EXHIBIT 10.1

LOAN MODIFICATION AGREEMENT

This Loan Modification Agreement is entered into May 20, 2005, effective as of
May 7, 2005, by and between SILICON VALLEY BANK (“Bank”), whose address is 3003
Tasman Drive, Santa Clara, California 95054 with a loan production office at
4410 Arapahoe Avenue, Suite 200, Boulder, CO 80303 and ADVANCED ENERGY
INDUSTRIES, INC. (“Borrower”), whose address is 1625 Sharp Point Drive, Fort
Collins, CO 80525.

1. DESCRIPTION OF EXISTING AGREEMENT. Among other Obligations, which may be
owing by Borrower to Bank, Borrower is or may become indebted to Bank pursuant
to, among other documents, a Loan and Security Agreement dated May 10, 2002, as
it may be amended from time to time (the “Loan Agreement”). The Loan Agreement
provides for, among other things, a Committed Revolving Line in the original
principal amount of Twenty-Five Million and No/100 Dollars ($25,000,000.00).
Defined terms used but not otherwise defined herein shall have the same meanings
as set forth in the Loan Agreement.

Hereinafter, all indebtedness owing by Borrower to Bank shall be referred to as
the “Obligations.”

2. DESCRIPTION OF COLLATERAL. Repayment of the Obligations is secured by the
Collateral as described in the Loan Agreement.

Hereinafter, the above-described security documents, together with all other
documents securing repayment of the Obligations shall be referred to as the
“Security Documents”. Hereinafter, the Security Documents, together with all
other documents evidencing or securing the Obligations shall be referred to as
the “Existing Loan Documents”.

3. DESCRIPTION OF CHANGE IN TERMS. Bank hereby agrees to modify the Loan
Agreement as follows:

      Section 13.1 entitled “Definitions” is hereby amended to change the
definition of “Revolving Maturity Date” to read:

“Revolving Maturity Date” is July 7, 2005.

4. CONSISTENT CHANGES. The Existing Loan Documents are hereby amended wherever
necessary to reflect the changes described above.

5. PAYMENT OF LOAN FEE AND EXPENSES. Borrower shall pay to Bank a fee in the
amount of Four Hundred Twenty and No/100 Dollars ($420.00) (the “Loan Fee”) plus
all of Bank’s reasonable out-of-pocket expenses in connection with this Loan
Modification Agreement.

6. NO DEFENSES OF BORROWER. Borrower (and each guarantor and pledgor signing
below) agrees that, as of the date hereof, it has no defenses against the
obligations to pay any amounts under the Obligations.

7. CONTINUING VALIDITY. Borrower (and each guarantor and pledgor signing below)
understands and agrees that in modifying the existing Obligations, Bank is
relying upon Borrower’s representations, warranties, and agreements, as set
forth in the Existing Loan Documents. Except as expressly modified pursuant to
this Loan Modification Agreement, the terms of the Existing Loan Documents
remain unchanged and in full force and effect. Bank’s agreement to modifications
to the existing Obligations pursuant to this Loan Modification Agreement in no
way shall obligate Bank to make any future modifications to the Obligations.
Nothing in this Loan Modification Agreement shall constitute a satisfaction of
the Obligations. It is the intention of Bank and Borrower to retain as liable
parties all makers and endorsers of Existing Loan Documents, unless the party is
expressly released by Bank in writing. Unless expressly released herein, no

 

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maker, endorser, or guarantor will be released by virtue of this Loan
Modification Agreement. The terms of this paragraph apply not only to this Loan
Modification Agreement, but also to all subsequent loan modification agreements.

8. CONDITIONS. The effectiveness of this Loan Modification Agreement is
conditioned upon receipt by Bank of the Loan Fee and a fully executed
counterpart hereof.

      This Loan Modification Agreement is executed as of the date first written
above.

             
BORROWER:
  BANK:
 
           
ADVANCED ENERGY INDUSTRIES, INC.
  SILICON VALLEY BANK
 
           
By:
  /s/ Michael El-Hillow   By:   /s/ Mike Devery

           
 
           
Name:
  Michael El-Hillow   Name:   Mike Devery

           
 
           
Title:
  Executive V.P. and CFO   Title:   SVP

           

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(COMPANY LOGO) [d25859d2585947.gif]

SILICON VALLEY BANK

PRO FORMA INVOICE FOR LOAN CHARGES

             
BORROWER:
  Advanced Energy Industries, Inc.        
 
           
LOAN OFFICER:
  Mike Devery        
 
           
DATE:
  May ___, 2005        
 
           

  Documentation Fee     ___.00  
 
           

  Loan Fee     420.00  
 
           

  TOTAL FEE DUE   $ ___.00  

Please indicate the method of payment:

  {  } A check for the total amount is attached.     {  } Debit DDA #
________for the total amount.     {  } Loan proceeds

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Borrower                                        (Date)

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Silicon Valley Bank                        (Date)
Account Officer’s Signature