<PAGE>

EXHIBIT 10.3

                        DISCOUNTED LOAN PAYOFF AGREEMENT

THIS DISCOUNTED LOAN PAYOFF AGREEMENT ("Agreement") is entered into as of March
31, 2003, by and among UNION BANK OF CALIFORNIA, N.A., ("Bank"), SVI SOLUTIONS,
INC., ("Borrower"), and SVI RETAIL, INC., SABICA VENTURES, INC., and SVI
TRAINING PRODUCTS, INC., ("Guarantors"), with reference to the following:

                                    RECITALS

A. Bank previously extended credit to Borrower in the amount of $7,359,605.24
evidenced by the following:

         1. Term Loan Note in the original principal amount of $7,359,605.24
         ("Loan") pursuant to the terms of that Amended and Restated Term Loan
         Agreement dated as of June 29, 2001, executed by Borrower and Bank
         ("Loan Agreement"). The Loan is evidenced by that certain Amended and
         Restated Term Loan Note dated as of July 10, 2001 ("Note") as amended
         by that Second Amended and Restated Term Loan Note dated as of July 15,
         2002 ("Amended Note"), executed by Borrower to order of Bank. The Loan
         Agreement was subsequently amended by four separate Amendments to
         Amended and Restated Term Loan Agreement ("Amendments"), dated as of
         March 18, 2002, May 21, 2002, July 15, 2002 and November 15, 2002,
         respectively.

         2. To secure Borrower's obligations to Bank, Borrower executed that
         certain Amended and Restated Security Agreement dated as of July 10,
         2001 ("Solutions Security Agreement") pursuant to which Borrower
         granted Bank a security interest in personal property described therein
         ("Solutions Collateral"). On or about July 13, 2001, Bank perfected its
         security interest in the personal property described in the Solutions
         Security Agreement by, among other things, filing UCC Financing
         Statements with the Delaware Secretary of State as Instrument Numbers
         010339417 and 010339424 (the "Solutions UCC's").

         3. As additional security for the Loan, Sabica Ventures, Inc.
         ("Sabica") executed that certain Amended and Restated Security
         Agreement dated as of July 10, 2001 ("Sabica Security Agreement")
         pursuant to which Sabica granted Bank a security interest in personal
         property described therein ("Sabica Collateral"). On or about July 12,
         2001, Bank perfected its security interest in the personal property
         described in the Sabica Security Agreement by, among other things,
         filing UCC Financing Statements with the California Secretary of State
         as instrument numbers 0119460154 and 0119460159 (the "Sabica UCC's).

         4. As additional security for the Loan, SVI Training Products, Inc.,
         ("Training") executed that certain Amended and Restated Security
         Agreement, dated as of July 10, 2001 ("Training Security Agreement")
         pursuant to which Training granted Bank a security interest in personal
         property described therein.

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         5. As additional security for the Loan, SVI Retail, Inc., ("Retail")
         executed that certain Amended and Restated Security Agreement, dated as
         of July 10, 2001 ("Retail Security Agreement") pursuant to which Retail
         granted Bank a security interest in personal property described
         therein.

         6. As further additional security for the Loan, Borrower, Sabica,
         Retail and Training executed that certain Amended and Restated Pledge
         Agreement, dated as of July 10, 2001 ("Pledge Agreement"), as amended
         by that certain First Amendment to Amended and Restated Pledge
         Agreement ("Amended Pledge Agreement") pursuant to which Borrower,
         Sabica, Retail and Training pledged and granted to Bank a continuing
         first-priority security interest in and to all of the personal property
         described therein.

         7. As further additional security for the Loan, Borrower, Retail,
         Training and Sabica executed that certain Amended and Restated
         Copyright Security Agreement dated as of July 10, 2001 ("Copyright
         Agreement") pursuant to which Borrower, Retail, Training and Sabica
         granted to Bank a security interest in the personal property described
         therein.

         8. As further additional security for the Loan, Borrower, Retail,
         Training and Sabica executed that certain Amended and Restated Patent
         and Trademark Security Agreement dated as of July 10, 2001
         ("Patent/Trademark Agreement") pursuant to which Borrower, Retail,
         Training and Sabica granted to Bank a security interest in the personal
         property described therein.

         9. Pursuant to the Solutions Security Agreement, the Solutions UCC's,
         the Sabica Security Agreement, the Sabica UCC's, the Training Security
         Agreement, the Retail Security Agreement, the Pledge Agreement, the
         Amended Pledge Agreement, the Copyright Agreement and the
         Patent/Trademark Agreement, Bank has a lien on all of the personal
         property described therein.

B. To induce Bank to make the Loan evidenced by the Note available to Borrower,
Guarantors executed and delivered to Bank that certain Amended and Restated
Subsidiary Guaranty dated as of July 10, 2001, guaranteeing the payment and
performance of Borrower's obligations to Bank ("Guaranty").

C. The outstanding principal balance under the Amended Note of $7,065,847.20
together with accrued unpaid interest in the amount of $162,532.88, together
with all accruing interest, fees, costs and expenses provided in the Loan
Documents (defined below), including without limitation, attorneys' and
consultants fees, costs, title fees, and appraisal costs (collectively,
"Obligations") is due and outstanding from Borrower to Bank.

D. On January 2, 2003 Borrower issued a Warrant to Purchase Common Stock of
Borrower (the "Warrant") in favor of Bank with respect to 1,538,997 of
Borrower's Common Stock.

E. This Agreement, the Loan Agreement, the Amendments, the Note, the Amended
Note, the Solutions Security Agreement, the Solutions UCC's, the Sabica Security
Agreement, the Sabica UCC's, the Training Security Agreement, the Retail
Security Agreement, the Pledge Agreement, the Amended Pledge Agreement, the
Copyright Agreement, the Patent/Trademark Agreement, the Guaranty and the
Warrant, and all other documents executed by Borrower, Guarantors and/or Bank in
connection therewith shall be referred to herein as the "Loan Documents". There
are no written or oral agreements concerning or affecting the Loan between
Borrower and/or Guarantors on the one hand and Bank on the other, other than the
Loan Documents. Unless otherwise defined herein, all capitalized terms shall
have the meanings assigned to them in the Loan Documents.

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F. Borrower and Guarantors have proposed that Bank accept $2,800,000 in cash,
together with a $500,000 Promissory Note ("Payment Note") from Borrower, in
addition to 1,000,000 shares of Borrower's restricted common stock, ("Borrower's
Common Stock") as full satisfaction for all remaining Obligations owing under
the Loan and terminate the Obligations upon satisfaction of the requirements as
set forth below. Bank is willing to accept such payment only on the terms set
forth below.

                                    AGREEMENT

NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of
which is hereby acknowledged, the parties hereto agree as follows:

1. INCORPORATION OF RECITALS. All of the foregoing recitals are incorporated
herein by this reference and are true in all material respects.

2. PAYMENT. As full and final settlement of all amounts owed by Borrower to Bank
under the terms of the Loan Documents, Borrower shall, by no later than March
31, 2003 ("Closing Date"):

         (a) Pay to Bank a non-refundable payment of $2,800,000 ("the Discounted
         Payoff Amount");

         (b) Issue in favor of Bank the Payment Note in the principal sum of
         $500,000 in the form of Exhibit "A" attached hereto;

         (c) Cause to be issued to Bank 1,000,000 shares of Borrower's Common
         Stock ("Share Issuance"). The disposition by Bank of the shares subject
         to the Share Issuance shall be subject to Rule 144 of the Securities
         and Exchange Commission. Following the holding period specified in said
         Rule, disposition by Bank of the shares subject to the Share Issuance
         shall be restricted to 83,333 shares per month, with no disposition on
         any single day exceeding 10,000 shares;

         (d) If Borrower fails to perform any one of paragraphs 2(a) through (c)
         above, strictly and absolutely on or before the Closing Date, Bank
         shall be released from its agreement to accept an amount less than full
         payment of the Obligations in satisfaction of the Amended Note; and

         (e) Nothing contained herein shall constitute an admission by Bank as
         to the value of any collateral held by Bank pursuant to the Loan
         Documents. This Agreement is executed by Bank with an express
         reservation of rights by Bank to present evidence in any proceeding as
         to the value of any such collateral if the Closing does not occur.
         Nothing contained in this Agreement shall be deemed or construed to be
         an admission by Bank that Bank is adequately protected in any
         bankruptcy proceeding or in any other proceeding.

3. FORM OF PAYMENT

         (a) The Discounted Payoff Amount shall be made by wire transfer.

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         (b) Payments made by wire transfer shall be executed using the
         following instructions:

                           Union Bank of California, N.A.
                           601 Portrero Grande
                           Monterey Park, California  91755-7417
                           Attn: Commercial Loan Operations
                           ABA #122000496
                           Acct. #77-070-196431
                           Borrower Loan #8802802084

         Payments made by wire transfer shall be considered made when received
         by Bank addressed, with confirmation by 12:00 Noon, California time,
         and transferred as set forth above and Bank has received final
         settlement therefor.

4. CONDITIONS PRECEDENT. The effectiveness of this Agreement is subject to
Borrower's satisfaction of each and every one of the following conditions on or
before March 31, 2003, unless waived by Bank in its sole discretion:

         (a) Borrower and Guarantors each shall have duly executed and delivered
         this Agreement to Bank;

         (b) Borrower shall have paid Bank the Discounted Payoff Amount;

         (c) Borrower shall have executed and delivered to Bank the Payment
         Note; and

         (d) Borrower shall have delivered to Bank stock certificates properly
         endorsed representing the Share Issuance.

         (e) Borrower shall have reimbursed Bank for Bank's costs and expenses,
         including, without limitation, reasonable attorneys' fees and expenses
         (including the fees of Bank's inside counsel), incurred in connection
         with Bank's enforcement of Borrower's obligations, and consultant's
         fees under the Loan Documents, in the amount of $24,000.00; and

5. CANCELLATION OF AMENDED NOTE, THE WARRANT, AND TERMINATION OF SECURITY
INTEREST. Concurrently with Borrower's satisfaction of the requirements set
forth in paragraphs 4(a) through (e) of this Agreement, (a) Bank shall mark the
Amended Note and the Warrant as canceled, deliver the Amended Note and the
Warrant to Borrower and terminate all its rights and its security interests
under the Loan Documents, (b) Bank appoints the Chief Executive Officer of
Borrower as its attorney-in-fact to execute such documents as may be necessary
to give effect to the foregoing, and (c) Bank shall deliver to Borrower all
collateral held by Bank pursuant to the Loan Documents including without
limitation the Borrower's Common Stock held in pledge. Bank represents and
warrants to Borrower that Bank has not sold, assigned, encumbered, or otherwise
transferred all or any rights in any of the Loan Documents or any collateral
held by Bank under the Loan Documents.

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6. REAFFIRMATION OF LOAN DOCUMENTS. Except as expressly provided herein, Bank's
execution of this Agreement shall not result in the waiver of any terms under
the Loan Documents, the obligations, covenants, representations and warranties
of which are reaffirmed in their entirety by Borrower and Guarantors if the
Closing does not occur.

7. DEFAULT. Failure by Borrower or Guarantors to perform all terms and
conditions contained in this Agreement shall constitute a default hereunder and,
at the option of Bank, this Agreement shall be of no further force and effect.

8. AUTHORITY. Bank, Borrower and Guarantors each hereby represent and warrant
that each has full power and authority to execute this Agreement and all
documents referred to herein and to undertake and consummate the transactions
contemplated hereby.

9. EXECUTION OF DOCUMENTS AND INSTRUMENTS. Borrower and Guarantors each shall
execute such other and further documents and instruments and take all other
actions as may be reasonable, necessary or convenient, as and when requested by
Bank to accomplish the purpose and intent of this Agreement.

10. EXECUTION OF DOCUMENTS AND INSTRUMENTS. Bank shall execute such other and
further documents and instruments and take all other actions as may be
reasonable, necessary or convenient, as and when requested by Borrower and
Guarantors to accomplish the purpose and intent of this Agreement.

11. REPRESENTATION BY COUNSEL. The parties have retained counsel (or have had
the opportunity to retain counsel) to represent them in the transactions
contemplated herein; the parties have read and understand this Agreement; and
the parties have been advised by their respective counsel with respect to their
rights and obligations under this Agreement.

12. RELEASE. Effective upon the Closing Borrower and Guarantors , their
successors, heirs, executors, administrators, officers, agents, employees,
directors, beneficiaries and assigns (collectively, "Releasor Parties"), hereby
release, acquit and forever discharge Bank, its directors, officers, employees,
agents, affiliates, predecessors, successors, administrators and assigns
(collectively, "Releasee Parties"), of and from any and all claims, actions,
causes of action, demands, rights, damages, costs, loss of service, expenses and
compensation whatsoever which Releasor Parties might have because of anything
done, omitted to be done, or allowed to be done by any of Releasee Parties and
in any way connected with any of the Loan Documents or any of Borrower's or any
Guarantor's obligations thereunder as of the date of execution of this
Agreement, WHETHER KNOWN OR UNKNOWN, FORESEEN OR UNFORESEEN, including without
limitation any settlement negotiations and any damages and the consequences
thereof resulting or to result from the events described, referred to or
inferred hereinabove (collectively, "Released Matters"). Releasor Parties
further agree never to commence, aid or participate in (except to the extent
required by order or legal process issued by a court or governmental agency of
competent jurisdiction) any legal action or other proceeding based in whole or
in part upon the foregoing. In furtherance of this general release, Releasor
Parties acknowledge and waive the benefits of California Civil Code Section 1542
(and all similar ordinances and statutory, regulatory, or judicially created
laws or rules of any other jurisdiction) which provides:

                  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 MUST HAVE
                  MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

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Releasor Parties agree that this waiver and release is an essential and material
term of this Agreement and that the agreements in this Section are intended to
be in full satisfaction of any alleged, known, or unknown injuries or damages in
connection with the Released Matters. Releasor Parties represent and warrant
that they have not purported to convey, transfer or assign any right, title or
interest in any Released Matter to any other person or entity and that the
foregoing constitutes a full and complete release of the Released Matters.
Releasor Parties also understand that this release shall apply to all unknown or
unanticipated results of the transactions and occurrences described above, as
well as those known and anticipated. Releasor Parties have consulted with legal
counsel prior to signing this release, or have had an opportunity to obtain such
counsel and knowingly chose not to do so, and execute such release voluntarily,
with the intention of fully and finally extinguishing all Released Matters.

13. RELEASE. Effective upon the Closing Bank, its successors, officers, agents,
employees, directors, beneficiaries and assigns (collectively, "Releasor
Parties"), hereby release, acquit and forever discharge Borrower and Guarantors,
their respective directors, officers, employees, agents, affiliates,
predecessors, successors, administrators and assigns (collectively, "Releasee
Parties"), of and from any and all claims, actions, causes of action, demands,
rights, damages, costs, loss of service, expenses and compensation whatsoever
which Releasor Parties might have because of anything done, omitted to be done,
or allowed to be done by any of Releasee Parties and in any way connected with
any of the Loan Documents or any of Borrower's or any Guarantor's obligations
thereunder as of the date of execution of this Agreement, WHETHER KNOWN OR
UNKNOWN, FORESEEN OR UNFORESEEN, including without limitation any settlement
negotiations and any damages and the consequences thereof resulting or to result
from the events described, referred to or inferred hereinabove (collectively,
"Released Matters"). Releasor Parties further agree never to commence, aid or
participate in (except to the extent required by order or legal process issued
by a court or governmental agency of competent jurisdiction) any legal action or
other proceeding based in whole or in part upon the foregoing. In furtherance of
this general release, Releasor Parties acknowledge and waive the benefits of
California Civil Code Section 1542 (and all similar ordinances and statutory,
regulatory, or judicially created laws or rules of any other jurisdiction) which
provides:

                  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 MUST HAVE
                  MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

Releasor Parties agree that this waiver and release is an essential and material
term of this Agreement and that the agreements in this Section are intended to
be in full satisfaction of any alleged, known, or unknown injuries or damages in
connection with the Released Matters. Releasor Parties represent and warrant
that they have not purported to convey, transfer or assign any right, title or
interest in any Released Matter to any other person or entity and that the
foregoing constitutes a full and complete release of the Released Matters.
Releasor Parties also understand that this release shall apply to all unknown or
unanticipated results of the transactions and occurrences described above, as
well as those known and anticipated. Releasor Parties have consulted with legal
counsel prior to signing this release, or have had an opportunity to obtain such
counsel and knowingly chose not to do so, and execute such release voluntarily,
with the intention of fully and finally extinguishing all Released Matters.

                                     Page 6
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Notwithstanding anything to the contrary, this paragraph 13 shall be deemed void
AB INITIO if Borrower or Maker, at any time within 90 days of the Closing,
become a "debtor" as defined in 11 U.S.C. Section 101, or any successor statute
(unless, in the case of a petition filed against Borrower or any Guarantor, such
petition is dismissed within 90 days after its original filing).

14. ATTORNEYS' FEES. In the event of any action in relation to the enforcement
of the terms of this Agreement, the prevailing party, in addition to all other
sums to which it may be entitled, shall be entitled to reasonable attorneys'
fees and costs incurred in connection therewith.

15. TIME OF THE ESSENCE. Time is of the essence with respect to any act, payment
or performance required under the terms of this Agreement.

16. HEADINGS. The headings in this Agreement are for purposes of reference only
and shall not limit or otherwise affect the terms of this Agreement.

17. CONSTRUCTION. This Agreement constitutes the product of the negotiation of
the parties hereto, and the enforcement hereof shall be interpreted in a neutral
manner and not more strongly for or against any party based upon the source of
the draftsmanship hereof.

18. COUNTERPARTS. This Agreement may be executed in counterparts, each of which,
when so executed, shall be deemed an original, but all such counterparts shall
constitute one and the same agreement.

19. WAIVER OF JURY TRIAL. BORROWER AND EACH GUARANTOR HEREBY EXPRESSLY,
KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A
TRIAL BY JURY WITH RESPECT TO ANY LITIGATION BASED HEREON, OR ARISING OUT OF OR
IN CONNECTION WITH THIS AGREEMENT OR THE LOAN DOCUMENTS, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF
ANY OF THE PARTIES TO THIS AGREEMENT. THIS PROVISION IS A MATERIAL INDUCEMENT TO
BANK EXECUTING THIS AGREEMENT.

INITIALS OF BORROWER _______         INITIALS OF GUARANTORS _____  _____  _____

20. LIMITATION ON RELATIONSHIP. This Agreement and the other Loan Documents
shall not be deemed or construed to create a partnership, tenancy in common,
joint tenancy, joint venture, co-ownership or any other relationship aside from
a continuing debtor-creditor relationship between Borrower and Guarantors, on
the one hand, and Bank, on the other.

21. REVERSAL OF PAYMENTS. If Bank receives any payments or proceeds of the
Collateral which are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be paid to a trustee,
debtor-in-possession, receiver or any other party under any bankruptcy law,
common law, equitable cause or otherwise, then, to such extent, the obligations
or part thereof intended to be satisfied by such payments or proceeds shall be
reserved and continue as if such payments or proceeds had not been received by
Bank.

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22. INTEGRATED AGREEMENT. This Agreement and any agreement referred to herein
constitute a single, integrated written contract expressing the entire agreement
among the parties hereto relative to the subject matter hereof and shall not be
amended except by a writing signed by all parties. No covenants or agreements of
any kind whatsoever concerning the subject matter hereof have been made by any
party except as specifically set forth in this Agreement and the prior Loan
Documents. Each party has had an opportunity to make any inquiry or
investigation regarding the subject matter of this Agreement which it believes
desirable. This Agreement has been carefully read by, the contents are known and
understood by, and it is signed freely by each party.

IN WITNESS WHEREOF, Borrower, Guarantors and Bank have executed this Agreement
as of the date set forth hereinabove.


"BORROWER"                                 "BANK"

SVI SOLUTIONS, INC.                        UNION BANK OF CALIFORNIA, N. A.

By: /s/ BARRY SCHECHTER                    By: /s/ JEAN PIERRE KNIGHT
    -------------------------                  ---------------------------
                                                   JEAN PIERRE KNIGHT
Title: CHIEF EXECUTIVE                     Title:    Vice President
      ----------------------                      ------------------------

By:
    ------------------------

Title:
      ----------------------

"GUARANTORS"

SVI RETAIL, INC.

By: /s/ BARRY SCHECHTER
    ------------------------

Title: CHIEF EXECUTIVE
       ---------------------

By: ________________________

Title: _____________________

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SABICA VENTURES, INC.

By: /s/ BARRY SCHECHTER
    -------------------------

Title: CHIEF EXECUTIVE
      ----------------------

By: ________________________

Title: _____________________


SVI TRAINING PRODUCTS, INC.

By: /s/ BARRY SCHECHTER
    ------------------------

Title: DIRECTOR
      ----------------------

By: ________________________

Title: _____________________

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