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                                                                  EXHIBIT 10.25
                                       
                            THIRD AMENDMENT TO LEASE

I.       PARTIES AND DATE.

         This Third Amendment to Lease (the "Third Amendment") dated July 15,
1998, is by and between THE IRVINE COMPANY, as successor-in-interest to Carroll
Ridge Park, a California general partnership ("Lessor"), and ELGAR ELECTRONICS
CORPORATION, a California corporation ("Lessee").

II.      RECITALS.

         On February 1, 1984, Lessor and Lessee entered into a lease for space
in a building located at 9250 Brown Deer Road, San Diego, California
("Premises"), which lease was subsequently amended by a First Amendment to Lease
dated November 5, 1992, and by a Second Amendment to Lease dated March 11, 1998
(as amended, the "Lease").

         Lessor and Lessee each desire to modify the Lease as set forth in "III.
MODIFICATIONS" next below.

III.     MODIFICATIONS.

         A. LATE RENTAL PAYMENTS. In the event Lessee has been late delivering
its monthly rental payments to Lessor on more than three (3) occasions during
any twelve (12) month period during the term of the Lease, then Tenant shall pay
to Landlord a late charge for each subsequent delinquent rental payment in an
amount equal to the greater of six percent (6%) of the delinquent payment, or
Two Hundred Fifty Dollars ($250.00). In connection with the assessment of such
late charge, Tenant acknowledges that the late payment by Tenant to Landlord of
rent will cause Landlord to incur costs not contemplated by this Lease, the
exact amount of which will be extremely difficult and impracticable to
ascertain. Those costs may include, but are not limited to, administrative,
processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any ground lease, mortgage or trust deed covering the
Premises. Acceptance of a late charge by Landlord shall not constitute a waiver
of Tenant's default with respect to the overdue amount, nor shall it prevent
Landlord from exercising any of its other rights and remedies. Any payment
received after the tenth of the month is considered delinquent and therefore is
considered to be subject to a late charge.

         B. CARPET REIMBURSEMENT/RENT CREDIT. As compensation for the carpet
installation necessary for the second floor premises, Lessor hereby agrees to
provide Lessee with a credit against the monthly rental next due and payable
following the full execution and delivery of this Third Amendment in the amount
of Seven Thousand Six Hundred Forty-Six Dollars and Seventy Cents ($7,646.70).

                                       

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 IV.     GENERAL.

         A.   EFFECT OF AMENDMENTS.  The Lease shall remain in full force and 
effect except to  the extent that is modified by this Amendment.

         B.   ENTIRE AGREEMENT. This Amendment embodies the entire 
understanding between Lessor and Lessee with respect to the modifications set 
forth in "III. MODIFICATIONS" above and can be changed only by a writing 
signed by Lessor and Lessee.

         C.   COUNTERPARTS. If this Amendment is executed in counterparts, 
each is hereby declared to be an original; all, however, shall constitute but 
one and the same amendment. In any action or proceeding, any photographic, 
photostatic, or other copy of this Amendment may be introduced into evidence 
without foundation.

         D.   DEFINED TERMS. All words commencing with initial capital 
letters in this Amendment and defined in the Lease shall have the same 
meaning in this Amendment as in the Lease, unless they are otherwise defined 
in this Amendment.

         E.   CORPORATE AND PARTNERSHIP AUTHORITY. If Lessee is a corporation 
or partnership, or is comprised of either or both of them, each individual 
executing this Amendment for the corporation or partnership represents that 
he or she is duly authorized to execute and deliver this Amendment on behalf 
of the corporation or partnership and that this Amendment is binding upon the 
corporation or partnership in accordance with its terms.

         F.   ATTORNEYS' FEES.  The provisions of the Lease respecting 
payment of attorneys' fees  shall also apply to this Amendment.

V.       EXECUTION.

         Lessor and Lessee executed this Amendment on the date as set forth 
in "I.  PARTIES  AND DATE" above.

LESSOR:                                         LESSEE:

THE IRVINE COMPANY                              ELGAR ELECTRONICS CORPORATION,
                                                  a California corporation

By: /s/ Clarence W. Barker                      By: /s/ Kenneth R. Kilpatrick
    -------------------------------------           ---------------------------
    President, Irvine Industrial Company,           President and
      a division of The Irvine Company                Chief Executive Officer

By: /s/ Nancy E. Trujillo                       By: /s/ Christopher W. Kelford
    -------------------------------------           ---------------------------
    Assistant Secretary                             Chief Financial Officer

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