8-K

                       SECURITIES AND EXCHANGE COMMISSION

                                     WASHINGTON, D.C. 20549

                        FORM 8-K

                   CURRENT REPORT

                       Pursuant to Section 13 or 15(d) of

                      The Securities Exchange Act of 1934

                                DECEMBER 21, 2010

                                -----------------------------

                                (Date of Report)

                           ALANCO TECHNOLOGIES, INC.

                           ---------------------------------------------

                   (Exact name of Registrant as specified in its charter)

                           0-9437

                          ---------

                        (Commission File No.)

      ARIZONA                        86-0220694

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          (State or other jurisdiction)    (IRS Employer Identification No.)

             15575 N 83RD WAY, SUITE 3, SCOTTSDALE, ARIZONA  85260

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            (Address of Principal Executive Office)                   (Zip Code)

                                 (480) 607-1010

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              (Registrant's telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of

the following provisions (see General Instruction A.2. below):

(  ) Written communication pursuant to Rule 425 under the Securities Act

     (17 CFR 230.425)

(  ) Soliciting material pursuant to Rule 14a-12 under the Exchange Act

     (17 CFR 240.14a-12)

(  ) Pre-commencement communications pursuant to Rule 14d-2(b) under the

     Exchange Act (17 CFR 240.14d-2(b))

(  ) Pre-commencement communications pursuant to Rule 13e-4(c) under the

     Exchange Act (17 CFR 240.13e-4(c))

Item 1.01         Entry into a Material Agreement

Item 2.03         Creation of a Direct Financial Obligation

On December 16, 2010, Alanco Technologies, Inc. (“the Company”) entered into an agreement to amend its Line of Credit Agreement with a trust controlled By Donald Anderson, a greater than 5% stockholder of the Company.  Under the amendment, the amount available to the Company increased by $300,000 and the maturity date of the Line of Credit was extended to January 31, 2011.  A copy of the agreement is attached hereto as Exhibit 99.1, and is hereby incorporated by reference in this Item 2.03.

On December 16, 2010, Alanco Technologies, Inc. (“the Company”) completed an agreement with its CEO, Robert R. Kauffman, whereby the Company received $100,000 under an unsecured promissory note which accrues interest at a rate of 12% per annum.  A copy of the promissory note is attached hereto as Exhibit 99.2, and is hereby incorporated by reference in this Item 2.03.

Item 9.01

Exhibit 99.1                                Sixth Amendment to Restated Loan and Security Agreement     

Exhibit 99.2                                Promissory Note

    SIGNATURES

                                            ALANCO TECHNOLOGIES, INC.

Date: December 21, 2010                          By: /s/John A Carlson

                                                     -----------------------------

                                           Chief Financial Officer

EX-99.1

SIXTH AMENDMENT TO

RESTATED LOAN AND SECURITY AGREEMENT

THIS SIXTH AMENDMENT TO RESTATED LOAN AND SECURITY AGREEMENT (“Sixth Amendment”) is entered into this 16th day of December, 2010, between Donald E. Anderson and Rebecca E. Anderson, Trustees of the Anderson Family Trust, UTA dated December 20, 1993 ("Lender") as secured party, and Alanco Technologies, Inc. ("ATI"), an Arizona corporation ("Borrower 1"); Excel/Meridian Data, Inc. ("EMD"), an Arizona corporation ("Borrower 2"); Alanco/TSI Prism, Inc. (“TSI”), an Arizona corporation (“Borrower 3"); and StarTrak Systems, LLC, a Delaware limited liability company (“Borrower 4").  Borrower 1,   Borrower 2,   Borrower 3, and Borrower 4, jointly and severally, individually and collectively, the "Borrower".

RECITALS:

The parties entered into that Amended and Restated Loan and Security Agreement, dated December 21, 2007, pursuant to which Lender agreed to provide certain funds to Borrower upon the terms and conditions set forth therein, and that First Amendment to Restated Loan and Security Agreement, dated February 26, 2008, that Second Amendment to Restated Loan and Security Agreement, dated August 22, 2008 amending the Amended and Restated Loan and Security Agreement, that Third Amendment to Restated Loan and Security Agreement, dated January 15, 2009, that Fourth Amendment to Restated Loan and Security Agreement, dated November 16, 2009, and that Fifth Amendment to Restated Loan and Security Agreement, dated November 20, 2009 amending the Amended and Restated Loan and Security Agreement. The Amend ed and Restated Loan and Security Agreement as previously amended by the First Amendment, the Second Amendment, the Third Amendment, the Fourth Amendment and the Fifth Amendment is herein referred to as the ”Agreement.” The parties wish to modify the Agreement in certain respects as set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties agree as follows:

1.           Section 1.16 of the Agreement shall be amended to read as follows:

1.16           "Maturity Date" shall mean January 31, 2011, provided, however, in the event Borrower adopts a plan to recapitalize the Indebtedness, which plan is approved by Lender in writing, then the Maturity Date shall be extended to April 30, 2011 to accommodate consummation of said plan. In the event of said extension, Borrower shall pay Lender an extension fee equal to $30,000, which extension fee shall be added to the Indebtedness balance.

2.           Section 1.8 of the Agreement shall be amended to read as follows::

1.8           “Credit Limit” shall mean Four Million Two Hundred Thousand and 00/100ths Dollars ($4,200,000.00), provided, however, in the event any substantial part of Borrower’s assets are sold, assigned or otherwise conveyed in any manner not in the ordinary course of business of Borrower, then the Credit Limit shall be immediately reduced upon such sale, assignment or conveyance to Three Million Nine Hundred Thousand and 00/100ths Dollars ($3,900,000.00), and any amount in excess of said Credit Limit shall be immediately repaid. Provided further, in the event the Maturity Date is extended to April 30, 2011 as described in section 1.16 of this Agreement, then the Credit Limit shall be increased by $30,000.00 to accommodate inclusion of the extension fee.

3.           Section 2.1 of the Agreement shall be amended to read as follows:

2.1           Upon the request of Borrower, made at any time and from time to time during the term hereof, and so long as no Event of Default has occurred, Lender shall lend to Borrower at Borrower’s request an amount up to the Credit Limit. If at any time for any reason, the amount of Indebtedness owed by Borrower to Lender pursuant to this Section 2.1 of this Agreement is greater than the aggregate amount available to be drawn under this Section 2.1, Borrower shall immediately pay to Lender, in cash, the amount of such excess.

4.           The following paragraph shall be added at the end of section 2.2 of the Agreement:

If Borrower fails to pay when due and payable, all or any portion of Borrower's Indebtedness upon the Maturity Date, Borrower shall pay to Lender a late fee in the amount of $70,000, which fee shall be immediately added to the Indebtedness balance owed.

5.           The following section 6.21 shall be added to the Agreement:

6.21           Unless and until the Maturity Date is extended to April 30, 2011 in accordance with section 1.16 of this Agreement, ATI shall not issue any shares of its stock or other instrument convertible into equity of ATI as long as any part of the Indebtedness is outstanding, other than issuances in connection with (1) exercise of any warrants or options outstanding on the date of the Sixth Amendment to this Agreement, (2) exercise of existing conversion rights of preferred stock of the Company outstanding on the date of the Sixth Amendment to this Agreement or issued as in-kind dividends after the date of the Sixth Amendment to this Agreement, (3) issuance and/or exercise of additional employee stock options granted subsequent to the date of the Sixth Amendment to this Agreement, and (4) common stock of the Borrower issued subsequent to the date of the Sixth Amendment to this Agreement to pay obligations of the Borrower to creditors of Borrower.

6.           Section 6B.1 of the Agreement shall be amended to read as follows:

6B.1           In the event the Indebtedness is not paid when due, at the option of Lender, Lender shall have the right and option to convert up to $1,000,000 of the outstanding Credit into shares of Class A Common Stock of ATI at the conversion rate of $1.37 of the Credit to be converted for each share of Class A Common Stock, without the payment of any additional consideration, subject to readjustment as provided herein below.  All principal payments hereafter made with respect to the Loan shall be deemed to be applied in respect of the non-convertible portion of the Loan until the non-convertible portion has been paid in full, and then to the convertible portion.  Anything contained in this Agreement to the contrary notwithstanding, the Borrower shall b e required to give the Lender the (3) days’ notice prior to any payment of any convertible portion of the Loan once any portion of the Loan is convertible as described above, and the Lender shall retain the right to elect to convert all or any portion of such convertible principal prior to the date fixed by the Borrower for payment.

7.           Borrower agrees that (a) except as expressly provided herein to the contrary, this Sixth Amendment shall not modify the Agreement as previously amended, (b) all of the collateral described in the Agreement shall remain in all respects subject to the lien or charge of the security interest set forth in the Agreement, and (c) nothing contained herein and nothing done pursuant hereto, shall effect or be construed as affecting the lien or charge of said security interest, or the priority thereof over other liens or charges, or as releasing or affecting the liability of any party or parties who may now or hereafter be liable under or on account of the Agreement.  The provisions of this Sixth Amendment are modifications only and except as provided herein all o f the terms and conditions of the Agreement as previously amended remain in full force and effect and the parties hereto ratify and confirm the security, priority and enforceability of the Agreement, as expressly modified by this Sixth Amendment.

8.           This Sixth Amendment shall bind and inure to the benefit of the respective successors and assigns of each of the parties. This Sixth Amendment may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original and all of which shall constitute together but one and the same agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Sixth Amendment to be executed to be effective as of the date first above written.

BORROWERS:

“Borrower l”:

Alanco Technologies, Inc., an Arizona Corporation

“Borrower 2":

Excel/Meridian Data, an Arizona corporation

“Borrower 3":

Alanco/TSI Prism, Inc., an Arizona corporation

By: ____________________________________

Robert R. Kauffman, Chief Executive Officer

“Borrower 4":

StarTrak Systems, LLC

a Delaware limited liability company

By: ____________________________________

Robert R. Kauffman, Manager

LENDER:

_______________________________________

DONALD E. ANDERSON

_______________________________________

REBECCA E. ANDERSON

Trustees of the Anderson Family Trust, UTA

dated December 20, 1993

EX-99.2

PROMISSORY NOTE

$100,000.00

Scottsdale, Arizona

December 16, 2010

FOR VALUE RECEIVED, the undersigned, Alanco Technologies, Inc., an Arizona corporation (“Maker”), promises to pay to the order of Robert R. Kauffman (“Holder”), in lawful money of the United States of America, the principal sum of One Hundred Thousand and no/100ths Dollars ($100,000.00), together with interest thereon as described below, as follows:

A. Interest shall accrue upon the outstanding principal balance of this Note from the date hereof until all principal is paid in full at the rate of twelve (12%) percent per annum, and be payable on the last day of each month hereafter, commencing December 16, 2010.

B. All principal and accrued unpaid interest shall be due in full and paid within thirty (30) days following written demand for such payment by the Holder (the “Maturity Date”).

If payment at the Maturity Date is not paid when due, the entire outstanding principal balance  shall bear interest at a rate (the “Default Rate”) which shall be five (5%) percent per annum in excess of the regular rate of interest shown above, such interest being due from the due date of the delinquent payment until the date of receipt by Holder of the delinquent payment.

Maker may prepay this Note, in part or in full, without a prepayment penalty.  Sums so prepaid may not be re-borrowed.

Unless otherwise agreed to, in writing, or otherwise required by applicable law, payments will be applied first to accrued, unpaid interest, then to unpaid collection costs, late charges and other charges, and any remaining amount to principal.

It is agreed that time is of the essence hereof.  The Maker waives all applicable diligence, presentment, protest and demand, and also notice of protest, of demand, of nonpayment, and of maturity.

The Maker agrees to pay all costs of collection, including reasonable attorneys’ fees and all costs of suit, in case the unpaid principal sum of this Note, or any payment thereon, is not paid when due, or in case it becomes necessary to protect the security for the indebtedness evidenced hereby, or for the foreclosure by Holder of any security for this Note, or in the event Holder is made a party to any litigation because of the existence of the indebtedness evidenced by this Note, whether suit be brought or not, and whether through courts of original jurisdiction, as well as in courts of appellate jurisdiction, or through a Bankruptcy Court or other legal proceedings.

Whenever used herein, the words “Maker” and “Holder” shall be deemed to include their respective heirs, personal representatives, and permitted successors and assigns.

This Note shall be governed by and construed in accordance with the laws of the State of Arizona.

Events of Default.  Each of the following will constitute an event of default (“Event of Default”) under this Note:

Maker’s failure to pay interest when due and all principal and accrued unpaid interest due on the Maturity Date.

Maker’s failure in the performance of any of the terms, agreements, covenants or conditions contained in this Note, which failure shall not have been cured within any applicable grace period.

Maker’s (i) assignment for the benefit of its creditors, or (ii) application for, consent to or acquiescence in, the appointment of a trustee, receiver or other custodian for Maker, the property of the Maker or any part thereof, or in the absence of any application, consent or acquiescence, the appointment of a trustee, receiver or other custodian for Maker or substantial part of the property of Maker, which appointment is not discharged within forty-five (45) days.

The commencement of any case under Title 11 of the Untied States Code or any other bankruptcy, reorganization, receivership, custodianship, or similar proceeding under any state of federal law by or against Maker, with respect to any such case or proceeding that is involuntary, such case or proceeding is not dismissed within sixty (60) days of the filling thereof.

The termination or dissolution of Maker.

Preference Payments.  Maker agrees that, to the extent Maker makes any payment to Holder in connection with the indebtedness evidenced by this Note, and all or any part of such payment is subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid by Holder or paid over to a trustee, receiver or any other entity, whether under any bankruptcy act or otherwise (a “Preferential Payment”), then the indebtedness of Maker and any other party liable under this Note shall continue or shall be reinstated, as the case may be, and the obligation underlying such Preferential Payment shall be revived and continue in full force and effect as if no Preferential Payment had been made.

IN WITNESS WHEREOF, Maker has executed this Note as of the date first above written.

ALANCO TECHNOLOGIES, INC.

an Arizona corporation

By: _____________________________

John A. Carlson

Chief Financial Officer