ASSUMPTION AGREEMENT

                                 ASSUMPTION AGREEMENT

          ASSUMPTION AGREEMENT (this "Agreement"), dated as of February 3, 1998,
is by Elgar Holdings, Inc., a Delaware corporation (the "Company"), and Elgar
Electronics Corporation, a California corporation (the "Subsidiary Guarantor").

                                 W I T N E S S E T H

          WHEREAS, JFL-EEC Merger Sub Co., a Delaware corporation ("MergerCo"),
has heretofore executed and delivered to the Initial Purchaser a purchase
agreement (the "Purchase Agreement"), dated as of January 30, 1998, providing
for the terms pursuant to which the Initial Purchaser will purchase $90,000,000
aggregate principal amount of 9 7/8% Senior Notes due 2008 (the "Notes") of
MergerCo;

          WHEREAS, MergerCo has heretofore executed and delivered to the Initial
Purchaser a registration rights agreement (the "Registration Rights Agreement"),
dated as of February 3, 1998, providing for the registration of the Notes and
the Exchange Notes of MergerCo under the Securities Act of 1933, as amended;

          WHEREAS, MergerCo has been merged with and into the Company (the
"Merger");

          WHEREAS, pursuant to the Purchase Agreement and the Registration
Rights Agreement, the Company upon consummation of the Merger is required to
assume all of the obligations of MergerCo under the Purchase Agreement and the
Registration Rights Agreement and to execute and deliver this Agreement
concurrently with the Merger; and

          WHEREAS, pursuant to the Purchase Agreement and the Registration
Rights Agreement, immediately subsequent to the Merger, the Subsidiary Guarantor
is required to become a party to the Purchase Agreement and the Registration
Rights Agreement and to guarantee the obligations of the Company with respect to
the Notes thereunder;

          NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Company and the Subsidiary Guarantor mutually covenant and agree for the benefit
of the Initial Purchaser as follows:




                                         -2-


          1.   ASSUMPTION.  The Company hereby agrees to assume all of the
obligations of MergerCo and all of its own obligations under each of the
Purchase Agreement and the Registration Rights Agreement.

          2.   SUBSIDIARY GUARANTOR.  The Subsidiary Guarantor hereby agrees to
be deemed the "Subsidiary Guarantor" or the "Subsidiary" for all purposes under
the Purchase Agreement and the "Subsidiary Guarantor" and an "Issuer" for all
purposes under the Registration Rights Agreement and to perform all obligations
and duties of the Subsidiary Guarantor, the Subsidiary or an Issuer, as the case
may be, thereunder.

          3.   DEFINITIONS.  Capitalized terms used herein but not defined shall
have the meanings given to such terms in the Purchase Agreement and the
Registration Rights Agreement.

          4.   NEW YORK LAW TO GOVERN.  The internal law of the State of New
York, without regard to the choice of law rules thereof, shall govern and be
used to construe this Agreement.

          5.   COUNTERPARTS.  The parties may sign any number of copies of this
Agreement.  Each signed copy shall be an original, but all of them together
represent the same agreement.

          6.   EFFECT OF HEADINGS.  The Section headings herein are for
convenience only and shall not affect the construction hereof.



          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered, all as of the date first above written, which is
the date of the Merger.

                                   ELGAR HOLDINGS, INC.

                                   By:  /s/ Xxxxxx Xxxxxxxx
                                        ---------------------------------------
                                        Name:  Xxxxxx Xxxxxxxx
                                        Title: President

                                   ELGAR ELECTRONICS CORPORATION

                                   By:  /s/ Xxxxxxxxxxx X. Xxxxxxx
                                        ---------------------------------------
                                        Name:  Xxxxxxxxxxx X. Xxxxxxx
                                        Title: Vice President--Finance,
                                               Chief Financial Officer
                                               and Treasurer