<PAGE>

                                                                   Exhibit 10.12

                       FIRST LOAN MODIFICATION AGREEMENT

      The First Loan Modification Agreement is entered into as of ________,
2000, by and between SEACHANGE INTERNATIONAL, INC., a Delaware corporation with
its principal place of business at 124 Acton Street, Maynard, Massachusetts
("Borrower"), and SILICON VALLEY BANK, a California-chartered bank ("Lender"),
with its principal place of business at 3003 Tasman Drive, Santa Clara, CA
95054 and with a loan production office located at Wellesley Office Park, 40
William Street, Suite 350, Wellesley, MA 02481, doing business under the name
"Silicon Valley East."

1.    DESCRIPTION OF EXISTING INDEBTEDNESS. Among other indebtedness which may
      ------------------------------------
be owing by Borrower to Lender, Borrower is indebted to Lender pursuant to,
among other documents, a Loan and Security Agreement dated November 10, 1998 (as
may be amended, the "Loan Agreement"). Capitalized terms used but not otherwise
defined herein shall have the same meaning as in the Loan Agreement.

Hereinafter, all indebtedness owing by Borrower to Lender shall be referred to
as the "Indebtedness".

2.    DESCRIPTION OF COLLATERAL AND GUARANTIES. Repayment of the Indebtedness is
      -----------------------------------------
secured by the Collateral as described in the Loan Agreement (together with any
other collateral security granted to Lender, the "Security Documents").

Hereinafter, the Security Documents, together with all other documents
evidencing or securing the Indebtedness shall be referred to as the "Existing
Loan Documents".

3.    DESCRIPTION OF CHANGE IN TERMS.
      -------------------------------

      A.  Modification(s) to Loan Agreement.
          ----------------------------------

             1. The Loan Agreement shall be amended by deleting the following
                definition for Committed Equipment Line:

                "Committed Equipment Line" means a credit extension of up to
                Three Million Dollars ($3,000,000.00).

                and substituting therefor the following:

                "Committed Equipment Line" means a credit extension of up to
                Three Million Dollars ($3,000,000.00) for Equipment Line No. 1,
                and Equipment Line No. 2, plus Two Million Dollars
                ($2,000,000.00) for Equipment Line No. 3.

             2. The Loan Agreement shall be amended by inserting into Section
                1.1, the following definitions:

                "Equipment Line No. 1" has the meaning set forth in Section
                2.1.2.

                "Equipment Line No. 2" has the meaning set forth in Section
                2.1.2.

                "Equipment Line No. 3" has the meaning set forth in Section
                2.1.2.

                "Equipment Availability End Date No. 3" has the meaning set
                forth in Section 2.1.2.

<PAGE>

                "Equipment Maturity Date No. 3" means March 31, 2003.

             3. The Loan Agreement shall be amended by deleting the following
                Section 2.1.2:

                "2.1.2 Equipment Advances.
                       ------------------

                (a)    Subject to and upon the terms and conditions of
                       this Agreement, Bank agrees to make advances (each an
                       "Equipment Advance" and collectively, the "Equipment
                       Advances") to Borrower: (i) in one advance to take place
                                                      ---
                       at any time after the Closing Date through thirty (30)
                       days after the Closing Date (the "Equipment Availability
                       End Date No. 1") in the aggregate outstanding amount not
                       to exceed Two Million Dollars ($2,000,000.00) (the
                       "Equipment Line No. 1"), and (ii) at any time and from
                       time to time from the Equipment Availability End Date No.
                       1 through June 30, 1999 (the "Equipment Availability End
                       Date No. 2") in the aggregate outstanding amount not to
                       exceed Three Million Dollars ($3,000,000.00) less the
                                                                    ----
                       cumulative Equipment Advances made under Equipment Line
                       No. 1 (the "Equipment Line No. 2"). To evidence the
                       Equipment Advances, Borrower shall deliver to Bank, at
                       the time of each Equipment Advance request, an invoice
                       for the equipment to be purchased or refinanced.
                       Equipment Advance requests under Equipment Line No. 1
                       shall only be permitted for Equipment purchased between
                       July 2, 1997 and June 30, 1998. Equipment Advance
                       requests under Equipment Line No. 2 shall only be
                       permitted for Equipment purchased between July 1, 1998
                       and June 30, 1999. The Equipment Advances shall be used
                       only to purchase or refinance Equipment and shall not
                       exceed: (i) eighty percent (80.0%) of the invoice amount
                       on such equipment, including software, approved from time
                       to time by Bank under Equipment Line No. 1, and (ii) one
                       hundred percent (100%) of the invoice amount on such
                       equipment, including software, approved from time to time
                       by Bank in accordance with its standard commercial
                       practices under Equipment Line No. 2, each of (i) and
                       (ii) excluding taxes, shipping, warranty charges, freight
                       discounts, and installation expense.

                (b)    Interest shall accrue from the date of each
                       Equipment Advance at the per annum rate of one percent
                       (1.0%) above the Prime Rate and shall be payable monthly
                       on the Payment Date of each month. Any equipment Advances
                       made pursuant to the Equipment Line No. 1 that are
                       outstanding on the Equipment Availability End Date No. 1
                       will be payable in Thirty (30) equal monthly installments
                       of principal, plus all accrued interest, beginning on the
                       Payment Date of the month following Equipment
                       Availability End Date No. 1 and ending on the Equipment
                       Maturity Date No. 1. Any Equipment Advances made pursuant
                       to the Equipment Line No. 2 that are outstanding on the
                       Equipment Availability End Date No. 2 will be payable in
                       Thirty-Six (36) equal monthly installments of principal,
                       plus all accrued interest, beginning on the Payment Date
                       of the month following Equipment Availability End Date
                       No. 2 and ending on the Equipment Maturity Date No. 2.
                       Equipment Advances, once repaid, may not be reborrowed.


                                      2-




<PAGE>

                (c)    When Borrower desires to obtain an Equipment Advance,
                       Borrower shall notify Bank (which notice shall be
                       irrevocable) by facsimile transmission to be received no
                       later than 3:00 p.m. Eastern time one (1) Business Day
                       before the day on which the Equipment Advance is to be
                       made. Such notice shall be substantially in the form of
                       Exhibit B. The notice shall be signed by a Responsible
                       Officer or its designee and include a copy of the invoice
                       for the Equipment to be financed."

                and substituting therefor the following:

                "2.1.2 Equipment Advances.
                       -------------------

                (a)    Subject to and upon the terms and conditions of this
                       Agreement, Bank agrees to make advances (each an
                       "Equipment Advance" and collectively, the "Equipment
                       Advances") to Borrower: (i) in once advance to take place
                                                      ----
                       days after the Closing Date (the "Equipment Availability
                       End Date No. 1") in the aggregate outstanding amount not
                       to exceed Two Million Dollars ($2,000,000.00) (the
                       "Equipment Line No. 1"), and (ii) at any time and from
                       time to time from the Equipment Availability End Date No.
                       1 through June 30, 1999 (the "Equipment Availability End
                       Date No. 2") in the aggregate outstanding amount not to
                       exceed Three Million Dollars ($3,000,000.00) less the
                                                                    ----
                       cumulative Equipment Advances made under Equipment Line
                       No. 1 (the "Equipment Line No. 2"), and (iii) at any time
                       and from time to time from March 13, 2000 through March
                       31, 2000 (the "Equipment Availability End Date No. 3") in
                       the aggregate outstanding amount not to exceed Two
                       Million Dollars ($2,000,000.00) (the "Equipment Line No.
                       3"). To evidence the Equipment Advances, Borrower shall
                       deliver to Bank, at the time of each Equipment Advance
                       request, an invoice for the equipment to be purchased or
                       refinanced. Equipment Advance requests under Equipment
                       Line No. 1 shall only be permitted for Equipment
                       purchased between July 2, 1997 and June 30, 1998.
                       Equipment Advance requests under Equipment Line No. 2
                       shall only be permitted for Equipment purchased between
                       July 1, 1998 and June 30, 1999. Equipment Advance
                       requests under Equipment Line No. 3 shall be used only
                       for Equipment purchased through March 31, 2000. The
                       Equipment Advances shall be used only to purchase or
                       refinance Equipment and shall not exceed: (i) eighty
                       percent (80.0%) of the invoice amount on such equipment,
                       including software, approved from time to time by Bank
                       under Equipment Line No. 1, and (ii) one hundred percent
                       (100%) of the invoice amount on such equipment, including
                       software, approved from time to time by Bank in
                       accordance with its standard commercial practices under
                       Equipment Line No. 2, and Equipment Line No. 3, each of
                       (i) and (ii) excluding taxes, shipping, warrant charges,
                       freight discounts, and installation expense.

                (b)    Interest shall accrue from the date of each Equipment
                       Advance at the per annum rate of: (i) for Equipment Line
                       No. 1, and Equipment Line No. 2, one percent (1.0%) above
                       the Prime Rate, and (ii) for Equipment Line No. 3, at one
                       half of one percent (.50%) above the Prime Rate. Interest
                       shall be payable monthly on the Payment Date of each
                       month. Any Equipment

                                      3-

<PAGE>

                       Advances made pursuant to the Equipment Line No. 1 that
                       are outstanding on the Equipment Availability End Date
                       No. 1 will be payable in Thirty (30) equal monthly
                       installments of principal, plus all accrued interest,
                       beginning on the Payment Date of the month following
                       Equipment Availability End Date No. 1 and ending on the
                       Equipment Maturity Date No. 1. Any Equipment Advances
                       made pursuant to the Equipment Line No. 2 that are
                       outstanding on the Equipment Availability End Date No. 2
                       will be payable in Thirty-Six (36) equal monthly
                       installments of principal, plus all accrued interest,
                       beginning on the Payment Date of the month following
                       Equipment Availability End Date No. 2 and ending on the
                       Equipment Maturity Date No. 2. Any Equipment Advances
                       made pursuant to the Equipment Line No. 3 that are
                       outstanding on the Equipment Availability End Date No. 3
                       will be payable in Thirty-Six (36) equal monthly
                       installments of principal, plus all accrued interest,
                       beginning on the Payment Date of the month following
                       Equipment Availability End Date No. 3 and ending on the
                       Equipment Maturity Date No. 3. Equipment Advances, once
                       repaid, may not be reborrowed.

                (c)    When Borrower desires to obtain an Equipment Advance,
                       Borrower shall notify bank (which notice shall be
                       irrevocable) by facsimile transmission to be received no
                       later than 3:00 p.m. Eastern time one (1) Business Day
                       before the day on which the Equipment Advance is to be
                       made. Such notice shall be substantially in the form of
                       Exhibit B. The notice shall be signed by a Responsible
                       Officer or its designee and include a copy of the invoice
                       for the Equipment to be financed."

         2.     The Loan Agreement shall be amended by deleting the following in
                Section 6.3:

                "6.3 Financial Statements, Reports, Certificates. Borrower shall
                     -------------------------------------------
                deliver to Bank: (a) as soon as available, but in any event
                within forty-five (45) days after the end of each quarter, a
                company prepared consolidated balance sheet and income statement
                covering Borrower's consolidated operations during such period,
                in a form and certified by an officer of Borrower reasonably
                acceptable to Bank; (b) as soon as available, but in any event
                within thirty (30) days after the end of each month, a company
                prepared consolidated revenue and expense statement covering
                Borrower's consolidated operations during such period, in form
                reasonably acceptable to Bank; (c) as soon as available, but in
                any event within ninety (90) days after the end of Borrower's
                fiscal year, audited consolidated financial statements of
                Borrower prepared in accordance with GAAP, consistently applied,
                together with an unqualified opinion on such financial
                statements of an independent certified public accounting firm
                reasonably acceptable to Bank; (d) promptly upon receipt of
                notice thereof, a report of any legal actions pending or
                threatened against Borrower or any Subsidiary that could result
                in damages or costs to Borrower or any Subsidiary of Two Hundred
                Fifty Thousand Dollars ($250,000) or more; (e) prompt notice of
                any material change in the composition of the Intellectual
                Property Collateral, including, but not limited to, any
                subsequent ownership right of the Borrower in or to any
                Copyright, Patent or Trademark not specified in any intellectual
                property security agreement between Borrower and Bank or
                knowledge of an event other than information that is publicly
                available and applicable generally to Borrower's business
                practices and industry that materially adversely affects the
                value of the Intellectual

                                      4-


<PAGE>

                Property Collateral; and (f) such budgets, sales projections,
                operating plans or other financial information as Bank may
                reasonably request from time to time.


                Within twenty (20) days after the last day of each month,
                Borrower shall deliver to Bank a Borrowing Base Certificate
                signed by a Responsible Officer in substantially the form of
                Exhibit C hereto, together with aged listings of accounts
                receivable.

                Within forty-five (45) days after the last day of each quarter,
                Borrower shall deliver to Bank with the quarterly financial
                statements a Compliance Certificate signed by a Responsible
                Officer in substantially the form of Exhibit D hereto.

                Bank shall have a right from time to time hereafter to audit
                Borrower's Accounts at Borrower's expense, provided that such
                audits will be conducted no more often than every six (6) months
                unless an Event of Default has occurred and is continuing."

                and inserting in lieu thereof the following:


                "6.3 Financial Statements, Reports, Certificates. Borrower shall
                deliver to Bank: (a) as soon as available, but in any event
                within forty-five (45) days after the end of each quarter, a
                company prepared consolidated balance sheet and income statement
                covering Borrower's consolidated operations during such period,
                in a form and certified by an officer of Borrower reasonably
                acceptable to Bank; (b) as soon as available, but in any event
                within thirty (30) days after the end of each month, a company
                prepared consolidated revenue and expense statement covering
                Borrower's consolidated operations during such period, in form
                reasonably acceptable to Bank; (c) as soon as available, but in
                any event within one hundred twenty (120) days after the end of
                Borrower's fiscal year, audited consolidated financial
                statements of Borrower prepared in accordance with GAAP,
                consistently applied, together with an unqualified opinion on
                such financial statements of an independent certified public
                accounting firm reasonably acceptable to Bank; (d) promptly upon
                receipt of notice thereof, a report of any legal actions pending
                or threatened against Borrower or any Subsidiary that could
                result in damages or costs to Borrower or any Subsidiary of Two
                Hundred Fifty Thousand Dollars ($250,000) or more; (e) prompt
                notice of any material change in the composition of the
                Intellectual Property Collateral, including, but not limited to,
                any subsequent ownership right of the Borrower in or to any
                Copyright, Patent or Trademark not specified in any intellectual
                property security agreement between Borrower and Bank or
                knowledge of an event other than information that is publicly
                available and applicable generally to Borrower's business
                practices and industry that materially adversely effects the
                value of the Intellectual Property Collateral; and (f) such
                budgets, sales projections, operating plans or other financial
                information as Bank may reasonably request from time to time.

                Within twenty (20) days after the last day of each month,
                Borrower shall deliver to Bank a Borrowing Base Certificate
                signed by a Responsible Officer in substantially the form of
                Exhibit C hereto, together with aged listings of accounts
                receivable.

                Within forty-five (45) days after the last day of each quarter,
                Borrower shall deliver to Bank with quarterly financial
                statements a Compliance Certificate signed by a Responsible
                Officer in substantially the form of Exhibit D hereto.


                                      5-




<PAGE>

                Bank shall have a right from time to time hereafter to audit
                Borrower's Accounts at Borrower's expense, provided that such
                audits will be conducted no more often than every six (6) months
                unless an Event of Default has occurred and is continuing."

       3.       The Loan Agreement shall be amended by deleting the following
                financial covenants appearing as Sections 6.8 through 6.12:

                "6.8 Quick Ratio. Borrower shall maintain, measured as of the
                last day of each quarter, a ratio of Quick Assets to Current
                Liabilities of at least 0.75 to 1.0.

                6.9 Tangible Net Worth. Borrower shall maintain, measured as of
                the last day of each quarter, a Tangible Net Worth of not less
                than: (i) Twenty Nine Million Dollars ($29,000,000.00) as of the
                last day of the quarter ending September 30, 1998; and (ii)
                Twenty-Eight Million Five Hundred Thousand Dollars
                ($28,500,000.00) as of the last day of each calendar quarter
                thereafter.

                6.10 Debt-Net Worth Ratio. Borrower shall maintain, measured as
                of the last day of each quarter, a ratio of Total Liabilities to
                Tangible Net Worth of not greater than 0.80 to 1.0.

                6.11 Profitability. Borrower shall maintain, measured as of the
                last day of each quarter: (i) a maximum net loss of One Million
                Five Hundred Thousand Dollars ($1,500,000.00) as of the last day
                of the third quarter of 1998; (ii) a maximum net loss of One
                Million Dollars ($1,000,000.00) as of the last day of the fourth
                quarter of 1998; and (iii) a profit for each quarter commencing
                with the first quarter of Borrower's fiscal year 1999 with an
                allowance for one quarterly loss during such fiscal year of no
                greater than Two Hundred Fifty Thousand Dollars ($250,000.00).

                6.12 Debt Service Coverage Ratio. Beginning with the last day of
                the first quarter following the Debt Service Coverage Event,
                Borrower shall maintain, measured as of the last day of each
                quarter, a Debt Service Coverage Ratio of 1.50 to 1.0."

                and substituting the following:

                "6.8 [Intentionally Deleted]

                6.9 [Intentionally Deleted]

                6.10 Quick Ratio. Borrower shall maintain, measured as of the
                last day of each quarter, a ratio of Quick Assets to Current
                Liabilities of at least 1.0 to 1.0.

                6.11 Tangible Net Worth. Borrower shall maintain, measured as of
                the last day of each quarter, a Tangible Net Worth of not less
                than Thirty Million ($30,000,000.00) as of the month ending
                December 31, 1999, and as of the last day of each month
                thereafter.

                6.12 Profitability. Borrower shall maintain, measured as of the
                last day of each quarter: (i) a profit of One Hundred Thousand
                Dollars ($100,000.00) as of the last day of the first quarter of
                fiscal year 2000; (ii) a profit of Two Hundred Thousand

                                      6-


<PAGE>

                Dollars ($200,000.00) as of the last day of the second and third
                quarters of fiscal year 2000; and (iii) a profit of Three
                Hundred Thousand Dollars ($300,000.00) as of the last day of the
                fourth quarter of fiscal year 2000, with an allowance for one
                quarterly loss during such fiscal year of no greater than One
                Hundred Thousand Dollars ($100,000.00). Notwithstanding the
                foregoing, the Borrower shall maintain a profit for fiscal year
                2000 of Eight Hundred Thousand Dollars ($800,000.00)."

2. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended wherever
necessary to reflect the changes described above.

3. RATIFICATION OF LOAN DOCUMENTS. Borrower hereby ratifies, confirms, and
reaffirms all terms and conditions of all security or other collateral granted
to the Lender, and confirms that the indebtedness secured thereby includes,
without limitation, the Indebtedness.

4. NO DEFENSES OF BORROWER. Borrower agrees that, as of this date, it has no
defenses against the obligations to pay any amounts under the Indebtedness.

5. CONTINUING VALIDITY. Borrower understands and agrees that in modifying the
existing Indebtedness, Lender is relying upon Borrower's representations,
warranties, and agreements, as set forth in the Existing Loan Documents. Except
as expressly modified pursuant to this Loan Modification Agreement, the terms of
the Existing Loan Documents remain unchanged and in full force and effect.
Lender's agreement to modifications to the existing Indebtedness pursuant to
this Loan Modification Agreement in no way shall obligate Lender to make any
future modifications to the Indebtedness. Nothing in this Loan Modification
Agreement shall constitute a satisfaction of the Indebtedness. It is the
intention of Lender and Borrower to retain as liable parties all makers and
endorsers of Existing Loan Documents, unless the party is expressly released by
Lender in writing. No maker, endorser, or guarantor will be released by virtue
of this Loan Modification Agreement. The terms of this Paragraph apply not only
to this Loan Modification Agreement, but also to all subsequent loan
modification agreements.

6. JURISDICTION/VENUE. Borrower accepts for itself and in connection with its
properties, unconditionally, the non-exclusive jurisdiction of any state or
federal court of competent jurisdiction in the Commonwealth of Massachusetts in
any action, suit, or proceeding of any kind against it which arises out of or by
reason of this Loan Modification Agreement; provided, however, that if for any
reason Lender cannot avail itself of the courts of the Commonwealth of
Massachusetts, then venue shall lie in Santa Clara County, California.

7. COUNTERSIGNATURE. This Loan Modification Agreement shall become effective
only when it shall have been executed by Borrower and Lender (provided, however,
in no event shall this Loan Modification Agreement become effective until signed
by an officer of Lender in California).

                                      7-








<PAGE>

     This Loan Modification Agreement is executed as of the date first written
above.

BORROWER:                              LENDER:

SEACHANGE INTERNATIONAL, INC.          SILICON VALLEY BANK, doing business as
                                       SILICON VALLEY EAST

By: /s/ WL FIEDLER                     By:
   ----------------------------           -----------------------------
Name:  WL FIEDLER                      Name:
     --------------------------             ---------------------------
Title: Vice President                  Title:
      -------------------------              --------------------------


                                       SILICON VALLEY BANK

                                       By:
                                          -----------------------------
                                       Name:
                                            ---------------------------
                                       Title:
                                             --------------------------

                                      -8-