows:

	 	 	 
	If to Consultant:

	 	If to MTI:
	 
	 	 
	Richard Ruskin

	 	MTI Technology Corporation
	2 Chelsea Ave. #102

	 	17595 Cartwright Rd
	Long Branch, NJ 07740

	 	Irvine, CA 92614

	 	10.5	 	This Agreement constitutes the entire Agreement between the parties relating to
Consultant’s providing of services to MTI as an independent contractor. This Agreement
may be modified only in writing.

	 	 	 
	CONSULTANT

	 	MTI TECHNOLOGY CORPORATION
	 
	 	 
	/s/ Richard L. Ruskin

	 	/s/ Huan Huynh
	 

	 	 
	Signature

	 	Signature
	 
	 	 
	Richard Ruskin

	 	Huan Huynh
	 

	 	 
	Name

	 	Name
	 
	 	 
	Consultant

	 	VP, Human Resources
	 

	 	 
	Title

	 	Title
	 
	 	 
	12/1/06

	 	12/1/06
	 

	 	 
	Date

	 	Date

4

 

Agreement No.        

Exhibit A

SCOPE OF WORK

Consultant will provide information and conduct research as requested by MTI to assist in the
understanding, development and delivery of the following:

Deliverables

At MTI’s sole discretion, MTI may request that Consultant provide advice as to the development and
implementation of both tactical and strategic service operations for MTI or its subsidiaries.

5

 

Agreement No.        

Exhibit B

FEES

MTI agrees to pay consultant $125 per hour plus expenses per assignment, with the number of
billable hours per assignment to be mutually agreed upon by both MTI and consultant, in writing,
prior to Consultant providing any service relating the respective assignment. MTI retains the
unilateral and sole right to determine if any services are to be requested of the Consultant, and
Consultant agrees not to undertake any actions or provide any services under this Agreement unless
directed to do so by the appropriate representatives of MTI.

PAYMENT TERMS

Upon completion of an assignment, or monthly if the assignment exceeds 30 days, as set forth
in “Exhibit A” and submission of an invoice, the agreed upon amount of the assignment’s billable
hours multiplied at the rate of $125 per hour will be paid on a net 30 days.

TERMS OF AGREEMENT

This agreement is effective beginning October 1, 2006 and terminates June 30, 2007. MTI
agrees that this Agreement will remain in effect for the full term set forth above.

The number of assignments that Consultant will be asked to engage will be solely determined by
MTI. MTI may, at its sole discretion, elect not to engage the Consultant for any assignment
during the term of this Agreement. Unless the Agreement is terminated by the Consultant pursuant
to the terms and conditions as set forth above, Consultant agrees that he will make himself
available to MTI during the term of the Agreement.

6

 

Agreement No.        

Exhibit C

CONFIDENTIALITY/NON-DISCLOSURE AGREEMENT

In consideration of MTI Technology Corporation, a Delaware corporation (herein “MTI”) granting
me to access MTI facilities and information, I agree as follows:

	 	1.	 	As an employee of Consultant, it is my understanding that, pursuant to a
Consulting Agreement between Consultant and MTI Technology Corporation, I will have
access and acquire techniques, know-how, or other information of a confidential nature
concerning MTI experimental and developmental work, trade secrets, secret procedures,
business matters or affairs including, but not limited to, information relating to
ideas, discoveries, inventions, disclosures, processes, methods, systems, formulas,
patents, patent applications, machines, materials, research plans, and activities,
research results, and business marketing information, plans, operations, activities,
and results. I WILL NOT DISCLOSE ANY SUCH INFORMATION TO ANY PERSON OR ENTITY OR USE
ANY SUCH INFORMATION WITHOUT MTI’S PRIOR WRITTEN CONSENT. Information will, for
purposes of this Agreement, be considered to be confidential if not know in the field
generally, even though such information has been disclosed to one or more third parties
pursuant to join research agreements, consulting agreements, or other agreements
entered into by MTI or any of its affiliates. Excluded from the obligations of
confidentiality and non-discloser agreed to herein is information (i) that I can
establish I knew prior to my acquiring it from MTI; (ii) that I receive from a third
party who, when providing it to me, is not under an obligation to MTI to keep the
information confidential; or (iii) that enters the public domain through no fault of
mine.
	 
	 	2.	 	If, as a consequence of my access to MTI facilities or information, I conceive
of or make, alone or with others, ideas, inventions and improvements thereof of
know-how related thereto that relate in any manner to the actual or anticipated
business of MTI, I will assign and do hereby assign to MTI my right, title, and
interest in each of the ideas, inventions and improvements thereof described in this
paragraph. I will, at MTI’s expense, execute, acknowledge, and deliver such documents.
	 
	 	3.	 	I agree that, upon the earlier of the completion of my work for MTI, as an
employee of Consultant or upon the termination of the Consulting Agreement between MTI
and Consultant, I will deliver to MTI (and will not keep in my possession or deliver to
anyone else) any and all devices, records, data, notebooks, notes, reports, proposals,
lists, correspondence, specifications, drawings, blueprints, sketches, materials,
equipment, other documents or property, or reproductions of any aforementioned items
belonging to MTI, its successors or assigns.
	 
	 	4.	 	I agree to execute any proper oath or verify any proper document required to
carry out the terms of this Agreement. I represent that my performance of all the
terms of this Agreement will not breach any agreement to keep in confidence the
proprietary information acquired by me in confidence or in trust prior to my commencing
work for MTI. I have entered into, and I agree I will not enter into, any oral or
written agreement in conflict herewith.
	 
	 	5.	 	This Agreement will be governed by the laws of the State of California.
	 
	 	6.	 	If one or more of the provisions in this Agreement is deemed void by law, then
the remaining provisions will continue in full force and effect
	 
	 	7.	 	This Agreement will be binding upon my heirs, executors, administration and
other legal representatives and will be for the benefit of MTI, its successors, and its
assigns.

7

 

Agreement No.        

	 	8.	 	This Agreement will remain in full force and effect so long as any materials
referred to in paragraph 1 remain trade secrets of MTI.
	 
	 	9.	 	This Agreement does not modify or limit my obligation or duties of Consultant
under the Propriety Information Agreement signed by consultant.

	 	 	 
	 

	 	 
	 

	 	 
	Date

	 	Signature
	 

	 	 
	 

	 	 
	 

	 	 
	Witness

	 	Name

8

 

Agreement No.        

EXHIBIT D

CONSULTANT PRODUCTS

(IF ANY)

9

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