ROBERT E. OPERA State Bar No. 101182 RICHARD H. GOLUBOW State Bar No.

o. 160434 WINTHROP COUCHOT PROFESSIONAL CORPORATION 660 Newport Center Drive, Fourth Floor Newport Beach, CA 92660 Telephone: (949) 720-4100 Facsimile: (949) 720-4111 Proposed General Insolvency Counsel for the Committee of Creditors Holding Unsecured Claims

ELECTRONICALLY FILED

UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA SANTA ANA DIVISION In re MTI TECHNOLOGY CORPORATION, a Delaware corporation, Debtor. Case No. 8:07-13347 ES Chapter 11 Proceeding [No Hearing Set]

NOTICE TO CREDITORS AND PARTIES IN INTEREST OF FILING OF APPLICATION OF COMMITTEE OF CREDITORS HOLDING UNSECURED CLAIMS FOR AUTHORITY TO EMPLOY CORPORATE RECOVERY SERVICES AS ITS BUSINESS AND FINANCIAL ADVISORS TO THE OFFICE OF THE UNITED STATES TRUSTEE, CREDITORS, AND PARTIES IN INTEREST: PLEASE TAKE NOTICE that the Committee of Creditors Holding Unsecured Claims (Committee) has filed its Application with the Court seeking an order authorizing it to employ Corporate Recovery Associates as the Committees business and financial advisors. In support of the Application, the Committee respectfully represents and alleges as follows: 1. On October 15, 2007 (Petition Date), Debtor MTI Technology Corporation (Debtor) filed in this Court a petition for relief under Chapter 11 of the Bankruptcy Code. Since the Petition Date, the Debtor has acted as a debtor-in-possession pursuant to Sections 1107 and 1108 of the Bankruptcy Code. 2. On October 26, 2007, the Office of the United States Trustee (U.S. Trustee) gave notice of the appointment of the Committee to serve as the duly authorized committee of creditors holding unsecured claims with respect to the Debtors case. 3. The Committee desires to employ Corporate Recovery Associates (Corporate Recovery) as the Committees business and financial advisors for the purposes described in the Application and herein. 4. Corporate Recovery is comprised of business and financial advisors with extensive experience providing financial consulting services for financially-distressed businesses and official creditors committees in bankruptcy proceedings. Richard Feferman, a principal of Corporate Recovery, has more than 12 years consulting experience regarding companies in transition including debt restructurings, financial and operational turnarounds, and in bankruptcies, and with respect to sales, refinancings and recapitalizations of financially-distressed businesses. A copy of Corporate Recoverys rsum is attached as Exhibit 1 to the Feferman Declaration filed in support of the Application. 5. The Committee requires the services of Corporate Recovery for the following purposes:
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A. To provide to the Committee advice with respect to the Debtors ongoing business operations; B. To assist the Committee in investigating the assets, liabilities and financial condition of the Debtor and its insiders and affiliates; C. To assist the Committee in evaluating reorganization strategies and alternatives; D. To provide consulting services and expert witness testimony regarding confirmation issues, avoidance actions or other matters, if necessary; and E. Perform such other services that require financial, operational or business expertise that the Committee may require of Corporate Recovery in connection with this Chapter 11 case. 6. The Committee will indemnity, defend and hold Corporate Recovery and its officers, owners, directors, agents, representatives and employees harmless from and against any and all claims, damages, losses, and liabilities made against or incurred by Corporate Recovery, including, without limitation, any attorneys fees and costs (Liabilities), to the fullest extent allowed by applicable law, arising from the performance of Corporate Recoverys services pursuant hereto. The foregoing indemnification will not extend to liabilities resulting from any gross negligence or willful misconduct by Corporate Recovery, or by its officers, owners, directors, agents, representatives or employees. 7. Corporate Recovery has not received any retainer for its services in this case. Corporate Recovery will render services to the Committee at Corporate Recoverys regular hourly billing rates, which may be subject to adjustment in the future. A list of Corporate Recoverys hourly billing rates is set forth in the Feferman Declaration. 8. By the Application, Corporate Recovery requests that it be authorized to obtain from the Debtor payment of Corporate Recoverys accruing fees and costs on a monthly basis. On October 26, 2007, the Debtor filed its Motion for Order Establishing Procedures for Interim Compensation and Reimbursement of Expenses of Professionals Employed at the Expense of the Bankruptcy Estate (Compensation Procedures Motion). Pursuant to the Compensation Procedures Motion, the Debtor has requested that the Court enter an order authorizing and establishing procedures for the monthly compensation and reimbursement of all Court-appointed professionals in accordance with the following material terms and conditions: a. Retained professionals may seek monthly payment of their fees and expenses by filing and serving on certain parties specified in the Compensation Procedures Motion a statement of the professionals fees and expenses (Monthly Professional Fee Statement). b. Any creditors or party-in-interest will have the right to oppose the payment of the fees and expenses requested in the Monthly Professional Fee Statement. If no objection to the Monthly Professional Fee Statement is filed within ten days after the service of the Monthly Professional Fee Statement, to the extent that a pre-petition retainer has been paid, the professional may draw down from the retainer 100% of the professionals fees and 100% of the professionals costs requested in the Monthly Professional Fee Statement. If no pre-petition retainer has been paid or if a pre-petition retainer has been exhausted, the professional may be paid 80% of the professionals fees and 100% of the professionals expenses requested in the Monthly Professional Fee Statement. c. Pursuant to the Compensation Procedures Motion, any interim compensation paid to a professional is not allowed by the Court, but remains subject to Court approval of subsequently filed fee applications. Corporate Recovery hereby adopts and incorporates the compensation procedures set forth in the Compensation Procedures Motion and requests that payment of Corporate Recoverys fees and reimbursement of its expenses be paid in accordance therewith. 9. Corporate Recovery respectfully submits that the proposed monthly compensation procedures described in the Compensation Procedures Motion are justified on the grounds that the Debtors case is a complicated mega case that is proceeding at an extremely rapid pace. The Debtor has filed numerous emergency motions in this case. The Debtor has scheduled for November 20, 2007 a hearing on its motion to sell and to assign its interests in its European subsidiaries and is attempting to sell its domestic business segments, and anticipates that such sales will be concluded in or before December 2007. Since the Committees engagement of Corporate Recovery on October 26, 2007, Corporate Recovery has been required to devote substantial time to evaluating the Debtors business and financial
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affairs, the numerous proceedings filed by the Debtor in this case and the prospects for recovery by general unsecured creditors in this case. Corporate Recovery anticipates that it will be required to continue to devote substantial time to representing the interests of general unsecured creditors in the Debtors case through at least the closing of the sale transactions in the Debtors case. In effect, by reason of the fast track on which this case is proceeding, Corporate Recovery has been and will continue to be required to devote to this case a substantial amount of time during an approximately two-month period, a very compressed period of time relative to most other Chapter 11 cases. Based upon the foregoing, requiring that the Committees counsel wait for periods in excess of 120 days to obtain any compensation in this case would be imposing a severe and unnecessary hardship on the Committees financial advisor. Under such circumstances, the Committees financial advisor effectively would be required to finance the administration of the Debtors case, at its financial risk. The Committee respectfully submits that a monthly payment arrangement, in accordance with the provisions of the Compensation Procedures Motion, is necessary to ameliorate the financial hardships that otherwise would be imposed upon the Committees financial advisor in this case. 10. Corporate Recovery understands that its compensation in the Debtors case will be subject to the approval of the Court. No funds paid to Corporate Recovery pursuant to the proposed monthly payment procedure will be deemed to be allowed by the Court. All funds paid to Corporate Recovery pursuant to the proposed monthly payment procedure will be subject to allowance by the Court, upon appropriate application and noticed hearing. 11. As set forth in the Compensation Procedures Motion, approximately every four (4) months, Corporate Recovery will file an application with the Court seeking allowance of its fees and costs incurred to that date and paid pursuant to such monthly payment procedure. 12. At the conclusion of this case, Corporate Recovery will file an appropriate application seeking final allowance of all fees and costs, regardless of whether interim compensation has been paid to Corporate Recovery. Upon allowance of such fees and costs, the Debtor will pay to Corporate Recovery the difference between the amounts allowed to Corporate Recovery and any interim compensation paid to Corporate Recovery. 13. No portion of the funds paid to Corporate Recovery pursuant to the proposed monthly payment procedure will be deemed to have been allowed by the Court unless and until such time as the Court enters an order expressly allowing such fees and costs in accordance with the requirements of Sections 330 and 331 of the Bankruptcy Code. Corporate Recovery understands and agrees that any compensation to be received hereafter by Corporate Recovery is subject to approval by this Court, upon appropriate application and hearing in conformity with Sections 330 and 331 of the Bankruptcy Code. 14. As disclosed in the Feferman Declaration, to the best of Corporate Recoverys knowledge, neither Corporate Recovery nor any of the financial advisors comprising or employed by it, have any other connection with the Debtor, nor does Corporate Recovery have any other connection with the Debtors creditors, or any party-in-interest, or their respective attorneys or accountants. Corporate Recovery is a disinterested person within the meaning of Section 101(14) of the Bankruptcy Code. Furthermore, Corporate Recovery does not have an interest adverse to the Debtors estate in accordance with the provisions of Section 327 of the Bankruptcy Code. Corporate Recovery is not a creditor of the Debtors estate and is not owed any funds by the Debtor. 15. As set forth in the Feferman Declaration, none of the professionals comprising or employed by Corporate Recovery is related to any judge of the United States Bankruptcy Court for the Central District of California, the U.S. Trustee, or to any person employed by the U.S. Trustee. 16. Corporate Recovery has not agreed to share with any person or entity any compensation received by the Corporate Recovery in the Debtors case, except as among the members of Corporate Recovery.

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IF YOU DO NOT OPPOSE THE APPLICATION DESCRIBED ABOVE, YOU NEED TAKE NO FURTHER ACTION. HOWEVER, IF YOU OBJECT TO THE APPLICATION, PURSUANT TO LOCAL BANKRUPTCY RULE 9013-1(g)(1)(H), OBJECTIONS MUST BE FILED WITH THE COURT WITHIN FIFTEEN (15) DAYS OF THE DATE OF SERVICE OF THIS NOTICE. YOU MUST FILE YOUR OBJECTION AND REQUEST FOR A HEARING WITH THE CLERK OF THE UNITED STATES BANKRUPTCY COURT, LOCATED AT 411 WEST FOURTH STREET, SANTA ANA, CA 92701. YOU MUST SERVE A COPY OF YOUR OBJECTION TO THE APPLICATION, AND REQUEST FOR A HEARING, UPON THE COMMITTEES PROPOSED COUNSEL AT THE MAILING ADDRESS INDICATED IN THE UPPER LEFT CORNER OF THIS NOTICE, AND UPON THE OFFICE OF THE UNITED STATES TRUSTEE LOCATED AT 411 WEST FOURTH STREET, SUITE 9041, SANTA ANA, CA 92701. UPON RECEIPT OF A WRITTEN OBJECTION AND REQUEST FOR A HEARING, THE DEBTORS COUNSEL WILL OBTAIN A HEARING DATE AND GIVE APPROPRIATE NOTICE THEREOF. ANY FAILURE TO TIMELY FILE AND SERVE OBJECTIONS MAY RESULT IN ANY SUCH OBJECTIONS BEING WAIVED. DATED/SERVED: November 20, 2007 WINTHROP COUCHOT PROFESSIONAL CORPORATION

By: /s/ Richard H. Golubow Robert E. Opera Richard H. Golubow Proposed General Insolvency Counsel for the Committee

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CERTIFICATE OF SERVICE I, Jeannie Martinez, declare as follows: I am employed in the County of Orange, State of California; I am over the age of eighteen years and am not a party to this action; my business address is 660 Newport Center Drive, Fourth Floor, Newport Beach, California 92660, in said County and State. On November 20, 2007 I served the following document: NOTICE TO CREDITORS AND PARTIES IN INTEREST OF FIING OF APPLICATION OF COMMITTEE OF CREDITORS HOLDING UNSECURED CLAIMS FOR AUTHORITY TO EMPLOY CORPORATE RECOVERY SERVICES AS ITS BUSINESS AND FINANCIAL ADVISORS on each of the interested parties stated on the attached service list SEE ATTACHED SERVICE LIST by the following means of service:

BY MAIL: I placed a true copy in a sealed envelope addressed as indicated above, on the abovementioned date. I am familiar with the firm's practice of collection and processing correspondence for mailing. It is deposited with the U.S. Postal Service on that same day in the ordinary course of business. Under that practice it would be deposited with the U.S. Postal Service on that same date with postage thereon fully prepaid at Newport Beach, California in the ordinary course of business I am aware that on motion of party served, service is presumed invalid if postal cancellation date or postage meter date is more than one day after date of deposit for mailing in affidavit. I am employed in the office of Winthrop Couchot Professional Corporation; Richard H. Golubow is a member of the bar of this court. (FEDERAL) I declare under penalty of perjury that the foregoing is true and correct.

Executed on November 20, 2007, at Newport Beach, CA

/s/ Jeannie Martinez Jeannie Martinez

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SERVICE LIST

MTI Technology Corporation Attn: Thomas P. Raimondi, Jr., Pres. & CEO 15641 Red Hill Avenue, Suite 200 Tustin, CA 92780 Debtors Counsel Clarkson, Gore & Marsella, SPLC Scott C Clarkson, Esq. 3424 Carson St Ste 350 Torrance, CA 90503 Committee Members EMC Corporation, FedEx Custom Critical Steven D. Saas, Esq. c/o RMS 307 International Circle, #270 Hunt Valley, MD 21030 Committee Member Wade Saadi Pencom Systems, Inc. 40 Fulton Street, 18th Fl. New York, NY 10038-5058 Committee Member Mid Atlantic Corp. Services, Inc. Michael Buston 812 Oregan Ave., #H Limphicum, MD 21090 The Canopy Group c/o Snell & Wilmer Michael B. Reynolds, Esq. Eric S. Pexold 600 Anton blvd., #1400 Costa Mesa, CA 92626 11/2/07 RSN

U.S. Trustees Office Frank Cadigan, Esq. 411 West Fourth Street, #9041 Santa Ana, CA 92701

MTI Tech Special Notice List Document No. 119553

Securities & Exchange Commission 5670 Wilshire Blvd., 11th Fl. Los Angeles, CA 90036

Committee Member Neoscale Systems, Inc. Andrew Moley/Janet Cahill 1655 McCarthy Blvd. Milpitas, CA 95035 Committee Member CCS Computer Configuration Services Al Crasso 2532 White Road Irvine, CA 92614
RSN 10/31/07 American Express Travel Related Svcs Co. c/o Becket & Lee LLP Gilbert B. Weisman, Esq. PO Box 3001 Malvern, PA 19355-0701

Committee Member Compnology, Inc. John S. Cronin 6300 Station Mill Dr. Norcross, GA 30092 Committee Member Lifeboat Distribution, Inc. Kevin Scull 1157 Shrewsbury Ave. Shrewsbury, NJ 07720 Rockwell Collins, Inc. 11/2/07 RSN McKenna, Long & Aldridge LLP Gary W. Marsh, Esq. One Peachtree Center 303 Peachtree St., #5300 Atlanta, GA 30308 RSN 11/6/07 Missouri Department of Revenue Bankruptcy Unit Attn: Sheryl L. Moreau PO Box 475 Jefferson City, MO 65105-0475

The Canopy Group Snell & Wilmer LLP Michael R. Johnson, Esq. Gateway Tower West 15 West South Temple, Suite 1200 Salt Lake City, UT 84101

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