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EXHIBIT 10.17


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SVI, INC.
DEVELOPMENT AGREEMENT

This DEVELOPMENT AGREEMENT ("Agreement") is entered into as of this 29th day of
May, 2002 ("Effective Date"), between SVI SOLUTIONS, INC. ("SVI"), a Delaware
corporation located at 5607 Palmer Way, Carlsbad, CA 92008, on behalf of itself
and its subsidiaries (collectively "SVI"), and Toys "R" Us, Inc. ("Customer"), a
Delaware corporation located at 461 From Road, Paramus, NJ, 07652.

This Agreement sets forth the terms and conditions by which SVI will license,
develop and install Software and provide other Professional Services to
Customer. Any capitalized terms in this Agreement shall have the same meaning as
defined in this Agreement, including the Exhibits attached hereto.

This Agreement consists of this document and the following exhibits that are
incorporated herein by reference (the "Exhibits").

Exhibits

1        Professional Services and Module Delivery Schedule

2        Allocated Resources

3        Documentation

4        SVI's Standard Professional Rates

5        Services

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1.       EFFECTIVE DATE, TERM AND TERMINATION:

         1.1      The effective date ("Effective Date") of this Agreement shall
                  be the date first above written.

         1.2      The term of this Agreement ("Term") commences on the Effective
                  Date, and unless the Agreement is terminated pursuant to
                  Section 1.3 or 1.4, it shall continue in force until
                  "Completion Date" (as defined in Section 3.2).

         1.3      Each party may terminate this Agreement (effective immediately
                  upon written notice) if the other party materially breaches
                  any provision of this Agreement if such breach continues and
                  is not cured within [***].

         1.4      Customer may terminate this Agreement during the Term (a) upon
                  written notice to SVI [***].

         1.5      After expiration or termination of this Agreement for any
                  reason, other than related to Customer's breach, SVI shall
                  promptly deliver any partially-created Deliverable that exists
                  as of the expiration or termination date; provided that
                  Customer pays SVI all amounts then due SVI. Upon delivery,
                  such Deliverable shall be considered a "Deliverable" for all
                  purposes hereunder.

         1.6      Subject to each party's rights, remedies and defenses relating
                  to any breach by the other party, the provisions of Sections
                  1.5, 1.6, 6 (with respect to Deliverables delivered in the
                  Term, subject to Section 1.5), 9.1 (with respect to fees
                  accrued prior to expiration or termination), 9.3, 12.2(a),
                  12.3-12.7, 14-33 shall survive expiration or termination of
                  this Agreement (including the Revenue Sharing Term in Section
                  17.1) for any reason.

2.       DEFINITIONS:

         2.1      "AFFILIATE" means any person or entity that (i) controls, or
                  is under common control with, or is controlled by, Customer,
                  or (ii) has entered into an agreement with Customer (including
                  without limitation a joint venture agreement) for the purpose
                  of conducting Licensed Toys "R" Us Operations. As used in this
                  definition, "control" means an equity ownership of at least
                  fifty (50) percent.

         2.2      "ALLOCATED RESOURCES" means such qualified personnel of SVI
                  that are necessary to enable SVI to perform all Professional
                  Services hereunder in a competent and timely manner, but which
                  shall not be utilized exclusively to Professional Services.
                  The current list of Allocated Resources is set forth on
                  Exhibit 2 hereto.

         2.3      "DELIVERABLES" shall mean such Software and related
                  Documentation that SVI is required to deliver to Customer
                  under this Agreement.

         2.4      "DOCUMENTATION" shall mean such documentation in any form or
                  media that SVI reasonably determines is necessary or desirable
                  to enable Customer to use the Software and/or any available
                  Updates thereto, including without limitation the
                  documentation described on Exhibit 3 hereto.


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         2.5      "LICENSED TOYS "R" US OPERATIONS" means any retail operations
                  by a third party authorized to use the "Toys "R" Us" brand
                  name, or any other store name or trade name used by Customer
                  or an Affiliate, whether in English or a different language.

         2.6      "PROFESSIONAL SERVICES" shall be the types of services offered
                  by SVI as described in Section 3.1 below.

         2.7      "SOFTWARE" shall mean the software and related items as
                  described in Exhibit 1 and delivered to Customer under this
                  Agreement.

         2.8      "UPDATES"H shall mean modifications, debugging, fixes,
                  updates, upgrades, enhancements, improvements and derivative
                  works to the Software, which shall be included in the
                  definition of "Software" hereunder upon delivery of such
                  Updates to Customer.

3.       OBLIGATIONS OF SVI:

         3.1      SVI will provide Customer with the Allocated Resources which
                  SVI determines to be reasonably necessary based on its prior
                  experience for the purpose of developing the Software by the
                  dates specified in Exhibit 1 and performing SVI's customary
                  services for Customer or its employees concerning the use of
                  the Software. The customary services provided by SVI include,
                  but are not limited to the services listed on Exhibit 5
                  hereto, training applicable Customer's employees, answering
                  Customer's questions via teleconference and e-mail, and
                  producing work product reasonably consistent with producing
                  the Software and as reasonably requested by Customer to
                  document the results of visits, sessions or teleconferences
                  within the scope and in the manner customarily provided by SVI
                  to comparable customers (such services to be performed
                  hereunder, the "Professional Services"). SVI shall exercise
                  its commercially reasonable best efforts in providing such
                  services.

         3.2      SVI shall meet all deadlines and delivery dates specified on
                  Exhibit 1 hereto, and as later agreed by the parties, with
                  respect to all Software and Updates, except to the extent
                  delay is caused by Customer, its employees, agents, officers,
                  Affiliates or Licensed Toys "R" Us Operations or factors
                  beyond SVI's control constituting a Force Majeure in
                  accordance with the terms of Section 25. Subject to the
                  foregoing, SVI agrees that the following deadlines are
                  material, and that time and strict performance are of the
                  essence with respect thereto: [***] later date caused by
                  Customer, its employees, agents, officers, Affiliates or
                  Licensed Toys "R" Us Operations shall be the "Completion Date"
                  hereunder.

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4.       PROFESSIONAL SERVICES:

         4.1      SVI will use commercially reasonable efforts to make Allocated
                  Resources available when Customer requests them, subject to
                  reasonable limitations as may be reasonably determined by SVI
                  (including without limitation absences due to health reasons
                  and vacation). SVI agrees that the Customer will always have
                  first priority access to available resources. SVI will use
                  commercially reasonable efforts to accommodate Customer's
                  needs as promptly as reasonably practicable if the Allocated
                  Resources or those qualified to provide the services are not
                  immediately available when Customer requests them.

         4.2      Any fees for the Allocated Resources for Professional Services
                  described in Exhibit 1 are included within the fees set forth
                  in Section 9, except to the extent of changes authorized by
                  Customer under this Agreement.

5.       WORK AUTHORIZATION:

         5.1      Requests for visits to Customer's location or requests for
                  services to be performed at a SVI site must be made by
                  Customer in writing or by e-mail. Before an SVI representative
                  travels or begins Professional Services on Customer's behalf,
                  SVI will ask for written or e-mail confirmation of Customer's
                  request on a quarterly basis describing generally SVI's
                  estimated anticipated travel and payment requirements.
                  Customer will not be invoiced for out-of-pocket expenses and
                  travel expenses for services that Customer has not approved or
                  confirmed and SVI will not travel or perform any services
                  until Customer has given SVI such approval or confirmation.

         5.2      Change orders or requests may be made by Customer in writing
                  or by e-mail. All such changes must detail the proposed
                  change, the reasons for the change and its perceived impact on
                  other services to be performed by SVI. Within 15 days
                  following receipt of any change pursuant to this Section, SVI
                  shall notify Customer in writing or by e-mail of the estimated
                  effect such change will have on the cost and timing of
                  services to be provided hereunder.

6.       LICENSE:

         6.1      SVI grants to Customer a perpetual, worldwide,
                  non-transferable, non-exclusive right and license, in all
                  cases for Customer's internal purposes only, to use, copy,
                  distribute, publish, display, perform and make Updates to the
                  Deliverables. Such license covers all (i) patents, copyrights,
                  trade secrets and other intellectual property rights, (ii)
                  object code and all Source Materials (as defined in Section
                  6.2 and subject to Section 6.2), and (iii) third-party rights
                  relating to the Deliverables, if any.

         6.2      [***]

         6.3      [***]


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         6.4      [***].

         6.5      In order to protect SVI's trade secrets and copyrights in the
                  Deliverables and any Updates, Customer agrees to reproduce and
                  incorporate SVI's copyright notice below in any copies made by
                  Customer, including partial copies in any form: [Program
                  property of SVI, Inc. This work contains trade secrets deemed
                  valuable and proprietary to SVI. Unauthorized use is
                  prohibited. (C) [year of publication] SVI, Inc. All rights
                  reserved.]

         6.6      Upon Customer's request, SVI will ship any Deliverables to
                  Customer's installation address(es) as specified by Customer
                  in writing. Customer will be responsible for paying all
                  delivery expenses, taxes, tariffs and duties related to the
                  distribution and shipment of Deliverables to its multiple
                  locations, but in no event shall Customer be responsible for
                  the payment of SVI's taxes on its income.

         6.7      SVI shall deliver the Deliverables to Customer in accordance
                  with the Schedule set forth in Exhibit 1. SVI shall ensure
                  that Customer's project or account manager in Section 11.1 is
                  notified of such delivery. [***]

         6.8      Customer shall be responsible for procuring, installing, and
                  maintaining all equipment, telephone lines, communications
                  interfaces, and other hardware (other than the hardware
                  constituting the program control center maintained at SVI's
                  facilities) necessary to use the Deliverables, PROVIDED THAT
                  SVI shall provide all reasonably necessary information and
                  cooperation to Customer in connection with the foregoing.

         6.9      All Software, any Updates and all copies thereof are the
                  intellectual property of SVI. All applicable proprietary and
                  intellectual property rights, copyrights, trademarks, and
                  trade secrets in the Software are and will remain with and in
                  SVI. Except as contemplated in this Agreement, Customer shall
                  not sell, transfer, publish, disclose, display or otherwise
                  make available any Software, Updates or copies thereof to
                  others. Customer shall own all physical and tangible items
                  comprising the Deliverables and all information stored or
                  cached therein or transmitted, processed or routed thereby.
                  Customer agrees that the Software, Updates and copies thereof
                  shall be deemed "Confidential Information" in accordance with
                  Section 14.

                  6.9.1    All applicable proprietary and intellectual property
                           rights, copyrights, trademarks and trade secrets in
                           all Documentation shall remain with SVI. Customer
                           agrees to:

                                    (i) secure and protect the confidentiality
                           of any Confidential Information in such Documentation
                           in accordance with Section 14;

                                    (ii) not copy any Confidential Information
                           in such Documentation except in accordance with
                           Section 14;

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                                    (iii) use such Documentation only as
                           permitted by this Agreement (including Sections 6.1
                           and 6.2 and Section 14); and

                                    (iv) not sell, transfer or otherwise make
                           such documentation available to others, except as
                           permitted by this Agreement (including Sections 6.1
                           and ERROR! REFERENCE SOURCE NOT FOUND. and Section
                           14).

         6.10     Customer understands that the Software may be protected by a
                  security program (the "Security Program") that will render the
                  Software unusable. Customer understands that if Customer
                  materially breaches the conditions of this Agreement and does
                  not cure such breach after thirty (30) days notice (unless
                  Customer has applied to a court of competent jurisdiction
                  within such timeframe and obtained an order for injunctive
                  relief) or deliberately tampers with the Security Program, SVI
                  shall have the right to activate the Security Program upon
                  notice to Customer. Customer further understands that, in the
                  event of such activation, SVI must be contacted to restore
                  access to the Software. SVI will use its best efforts to send
                  Customer, within one full business day of notification from
                  Customer, a new key that will provide access to the Software
                  in any location of Customer or any of its Sublicensees. SVI
                  represents and warrants that the Security Program (a) will not
                  inhibit, in any way, Customer or its Sublicensees' use of the
                  Software or their ability to modify the Software and (b) has
                  the sole purpose and capability of enabling SVI to prevent,
                  and will not be used by or on behalf of SVI except to prevent,
                  Customer's use of the Software in the event that Customer (i)
                  is in material breach of this Agreement and fails to cure such
                  default within the applicable cure period (unless Customer has
                  applied to a court of competent jurisdiction within such time
                  period and obtained an order for injunctive relief); or (ii)
                  deliberately tampers with the Security Program. SVI shall
                  disable the Security Program (a) with respect to any
                  Deliverable, once SVI has been fully paid for such
                  Deliverable; and (b) with respect to all Deliverables, at the
                  expiration or termination of the Term for any reason.

         6.11     Unless the parties later agree otherwise in a separate
                  maintenance agreement pursuant to Section 9.2, SVI will, at no
                  additional charge to Customer, (i) support all applicable
                  Deliverables throughout the Term on SVI's Specified CPU and
                  (ii) provide any Updates to the Deliverables that SVI creates
                  throughout the Term, in accordance with SVI's customary
                  practices and procedures. SVI will notify Customer in writing
                  of any material changes to the Specified CPUs promptly upon
                  becoming aware of such change.

         6.12     SVI will not be responsible for any Software problems
                  resulting directly or indirectly from (i) Customer
                  modifications to the Software not performed at SVI's direction
                  or supervision, (ii) incompatibility of any equipment not
                  specified as compatible or approved by SVI, or (iii) the
                  installation of any Software or Updates that is not by or on
                  behalf of SVI or its authorized agents.

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         6.13     SVI will not be responsible for any Software problems
                  resulting from (i) Customer modifications to the Software not
                  performed at SVI's direction or supervision, (ii)
                  incompatibility of any equipment not specified as compatible
                  or approved by SVI, or (iii) the installation of any Software
                  or Updates that is not by or on behalf of SVI or its
                  authorized agents.

7.       WORK AUTHORIZATION:

         7.1      Requests for visits to Customer's location or requests for
                  services to be performed by an SVI site must be made by
                  Customer in writing or by e-mail. Before an SVI Retail
                  representative travels or begins work on Customer's behalf,
                  SVI will ask for written or e-mail confirmation of Customer's
                  request. Unless specifically indicated otherwise in this
                  Agreement, Customer will not be charged for fees and expenses
                  for services that Customer has not approved and SVI will not
                  travel or perform any services until Customer has given SVI
                  such approval. Customer shall not delay or unreasonably
                  withhold its approvals.

         7.2      Change orders or requests may be made by Customer in writing
                  or by e-mail. All such changes must detail the proposed
                  change, the reasons for the change and its perceived impact on
                  other services to be performed by SVI. Within fifteen (15)
                  days following receipt of any change pursuant to this Section,
                  SVI shall notify Customer in writing or by e-mail of the
                  estimate effect such change will have on the cost and timing
                  of services to be provided hereunder.

8.       TRAVEL EXPENSES:

         8.1      In scheduling a visit to Customer's location, SVI shall
                  attempt to work with Customer so that the time SVI spends is
                  used effectively. SVI will assign its personnel based upon the
                  services to be performed, upon an ongoing analysis of
                  Customer's needs and upon Customer's approval. There may be
                  one of SVI's employees at Customer's site on some occasions
                  and more than one at other times. For this reason, and because
                  of the varying lengths of stay, expenses will vary from visit
                  to visit.

         8.2      Expenses shall be limited as follows: [***].

         8.3      Since SVI's employees might visit more than one user site
                  during a trip, it is possible that Customer will be billed for
                  only a portion of the related expenses. The portion paid by
                  Customer in such a case will be calculated by dividing the
                  number of hours spent at Customer's site by the total number
                  of hours for all users visited during the trip, and then
                  applying this ratio to any common expenses incurred, such as
                  airfare.

         8.4      The amount Customer will be charged for travel expenses will
                  be determined by the going rates for services in Customer's
                  area. SVI employees will make their own arrangements and
                  submit expense claims to SVI. Customer will be billed for each
                  visit. Copies of completed, approved by SVI management travel
                  expense reports will accompany all travel expense invoices.
                  All invoices submitted to Customer will conform to Customer's
                  Travel Reimbursement Policy requirements.

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         8.5      For the avoidance of doubt, (i) all travel expenses in Section
                  8 are subject to Section 9.1(c) hereunder, and (ii) Customer
                  shall not be billed on an hourly basis for any travel time.

9.       PAYMENTS:

         9.1      Except as otherwise specified herein, SVI shall invoice
                  Customer for all fees payable under this Agreement, and
                  Customer shall pay such amounts [***].

                  9.1.1    [***].

                  9.1.2    [***].

                  9.1.3    [***].

         9.2      Customer shall have the right, at its sole option, to enter
                  into a maintenance agreement with SVI in accordance with SVI's
                  prevailing standard, terms and conditions governing the
                  provision of support after [***] periods in Section12.3.
                  Customer shall notify SVI of its intent to enter into such
                  agreement within [***].

10.      TIME AND COSTS:

         10.1     SVI will not be responsible for any errors or omissions in
                  information, data or services provided by Customer or by third
                  parties hired by Customer to act on Customer's behalf.

11.      PROJECT STAFF:

         11.1     Each party to this Agreement shall appoint a project or
                  account manager who will be responsible for representing that
                  party in connection with the services under this Agreement.
                  SVI's account manager shall devote adequate time to the
                  services performed hereunder and shall have the authority and
                  responsibility for the planning, control and scheduling of all
                  effort and resources in connection with SVI's work under this
                  Agreement. Customer's project manager will have responsibility
                  for all planning, control and scheduling of effort and
                  resources required to be provided or made available by
                  Customer under this Agreement. The Chief Executive Officer of
                  SVI Holdings, Inc. shall confer with Customer's project
                  manager on a weekly basis to discuss the services provided
                  hereunder.

         11.2     Each party will endeavor to ensure continuity of its key staff
                  on the project but reserves the right to make changes if
                  necessary including, due to circumstances beyond its control.
                  Should it become necessary for either party to replace any key
                  member of its staff involved in the performance of work under
                  this Agreement, the affected party shall notify the other and
                  will provide a suitably qualified and experienced replacement
                  member of staff with as similar a level of skill and
                  experience to the replaced member of staff as is reasonably
                  possible.

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         11.3     SVI warrants that any staff assigned to provide services to
                  Customer under this Agreement shall possess such skill and
                  experience as is necessary for the proper performance of those
                  services.

         11.4     Customer has the right to reject any employee SVI assigns to
                  work on Customer's behalf with the understanding that other
                  employees might not be available to take their place on short
                  notice which may result in delays.

         11.5     SVI warrants that given adequate notice, it will use
                  commercially reasonable best efforts to make available the
                  number of SVI employees Customer reasonably requests for the
                  time period Customer reasonably requests.

         11.6     SVI may employ outside contractors to perform the Professional
                  Services hereunder, PROVIDED THAT SVI remains liable in all
                  respects under this Agreement for such third parties'
                  performance.

12.      REPRESENTATIONS/WARRANTIES/DISCLAIMERS/LIMITATION OF LIABILITY:

         12.1     Each party represents, warrants and covenants that: (i) it is
                  a corporation duly incorporated and validly existing and in
                  good standing under the laws of its respective state of
                  incorporation; (ii) it has all necessary corporate power and
                  authority to enter into this Agreement, to perform its
                  obligations hereunder and to consummate the transactions
                  contemplated hereby; (iii) it has taken all corporate action
                  necessary to execute and deliver this Agreement, to consummate
                  the transactions contemplated hereby; and to perform its
                  obligations hereunder; (iv) this Agreement has been duly
                  executed and delivered by both parties; (v) it is aware of no
                  obligation, legal or otherwise, which is inconsistent with its
                  obligations under this Agreement; and (vi) performance of its
                  obligations under this Agreement will not violate any law,
                  rule, regulation, or any proprietary or other right of a third
                  party.

         12.2     SVI represents, warrants and covenants that:

                  12.2.1   it is sole owner of, or has obtained all necessary
                           rights to use and for Customer to use all
                           intellectual property and other rights relating to
                           the Deliverables, the Professional Services and SVI's
                           performance of its obligations hereunder, and
                           Customer's use of the foregoing hereunder shall not
                           infringe or violate any rights of a third party;

                  12.2.2   it shall (i) be responsible in all respects for the
                           performance of its own personnel hereunder, including
                           but not limited to any liability arising out of such
                           performance, and for maintaining any insurance
                           policies relating thereto; (ii) comply with all laws,
                           statutes, rules, regulations and reputable business
                           practice in its performance of all of its obligations
                           hereunder; and (iii) obtain all consents, permits,
                           licenses and approvals (including work permits or
                           visa applications) that may be necessary or expedient
                           for performing all of its obligations hereunder;

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                  12.2.3   [***]

                  12.2.4   the Deliverables will substantially conform to and
                           comply with their specifications, be operational and
                           fit for their intended purpose as identified in the
                           specifications and/or Documentation.

         12.3     If at any time during the [***].

         12.4     [***].

         12.5     EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, SVI EXPRESSLY
                  DISCLAIMS ANY AND ALL WARRANTIES CONCERNING THE SOFTWARE
                  AND/OR THE SERVICES TO BE RENDERED HEREUNDER, WHETHER EXPRESS
                  OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF
                  MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

         12.6     Except with respect to the parties' indemnification
                  obligations hereunder, (i) in no event shall either party's
                  cumulative liability for any claim arising in connection with
                  this Agreement exceed the total fees and charges paid to SVI
                  by Customer from the preceding [***] before the Effective Date
                  until the expiration or termination of the Term; or (ii) in no
                  event shall either party be liable for any indirect,
                  consequential, special, exemplary, or incidental damages of
                  whatever kind arising out of its performance hereunder.

         12.7     No action, whether based in contract, strict liability, or
                  tort, including any action based on negligence, arising out of
                  the performance of services under this Agreement, may be
                  brought by either party more than one year after such cause of
                  action accrued.

13.      ASSIGNMENT:

         13.1     Neither party shall assign any of its obligations under this
                  Agreement without the prior written consent of the other
                  party, including any assignment (whether actual, implied or DE
                  FACTO) in the event of a party's "change of control." "Change
                  of control" means either (i) the sale or transfer of all or
                  substantially all of a party's assets to any person or group
                  of persons; or (ii) the acquisition of a party by another
                  person by means of any transaction or series of related
                  transactions (including any reorganization, merger or
                  consolidation, whether of a party with or into any other
                  person or persons or of any other person or persons with or
                  into a party). The sole and exclusive remedy for a change of
                  control shall be as set forth in Section 1.4(b) above.

         13.2     The parties agree that this Agreement shall be deemed an
                  Agreement for the personal services of SVI and, to the fullest
                  extent permitted by law, shall not be assumable and/or
                  assignable by SVI in bankruptcy without Customer's prior
                  consent.

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         13.3     Any purported assignment by either party in violation of the
                  foregoing shall be null and VOID AB INITIO and of no force or
                  effect. In the event of a permitted assignment hereunder, this
                  Agreement shall be binding upon the parties and their
                  permitted assigns.

14.      CONFIDENTIALITY:

         14.1     It is anticipated that Customer and SVI, in the course of
                  carrying out their respective responsibilities under this
                  Agreement, will consult with the other party's personnel
                  about, or receive certain of, the other party's confidential
                  business and technical information ("Confidential
                  Information"). Customer and SVI agree to keep confidential
                  and, without the other party's prior written consent, will not
                  use and will not disclose to any person or entity, other than
                  its employees (and consultants or third-party service
                  providers, subject to reasonable confidentiality agreements)
                  who reasonably need to know same to perform such party's
                  obligations hereunder, any Confidential Information.

         14.2     The foregoing obligations of this Section 11 will not apply to
                  any information or data that (1) at the time of disclosure or
                  use by the recipient is known or available to the general
                  public by publication or otherwise (other than as a result of
                  a breach of this Section 11); (2) is known by the recipient at
                  the time of receiving such information; (3) is made public by
                  the disclosing party; (4) is developed independently by the
                  recipient prior to the date of disclosure by the disclosing
                  party; (5) is acquired by the recipient from a third party who
                  independently and rightfully developed or acquired the
                  information or data and was under no duty to refrain from its
                  disclosure; or (6) is required to be disclosed by law, court
                  order, regulation or judicial process, PROVIDED THAT the
                  receiving party shall give prompt notice of any such
                  requirement to the disclosing party, disclose no more
                  information than is so required and cooperate with all efforts
                  by the disclosing party to receive a protective order or
                  similar confidential treatment.

         14.3     Customer shall not, and shall not allow any other party to,
                  reverse assemble or reverse compile the Software for any
                  purpose, except as permitted by this Agreement (including
                  Section ERROR! REFERENCE SOURCE NOT FOUND.).

         14.4     Either Customer or SVI may specifically enforce any agreement
                  contained in this Section 14 through an injunction or
                  otherwise (in accordance with Sections 22 and 26), in the
                  event of breach or threatened breach by the other. Such
                  remedies will be in addition to all others that may be
                  available.

15.      NON-SOLICITATION OF STAFF:

         15.1     During the [***].

         15.2     Each party's estimate of the damage that a breach of the above
                  paragraph would have upon its business is herein quantified as
                  liquidated damages in the amount of prior years' total
                  compensation for the individual in question. Each party
                  accepts that these are reasonable estimates of loss and agrees
                  to pay the same upon demand in the event of its breach of this
                  clause.

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16.      NO WAIVER:

         The waiver by either party of a particular breach of this Agreement by
         the other shall not be construed or constitute a continuing waiver of
         such breach or of other breaches of the same or other provisions of
         this Agreement.

17.      [***]

         17.1     [***]

         17.2     [***]

         17.3     [***]

18.      INDEMNITY:

         18.1     Subject to the provisions of Section 12.7 above, each party
                  agrees to indemnify, defend and hold harmless the other party
                  and its affiliates (and Sublicensees, with respect to
                  Customer) and their officers, directors, shareholders,
                  employees and agents from any third party loss, claim,
                  liability, award, judgment, damage, settlement, cost or
                  expense (including reasonable attorney's fees and costs of
                  suit) ("Loss") which is directly or indirectly caused by (i)
                  with respect to either party, its breach of any
                  representation, warranty or covenant or failure to perform any
                  obligation under this Agreement, except to the extent covered
                  by the other party's indemnity obligations hereunder; or (ii)
                  with respect to SVI, its activities pursuant to Section 17.1.

         18.2     The indemnified party agrees to notify the indemnifying party
                  promptly of any potential indemnified claim and to cooperate
                  fully with the indemnifying party, at the indemnifying party's
                  expense, in the defense and settlement thereof. Neither party
                  shall settle or compromise an indemnified claim any way that
                  impairs or jeopardizes the other party's rights or subjects
                  the other party to liability without such party's prior
                  written consent, which shall not be unreasonably withheld.

         18.3     If Customer or its Sublicensees' use of one or more
                  Deliverables infringes any patent, copyright, trade secret or
                  other intellectual property right of a third party, SVI shall,
                  at its sole cost and expense, either (i) acquire for Customer
                  the right to continue to use such Deliverable in accordance
                  with the terms hereof, or (ii) provide Customer with another
                  software product which will perform in an equivalent manner.
                  If one of the foregoing does not occur within a reasonable
                  period of time, in no event longer than forty-five (45) days,
                  then Customer shall have the right to terminate this Agreement
                  as to the affected Deliverables (but not other Deliverables or
                  the entire Agreement, unless the affected Deliverable


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                  substantially impairs Customer's ability to enjoy the benefits
                  of this Agreement), and receive(a) for Deliverables on Exhibit
                  1, Schedules A or B, a PRO RATA portion of fees under Section
                  9.1.1 as indicated on such Schedules; or (b) for Deliverables
                  on Exhibit 1, Schedule C, the full contract amount set forth
                  thereon plus all service fees relating to the delivery of such
                  Deliverable. This remedy is in addition to, and not in
                  limitation of, any other remedies Customer may have hereunder,
                  at law or in equity. However, SVI will not be responsible for
                  any infringement liability resulting directly or indirectly
                  from (i) Customer modifications to the Deliverables that are
                  not made by SVI or under its direction or with its express
                  approval, (ii) Customer's use with the Deliverables of any
                  equipment not specified by SVI, or (iii) any Deliverables not
                  installed by SVI or its authorized agents or with SVI's
                  approval.

         18.4     SVI shall maintain, at all times during the Term, insurance of
                  the following types and in the following amounts: commercial
                  general liability insurance (including contractual liability)
                  on an occurrence form with limits (in combination with excess
                  liability insurance) of [***] in the aggregate and workers
                  compensation coverage as dictated by applicable law. Customer
                  will be added as an additional insured. Upon the execution of
                  this Agreement and annually thereafter, SVI shall furnish
                  Customer with an insurance certificate relating to the
                  commercial general liability insurance and indicating that
                  such insurance will not be canceled, terminated or modified
                  unless thirty (30) days prior written notice has been given by
                  the carrier to Customer and that Customer is included as an
                  additional insured. SVI hereby agrees to use commercially
                  reasonable efforts to cause its insurance company(ies) to,
                  waive any rights they may have to recover from Customer or any
                  Sublicensee any damages arising from claims falling within the
                  scope of the indemnities set forth herein.

19.      BANKRUPTCY:

         19.1     In the event of any bankruptcy of SVI, its affiliates or
                  subsidiaries, the parties acknowledge and agree that the
                  licensed rights hereunder are fundamentally in the nature of
                  "intellectual property" as defined in the Bankruptcy Code;
                  that Customer's continued enjoyment of all licensed rights is
                  fundamental to the basic license hereunder; and therefore all
                  licensed rights should be deemed intellectual property subject
                  to Customer's rights under Section 365(n) of the Bankruptcy
                  Code.

         19.2     The parties agree that upon any election by Customer pursuant
                  to Section 365(n)(1)(B) of the Bankruptcy Code, that Customer
                  shall be entitled to, on its own or through Sublicensees,
                  employees, contractors, agents or otherwise, use, copy,
                  distribute, make derivative works based upon, publish,
                  display, perform and create Updates based upon the rights
                  licensed hereunder.

         19.3     In the event of a bankruptcy of any third party with rights in
                  any Deliverable, SVI shall refrain from exercising any rights
                  under Section 365(n) without Customer's prior written consent
                  and shall file and prosecute such motions, applications and
                  pleadings and take all such actions under Section 365(n) of
                  the Bankruptcy Code to protect and preserve Customer's rights
                  hereunder as Customer may direct from time to time.

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         19.4     Without limiting Customer's rights under the foregoing, solely
                  in the event SVI fails to perform any of its obligations
                  described in Section 16.3, SVI hereby irrevocably constitutes
                  and appoints Customer and any officer or agent of Customer,
                  with full power of substitution, as its true and lawful
                  attorney-in-fact with full irrevocable power and authority in
                  the place and stead of SVI and in the name of SVI or in its
                  own name, to take (in Customer's sole and absolute discretion)
                  any and all actions described in Section 16.3 to protect SVI
                  and/or Customer's rights to the intellectual property
                  hereunder, including without limitation (i) commencing any and
                  all necessary actions or suits at law or in equity in any
                  court of competent jurisdiction connection with SVI's rights
                  to the intellectual property or any election under Section
                  365(n) of the Bankruptcy Code, or (ii) defending or
                  compromising or adjusting suits at law or in equity in any
                  court of competent jurisdiction in connection with SVI's
                  rights to the intellectual property or any election under
                  Section 365(n) of the Bankruptcy Code.

20.      LEGAL AUTHORITY:

         SVI and Customer are independent entities and shall not have authority
         to act for or bind the other in any way or to represent that either of
         them is in any way responsible for acts of the other.

21.      LAW:

         All questions concerning the validity, operation, interpretation and
         construction of this Agreement shall be governed by and determined in
         accordance with the internal laws of the State of California
         (irrespective of its choice of law principles).

22.      ARBITRATION:

         22.1     Except as specifically modified by this paragraph, and
                  excepting matters involving provisional remedies as set forth
                  below, any controversy or claim arising out of or relating to
                  this Agreement, or any breach thereof, including without
                  limitation, any claim that this Agreement, or any part
                  thereof, is invalid, illegal or otherwise voidable or void,
                  shall be submitted to arbitration to be held before a single
                  arbitrator in San Diego, California before and in accordance
                  with the commercial arbitration rules of the American
                  Arbitration Association. If the claims at issue exceed
                  $500,000.00, exclusive of interest and attorneys' fees, such
                  commercial arbitration rules shall include the supplementary
                  procedures for large, complex cases and the number of
                  arbitrators shall be three. In all cases, the arbitrators
                  shall be members of the State Bar of California, actively
                  engaged in the practice of law for at least 10 years, or a
                  retired member of the state or federal judiciary.

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         22.2     This provisions of this paragraph shall be construed as
                  independent of any other covenant or provision of this
                  Agreement; provided that if a court of competent jurisdiction
                  determines that any such provisions are unlawful in any way,
                  such court shall modify or interpret such provisions to the
                  minimum extent necessary to have them comply with the law.

         22.3     Nothing in Section 22.1 shall prevent a party from applying to
                  a court of competent jurisdiction for temporary or preliminary
                  injunctive relief pending the outcome of the arbitration in
                  Section 22.1. Judgment upon an arbitration award may be
                  entered in any court having competent jurisdiction and shall
                  be binding, final and non-appealable.

         22.4     This arbitration provision shall be deemed to be
                  self-executing and shall remain in full force and effect after
                  expiration or termination of this Agreement.

23.      PRESS RELEASES:

         Subject to SVI's obligations to comply with applicable laws and
         regulations, including without limitation applicable securities' laws;
         provided SVI shall provide Customer with prompt written notice of any
         such obligations and shall take no actions beyond the scope of such
         obligations, SVI will receive Customer's approval in its reasonable
         discretion before (i) releasing any press release that provides any
         information regarding Customer and/or this Agreement or (ii) including
         Customer's name on any published list of customers. Neither party shall
         use the name, logos, service marks, trademarks and identity of the
         other (and SVI shall not use those of Customer's Sublicensees) in
         publicity, advertising, or any similar activity, without the prior
         written consent of the other.

24.      ATTORNEYS' FEES:

         In the event any arbitration is initiated by any party pursuant to
         Section 22, the prevailing party shall be entitled to recover from the
         unsuccessful party all costs, expenses, and actual attorneys' fees
         relating thereto or arising therefrom. Any judgment upon an arbitration
         award pursuant to Section 22.3 shall contain a specific provision for
         the recovery of the foregoing.

25.      FORCE MAJEURE:

         Neither of the parties shall be liable or be in breach of any provision
         of this Agreement for any failure or omission on its part to perform
         any obligation because of force majeure, including, but not limited to
         war, riot, fire, explosion, flood, sabotage, terrorism, accident or
         breakdown of machinery, or other impediments, hindrances, or cause
         beyond the reasonable control of the party; and provided that such
         failure or omission resulting from one of the above causes is cured as
         soon as practicable after the occurrence of one or more of the
         above-mentioned causes. A party claiming a right to excused performance
         under this Section 25 shall promptly notify the other party in writing
         of the extent of its inability to perform, which notice shall specify
         the occurrence beyond its reasonable control that prevents such
         performance. After one hundred and twenty (120) days, unless the
         parties have agreed to an alternative resolution, the right to such
         excused performance shall expire.

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26.      SCOPE OF AGREEMENT/AMENDMENT:

         The parties hereto acknowledge that each has read this Agreement,
         understands it, and agrees to be bound by its terms. The parties
         further agree that this Agreement is the complete and exclusive
         statement of agreement and supersedes all proposals (oral or written),
         understandings, representations, conditions, warranties, covenants, and
         other communications between the parties (and their predecessors and
         affiliates) relating hereto including (i) the Professional Services
         Agreement and related Schedules dated July 10, 2001 between SVI Retail,
         Inc. and Customer provided that the Software, Documentation and other
         deliverables provided and services performed under such agreement
         (including without limitation any of the foregoing on Exhibit 1,
         Schedule A) shall be deemed and treated as if they are accepted by
         Customer and fully-paid Deliverables and Professional Services in this
         Agreement for all applicable purposes hereunder, including without
         limitation Sections 6, 12, 18 and 19, and (ii) any other Superseded
         Documents (as defined in Section 12 of the Purchase Agreement between
         the parties of even date herewith). For the avoidance of doubt, the
         foregoing shall not be deemed to supersede the License Agreement
         between Island Pacific Systems Corp. and Customer, including all
         attachments thereto, dated May 20, 1999. This Agreement may be amended
         only by a subsequent writing that specifically refers to this Agreement
         and is signed by both parties, and no other act, document, usage, or
         custom shall be deemed to amend this Agreement.

27.      VENUE AND JURISDICTION:

         For purposes of venue and jurisdiction, this Agreement shall be deemed
         made and to be performed in the City of San Diego, California.

28.      COUNTERPARTS:

         This Agreement may be executed in counterparts, each of which shall be
         deemed an original and all of which together shall constitute one
         document.

29.      TIME OF ESSENCE:

         Time and strict and punctual performance are of the essence with
         respect to each provision of this Agreement.

30.      [INTENTIONALLY OMITTED]:

31.      HEADINGS:

         The headings of the Paragraphs of this Agreement have been included
         only for convenience, and shall not be deemed in any manner to modify
         or limit any of the provisions of this Agreement, or be used in any
         manner in the interpretation of this Agreement.

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32.      PARTIAL INVALIDITY:

         Each provision of this Agreement shall be valid and enforceable to the
         fullest extent permitted by law. If any provision of this Agreement or
         the application of such provision to any person or circumstance shall,
         to any extent, be invalid or unenforceable, the remainder of this
         Agreement, or the application of such provision to persons or
         circumstances other than those as to which it is held invalid or
         unenforceable, shall not be affected by such invalidity or
         unenforceability, unless such provision or such application of such
         provision is essential to this Agreement.

33.      DRAFTING AMBIGUITIES:

         Each party to this Agreement and its legal counsel have reviewed and
         revised this Agreement. The rule of construction that any ambiguities
         are to be resolved against the drafting party shall not be employed in
         the interpretation of this Agreement or of any amendments or exhibits
         to this Agreement.

34.      NOTICES:

         Any notice, consent, authorization or other communication to be given
         hereunder shall be in writing and shall be deemed duly given and
         received when delivered personally or transmitted by facsimile
         transmission with receipt acknowledged by the addresses or three days
         after being mailed by first class mail, or the next business day after
         being deposited for next-day delivery with a nationally recognized
         overnight delivery service, charges and postage prepaid, properly
         addressed to the party to receive such notice at the address(es)
         specified below, or at such other address as shell be specified by like
         notice:

                      If to SVI:

                      SVI, Inc.
                      5607 Palmer Way
                      Carlsbad, CA  92008
                      Attention:  Barry Schechter, Chief Executive Officer
                      Facsimile:  (760) 496-0285

                      with a copy to:

                      Solomon Ward Seidenwurm & Smith, LLP
                      401 B Street, Suite 1200
                      San Diego, California 92101
                      Attention:  Norman L. Smith
                      Facsimile:  (619) 231-4755

                      If to Customer:

                      Toys "R" Us
                      481 From Road
                      Paramus, NJ 07652
                      Attention:  General Counsel
                      Facsimile:  (201) 599-8077

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                  IN WITNESS WHEREOF, SVI and Customer have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.

SVI SOLUTIONS, INC.                      TOYS "R" US, INC.

By___________________________________    By___________________________________
Name ________________________________    Name_________________________________
Title________________________________    Title________________________________
Date ________________________________    Date_________________________________




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         EXHIBIT 1 - PROFESSIONAL SERVICES AND MODULE DELIVERY SCHEDULE

SCHEDULE A - THE FOLLOWING ENHANCEMENTS WERE PREVIOUSLY PAID FOR BY CUSTOMER.


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SCHEDULE B - THE FOLLOWING ENHANCEMENTS ARE COVERED BY THE FEES SPECIFIED IN
SECTION 9.1.1.

[***]

SCHEDULE C - THE FOLLOWING ENHANCEMENTS ARE NOT INCLUDED IN SOFTWARE, ABSENT A
LATER AGREEMENT BY THE PARTIES, PROVIDED THAT CUSTOMER HAS THE OPTION TO ADD THE
FOLLOWING AT THE CONTRACTED PRICES SET FORTH BELOW, SUBJECT TO A DISCOUNT OF
[***].

[***]


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                                    EXHIBIT 2


                                      [***]

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                            EXHIBIT 3 - DOCUMENTATION

Documentation includes without limitation the following:

         1.       a reference manual for each Software product containing:

                  (a) system introduction and overview of applications
         including, without limitation, a reasonably detailed description of all
         of the functions performed by the applicable product, broken down by
         module;

                  (b) samples of all menus used for application access;

                  (c) step by step instruction in the operation of each
         application and all enhancements thereto;

                  (d) explanations and examples of the retail merchandising
         terms and theory used in the system, including the formulas used by the
         system to calculate the values presented on reports and screen
         inquiries;

                  (e) instructions allowing Customer and its Sublicensees to
         personalize options allowed by the system; and

                  (f) instructions allowing Customer and its Sublicensees to
         develop and implement a plan of secured access to menus and
         applications.





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                  EXHIBIT 4 - SVI'S STANDARD PROFESSIONAL RATES



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                        EXHIBIT 5 - PROFESSIONAL SERVICES



Design Services - providing Functional Design Specifications.



Development Services - providing Technical Design Reviews and ad hoc technical
consultancy.



Professional Services - providing account management, project management, system
knowledge and system application to business process support.



Technical Consulting Services - providing system knowledge, supporting TRUI
system integration, supporting the TRUI lab environment as requested by TRUI and
managing the development of specific custom software requested by TRUI.



Programming Services - developing the specific custom software requested by
TRUI.