EXHIBIT 10.25 AMENDMENT TO FINANCING AGREEMENT



                                                             As of April 6, 1998

Sharper Image Corporation
650 Davis Street
San Francisco, CA 94111

Gentlemen:

Reference is made to (a) the Financing  Agreement between us dated September 21,
1994,  as amended  (the  "Financing  Agreement")  and (b) the  Amendment  Letter
between us dated May 15, 1996 (herein the "1996 Amendment Letter").  Capitalized
terms used herein shall have the same  meanings as  specified  in the  Financing
Agreement unless otherwise specifically defined herein.

Effective immediately, pursuant to mutual understanding, the Financing Agreement
shall be, and hereby is, amended as follows:

(A) Section 1 of the  Financing  Agreement  shall be, and hereby is,  amended by
amending the definitions of "Early Termination  Date",  "Early Termination Fee",
"Line of Credit" and "Line of Credit Fee" in their entirety to read as follows:

         "Early  Termination  Date  shall  mean the date on  which  the  Company
         terminates this Financing Agreement or the Line of Credit which date is
         prior to the fifth Anniversary Date."

         "Early  Termination  Fee shall:  i) mean the fee CITBC is  entitled  to
         charge the  Company  in the event the  Company  terminates  the Line of
         Credit  or  this  Financing  Agreement  on a date  prior  to the  fifth
         Anniversary  Date (except as  otherwise  provided in Section 10 of this
         Financing  Agreement);  and ii) be determined by calculating the sum of
         (a) the average  daily  balance of the  Revolving  Loans for the period
         from the date of this  Financing  Agreement  to the  Early  Termination
         Date,  (b) the  average  daily  undrawn  face  amount of the Letters of
         Credit  outstanding  from the date of this  Financing  Agreement to the
         Early  Termination Date and (c) the average daily balance of CAPEX Term
         Loans for the  period  from the  effective  date of the CAPEX Term Loan
         Line of Credit to the Early  Termination  Date and multiplying that sum
         by (i) one percent (1%) per annum if the Early  Termination Date occurs

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         prior  to the  second  Anniversary  Date;  (ii)  three-quarters  of one
         percent (3/4 of 1%) per annum if the Early  Termination  Date occurs on
         or after the second Anniversary Date but prior to the third Anniversary
         Date;  and (iii)  one-half of one percent  (1/2 of 1%) per annum if the
         Early  Termination  Date occurs on or after the third  Anniversary Date
         but prior to the fifth Anniversary Date, in each case for the number of
         days from the Early Termination Date to the fifth Anniversary Date."

         "Line of Credit shall mean the  commitment  of CITBC to make  Revolving
         Loans under  Section 3 hereof,  make CAPEX Term Loans under  Section 3A
         hereof and issue Letter of Credit  Guaranties  under  Section 4 hereof,
         all  pursuant to and in  accordance  with  Sections 3, 3A and 4 of this
         Financing  Agreement,  in the aggregate  amount of  $24,500,000  at all
         times, provided that (i) such amount shall be automatically and without
         any further act by CITBC or the Company  reduced by an amount  equal to
         the aggregate amount of all drawdowns of CAPEX Term Loans made by CITBC
         to the Company hereunder and (ii) the aggregate  outstanding balance of
         Revolving  Loans and Letters of Credit shall not exceed  $20,000,000 at
         all times except as set forth below:

                  (a) October 1 - December 31, 1998           $28,000,000.00
                  (b) October 1 - December 31, 1999           $30,000,000.00
                  (c) October 1 - December 31, 2000           $31,000,000.00
                  (d) October 1 - December 31, 2001           $32,000,000.00
                  (e) October 1 - December 31, 2002           $33,000,000.00"

         "Line of Credit Fee shall: i) mean the fee due CITBC at the end of each
         month for the Line of Credit,  and ii) be determined by  multiplying x)
         the difference between the Line of Credit at the end of such month less
         the sum of a) the average daily Revolving Loans outstanding during such
         month,  and b) the average daily undrawn face amount of all outstanding
         Letters of Credit for said month by y) one half of one percent  (.500%)
         per  annum for the  number  of days in said  month  during  which  this
         Financing   Agreement  was  in  effect  (herein  the  "Line  of  Credit
         Percentage"),  provided,  however, the percentage set forth in y) shall
         be subject to increase or decrease (herein each a "Fee  Adjustment") as
         outlined below:

         (i) The Line of  Credit  Percentage  may be  reduced  or  increased  in
         accordance  with the grid set forth below from the rate set forth in y)
         above,  based on the  EBITDA  of the  Company  for any  fiscal  quarter
         commencing  with the fiscal  quarter  ending  January 31, 1998 and each
         fiscal quarter thereafter.

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         EBITDA for Four Consecutive                 Line of Credit
         Quarters, then ended                        Percentage
         --------------------                        ----------

         1. Less than $5,000,000.00                  0.500% per annum

         2. $5,000,000.00 or more
            but less than $6,500,000.00*             0.375% per annum

         3. $6,500,000.00 or more*                   0.250% per annum

*except  solely with respect to the fiscal  quarter ended July 1998,  the figure
"$6,500,000.00" set forth in #2 and #3 above shall be "$6,000,000.00."

         (ii) In addition to the foregoing requirements,  each Fee Adjustment is
         subject  to  the  Company's  compliance  with  each  of  the  following
         conditions:

                  (x)  as to any  fee  reduction,  the  timely  delivery  by the
                  Company of the Relevant  Financial  Statements (as hereinafter
                  defined) in accordance  with  Paragraph 7 of Section 6 of this
                  Financing  Agreement  and  CITBC  has had  reasonable  time to
                  review  such   financial   statements   to  its   satisfaction
                  ("Financial  Statement Test"),  and the absence of any Default
                  or  Event  of  Default  on the  date of  determination  of the
                  Financial Statement Test or the effective date of any such Fee
                  Adjustment; and

                  (y) each Fee  Adjustment  will be effective only after CITBC's
                  receipt  and  review  of (a) the  Company's  latest  financial
                  statements  reflecting the four (4) consecutive  most recently
                  ended quarters (the "Relevant  Financial  Statements") for the
                  applicable  fiscal quarter and (b) a certificate  signed by an
                  authorized   officer  of  the   Company   setting   forth  the
                  calculations  used to determine the applicable  Line of Credit
                  Percentage based on the terms and conditions set forth herein.
                  Any such Fee Adjustment shall be effective on the first day of
                  the  month  following  CITBC's  receipt  and  review  of  such
                  Relevant Financial Statements.

         (iii)  Notwithstanding  the  foregoing,  if the Company fails to timely
         deliver to CITBC the Relevant Financial Statements under this Financing
         Agreement,  and/or a Default or an Event of Default has occurred  under
         this Financing  Agreement as further  provided in clause (x) above, the
         Line of Credit Percentage shall be 0.500% per annum."

(B)  Section 1 of the  Financing  Agreement  shall be, and  hereby  is,  further
amended by adding the 


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following  definitions in their proper  alphabetical order as follows:

         "Chase  Manhattan  Bank Rate shall mean the rate of interest  per annum
         announced by Chase  Manhattan  Bank from time to time as its prime rate
         in effect at its principal  office in the City of New York.  (The prime
         rate is not intended to be the lowest rate of interest charged by Chase
         Manhattan Bank to its borrowers).

         All  references in the Financing  Agreement to the "Chemical Bank Rate"
         shall be, and hereby are, amended to the "Chase Manhattan Bank Rate."

         "Interest  Coverage  Ratio  shall  mean a  ratio  determined  as of the
         relevant  calculation  date by dividing EBITDA by Interest  Expense for
         the relevant period."

(C)  Section 3,  Paragraph 1 shall be, and hereby is,  amended by  amending  the
second sentence thereof in its entirety to read as follows:

         "Such loans and advances shall be in amounts up to the sum of:

         (a)  twenty  percent  (20%) of the  aggregate  value  of the  Company's
         Eligible Inventory which is Proprietary Products Inventory plus (b) (i)
         fifty-five percent (55%) for the period January 1 through and including
         September 30 of each year, (ii) sixty percent (60%) for the period from
         October   1,   through   and   including   October  31  of  each  year,
         (iii)sixty-five  percent  (65%) for the period from November 1, through
         and including  December 31 of each year, of the aggregate  value of the
         Company's other Eligible  Inventory provided that in no event shall the
         aggregate amount of Eligible  Inventory computed pursuant to the clause
         (a) above exceed twenty-five percent (25%) of the total of all Eligible
         Inventory."

(D) Section 6, Paragraphs 8, 10 and 11 of the Financing  Agreement shall be, and
each hereby is, amended as follows:

         (i) The Net Worth  covenant set forth in Paragraph 8 of Section 6 shall
         be, and hereby is,  amended by  amending  the Net Worth  amount for all
         fiscal   quarters   ending   October   of  each   fiscal   year  to  be
         "$24,000,000.00".  Such covenant  shall remain  unchanged for all other
         fiscal quarters and periods.

         (ii) The Working Capital  covenant set forth in Paragraph 10 of Section
         6 shall be, and hereby is,  amended by deleting it in its  entirety and
         substituting the following in lieu thereof:

                  "10. Intentionally Omitted."

         (iii) The Fixed Charge  Coverage  Ratio covenant set forth in Paragraph
         11 of Section 

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         6 shall be, and hereby is,  amended by deleting it in its  entirety and
         substituting the following in lieu thereof:

                  "11.  The  Company  shall  maintain  at the end of each fiscal
                  quarter  for the four (4)  consecutive  fiscal  quarters  then
                  ending an Interest Coverage Ratio of at least 2.50 to 1.0."

         (iii) The Leverage  Ratio covenant set forth in Paragraph 12 of Section
         6 shall be, and hereby is,  amended by deleting it in its  entirety and
         substituting the following in lieu thereof:

                  "12.  Without the prior written consent of CITBC,  the Company
                  will not contract for, purchase,  make expenditures for, lease
                  pursuant to a Capital  Lease or  otherwise  incur  obligations
                  with  respect to Capital  Expenditures  (whether  subject to a
                  security  interest or otherwise) during any fiscal year in the
                  aggregate amount in excess of $10,000,000.00.  Notwithstanding
                  the foregoing, if the Company, in any fiscal year, spends less
                  than the permitted  Capital  Expenditures  for such year, then
                  fifty  percent  (50%) of such unused  amount shall be added to
                  the amount  permitted  solely for the next  succeeding  fiscal
                  year."

(E) Paragraph 1 of Section 7 of the Financing Agreement shall be, and hereby is,
amended by adding the following subparagraph (d) to the end of such paragraph:

         "(d) Subject to the conditions set forth in this  subparagraph (d), the
         interest  rates set forth in  Paragraph  1,  subparagraphs  (a) and (b)
         shall  be  subject  to  increase  or  decrease  (herein  each  a  "Rate
         Adjustment") as outlined below:

                  i) The spread over the Chase Manhattan Bank Rate and the Libor
                  may be reduced or  increased in  accordance  with the grid set
                  forth below from the rate set forth in sub-Paragraphs  (a) and
                  (b) above,  as  applicable  (as such rate may be adjusted from
                  time to time hereunder) based on the EBITDA of the Company for
                  any fiscal quarter  commencing  with the fiscal quarter ending
                  January 31, 1998 and each fiscal quarter thereafter.

                                 REVOLVING LOANS
                                 ---------------

EBITDA for Four Consecutive           Chase Manhattan 
---------------------------           ---------------
Quarters, then ended                  Bank Rate Margin           Libor Margin
--------------------                  ----------------           ------------
                                      
1. Less than $5,000,000.00                + 0.75%                  + 2.75%
                                      
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2. $5,000,000.00 or more              
    but less than $6,500,000.00*          + 0.50%                  + 2.50%
                                      
3. $6,500,000.00 or more*                 + 0.25%                  + 2.25%
                                      
                                
                                   CAPEX LOANS
                                   -----------

EBITDA for Four Consecutive           Chase Manhattan 
---------------------------           ---------------
Quarters, then ended                  Bank Rate Margin           Libor Margin
--------------------                  ----------------           ------------

1. Less than $5,000,000.00                 + 1.00%                  + 3.00%

2. $5,000,000.00 or more
    but less than $6,500,000.00*           + 0.75%                  + 2.75%

3. $6,500,000.00 or more*                  + 0.50%                  + 2.50%

* except solely with respect to the fiscal quarter ended July,  1998, the figure
"$6,500,000.00"   set  forth  in  #2  and  #3  in  each  grid  above   shall  be
"$6,000,000.00."

         (ii) In addition to the foregoing requirements, each Rate Adjustment is
         subject  to  the  Company's  compliance  with  each  of  the  following
         conditions:

                  (x) as to any  rate  reduction,  the  timely  delivery  by the
                  Company of the Relevant  Financial  Statements (as hereinafter
                  defined) in accordance  with  Paragraph 7 of Section 6 of this
                  Financing  Agreement  and  CITBC  has had  reasonable  time to
                  review  such   financial   statements   to  its   satisfaction
                  ("Financial  Statement Test"),  and the absence of any Default
                  or  Event  of  Default  on the  date of  determination  of the
                  Financial  Statement  Test or the  effective  date of any such
                  Rate Adjustment; and

                  (y) each Rate  Adjustment will be effective only after CITBC's
                  receipt  and  review  of (a) the  Company's  latest  financial
                  statements  reflecting the four (4) consecutive  most recently
                  ended fiscal  quarters (the "Relevant  Financial  Statements")
                  for the applicable fiscal quarter and (b) a certificate signed
                  by an  authorized  officer of the  Company  setting  forth the
                  calculations  used to determine the  applicable  interest rate
                  margin based on the terms and conditions set forth herein. Any
                  such Rate Adjustment shall be effective as follows:

                           (A) as to the spread  over the Chase  Manhattan  Bank

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                           Rate on the first day of the month following  CITBC's
                           receipt  and  review  of  such   Relevant   Financial
                           Statements; and

                           (B) as to the  spread  over Libor on the first day of
                           the next  interest  period  commencing  after CITBC's
                           receipt  and  review  of  such   Relevant   Financial
                           Statements.

         (iii)    Notwithstanding the foregoing,  if the Company fails to timely
                  deliver to CITBC the Relevant Financial  Statements under this
                  Financing  Agreement,  the Chase Manhattan Bank Rate Margin or
                  the Libor  Margin,  as the case may be,  shall be equal to the
                  highest rate set forth in the applicable grid set forth above;
                  provided, however, nothing contained herein shall be deemed to
                  affect CITBC's right to charge the Default Rate of Interest in
                  accordance with the terms of this Financing Agreement.

(F) Section 10 of the Financing  Agreement  shall be, and hereby is,  amended as
follows:

         (i) the reference to the seventh or any subsequent Anniversary Date" as
         contained in the first sentence thereof shall be, and hereby is amended
         to read "ninth or any subsequent Anniversary Date"; and

         (ii) the  reference  to "fourth  Anniversary  Date" as contained in the
         proviso at the end of the fourth sentence  thereof shall be, and hereby
         is, amended to read "fifth Anniversary Date".

(G) The  Effectiveness  of all of the  amendments  set forth above shall be, and
hereby is,  subject to the  fulfillment to CITBC's  satisfaction  of each of the
Conditions Precedent. The "Conditions Precedent" shall mean:

         (i) The Company shall pay all Out-of-Pocket  Expenses incurred by CITBC
         in connection with the agreement and all the documents and transactions
         contemplated hereby including,  without limitation, the reasonable fees
         and expenses of CITBC's  outside legal  counsel in connection  with the
         warrant  referred to in clause  (iii)  below.  All such  amounts may be
         charged to your  Revolving  Loan  Account on the  respective  due dates
         thereof.

         (ii) CITBC's receipt of a secretary's  certificate  certifying Board of
         Directors   Resolutions   authorizing   the  execution,   delivery  and
         performance  by the Company of this  Agreement  and all  documents  and
         transactions contemplated hereby.

         (iii) The  Company  shall  enter into a warrant  agreement  in form and
         substance

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         satisfactory to CITBC and take all other actions  necessary to grant to
         CITBC or its assigns a warrant to  purchase up to 75,000  shares of its
         voting common stock at $4.125 a share.

Pursuant to mutual understanding, a typographical error of omission appearing in
(F) on page 6 of the 1996  Amendment  Letter is hereby  corrected  by adding the
words  "Paragraph 1 of" to the  beginning of the first  sentence in (F) prior to
the reference to "Section 7" therein.

Except to the  extent  set forth  herein,  no other  change in any of the terms,
provisions or conditions of the Financing  Agreement is intended or implied.  If
the foregoing is in accordance with your  understanding  of our agreement kindly
so indicate by signing and returning the enclosed copy of this letter.

                                      Very truly yours,

                                      THE CIT GROUP/BUSINESS CREDIT, INC.

                                      /s/ Adrian Avalos
                                          -------------
                                      By:    Adrian Avalos
                                      Title: Loan Officer

Read and Agreed to:

SHARPER IMAGE CORPORATION

/s/ Tracy Y. Wan
    ------------
By:    Tracy Y. Wan
Title: Senior Vice President, Chief Financial Officer


/s/ Barry Gilbert
    -------------
By:    Barry Gilbert
Title: Vice Chairman, Chief Operating Officer


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