Document:

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                             CONFIDENTIAL TREATMENT

                                  Exhibit 10.35
                                License Agreement

<PAGE>

                                                          CONFIDENTIAL TREATMENT

                     LICENSE AGREEMENT FOR SOFTWARE PRODUCTS
                                     BETWEEN
                       ISLAND PACIFIC SYSTEMS CORPORATION
                                       AND
                                TOYS "R" US, INC.

INSTALLATION ADDRESS:                       461 From Road
                                            Paramus, New Jersey  07652-3524

         Island Pacific Systems Corporation is hereafter called "Island Pacific"
and Toys "R" Us, Inc. is hereafter called "Customer". Island Pacific agrees to
provide and Customer agrees to license the software products listed in
Attachments A (the "Software Products") and related materials thereto, subject
to the following terms and conditions:

         1.       EFFECTIVE DATE AND LICENSE TERM:

                  (a) The effective date of this License Agreement shall be the
date this document has been executed and delivered by both Island Pacific and
Customer.

                  (b) The license granted herein for the Software and for each
Software Product shall commence on the effective date of this License Agreement
and shall continue indefinitely unless otherwise terminated as provided herein.

         2.       LICENSE:

                  (a) Island Pacific grants to Customer a perpetual, worldwide,
non-exclusive right and license (the "License") to use the Software and the
Software Products and to sublicense the use of the Software and the Software
Products to its Affiliates and Licensed Parties (each of Customer's Affiliates
and Licensed Parties shall be referred to hereafter individually as a
"Sublicensee" and collectively, as the "Sublicensees").

                  (b) For purposes of this License Agreement, the following
definitions apply:

                           (i) "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 percent.

                           (ii) "Release" means a version of Island Pacific
program products that incorporates all Corrective Service Requests and product
enhancements into the base products since the cut-off date of the previous
version of the software.

                           (iii) "Corrective Service Request" (CSR) means
program changes performed by Island Pacific to an Island Pacific Release after a
Release has been made generally available to Island Pacific customers.

                           (iv) "Licensed Party" means any entity who has
entered into a license agreement with Customer to conduct retail operations
using the "Toys "R" Us" brand name, or any other store name or trade name used
by Toys "R" Us or an Affiliate, whether in English or a different language
("Licensed Toys "R" Us Operations").

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                                                          CONFIDENTIAL TREATMENT

                           (v) "Software" means all software components
developed by or licensed to Island Pacific relating to the Software Products,
including without limitation those specified in the Documentation (as defined in
Paragraph 7 hereof).

                  (c) Before Island Pacific Software Products are installed at a
Sublicensee's location, the Affiliate or Licensed Party will be required to sign
a separate agreement, in substantially the form of Exhibit A, which will be
agreed upon and attached hereto within 30 days following the date hereof, that
protects Island Pacific's trade secrets and copyrights. Each such Sublicensee
shall also agree to use the Software only in connection with its Licensed Toys
"R" Us Operations.

                  (d) Upon Customer's request, Island Pacific will ship Software
Products to Customer's Installation Address only, as indicated above or as later
modified by notice from Customer to Island Pacific. Island Pacific will not be
responsible for the shipment or distribution of Software Products to Customer's
multiple locations. Customer will be responsible for paying all taxes, tariffs
and duties related to the distribution and shipment of Island Pacific Software
Products to its multiple locations. Island Pacific represents and warrants that,
to the best of Island Pacific's knowledge, exportation of the Software and the
Software Products by Customer will not violate any laws, rules or regulations of
the United States.

                  (e) Customer and its Sublicensees may install the Software on
as many IBM AS/400 CPUs and successor AS/400 CPUs (collectively, the "Specified
CPUs") for use by an unlimited number of users at as many locations as Customer
and its Sublicensees desire to support the business operations of (i) Customer
and (ii) its Sublicensees' Licensed Toys "R" Us Operations. Island Pacific
represents and warrants that, as of the date of this Agreement, all program
products listed in Attachments A will operate on any IBM AS/400 RISC level
processor with an operating system level of version 4, release 2, or above.
Island Pacific will notify Customer in writing of any material changes to the
Specified CPUs promptly upon becoming aware of such change. In addition, Island
Pacific will support each Release on its Specified CPU for at least two years
after written notification to Customer that the Release is available for
delivery to Customer.

                  (f) The License granted in Paragraph 2(a) above includes the
right to hold a reasonable number of back-up copies of the Software at any given
time, reasonably consistent with Customer's normal back-up policies. In order to
protect Island Pacific's trade secrets and copyrights in each Software Product,
Customer agrees to reproduce and incorporate Island Pacific's copyright notice,
as it appears below, in any copies or modifications made by Customer , including
partial copies in any form.

     -----------------------------------------------------------------------
      Program property of Island Pacific. This work contains trade secrets
        deemed valuable and proprietary to the owner. Unauthorized use is
          prohibited. Copyright (C) Island Pacific. All rights reserved.
     -----------------------------------------------------------------------

         3.       USE AND MODIFICATION:

                  (a) Island Pacific will not be responsible for any Software
problems resulting solely and directly from (i) Customer modifications to the
Software, (ii) incompatibility of any equipment not specified as compatible by
Island Pacific, or (iii) any Software Product, future Software Product release
or any modifications, changes or copies thereof not being installed by Island
Pacific or its authorized agents. Island Pacific's trade secret and copyright
rights will continue to exist in each Software Product. Customer agrees to
incorporate the copyright notice as found in Paragraph 2(f).

                  (b) Any modification or enhancement developed by Island
Pacific at Customer's request, whether for a fee or not, becomes part of the
Software and as such is the property of Island Pacific. Island Pacific's trade
secret and copyright rights will continue to exist in each Software Product.
Customer agrees to incorporate the copyright notice as found in Paragraph 2(f).

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                                                          CONFIDENTIAL TREATMENT

         4.       FEES AND CHARGES:  (SEE ATTACHMENTS A)

                  [***]

         5.       PROPRIETARY RIGHTS:

                  (a) Each Software Product and all copies thereof are the
         property of Island Pacific. All applicable proprietary and intellectual
         property rights, copyrights, trademarks and trade secrets in the
         Software are and will remain with and in Island Pacific. Except as
         contemplated herein, Customer shall not sell, transfer, publish,
         disclose, display or otherwise make available any Software Products or
         copies thereof to others, with the exception of consultants or
         contractors hired by Customer to assist in the implementation or
         operation of the products. Customer agrees to secure and protect Island
         Pacific's trade secrets and copyright rights in each Software product
         and copies thereof in a manner consistent with the protection of its
         own confidential materials, and in any event take reasonable steps and
         to take appropriate action by instruction or agreement with its
         employees or agents who are permitted access to each Software Product
         or copies thereof to satisfy its obligations hereunder.

                  (b) Customer understands that the Software Products are
         protected by a security program (the "Security Program") that will
         render them unusable if Customer violates the conditions of this
         License Agreement or tampers with the Security Program. Customer
         further understands that in the event of such a violation, Island
         Pacific must be contacted to restore access to the Software. Island
         Pacific 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 to any location of Customer or any of its
         Sublicensees.[***]

         6.       INDEMNIFICATION:

                  Each party agrees to indemnify, defend and hold the other (and
in the case of Island Pacific's indemnification of Customer, Customer's
Sublicensees are also indemnified), and their respective officers, shareholders,
directors, employees and representatives, harmless from any third party loss,
claim, liability or damage to person or property arising out of this License
Agreement or Customer's or any Sublicensee's possession or use of the Software
Products, or the services provided in connection therewith, which is directly or
indirectly caused by (i) the breach of any representation or warranty contained
herein by such party, or (ii) the negligence or intentional misconduct of such
party. This indemnity will survive indefinitely the termination of this License
Agreement. Nothing in this paragraph shall be construed to change the effect of
the provisions of paragraphs 10 and 11 below.

         7.       DOCUMENTATION:

                  (a) The documentation (the "Documentation") to be provided by
Island Pacific to Customer promptly upon execution of this License Agreement and
thereafter as new releases of the Software occur, shall include:

                           (i) a reference manual for each Software Product
containing:

[***] = Confidential Treatment Requested

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                                                          CONFIDENTIAL TREATMENT

                                    (A) system introduction and overview of
applications including, without limitation, a reasonably detailed description of
all of the functions performed by the applicable Software 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.

                           (ii) a logic manual describing the purpose and
inter-relationship of and between all programs and data base files used by each
Software Product.

                           (iii) the source code for all programs and data
descriptions used in each Software Product, with the exception of Island
Pacific's Security Program, in machine readable form. Island Pacific will
furnish to Customer the source code for the Security Program in machine readable
form, or will disable the Security Program, at Customer's option, in each case
without charge, immediately if Island Pacific ceases to operate its business in
the ordinary course or, except where Customer is in breach of any material
obligation under this Agreement and has failed to cure such breach within the
applicable cure period, if Island Pacific withholds or restricts access to the
Software by Customer or its Sublicensees for [***] business days following
notification in writing by Customer. Concurrently with execution of this License
Agreement, Island Pacific shall place the source code for the Security Program
in escrow with an independent third party pursuant to an escrow agreement
substantially in the form of Exhibit B, which will be agreed upon and attached
hereto within 30 days following the date hereof, pursuant to which such escrow
agent shall release such source code to Customer upon Customer's request should
Island Pacific cease to operate in the ordinary course or, except where Customer
is in breach of any material obligation under this Agreement and has failed to
cure such breach within the applicable cure period, if Island Pacific withholds
or restricts access to the Software by Customer or its Sublicensees for [***]
business days following notification in writing by Customer.

                  (b) Title to all documents and all applicable proprietary and
intellectual property rights, copyrights, trademarks and trade secrets and all
Documentation and the information contained therein shall remain with Island
Pacific. Customer agrees to:

                           (i) secure and protect the confidentiality of Island
Pacific's confidential documentation furnished to Customer in a manner
consistent with the security and protection of Customer's own confidential
property;

                           (ii) not copy such documentation in whole or in part
except for Customer's own use or for its Sublicensees' use;

                           (iii) use such documentation only in Customer's
business and its Sublicensees' Licensed Toys "R" Us Operations; and

[***] = Confidential Treatment Requested

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                                                          CONFIDENTIAL TREATMENT

                           (iv) not sell, transfer or otherwise make such
documentation available to others, except its Sublicensees.

                  (c) Notwithstanding the foregoing, the obligations set forth
in Paragraph 7(b) will not apply to any information or data which:

                           (i) is in or comes into the public domain other than
by reason of a breach of the obligations imposed in Paragraph 7(b), or

                           (ii) is independently developed by Customer or any of
the Sublicensees without the use of Island Pacific's confidential information
or,

                           (iii) is obtained from a third party who Customer
reasonably believes is lawfully authorized to disclose it, or

                           (iv) was in Customer's or a Sublicensee's possession
prior to receipt of the information from Island Pacific, or

                           (iv) is required to be disclosed by law or legal
process.

         8.       PRODUCT SUPPORT AND ENHANCEMENTS:

                  (a) Island Pacific hereby offers Customer software product
support and enhancement services for the Software Products described in
Attachments A pursuant to a Services Agreement (the "Services Agreement") in the
form attached hereto as Exhibit C, and Customer shall have the option of
subscribing to these services.

                  (b) Subject to Paragraph 8(e) hereof, the charge for such
services shall be [***] (c) Product support and enhancement services to be
provided by Island Pacific to Customer under the Services Agreement shall
include, but not be limited to:

                           (i) telephone access from Customer's centralized
location to the Island Pacific support "Hotline" during published support hours
regarding the installation, use of and suspected problems with the Software; and

                           (ii) one production copy of the object code and
applicable source code pursuant to the provisions herein for each new release of
each Software Product.

                  (d) Telephone support, including the reporting and correction
of suspected problems with the Software will be available for the current and
one previous published Release of each Software Product. Telephone support
services will be provided to a single centralized location of Customer only and
may not be used by all of Customer's locations unless separate support charges
are paid by Customer for each location.

                  (e) Subject to the provisions of Paragraph 8(b) hereof, Island
Pacific reserves the right to change the fees charged for the support services
under the Services Agreement after having given[***]written notice to Customer.
Increases can be no more than [***]of the then published price of the Software
Products covered in Attachments A per contract year, and the maximum aggregate
fees under the Services Agreement while it is in effect will equal [***]of the
published price then in effect for the Software Products then being serviced for
Customer by Island Pacific. In addition, the maximum support fees for
centralized support specified in the Services Agreement shall not increase by

[***] = Confidential Treatment Requested

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                                                          CONFIDENTIAL TREATMENT

more than, [***] Island Pacific reserves the right, after having given written
notice, to immediately withdraw product support services from Customer for
non-payment of any undisputed Island Pacific invoice that has become more than
thirty days past due, if Customer does not pay such invoice within [***] after
receipt of such written notice.

         9.       TERMINATION:

                  (a) If either party fails to comply with any of its material
obligations hereunder, and after the non-breaching party has given written
notice of its intent to terminate this License Agreement, such party may, after
having given the other party thirty days from receipt of such default notice to
remedy its default, terminate this License Agreement. The remedy of termination
is in addition to, and not in limitation of, any other rights of the
non-breaching party under this License Agreement, at law or in equity.

                  (b) Within thirty days of termination of this License
Agreement for any reason other than a breach of this License Agreement by Island
Pacific, Customer:

                           (i) will return to Island Pacific each Software
Product and related Documentation in the form provided by Island Pacific, or as
modified by Customer, and all copies in whole or in part made by Customer; or

                           (ii) will upon written request from Island Pacific,
destroy each Software Product and related documentation in the form provided by
Island Pacific, or as modified by Customer, and all copies in whole or in part
made by Customer and certify in writing that they have been destroyed.

         10.      LIMITATION OF REMEDY:

                  In no event will either party be liable to the other for any
indirect, remote, consequential or special damages arising out of (a) this
License Agreement, (b) the use of any Software, Software Products or
Documentation, or (iii) the services provided under this License Agreement.
Notwithstanding the foregoing, in the event of Customer's willful breach of
Paragraph 5(a) hereof, Island Pacific shall be entitled to compensation [***]

         11.      WARRANTIES:

                  (a) Island Pacific represents and warrants that it has full
power and authority to grant the rights granted herein without the consent of
any other party, and that the use of the Software and the Software Products will
not violate or infringe upon any copyright, trade secret or other intellectual
property right of any person or entity, and Island Pacific shall, and hereby
does, indemnify, defend and hold Customer and its Sublicensees, and their
respective officers, directors, employees, shareholders and representatives,
harmless from and against any loss, claim, cost, liability and expense
including, but not limited to, attorneys' fees and disbursements, arising from
any breach of this warranty.

                  (b) Island Pacific represents and warrants that (i) it is a
corporation duly organized, validly existing and in good standing under the laws
of the State of California and is entitled to own or lease its assets and
properties and to carry on its business as presently conducted; (ii) it has the
corporate power and authority to execute, deliver and perform this License
Agreement and the execution, delivery and performance of this License Agreement
by Island Pacific have been duly authorized by all necessary corporate action;
and (iii) this License Agreement has been duly executed and delivered by Island
Pacific and constitutes the legal, valid and binding obligation of Island
Pacific enforceable against Island Pacific in accordance with its terms.

                  (c) Island Pacific shall use its best efforts to remedy any
reported critical defect within [***] of notice thereof from Customer.[***] A
"critical defect" is a defect that adversely affects normal use or functionality

[***] = Confidential Treatment Requested

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                                                          CONFIDENTIAL TREATMENT

of any Software or Software Product. For purposes of this Paragraph 11(c),
"normal use or functionality" shall mean the program products will perform
substantially in accordance with the Documentation as defined in Paragraph
7.[***]
                  (d) Island Pacific represents and warrants that it owns all of
the rights, title and interest in and to the Software and the Software Products,
and that the Software has been and will be produced in accordance with all
applicable laws, rules and regulations.

                  (e) EXCEPT AS PROVIDED IN THIS LICENSE AGREEMENT OR THE
SERVICES AGREEMENT, INCLUDING ANY ATTACHMENTS OR EXHIBITS HERETO OR THERETO,
THERE ARE NO EXPRESSED OR IMPLIED WARRANTIES, INCLUDING THE IMPLIED WARRANTY OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, NOT SPECIFIED HEREIN
RESPECTING THIS LICENSE AGREEMENT AND THE SOFTWARE PRODUCTS, DOCUMENTATION AND
SERVICES PROVIDED.

                  (f) The Island Pacific Software Products identified in
Attachment As, and the Software systems as a whole (including all interface
files, screen interfaces, reports, transactions interfaces, database files,
utilities, peripheral programs and applications included in the current Software
Products and New Releases (collectively, the "System") are tested and guaranteed
year-2000 compliant. Island Pacific further represents and warrants that the
System and all software supporting its business operations:

                           (i) handle and will handle properly date information
before, during and after January 1, 2000, including but not limited to handling
of February 29, 2000, accepting date input, providing date output, and
performing calculations on dates or portions of dates;

                           (ii) function and will function accurately and
without interruption before, during and after January 1, 2000, without any
change in functionality associated with the advent of January 1, 2000 (the
"Millennium Date Change");

                           (iii) respond and will respond to two-digit year date
input in a way that avoids any ambiguity as to the applicable century; and

                           (iv) store and provide and will store and provide
output of date information in ways that are unambiguous as to century;

                           (v) do not contain time and date codes or internal
programs that will be impacted by the Millennium Date Change, and all current
time and date codes and programs contained in the Software Products will operate
during the term of this License Agreement and continue to operate beyond the
Millennium Date Change at least at the same level of functionality as would
otherwise be provided in the absence of a Millennium Date Change.

                  (g) If the System is found to be out of compliance with any of
the criteria set forth in clauses (i) through (v) above (the "Y2K Criteria"),
such that normal use or functionality of any of the Software or Software
Products is adversely affected, Island Pacific will remedy the problem
immediately, and entirely at it's own expense (including any incidental upgrade
or conversion costs).

                  (h) If any part of the System is found to be out of compliance
with the Y2K Criteria, but such non-compliance does not adversely affect the
normal use or functionality of the Software or Software Products, Island Pacific
will fix the discrepancy or provide equivalent functionality at no cost to
Customer. Such a discrepancy will be fixed or replaced within 10 business days
at no cost to Customer.

                  (i) If Island Pacific cannot make the entire system fully
compliant within the periods of time set forth above, then Customer may elect to
rescind this entire License Agreement or this License Agreement only as it

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                                                          CONFIDENTIAL TREATMENT

relates to the affected Software, return the affected Software, and receive a
complete and immediate cash refund of all fees paid to Island Pacific since the
execution of this License Agreement relating to the affected Software. This
remedy is in addition to, and not in limitation of, any other remedies Customer
may have hereunder, at law or in equity.

                  (j) If use of one or more of the Software Products or the
Software infringes upon any copyright, trade secret or other intellectual
property right of a third party, Island Pacific, as quickly as is reasonable
under the circumstances, will at its sole cost and expense, either (i) acquire
for Customer the right to continue to use the Software Products and Software in
accordance with the terms hereof, (ii) provide Customer with another software
product which will perform in an equivalent manner, so as to permit Customer to
continue to operate its business in an equivalent manner or, (iii) if one of the
foregoing does not occur within a reasonable period of time, in no event longer
than fifteen days, then Customer shall have the right to terminate this License
Agreement as to the affected Software and receive full reimbursement of all fees
paid to Island Pacific relating to the Affected Software. This remedy is in
addition to, and not in limitation of, any other remedies Customer may have
hereunder, at law or in equity.

                  (k) Customer represents and warrants that (i) it is a
corporation duly organized, validly existing and in good standing under the laws
of the State of New Jersey and is entitled to own or lease its assets and
properties and to carry on its business as presently conducted; (ii) it has the
corporate power and authority to execute, deliver and perform this License
Agreement and the execution, delivery and performance of this License Agreement
by Customer have been duly authorized by all necessary corporate action, and
(iii) this License Agreement has been duly executed and delivered by Customer
and constitutes the legal, valid and binding obligation of Customers enforceable
against Customer in accordance with its terms.

                  (l) The representations and warranties contained in this
License Agreement and in the Services Agreement shall indefinitely survive the
expiration or termination of this License Agreement and the Services Agreement.

         12.      INSURANCE:

                  (a) Island Pacific shall maintain, during the term of this
License Agreement, 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 [***] per occurrence combined single limit and [***] in
the aggregate and workers compensation coverage as dictated by applicable law.
Toys "R" Us will be added as an additional insured. Upon the execution of this
License Agreement and annually thereafter, Island Pacific 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 Client is included as an additional insured.

                  (b) The carrier(s) issuing the policies required hereunder
shall be rated [***] or better by Bests.

                  (c) [***].

         13.      GENERAL:

                  (a) This License Agreement may:

                           (i) be assigned by Customer to any Affiliate.

[***] = Confidential Treatment Requested

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                                                          CONFIDENTIAL TREATMENT

                           (ii) be assigned to any party in connection with a
merger, reorganization, or sale of substantially all of the assets of such
party.

                           (iii) not otherwise be assigned, in whole or in part,
by Customer or Island Pacific, without the written consent of the other party,
and such consent will not be unreasonably withheld.

                  (b) Customer may return any Software Product for any reason
for a period of seven months after the date of shipment of all of the Software
Products to Customer, and receive full refund of all software license fees paid
to Island Pacific. Such refund will be made to Customer within thirty days after
the Software Products are returned. Customer recognizes and agrees that this
return policy is not a warranty and does not alter the provisions or effect of
Paragraph 11 above.

                  (c) This License Agreement may be amended only in writing if
executed by both Customer and Island Pacific.

                  (d) This License Agreement is governed by the laws of the
state of New Jersey, without reference to its conflict of laws provisions.

                  (e) This License Agreement represents the entire agreement
between the parties and supersedes all prior oral and written proposals and
communications.

                  (f) No waiver of any party's rights hereunder shall be
effective unless in writing and signed by such party and each waiver shall
extend only to the specific instance involved and shall not impair a party's
rights in any other respect at any other time.

                  (g) If any paragraph, clause or provision of this License
Agreement is construed or interpreted by a court of competent jurisdiction to be
void, invalid or unenforceable, such decision shall affect only such paragraph,
clause or provision so construed or interpreted and shall not affect the
remaining paragraphs, clauses and provisions of this License Agreement.

                  (h) This License Agreement may be executed in counterparts
each of which shall be an original and all of which taken together shall
constitute one and the same document.

                  (i) This License Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns.

                  (j) Neither party shall use the name, logos, service marks,
trademarks and identity of the other (and Island Pacific shall not use those of
Customer's Sublicensees) in publicity, advertising, or any similar activity,
without the prior written consent of the other. Island Pacific may include
Customer's name only on its list of customers [***], unless otherwise agreed by
Customer.

                  (k) All notices, consents and other communications given
pursuant to, or required by, this License Agreement shall be in writing and
either: (i) personally delivered; (ii) sent by prepaid registered mail; (iii)
sent by recognized overnight courier, or; (iv) sent by facsimile transmission
(with a copy sent by registered mail to follow), to the parties at their address
set forth below:

               If to Island Pacific to:  Island Pacific Systems Corporation
                                         19800 MacArthur Blvd., 12th Floor
                                         Irvine, CA 92612-2441
                                         Fax No.: 949-476-0177
                                         Attn: Todd Hammett

[***] = Confidential Treatment Requested

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                                                          CONFIDENTIAL TREATMENT

               If to Customer to:        Toys "R" Us, Inc.
                                         461 From Road
                                         Paramus, New Jersey  07652-3524
                                         Fax No.:  (201) 262-8060
                                         Attn: Bruno Roqueplo,
                                               Senior Vice President of Finance
                                               and Administration (CFO)

                                         with a copy to the
                                         attention of the General
                                         Counsel at the same address

or to such other address as the party to receive the notices, consents or other
communications may from time to time designate in writing to the other.

                  (l) The captions used herein are for reference purposes only,
and shall not in any way affect the meaning or interpretation of this License
Agreement.

         14.      COSTS AND ATTORNEY'S FEES:

                  If any party to this License Agreement must bring suit to
protect its rights or enforce the terms and conditions of this License
Agreement, the prevailing party is entitled to all costs and reasonable
attorneys' fees approved by the court.

         IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date set forth below.

DATED: ______________________

                  TOYS "R" US, INC

                  BY:  ________________________________________________
                       BRUNO ROQUEPLO, SENIOR VICE PRESIDENT OF FINANCE
                          AND ADMINISTRATION (CFO)

                  ISLAND PACIFIC SYSTEMS CORPORATION

                  BY:  ________________________________________________
                       TODD HAMMETT
                       CHIEF FINANCIAL OFFICER

                                       10<PAGE>

                             CONFIDENTIAL TREATMENT

                                  Exhibit 10.36
                             Modification Agreement

<PAGE>

                                                          CONFIDENTIAL TREATMENT

                             ISLAND PACIFIC SYSTEMS
                             MODIFICATION AGREEMENT
         _______________________________________________________________

                  Concurrently with the execution of this template Agreement,
Toys "R" Us, Inc. ("Customer" or "you") and Island Pacific Systems Corporation
("Island Pacific" or "we") are entering into a certain License Agreement for
Software Products (the "License Agreement") and a certain Services Agreement
(the "Services Agreement"). Capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the License Agreement. This
document will serve as a template agreement between Customer and Island Pacific
describing the manner in which modifications to Island Pacific's Software
Products desired by Toys R Us are developed and delivered. We both agree to the
following terms and conditions:

                  DESCRIPTION OF PROJECT - AT THIS TIME THE SCOPE OF EACH
DELIVERABLE IS UNKNOWN. AS YOUR STAFF AND OURS AGREE ON THE CONTENTS THEREOF,
THE PARTIES WILL GIVE THE BODY OF WORK A NAME WHICH WILL APPEAR IN THIS
PARAGRAPH. TO EXPEDITE WORK, UPON YOUR REQUEST, WE WILL HAVE MORE THAN ONE OF
THESE MODIFICATION AGREEMENTS IN PROCESS AT ANY GIVEN TIME.

                    DESIGN SPECIFICATIONS - THE PROCESS OF IDENTIFYING USER
REQUIREMENTS, DOCUMENTING THE RELATED BUSINESS PROCESS FLOWS, AND DESIGNING THE
PANELS, FILES AND PROGRAMS RESULTS IN DESIGN SPECIFICATIONS. THESE
SPECIFICATIONS MUST BE COMPLETED BEFORE WE CAN GIVE A FIXED PRICE FOR THE CODE
BUILD. UPON SIGNING THE APPLICABLE MODIFICATION AGREEMENT, THE PARTIES WILL
AGREE UPON A DELIVERY DATE FOR THE DESIGN SPECIFICATIONS. BOTH PARTIES AGREE
THAT THEY WILL EACH USE THEIR REASONABLE BEST EFFORTS TO ASSIST EACH OTHER IN
MEETING THIS AGREED DATE. ONCE THE DESIGN SPECIFICATIONS ARE COMPLETED AND WE
HAVE GIVEN YOU A FIXED PRICE, MILESTONES AND FIRM DELIVERY DATES FOR THE CODE
BUILD, YOU CAN ELECT TO PROCEED WITH THE WORK, AMEND ITS SCOPE, OR CANCEL THE
MODIFICATION PROJECT ENTIRELY. IF YOU DECIDE TO CANCEL WORK ON THE MODIFICATION,
ANY DESIGN CHARGES ALREADY INCURRED ARE NOT WAIVED. IF YOU DECIDE TO PROCEED, WE
WILL EACH SIGN A SCHEDULE, TO BE ATTACHED TO THE APPLICABLE MODIFICATION
AGREEMENT, DESCRIBING THE APPLICABLE FIXED PRICE, MILESTONES AND FIRM DELIVERY
DATES FOR THE CODE BUILD (THE "PROJECT SCHEDULE").

                  CODE BUILD - ONCE THE PROJECT SCHEDULE IS APPROVED, WE WILL
UNDERTAKE CONSTRUCTION OF THE PANELS, FILES AND PROGRAMS NEEDED TO IMPLEMENT THE
DESIGN. WE WILL DO THIS IN PARALLEL WITH OTHER DEVELOPMENT PROJECTS.

                  MILESTONES - AS PART OF OUR AGREEMENT, THE PROJECT SCHEDULE
WILL CONTAIN DATES AT WHICH PORTIONS OF THE FINAL DELIVERABLE CAN BE EVALUATED
BY YOU. IN THIS WAY YOU

                                       1
<PAGE>

                                                          CONFIDENTIAL TREATMENT

CAN JUDGE BOTH OUR PROGRESS AND THE DEGREE TO WHICH THE DEVELOPMENT MEETS YOUR
UNDERSTANDING OF THE DESIGN SPECIFICATIONS.

                  COSTS - WE CHARGE FOR DESIGN SPECIFICATIONS AT OUR TECHNICAL
SERVICES RATE [***] AS THESE SERVICES ARE INCURRED. THESE CHARGES ARE FURTHER
DESCRIBED IN THE SERVICES AGREEMENT. THE AMOUNT WE CHARGE FOR THE CODE BUILD IS
BASED ON A FIXED COST, WITH [***]DUE UPON BOTH PARTIES SIGNING THE PROJECT
SCHEDULE, PRIOR TO WORK COMMENCING, AND [***]DUE UPON YOUR ACCEPTANCE OF THE
DELIVERABLE. PAYMENT FOR THE CHARGES TO COMPLETE THE DESIGN SPECIFICATIONS WILL
BE DUE WITHIN [***] AFTER RECEIPT OF OUR INVOICES.

                  DELIVERY - IN THIS PARAGRAPH WE WILL AGREE, IF POSSIBLE, ON
THE DATE ON WHICH THE COMPLETED MODIFICATION WILL BE DELIVERED TO YOU. DEPENDING
UPON THE COMPLEXITY OR THE SIZE OF THE MODIFICATION, WE MIGHT ALSO AGREE ON A
FLOATING DATE BASED UPON WHEN THE DETAIL SPECIFICATIONS ARE APPROVED. IN THAT
CASE, THE FIRM DELIVERY DATE WILL BE SET FORTH ON THE PROJECT SCHEDULE. MOST
OFTEN, OUR STAFF WILL TRAVEL TO YOUR SITE TO INSTALL THE MODIFICATION.
[***].

                  ACCEPTANCE - ONCE WE HAVE DELIVERED OR INSTALLED THE
MODIFICATION, YOU WILL HAVE [***] DAYS TO EITHER ACCEPT OR REJECT OUR WORK. IF
YOU DO NOT REJECT THE DELIVERED MODIFICATION WITHIN THIS TIME, WE BOTH AGREE IT
IS CONSIDERED ACCEPTED. IF WE FAIL TO DELIVER ANY PART OF THE MODIFICATION BY
THE AGREED FIRM DELIVERY DATE, WE BOTH AGREE IT IS CONSIDERED AUTOMATICALLY
REJECTED. IF YOU REJECT THE DELIVERED MODIFICATION, EXCEPT IN THE CASE OF
AUTOMATIC REJECTION DUE TO FAILURE TO DELIVER ON TIME, YOU MUST DOCUMENT THE
REASONS FOR SUCH REJECTION AND WE WILL THEN HAVE [***] FROM RECEIPT THEREOF IN
WHICH TO REMEDY OUR FAILURE. IF YOU STILL REJECT OUR WORK OR IF THE MODIFICATION
IS AUTOMATICALLY REJECTED WE WILL, AT YOUR DISCRETION, EITHER

                           a) DELIVER THE MODIFICATION IN ITS CURRENT UNFINISHED
STATE AND FORFEIT [***] OF THE FIXED COST DUE US, OR

                           b) NOT DELIVER THE MODIFICATION AND REFUND [***] AS
WELL AS [***] FOR THE DESIGN SPECIFICATIONS, OR

                           c) [***]

                  SUPPORT - THE MODIFICATION WILL BE DELIVERED AS PART OF AN
AGREED ISLAND PACIFIC RELEASE AND WILL BE SUPPORTED AS A STANDARD PART OF THIS
RELEASE. IF THE MODIFICATION IS DELIVERED IN AN INTERIM RELEASE, SUPPORT FOR
THAT INTERIM RELEASE WILL END SIX MONTHS AFTER GENERAL AVAILABILITY OF THE NEXT
PUBLISHED RELEASE.

[***] = Confidential Treatment Requested

                                       2
<PAGE>

                                                          CONFIDENTIAL TREATMENT

                  INTELLECTUAL PROPERTY - Any modification or enhancement
developed by Island Pacific at your request, whether for a fee or not, becomes
part of Island Pacific's software products. Title to the program product source
code and related documents will remain with Island Pacific. The application will
be incorporated into the I3 product suite and will be made available to all
Island Pacific users.

                  DOCUMENTATION - Application documentation will be included as
part of the first published release in which the modification exists.

                  LICENSE AGREEMENT - As set forth in Paragraph 3(b) of the
License Agreement, the modified Software and Software Products will constitute
"Software" and "Software Products" under the License Agreement.

         IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the Date set forth below.

DATED:

                  TOYS "R" US, INC

                  BY:   /s/ Bruno Roqueplo
                        ------------------------------------------------
                        BRUNO ROQUEPLO, SENIOR VICE PRESIDENT OF FINANCE
                        AND ADMINISTRATION (CFO)

                  ISLAND PACIFIC SYSTEMS CORPORATION

                  BY:   /s/ Todd Hammett
                        ------------------------------------------------
                        TODD HAMMETT
                        CHIEF FINANCIAL OFFICER

                                       3

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