EXHIBIT 10.42.5




                   Amendment to Amended and Restated Note Agreement
                             dated May 31, 1995
       between the Registrant and Principal Mutual Life Insurance Company


































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                                   AMENDMENT


THIS AMENDMENT  ("Amendment")  dated as of May 31, 1995 is entered into between
Hurco Companies,  Inc., an Indiana  corporation  (the "Company"),  and Principal
Mutual Life Insurance Company (the "Purchaser").

                                  WITNESSETH:

The Company and the Purchaser  have entered into that certain  Hurco  Companies,
Inc.  Amended and Restated Note Agreement dated as of March 24, 1994, as amended
by that certain Amendment and Notes  Modification  Agreement dated as of January
31, 1995 (as so amended,  the "Note  Agreement").  The Company and the Purchaser
agree to amend the Note  Agreement on the terms and conditions  hereinafter  set
forth.  Terms defined in the Note Agreement which are used herein shall have the
same meaning set forth in the Note Agreement unless otherwise specified herein.

1.  AMENDMENT.  Effective  as of May 31,  1995  and  subject  to the  conditions
precedent set forth in paragraph 2 hereof,  the Note Agreement is hereby amended
as follows:

               1.1 In SECTION 7.1,  the word "and" before  "January 31, 1996" is
               deleted and  replaced by ",",  the words "and April 30, 1996" are
               added after "January 31, 1996",  and the following  fiscal period
               and amount are added under the headings  "FISCAL  QUARTER  ENDED"
               and "MINIMUM CONSOLIDATED ADJUSTED NET WORTH":
                                                 MINIMUM CONSOLIDATED
               FISCAL QUARTER ENDED               ADJUSTED NET WORTH

                  April 30, 1996                      $5,100,000

               1.2 In SECTION 7.2, the date "January 31, 1996" in the fifth line
               is replaced by the date "May 1, 1996",  and the following  fiscal
               period and amount are added under the  headings  "FISCAL  QUARTER
               ENDED" and "MINIMUM CURRENT ASSETS":

                                                     MINIMUM
               FISCAL QUARTER ENDED               CURRENT ASSETS

                  April 30, 1996                     $38,500,000

               1.3 In SECTION 7.3, the following  fiscal  period and  percentage
               are  added  under  the  headings   "FISCAL   QUARTER  ENDED"  and
               "PERCENTAGE":


               FISCAL QUARTER ENDED               PERCENTAGE

                  April 30, 1996                      87%

               1.4 In SECTION 7.4, the  following  fiscal  period and amount are
               added under the  headings  "FISCAL  PERIOD" and  "MAXIMUM  LOANS,
               ETC.":


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               FISCAL PERIOD                     MAXIMUM LOANS, ETC.

               Fiscal Quarter
                 Ending April 30, 1996                $375,000

               1.5 In SECTION 7.5,  the  following  fiscal  period and ratio are
               added under the headings "FISCAL QUARTER ENDED" and "RATIO":

               FISCAL QUARTER ENDED                     RATIO

               April 30, 1996                        0.67 to 1.0

2. CONDITIONS PRECEDENT AND SUBSEQUENT. This Amendment shall become effective as
of the latest to occur of the date (i) the Company  shall have  delivered to the
Purchaser  reaffirmations  of each of the Subsidiary  Guaranties and the Autocon
Guaranty  executed in favor of  Purchaser,  (ii) the Company and NBD execute and
deliver  amendments  to the NBD  Agreement  and the NBD Term Loan in the form of
EXHIBIT A attached  hereto,  (iii) the  Purchaser and NBD execute and deliver an
amendment  to the  Intercreditor  Agreement  in the form of  EXHIBIT B  attached
hereto (the "Intercreditor Amendment"),  and (iv) the Company shall have paid to
the Collateral Agent the first $25,000  amendment fee referred to in paragraph 3
of the Intercreditor Amendment, and shall be subject to the condition subsequent
that the  Company  shall have paid to the  Collateral  Agent the second  $25,000
amendment  fee referred to in paragraph 3 of the  Intercreditor  Amendment on or
before August 1, 1995.
                  
3. REPRESENTATIONS AND WARRANTIES. The Company hereby represents and warrants to
the Purchaser  that (i) this  Amendment  constitutes a legal,  valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms,  and (ii)  that no event  has  occurred  and no  condition  exists  which
constitutes an "Event of Default" (as defined in the Note Agreement) or with the
lapse of time or the giving of notice or both, would become an Event of Default.

4. COSTS AND EXPENSES.  In accordance  with SECTION 11.1 of the Note  Agreement,
the Company  acknowledges  that it is liable to pay all  reasonable  expenses of
Purchaser,  including, without limitation,  reasonable charges and disbursements
of special counsel,  incurred in connection with the preparation,  execution and
delivery of this Amendment.

5.  RATIFICATION.  Except as specifically  amended or modified  above,  the Note
Agreement  and each of the Notes  shall  remain in full force and effect and are
hereby ratified and confirmed. The execution, delivery and effectiveness of this
Amendment shall neither operate as a waiver of any right, power or remedy of the
Purchaser  under the Note  Agreement or the Notes nor operate as a waiver of any
provision of the Note  Agreement or the Notes except as  specifically  set forth
herein.










                                    

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IN WITNESS WHEREOF,  the Company and the Purchaser have caused this Amendment to
be executed and delivered by their respective officer or officers thereunto duly
authorized.


                        HURCO COMPANIES, INC.


                        By: /S/ ROGER J. WOLF
                            --------------------------
                        Title: Senior Vice President
                                 and Chief Financial Officer


                        PRINCIPAL MUTUAL LIFE INSURANCE COMPANY


                        By: /S/DONALD D. BRATTEBO
                            -----------------------
                        Title: Counsel

                        By: /S/CLINT WOODS
                            -----------------------
                        Title:Counsel