EXHIBIT 10.20.18




                    Second Amendment to the Credit Agreement
                               dated May 31, 1995
                      between the Registrant and NBD Bank







                                                                  
























<PAGE>

                      SECOND AMENDMENT TO CREDIT AGREEMENT



         THIS SECOND  AMENDMENT  TO CREDIT  AGREEMENT,  dated as of May 31, 1995
(this "Second Amendment"), between HURCO COMPANIES, INC., an Indiana corporation
(the "Company"), and NBD BANK, a Michigan banking corporation (the "Bank").


                                    RECITALS

     A. The parties hereto have entered into a Credit Agreement and Amendment to
Term Loan  Agreement,  dated as of March  24,  1994,  as  amended  (the  "Credit
Agreement"), which is in full force and effect.

     B. The Company  desires to amend the Credit  Agreement as herein  provided,
and the Bank is  willing  to so amend  the  Credit  Agreement  on the  terms and
conditions set forth herein.


                                   AGREEMENT


     Based upon these recitals, the parties agree as follows:

1. AMENDMENT.  Upon the Company satisfying the conditions set forth in paragraph
4 (the date that this occurs  being  called the  "effective  date"),  the Credit
Agreement shall be amended as follows:
               
     (A) The terms "Automatic Termination Date", "Letter of Credit",  "Letter of
Credit  Advance",  and  "Outstanding  Facilities"  in Section  1.1 of the Credit
Agreement are amended to read as follows:

               "AUTOMATIC TERMINATION DATE" means May 1, 1996.

               "LETTER OF CREDIT" means any  Authorization  Letter of Credit and
               any New Facility Letter of Credit.

               "LETTER  OF CREDIT  ADVANCE"  means any  Authorization  Letter of
               Credit Advance and any New Facility Letter of Credit Advance.

               "OUTSTANDING FACILITIES" means,  collectively,  the New Facility,
               the New Facility  Note,  the NBD Term Loan  Agreement (as amended
               hereby), the Amended Term Note, the Reimbursement  Agreement, the
               IRB L/C, the Hurco Guaranty,  the NBD Guaranty, the Authorization
               Note, and the Letters of Credit,  each as existing  following the
               execution of this Agreement.

     (B) The  following  definitions  are added to  Section  1.1 in  appropriate
alphabetical order:

               "AUTHORIZATION  NOTE"  means the  demand  promissory  note of the
               Company   evidencing   the   Company's   obligations   under  the
               Authorization  Letters of Credit,  in  substantially  the form of
               Exhibit G, as amended or modified  from time to time and together
               with any  promissory  notes  issued in  exchange  or  replacement
               therefor.

<PAGE>
             
               "AUTHORIZATION  LETTER OF CREDIT"  means a standby or  commercial
               letter of credit or  bankers  acceptance  having a stated  expiry
               date not later than January 31,  1996,  issued by NBD pursuant to
               Section  3.1(a)(ii)  for the  account  of the  Company  under  an
               application   and  related   documentation   acceptable   to  NBD
               requiring,   among  other  things,  the  Company  to  immediately
               reimburse  NBD in  respect  of all  drafts or other  demands  for
               payment  honored  thereunder and all expenses paid or incurred by
               NBD relative thereto.

               "AUTHORIZATION LETTER OF CREDIT ADVANCE" means any issuance of an
               Authorization Letter of Credit.

               "NEW  FACILITY  ADVANCE"  means the  issuance of any New Facility
               Loan or any New Facility Letter of Credit Advance.

               "NEW  FACILITY  LETTER OF CREDIT"  means a standby or  commercial
               letter of credit,  bankers acceptance,  or bank guaranty having a
               stated  expiry  date not later than the  earlier of (a)  eighteen
               months after the issuance date, and (b) the date which is 30 days
               prior to the Automatic  Termination Date, and issued by NBD under
               the  New  Facility  for  the  account  of the  Company  under  an
               application   and  related   documentation   acceptable   to  NBD
               requiring,   among  other  things,  the  Company  to  immediately
               reimburse  NBD in  respect  of all  drafts or other  demands  for
               payment  honored  thereunder and all expenses paid or incurred by
               NBD relative thereto.

               "NEW FACILITY  LETTER OF CREDIT  ADVANCE" means any issuance of a
               New Facility Letter of Credit under the New Facility.

               "NOTES" means the Authorization Note and the New Facility Note.

     C. Section  2.1(a) is amended by deleting the term "Letter of Credit" where
it appears in the  section  and  substituting  therefor  the term "New  Facility
Letter of Credit".

     D. Section 2.1(b) is amended by deleting the term  "Advances" in subsection
(iii) and substituting  therefor the term "New Facility Advances",  and deleting
the  term  "Letter  of  Credit   Advances"  in  subsections  (iv)  and  (v)  and
substituting therefor the term "New Facility Letter of Credit Advances".

     E. A new Section 2.1A is added, to read as follows:

               Section 2.1A  AUTHORIZATION  LETTERS OF CREDIT.  NBD, in its sole
               and uncontrolled  discretion,  may issue Authorization Letters of
               Credit  for  the  benefit  of the  Company  pursuant  to  Section
               3.1(a)(ii) from time to time to but excluding September 30, 1995,
               not to exceed at any time  outstanding  the  aggregate  amount of
               $2,000,000.

     F. A new Section 2.3(e) is added, to read as follows:

               (e)  AUTHORIZATION  USAGE FEE. The Company agrees to pay to NBD a
               fee of $10,000 on or before the first date that an  Authorization
               Letter of Credit  Advance  is made in an amount  which,  together
               with the  amount of all  Authori-zation  Letters  of Credit  then
               outstanding, equals or exceeds $2,000,000.
<PAGE>

     G. Section 3.1 is amended to read as follows:

               3.1  DISBURSEMENT OF ADVANCES.  (a)(i) The Company shall give NBD
               notice  of  its  request  for  each  New   Facility   Advance  in
               substantially  the form of  Exhibit B hereto not later than 12:00
               p.m.  Noon Detroit time (i) five  Business Days prior to the date
               any New  Facility  Letter of Credit  Advance is  requested  to be
               made,  and  (ii) on the  Business  Day any New  Facility  Loan is
               requested to be made,  which notice shall  specify  whether a New
               Facility  Loan or a New  Facility  Letter of Credit is  requested
               and, in the case of each New Facility  Letter of Credit  Advance,
               such  information  as may be  necessary  for its issuance by NBD.
               Subject  to the terms of this  Agreement,  the  proceeds  of each
               requested  New Facility  Advance  shall be made  available to the
               Company  by  depositing  the  proceeds  thereof,  in  immediately
               available  funds, in an account  maintained and designated by the
               Company at NBD's principal office.

               (ii) The  Company  shall give NBD notice of its  request for each
               Authorization Letter of Credit Advance in accordance with Section
               9.2 not later than 12:00 p.m.  Noon  Detroit  time five  Business
               Days prior to the date any Authorization Letter of Credit Advance
               is  requested  to  be  made,  which  notice  shall  contain  such
               information  as may be  necessary  for its  issuance by NBD.  The
               Company shall  contemporaneously  provide PML with a copy of such
               request in the manner specified for notices in the  Intercreditor
               Agreement. Prior to making its first request for an Authorization
               Letter of Credit  Advance,  the Company shall  provide  documents
               satisfactory to NBD evidencing  necessary corporate action by the
               Company with respect to the Authorization Letters of Credit.

               (b) All New Facility Loans shall be evidenced by the New Facility
               Note,  all  reimbursement  obligations  under  the  Authorization
               Letters of Credit shall be evidenced by the  Authorization  Note,
               and all such loans shall be due and payable and bear  interest as
               provided  in this  Agreement.  NBD is  hereby  authorized  by the
               Company to record on the  schedule  attached to the Notes,  or in
               its books and  records,  the date,  amount and type of each loan,
               the amount of each payment or  prepayment  of principal  thereon,
               and the other  information  provided for on such schedule,  which
               schedule  or  books  and  records,  as the  case  may  be,  shall
               constitute  prima facie evidence of the  information so recorded,
               PROVIDED, HOWEVER, that failure of NBD to record, or any error in
               recording,  any such information shall not relieve the Company of
               its obligation to repay the outstanding  principal  amount of the
               loans,  all accrued interest  thereon,  and other amounts payable
               with respect  thereto in  accordance  with the terms of the Notes
               and this Agreement.  Subject to the terms of this Agreement,  the
               Company may borrow new  Facility  Loans under this  Section  2.4,
               prepay New Facility  Loans  pursuant to Section 5.2, and reborrow
               New Facility Loans under this Section.







<PAGE>

               (c)  Subject to the terms of this  Agreement,  NBD shall,  on the
               date any Letter of Credit Advance is requested to be made,  issue
               the  related  Letter of Credit for the  account  of the  Company.
               Notwithstanding  anything herein to the contrary, NBD may decline
               to issue any  requested  Letter  of Credit on the basis  that the
               beneficiary, the purpose of issuance, or the terms of the drawing
               are unacceptable to it.

               (d)  Notwithstanding  any  provisions  of this  agreement,  it is
               understood  and agreed that NBD shall at no time be  obligated to
               make  any  Authorization  Letter  of  Credit  Advance  hereunder,
               despite compliance with any express conditions precedent thereto,
               and NBD  shall  be  privileged  at any  time to make  demand  for
               payment of the Authorization Note, the reimbursement obligations,
               the cash collateral obligations pursuant to Section 5.2A, and all
               other indebtedness, obligations and liabilities of the Company to
               NBD in  connection  with the  Authorization  Letters  of  Credit,
               despite  the  fact  that  there  may not  then  exist an Event of
               Default.

     H. Section 3.3(c) is amended to read as follows:
                  
               (c) NBD  shall  have  received  the  Borrowing  Base  Certificate
               required to be delivered  under Section  7.1(d)(vi) as of the day
               next preceding the date such Advance, and the aggregate principal
               amount  of the New  Facility  Advances  then  outstanding,  after
               giving  effect to the  requested  Advance,  does not  exceed  the
               Borrowing Base as calculated in the Borrowing  Base  Certificate;
               and

     I. Section 4.2(b) is amended to delete the phrase  "payable in installments
of  $1,750,000  payable on the  Automatic  Termination  Date (as defined in this
Agreement),"  and  substituting  therefor the phrase "payable in installments of
$1,750,000 payable on February 1, 1996,".

     J. A new Section 5.2A is added, to read as follows:

               5.2A  AUTHORIZATION  NOTE  PAYMENTS.  Unless  earlier  payment is
               required  under this  Agreement,  the Company shall pay to NBD on
               demand   the   entire   outstanding   principal   amount  of  the
               Authorization Note and to immediately  deliver cash collateral to
               NBD  in an  amount  equal  to  the  maximum  amount  that  may be
               available  to be drawn at any time prior to the stated  expiry of
               all  outstanding  Authorization  Letters  of  Credit,  which cash
               collateral  shall be held in the Cash  Collateral  Account and is
               hereby pledged to NBD to secure all indebtedness, obligations and
               liabilities  of any kind of the  Company to NBD,  and the Company
               agrees to execute such further  written  agreements and documents
               in form and  substance  satisfactory  to NBD to further  document
               such pledge.

     K.  Section  5.4(b)  is  amended  by  deleting  the  term   "Advances"  and
substituting therefor the term "New Facility Advances".





<PAGE>

     L. Section 5.4(d) is amended to read as follows:

               (d) VIOLATION OF LETTER OF CREDIT  SUBLIMITS.  If at any time the
               face  amount of the New  Facility  Letters of Credit  exceeds the
               lesser of $9,500,000 and the New Facility  Commitment,  or if the
               face amount of the standby New Facility Letters of Credit exceeds
               the lesser of  $2,000,000  and the New Facility  Commitment,  the
               Company shall immediately pay to NBD an amount to be deposited in
               the Cash  Collateral  Account  equal to the  amount by which this
               excess exceeds the sum of all amounts then being held in the Cash
               Collateral  Account  allocable  to the New  Facility  Letters  of
               Credit.  If at any  time  the face  amount  of the  Authorization
               Letters  of  Credit   exceeds   $2,000,000,   the  Company  shall
               immediately  pay to NBD an  amount  to be  deposited  in the Cash
               Collateral  Account  equal to the  amount  by which  this  excess
               exceeds  the sum of all  amounts  then  being  held  in the  Cash
               Collateral  Account  allocable  to the  Authorization  Letters of
               Credit.

     M.  Section  7.2(c) is  amended by adding  the  following  after the phrase
"first fiscal quarter of fiscal year 1996":

               , and $375,000  during the second  fiscal  quarter of fiscal year
               1996

     N.  Section  7.2(m) is amended by adding the  following  at the end of that
subsection:
         
               , or (iii) if the aggregate  purchase price and other acquisition
               costs of all such Capital Expenditures made by the Company or any
               of its  Subsidiaries  during the second fiscal  quarter of fiscal
               year 1996, when combined with all other Capital Expenditures made
               during that fiscal year, would exceed $875,000.

     O. Exhibit D is amended by substituting  therefor the form of Third Amended
and Restated NBD Term Note attached as Exhibit D.

     P. A new  Exhibit  G,  Demand  Promissory  Note,  is  added  to the  Credit
Agreement in the form attached as Exhibit G.

2.  REFERENCES TO CREDIT  AGREEMENT.  From and after the effective  date of this
Second Amendment, references to the Credit Agreement in the Credit Agreement and
all  other  documents  issued  under  or with  respect  thereto  (as each of the
foregoing is amended hereby or pursuant hereto) shall be deemed to be references
to the Credit Agreement as amended hereby.

3.  REPRESENTATIONS  AND WARRANTIES.  The Company represents and warrants to the
Bank that:

               (a) (i) The  execution,  delivery and  performance of this Second
               Amendment and all  agreements  and documents  delivered  pursuant
               hereto by the Company have been duly  authorized by all necessary
               corporate action and do not and will not violate any provision of
               any law, rule, regulation, order, judgment,  injunction, or award




<PAGE> 

               presently  in  effect  applying  to  it,  or of its  articles  of
               incorporation or bylaws, or result in a breach of or constitute a
               default  under any material  agreement,  lease or  instrument  to
               which the Company is a party or by which it or its properties may
               be bound or affected; (ii) no authorization,  consent,  approval,
               license,  exemption or filing of a registration with any court or
               governmental department,  agency or instrumentality is or will be
               necessary to the valid execution,  delivery or performance by the
               Company of this Second Amendment and all agreements and documents
               delivered  pursuant  hereto;  and (iii) this Second Amendment and
               all agreements  and documents  delivered  pursuant  hereto by the
               Company  are the  legal,  valid and  binding  obligations  of the
               Company,  enforceable  against  it in  accordance  with the terms
               thereof.
                 
               (b) After giving effect to the amendments  contained herein,  the
               representations  and  warranties  contained  in Article VI (other
               than Section 6.5) of the Credit Agreement are true and correct on
               and as of the  effective  date  hereof  with the same  force  and
               effect as if made on and as of such effective date.

               (c) No Event of Default has  occurred and is  continuing  or will
               exist under the Credit Agreement as of the effective date hereof.

4. CONDITIONS TO EFFECTIVENESS. This Second Amendment shall not become effective
until the Bank has received the following documents and the following conditions
have been satisfied, each in form and substance satisfactory to the Bank:

               (a) Copies,  certified as of the effective  date hereof,  of such
               corporate  documents  of the  Company  as the Bank  may  request,
               including articles of incorporation,  bylaws (or certifying as to
               the  continued  accuracy  of the  articles of  incorporation  and
               by-laws  previously   delivered  to  the  Bank),  and  incumbency
               certificates,  and such documents  evidencing necessary corporate
               action by the Company with respect to this Second  Amendment  and
               all other  agreements or documents  delivered  pursuant hereto as
               the  Bank  may  request,  except  that the  Company  may  provide
               evidence of proper  corporate  authorization  for  requesting the
               Authorization  Letters of Credit at the time of its first request
               for an Authorization Letter of Credit Advance, as contemplated by
               Section 3.1(a)(ii) of the Credit Agreement;

               (b) An Amendment to Amended and Restated  Note  Agreement of even
               date  herewith  between  the Company  and  Principal  Mutual Life
               Insurance Company ("PML"), in the form and substance satisfactory
               to the Bank;

               (c) An Amendment to Intercreditor,  Agency, and Sharing Agreement
               of even date herewith among the Company,  the Bank,  PML, and the
               Bank as  Agent  for the  Bank  and  PML,  in form  and  substance
               satisfactory to the Bank;

               (d) The Third  Amended and  Restated  NBD Term Note  executed and
               delivered by the Company in the form attached as Exhibit D;

               (e) The Demand  Promissory  Note  executed  and  delivered by the
               Company in the form attached as Exhibit G;

<PAGE>

               (f) A Confirmation of Guaranty of even date herewith executed and
               delivered by the Guarantor in favor of the Bank;

               (g) An initial usage fee of $10,000 paid to NBD; and

               (h) Such additional  agreements and documents,  fully executed by
               the Company, as are reasonably requested by the Bank.

5.  MISCELLANEOUS.  The  terms  used  but not  defined  herein  shall  have  the
respective  meanings  ascribed  thereto  in  the  Credit  Agreement.  Except  as
expressly  amended hereby,  the Credit  Agreement and all other documents issued
under or with respect  thereto are hereby ratified and confirmed by the Bank and
the Company and shall  remain in full force and effect,  and the Company  hereby
acknowledges  that  it has no  defense,  offset  or  counterclaim  with  respect
thereto.

6.  COUNTERPARTS.  This  Second  Amendment  may be  executed  in any  number  of
counterparts,  all of which taken  together  shall  constitute  one and the same
instrument  and any of the parties  hereto may execute this Second  Amendment by
signing any such counterpart.

7. EXPENSES. The Company agrees to pay and save the Bank harmless from liability
for all costs  and  expenses  of the Bank  arising  in  respect  of this  Second
Amendment,  including the  reasonable  fees and expenses of  Dickinson,  Wright,
Moon, Van Dusen & Freeman, counsel to the Bank, in connection with preparing and
reviewing this Second Amendment and any related agreements and documents.

8. GOVERNING LAW. This Second  Amendment is a contract made under,  and shall be
governed by and construed in accordance  with, the laws of the State of Michigan
applicable to contracts made and to be performed  entirely within such state and
without giving effect to the choice law principles of such state.








IN WITNESS  WHEREOF,  the parties hereto have caused this Second Amendment to be
duly executed and delivered as of the date first written above.


HURCO COMPANIES, INC.                            NBD BANK


By: /S/ROGER J. WOLF                             By: /S/ANDREW P. ARTON
    ----------------------                           ----------------------
    Roger J. Wolf                                    Andrew P. Arton
     Its: Senior Vice President                       Its: Second Vice President
          and Chief Financial Officer                     







<PAGE>
                                   EXHIBIT D

                    THIRD AMENDED AND RESTATED NBD TERM NOTE

$4,035,936.42                                           Dated as of May 31, 1995
                                                           Detroit, Michigan

FOR VALUE RECEIVED, HURCO COMPANIES, INC. ("Borrower"),  an Indiana corporation,
hereby unconditionally  promises to pay to the order of NBD Bank (formerly known
as NBD  Bank,  N.A.),  a  Michigan  banking  corporation  (the  "Bank"),  at the
principal  banking  office of the Bank in lawful  money of the United  States of
America and in immediately  available  funds,  the principal sum of Four Million
Thirty-Five Thousand Nine Hundred Thirty-six and 42/100 Dollars ($4,035,936.42),
unless earlier payment is required,  in installments as follows:  (i) $1,750,000
payable on  February 1, 1996,  and (ii) the  remainder  payable on the  Maturity
Date, when the entire  outstanding  principal balance of the Term Loan evidenced
hereby, and all accrued interest thereon,  shall be due and payable;  and to pay
interest on the unpaid principal  balance hereof from time to time  outstanding,
in like money and funds,  for the period  from the date  hereof  until such Term
Loan shall be paid in full, at the rates per annum and on the dates  provided in
the Term Loan Agreement referred to below.

The Bank is hereby authorized by the Borrower to record on its books and records
the date, amount and type of each Loan, the applicable interest rate, the amount
of each payment or prepayment of principal  thereon,  and any other  information
required  by the Bank,  which  books and records  shall  constitute  prima facie
evidence of the information so recorded,  PROVIDED, HOWEVER, that any failure by
the Bank to record any such  information  shall not relieve the  Borrower of its
obligation to repay the outstanding  principal amount of the Term Loan evidenced
hereby, all accrued interest thereon and any amount payable with respect thereto
in accordance with the terms of this Term Note and the Term Loan Agreement.

This Term Note evidences a Term Loan made under a Term Loan  Agreement  dated as
of September 9, 1991,  as amended by a Credit  Agreement  and  Amendment to Term
Loan  Agreement  dated as of March 24, 1994,  and as further  amended by a First
Amendment  to Credit  Agreement  dated as of January 31,  1995,  and by a Second
Amendment to Credit Agreement of even date herewith between the Borrower and the
Bank (as amended,  the "Term Loan Agreement"),  to which reference is made for a
statement  of the  circumstances  under  which  this  Term  Note is  subject  to
prepayment and under which its due date may be  accelerated.  Capitalized  terms
used but not  defined  in this  Term Note  shall  have the  respective  meanings
assigned to them in the Term Loan Agreement.

This  Term  Note is made  under,  and  shall be  governed  by and  construed  in
accordance with, the laws of the State of Michigan  applicable to contracts made
and to be  performed  entirely  within such State and without  giving  effect to
choice of law principles of such State.
 
                                                HURCO COMPANIES, INC.

                                                 By: __________________________

                                                 Its: _________________________






<PAGE>
                                   EXHIBIT G
                             MASTER PROMISSORY NOTE


$2,000,000                                                   Detroit, Michigan
                                                        Dated as of May 31, 1995


For value received, on demand or at such other maturity or maturities as are set
forth in the Bank's records, Hurco Companies, Inc. (the "Borrower"), promises to
pay to the order of NBD Bank (the "Bank"), at the Bank's principal office in the
State of  Michigan,  in lawful  money of the  United  States of  America  and in
immediately available funds, the principal sum of TWO MILLION AND 00/100 DOLLARS
($2,000,000),  or such  lesser  amount as is  indicated  on the Bank's  records,
together with  interest  computed on the balance from time to time unpaid on the
basis of the actual  number of days elapsed in a year of 360 days at the rate(s)
per annum  determined  from time to time  pursuant to the Credit  Agreement,  as
defined  below,  and reflected on the Bank's  records,  which  interest shall be
payable in accordance with the terms set forth in the Credit  Agreement,  and to
pay interest on overdue  principal from the date of demand or default until paid
at the rate  which is  three  percent  (3%)  per  annum  in  excess  of the rate
announced from time to time by the Bank as its prime rate.

In no event shall the interest  rate exceed the maximum rate allowed by law. Any
interest  which would for any reason be deemed  unlawful  under  applicable  law
shall be applied to principal.

WAIVER:  The Borrower and each  endorser of this note and any other party liable
for the debt evidenced by this note severally waives demand, presentment, notice
of  dishonor  and  protest  of this  note,  and  consents  to any  extension  or
postponement of time of its payment without limit as to number or period, to the
addition of any party,  and to the  release,  discharge,  or  suspension  of any
rights and remedies against any person who may be liable for the payment of this
note. No delay on the part of the holder in exercising any right or remedy shall
operate as a waiver. No single or partial exercise by the holder of any right or
remedy  shall  preclude  any  future  exercise  of that  right or  remedy or the
exercise of any other right or remedy.  No waiver or indulgence by the holder of
any default shall be effective unless it is in writing and signed by the holder,
nor shall a waiver on one  occasion  be  construed  as a bar to or waiver of any
right on any future occasion.

This note  evidences a debt under the terms of a certain  Credit  Agreement  and
Amendment to Term Loan  Agreement  between the Bank and the Borrower dated as of
March  24,  1994,  and  any  amendments  (the  "Credit  Agreement"),   which  is
incorporated by reference for additional terms and conditions, including default
and acceleration provisions.













<PAGE>

WAIVER OF JURY TRIAL: The Bank and the Borrower,  after consulting or having had
the   opportunity   to  consult  with  counsel,   knowingly,   voluntarily   and
intentionally  waive any right either of them may have to a trial by jury in any
litigation based upon or arising out of this note, or any related  instrument or
agreement,  or any of the transactions  contemplated by this note, or any course
of conduct, dealing,  statements (whether oral or written), or actions of either
of them.  Neither  the Bank  nor the  Borrower  shall  seek to  consolidate,  by
counterclaim  or  otherwise,  any such action in which a jury trial cannot be or
has not been waived.  These provisions shall not be deemed to have been modified
in any respect or  relinquished  by either the Bank or the Borrower  except by a
written instrument executed by both of them.


                                               HURCO COMPANIES, INC.


                                               By:      _______________________

                                               Its:     _______________________