SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-K
(Mark One)
  X   Annual report  pursuant to section 13 or 15(d) of the Securities  Exchange
      Act of 1934 [Fee  Required]  for the fiscal year ended October 31, 2000 or
      Transition  report  pursuant  to  section  13 or 15(d)  of the  Securities
      Exchange  Act of 1934 [No Fee  Required]  for the  transition  period from
      _________ to _________.
Commission File No. 0-9143

                              HURCO COMPANIES, INC.
              (Exact name of registrant as specified in its charter)
               Indiana                                  35-1150732
------------------------------------          ---------------------------------
       (State or other jurisdiction of   (I.R.S. Employer Identification Number)
       incorporation or organization)
       One Technology Way
       Indianapolis, Indiana                               46268
------------------------------------          ---------------------------------
   (Address of principal executive offices)              (Zip code)
Registrant's telephone number, including area code   (317) 293-5309
                                                     --------------
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock,
                                                            No Par Value
                                                            -------------------
                                                            (Title of Class)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by  Sections  13 or 15(d)  of the  Securities  Exchange  Act of 1934
during  the  preceding  12  months,  and  (2) has  been  subject  to the  filing
requirements for at least the past 90 days. Yes X No
The  aggregate   market  value  of  the   Registrant's   voting  stock  held  by
non-affiliates as of January 2, 2001 was $20,693,873.
The number of shares of the Registrant's  common stock outstanding as of January
2, 2001 was 5,693,758.
DOCUMENTS INCORPORATED BY REFERENCE: None
Indicate by check mark if disclosure of delinquent  filers  pursuant to Rule 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of Registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  X
<PAGE>

                                     PART I

Item 1.  BUSINESS

(a)    General Development of Business

Hurco Companies, Inc. is an industrial automation systems company. We design and
produce interactive,  personal computer (PC) based, computer control systems and
software and  computerized  machine systems for sale through a worldwide  sales,
service and distribution  network.  Our proprietary computer control systems and
software  products  are  sold  primarily  as an  integral  component  of our own
computerized  machine  systems.  We also sell computer control models to machine
system end-users and other machine system  manufacturers who integrate them with
their own products.

We pioneered the  application of  microprocessor  technology and  conversational
programming  software for application on machine system  computer  controls and,
since  our  founding  in  1968,  have  been  a  leader  in the  introduction  of
interactive computer control systems that automate  manufacturing  processes and
improve productivity in certain segments of the parts manufacturing industry. We
have concentrated on designing "user-friendly" computer control systems that can
be operated by both skilled and  unskilled  machine tool  operators  and yet are
capable of instructing a machine to perform  complex tasks.  The  combination of
microprocessor technology and patented interactive,  conversational  programming
software in our computer  control  systems  enables  operators on the production
floor to  quickly  and  easily  create a  program  for  machining  or  forming a
particular part from a blueprint or computer-aided  design (CAD) and immediately
begin production of that part.

During fiscal 2000, we enhanced and expanded our product line with new software,
upgraded  computer controls and higher  performing  computerized  machine system
products.  We increased  manufacturing  capacity with the establishment of Hurco
Manufacturing Ltd., a wholly owned subsidiary, in Taiwan, which will manufacture
a significant number of our computerized  machine systems. We expanded our sales
and  distribution  network  with  the  establishment  of  a  sales  and  service
subsidiary in Milan, Italy for the Italian market,  newly expanded facilities in
Singapore and Munich,  Germany and a centralized  distribution  operation in the
Netherlands.  Finally,  during  fiscal  2000,  we settled a  significant  patent
infringement  action,  which we  believe  substantially  completes  the  license
program we began in 1995.

Our  executive  offices and principal  design,  engineering,  and  manufacturing
management  operations  are  headquartered  in  Indianapolis,   Indiana.  Sales,
application  engineering  and  service  offices  are  located  in  Indianapolis,
Indiana;  Farmington Hills, Michigan;  High Wycombe,  England;  Munich, Germany;
Paris, France; Milan, Italy and Singapore. A distribution facility is located in
Long Beach,  California  and a  manufacturing  facility is located in  Taichung,
Taiwan.

(b)      Financial Information About Industry Segments

We operate in one business segment,  industrial automation systems, as discussed
further in Note 14 in the Consolidated Financial Statements.
<PAGE>
(c)      Narrative Description of Business

General


Our strategy is to design,  develop,  produce and market a comprehensive line of
interactive  computer controls,  software and computerized machine systems using
our proprietary  technology designed to enhance the user's productivity  through
ease of operation and higher levels of machine performance (speed and accuracy).
We market these systems to the worldwide  parts  manufacturing  market.  We have
adopted an open systems software  architecture that permits our computer control
systems and software to be used with standard PC hardware and have  emphasized
an operator  friendly design that employs both  interactive  conversational  and
graphical  programming  software.  We have a  well-established  global  contract
manufacturing  network that  supplies the  computerized  machine  systems to our
selling divisions.


Products

Our  principal  products  consist  primarily  of  computerized  machine  systems
(milling  machines,  machining centers and metal forming systems) into which our
proprietary software and computer control systems have been fully integrated. We
also  produce  computer  control  systems  and related  software  for both metal
cutting  and metal  forming  machine  applications  that are sold  primarily  as
retrofit  control  systems.  In  addition,  we produce and  distribute  software
options,  control  upgrades,  hardware  accessories  and  replacement  parts and
provide operator training and support services to our customers.

The following table sets forth the  contribution of each of these product groups
to our total sales and service fees during each of the past three fiscal years:
<TABLE>
                                                                  Year Ended October 31,
                                           ---------------------------------------------------------------------
(Dollars in thousands)                                2000                    1999                    1998
                                                      ----                    ----                    ----
<S>                                           <C>       <C>           <C>      <C>            <C>      <C>
Computerized Machine Systems............      $71,708   (74.5%)       $63,793   (72.3%)       $64,770   (69.3%)
Computer Control
  Systems and Software*.................        9,605   (10.0%)        10,623   (12.0%)        14,727   (15.8%)
Service Parts...........................       10,649   (11.1%)         9,574   (10.9%)         9,424   (10.1%)
Service Fees............................        4,242    (4.4%)         4,248    (4.8%)         4,501    (4.8%)
                                              -------    ------       -------  --------       -------  --------
                                              $96,204   (100.0%)      $88,238  (100.0%)       $93,422  (100.0%)
                                              =======    ======       =======  ========       =======  ========
</TABLE>

* Amounts shown do not include  Computer  Control  systems sold as an integrated
component of computerized machine systems.
<PAGE>
Computerized Machine Systems
Computerized Machine Systems - Ultimax(R)  - Metal Cutting Applications

We design and market  computerized  machine  systems  which are equipped  with a
fully integrated  interactive  Ultimax(R)  computer control system. Our patented
Ultimax(R) twin screen  "conversational"  computer control system is sold solely
as a fully  integrated  feature of a Hurco  computerized  machine  system.  This
computer   control  system   enables  a  machine   operator  to  create  complex
two-dimensional  part  programs  directly  from  blue  prints  or  CAD.  Machine
operators with little or no  programming  experience  can  successfully  program
parts and begin  machining  operations  in a short  time  with  minimal  special
training.  Since the initial introduction of the Ultimax(R) computer control, we
have  added  enhancements  related to  operator  programming  productivity,  CAD
compatibility, data processing throughput and motion control speed and accuracy.
Our current Ultimax(R) 4 programming stations use a Pentium* processor featuring
an  operator  console  with liquid  crystal  display  screens  and  incorporates
personal computer (PC) platform  components.  This upgradeable  computer control
product  offers  improved  performance  while  ensuring  access to the most cost
effective computing hardware and software technology available.

In September  2000,  we  introduced  a new feature set on the entire  Ultimax(R)
based line of products  which  increases  the  machine  system  performance  and
provides greater customer benefits and market differentiation.
Specifically, the cubic  workspace  area in the machines was  increased,  the
cutting  speeds were increased  and the control  software and hardware  were
upgraded with new unique productivity  features. All of these  improvements were
made without increasing the market price to the  customer.  In fiscal 2000, we
also expanded our product line to include a  computerized  machine system with
x-axis travel of 50-inches, which increases our available market.

Our current line of machine systems is a complete  family of products  including
milling  machines  with an x-axis  travel of 30 and 40 inches  and  computerized
machining  centers with an x-axis travel of 24, 30, 40, 50 and 64 inches.  These
products provide  different levels of performance  features for different market
applications ranging in price from $25,000 to $165,000.

Computerized Machine Systems - Dynapath(TM) - Metal Cutting Applications

Our Dynapath(TM) product line includes two computerized milling machines and two
turning  machines  featuring our fully  integrated  Delta(TM)  computer  control
systems.  These products are designed for and marketed to the lower-priced entry
level market segment.

Computerized Machine Systems - Autobend(R) - Metal Forming Applications

In fiscal 1998, we introduced a new computerized machine product line system for
metal bending  applications that  incorporates our Autobend(R)  computer control
system. In addition, we introduced new European style  precision-ground  tooling
products which are sold either in conjunction with a computerized  metal forming
system or directly to end-users of metal  forming  systems.  In fiscal 2000,  we
introduced  a high  performance  computerized  metal  forming  system  line with
advanced  technology  features,  for  high-accuracy   performance  and  improved
productivity.  This new product line incorporates a third-party computer control
system.  Additionally,  in fiscal 2000, we expanded the precision-ground tooling
with the introduction of American style precision-ground tooling which is also
sold either in conjunction  with a metal forming system or directly to end-users
of metal forming  systems.  These products are sold in the North American market
by independent  distributors  and, in certain  territories,  by our direct sales
-------------
* Pentium is a registered trademark of the Intel Corporation
<PAGE>
personnel.  The products provide  different  levels of performance  features for
different market applications ranging in price from $30,000 to $300,000.

Computer Control Systems and Software

The  following  computer  control  systems and  software  products  are marketed
directly to end-users and or to original equipment manufacturers.

o    Delta(TM) Series
Our    Delta(TM)    series    computer    control    systems,    which   feature
microprocessor-based   electronics   incorporating  industry  standard  computer
components,  are  designed  for the  lower-priced  entry  level  segment  of the
worldwide  parts  manufacturing  industry,  and are  used on  milling  machines,
machining  centers,  turning  centers  and  punching  equipment.  The  Delta(TM)
computer control system is based on industry standard point-to-point programming
methodology  but  incorporates  software  features that group industry  standard
commands  into useful  part  features,  such as circles and frames,  to simplify
programming. The Delta(TM) computer control system is designed and configured as
a general-purpose  product,  which  offer  flexibility, reliability  and ease of
integration  with a wide  variety of machine  designs.  The  Delta(TM)  computer
control  system is sold either as an  integrated  component of our  Dynapath(TM)
Machine System or thru retro-fitters to end-users of a wide range of entry level
machine systems

In fiscal  2000,  the  software on the  Delta(TM)  computer  control  system was
enhanced and the microprocessor was upgraded to Pentium

o    Autobend(R)
Autobend(R)  computer control systems are applied to metal forming machines that
form   parts   from   sheet   metal  and   steel   plate   and   consist   of  a
microprocessor-based  computer  control  and back  gauge (an  automated  gauging
system that determines  where the bend will be made). We have  manufactured  and
sold the Autobend(R)  product line since 1968. We currently market two models of
our  Autobend(R)  computer  control  systems  for  metal  forming  machines,  in
combination with six different back gauges, through distributors to end-users as
retrofit units for  installation  on existing or new metal forming  systems,  as
well as to original  equipment  manufacturers  and  importers  of metal  forming
systems.  The  Autobend(R)  computer  control  system  is  also  sold as a fully
integrated feature on our up-acting metal forming system.

o    CAM and Software Products
In addition to our computer  control  product lines,  we offer metal cutting and
forming software products for programming two and three-dimensional parts. These
products are  marketed to users of  Ultimax(R)  computer  control  systems.  The
primary  products  in this  line  are  WinMax(R),  a  Windows**  based  off-line
programming  system,  released in fiscal  2000,  and a data file  transfer
(DXF) software option.  The DXF software option  eliminates manual data entry of
part  features  by  transferring  AutoCAD(TM)  drawing  files  directly  into an
Ultimax(R)  computer  control  or  the  off-line  programming  system  software,
substantially   increasing   operator   productivity.   We  have  augmented  our
Autobend(R)  product line with a  computer-aided  manufacturing  (CAM)  software
product, Autobend PC(R), that enables the user to create and manipulate computer
control compatible metal forming programs on a personal computer.

UltiPro(TM) is a high-speed  machining  software  option for our  Pentium*-based
Ultimax(R)  computer  control  platform.  The  UltiPro(TM)  software  enables  a
--------
* Pentium is a  registered  trademark  of the Intel  Corporation
**  Windows  is a  registered trademark of the Microsoft Corporation.
<PAGE>
customer to increase  machine  throughput by upgrading  computer  control system
performance with a high speed Pentium* CPU and advanced motion control software.
UltiNet(TM) is a networking  software  option for the Ultimax  computer  control
used by our customers to transfer part design and  manufacturing  information to
computerized  machine systems at high speeds and to network computerized machine
systems within a customer's manufacturing facility.

In fiscal 2000 we introduced a  conversational  part and tool dimension  probing
option for  Ultimax(R)  based  machines.  This option  permits  the  dimensional
measurement  of  machined  parts  and  the   associated   cutting  tools.   This
"on-machine" technique  significantly improves the throughput of the measurement
process when compared to traditional "off-machine" approaches.

Parts and Service

Our  global  service  organization  provides  installation,  warranty,  operator
training and customer support for our products worldwide.  In the United States,
our principal  distributors have primary responsibility for machine installation
and warranty service and support for new product sales only. We also service and
support  a  substantial  installed  base  of  existing  customers.  Our  service
organization   also  sells  software  options,   computer   controls   upgrades,
accessories and  replacement  parts for our products.  Our after-sale  parts and
service  business  helps  strengthen  our  customer  relationships  and provides
continuous information concerning the evolving requirements of end-users.

Marketing and Distribution

We sell our products through over 260 independent  agents and distributors in 58
countries throughout North America, Europe and Asia. We also have our own direct
sales  personnel  in the United  States,  England,  France,  Germany,  Italy and
Singapore,  which are considered to be among the world's principal  computerized
machine system consuming countries. During fiscal 2000, no distributor accounted
for  more  than  5% of our  sales  and  service  fees. Approximately  80% of the
worldwide demand for  computerized  machine systems and computer control systems
comes from  outside the U.S. In fiscal 2000,  approximately  54% of our revenues
were from overseas customers.

The end-users of our products are precision  tool,  die and mold  manufacturers,
independent metal parts  manufacturers and specialized  production groups within
large manufacturing corporations.  Industries served include aerospace, defense,
medical  equipment,  energy,  injection  molding,  transportation  and  computer
equipment.

Our computerized machine systems along with software options and accessories are
sold  primarily  to  end-users.  We sell  certain  computer  control  systems to
original  equipment  manufacturers  of new machine tools who integrate them with
their own products  prior to the sale of those  products to their own customers,
to  retrofitters  of used machine  tools who  integrate  them with those machine
tools  as  part of the  retrofitting  operation  and to  end-users  who  have an
installed base of machine tools, either with or without related computer control
systems.  During fiscal 2000, no single  end-user of our products  accounted for
more than 5% of our total sales and service fees.

In  fiscal  2000,  we  increased  and  strengthened  our  North  American  sales
organization  and we established a direct sales subsidiary in Italy as well as a
European  distribution  center  in the  Netherlands.  Also,  in  fiscal  2000 we
expanded our sales territories in Asia by establishing distributors in Malaysia,
Korea and Taiwan.  We also opened a sales and  service  office in Shanghai  that
supports mainland China.
<PAGE>
We believe  that  advances in  industrial  technology  and the related  need for
process   improvements  and  also  capacity   expansion  drive  the  demand  for
computerized machine systems and computer control systems.

Factors affecting demand include:
o    the need to continuously improve productivity and shorten cycle time,
o    an aging machine tool  installed  base that will require  replacement  with
     more  advanced and  efficient  technology  created by shorter  product life
     cycles,
o    the industrial development of emerging countries in Asia and Eastern
     Europe, and
o    the declining supply of skilled machinists,

However,  the demand for  computerized  machine systems and related  products is
highly  dependent  upon  economic  conditions  and the general level of business
confidence,  as well as such  factors as  production  capacity  utilization  and
changes in governmental policies regarding tariffs, corporate taxation and other
investment incentives. By marketing and distributing our products on a worldwide
basis,  we reduce the  potential  impact on our total sales and service  fees by
adverse changes in economic conditions in any particular geographic region.

Competition

Many  companies  compete  with  our  products  in both  the  United  States  and
international markets.  Several of these competitors are larger and have greater
financial   resources   than  we  do.  We  strive  to  compete   effectively  by
incorporating unique,  patented software and other proprietary features into our
products that offer enhanced  productivity,  greater technological  capabilities
and ease of use. We offer our products in a range of prices and  capabilities to
target a broad potential  market.  We also believe that our  competitiveness  is
aided by our reputation for  reliability and quality,  our strong  international
sales  and  distribution   organization  and  our  extensive   customer  service
organization.

In the United States and European metal cutting markets, major competitors
include Haas Automation,  Inc., Cincinnati Machine,  Deckel, Maho Gildemeister
Group (DMG),  Bridgeport  Machines,  Inc. and Fadal  Engineering along with a
large number of foreign  manufacturers including Okuma Machinery Works Ltd.,
Mori Seiki Co., Ltd.,  Masak and Matsuura  Machinery  Corporation.  The largest
competitors with respect to our computerized machine systems for metal forming
applications include Amada America, Inc. and Trumpf.


Manufacturing

Our  manufacturing  strategy is based on a global network of contract  suppliers
who manufacture our products in accordance with our proprietary design,  quality
standards and cost  specifications.  This has enabled us to lower product costs,
lower working capital per sales dollar and increase our worldwide  manufacturing
capacity  without  significant  incremental  investment in capital  equipment or
increased personnel.

Our  computerized   metal  cutting  machine  systems  are  manufactured  to  our
specifications  by  manufacturing  contractors  in Taiwan and in Europe.  During
fiscal 2000, we  established a wholly owned  subsidiary in Taiwan to manufacture
computerized machine systems. This subsidiary has increased our overall capacity
and reduced our dependence on other Taiwan contract manufacturers.  We also have
a 24%  ownership  interest  in another  contract  manufacturer.  We have  worked
closely with our contract manufacturers to increase their production capacity to
meet the rising  demand for our machine  tool  products  and  believe  that such
<PAGE>
capacity  is  sufficient  to meet  our  current  and  projected  demand.  We are
continuing to identify  additional  contract  manufacturing  resources that will
increase  our  capacity,  however;  any  significant  reduction  in  capacity or
performance capability of our principal  manufacturing  contractors would have a
material adverse effect on our operations.

We also have a contract  manufacturing  agreement for computer  control  systems
with a Taiwanese-based affiliate in which we have a 35% ownership interest. This
company  is   manufacturing   most  of  our  computer  control  systems  to  our
specifications and supplies certain  proprietary and standard components for use
in our domestic  production.  Alternative  sources for standard and  proprietary
components are available.

Backlog

Backlog consists of firm orders received from customers and distributors but not
shipped.  Backlog was $10.2 million, $8.5 million and $7.5 million as of October
31, 2000, 1999, and 1998, respectively.

Intellectual Property

We consider certain features of our products to be proprietary. We own, directly
or  through  a  subsidiary,  a number of  patents  that are  significant  to our
business. Our subsidiary, IMS Technology,  Inc. (IMS), owns domestic and foreign
patents  covering  the  machining  method  practiced  when  a  machine  tool  is
integrated with an interactive  computer control (these patents are collectively
referred  to  as  the  "Interactive   Machining   Patents").   We  also  hold  a
non-exclusive  license  covering  features of the automatic tool changer offered
with certain of our computer control machining centers.  We also own a patent on
an object-oriented, open architecture methodology for computer control software.

In fiscal 2000, we were granted a patent (patent no.  6149562) for a manual tool
changing  apparatus.  This is a manually  operated  apparatus  for  removal  and
insertion  of a tool  holder to and from a tool  pocket of a  magazine.  Also in
fiscal 2000,  we were granted a Registered  Trademark  for the software  options
WinMax(R) and we were granted a Registered  Service Mark for the phrase "We make
machines smarter(R)."

Beginning  in October  1995,  IMS  initiated a number of legal  actions  against
enterprises that it believed were infringing on one of the Interactive Machining
Patents. These included end-users of interactive computer controls, machine tool
builders  employing  interactive  computer  controls  within their  products and
computer control  manufacturers  whose control designs permit use of interactive
methods when coupled to machine tools (computer  control users).  At the present
date,  all legal actions have been settled  through  licensing  arrangements  or
litigation settlements. See Item 3. Legal Proceedings.

IMS has  actively  pursued  a  program  to  license  the use of the  Interactive
Machining  Patents.  During  the  past  five  fiscal  years,  IMS  entered  into
agreements  with  approximately  40 computer  control  Users under which IMS has
granted  non-exclusive  licenses of Interactive  Machining Patents.  We recorded
license fee income of $5.4 million,  $.3 million and $6.3 million,  net of legal
fees and expenses, in fiscal 2000, 1999, and 1998 and, respectively.  Subject to
the continuing validity of the U.S.  Interactive  Machining Patent, we expect to
receive  additional  license  fee  income,  net of legal fees and  expenses,  of
approximately  $300,000  in  fiscal  2001.  In  addition,  IMS  has  received  a
royalty-free  non-exclusive  license  under  six  patents  owned  by  two of the
licensees.  There are a limited number of remaining  computer control users that
IMS has identified as potential licensees.
<PAGE>
Research and Development

Research and development  expenditures for new products and significant  product
improvements,  included as period operating  expenses,  were $3.2 million,  $2.5
million  and $2.4  million in fiscal  2000,  1999,  and 1998,  respectively.  In
addition, we recorded expenditures of $706,000 in 2000, $1.0 million in 1999 and
$1.3  million  in 1998  related  to  software  development  projects  that  were
capitalized.

Employees

We had  approximately 292 employees at the end of fiscal 2000, none of which are
covered by a collective-bargaining  agreement or represented by a union. We have
experienced no employee-generated  work stoppages or disruptions and we consider
our employee relations to be satisfactory.

(d)      Financial Information About Geographic Areas

Financial  information  about  geographic  areas is set  forth in Note 14 to the
Consolidated Financial Statements.

We are  subject  to the risks of doing  business  on a global  basis,  including
foreign  currency  fluctuation  risks,  changes in general economic and business
conditions in the countries and markets that we serve and government actions and
initiatives including import and export restrictions and tariffs.


Item 2.  PROPERTIES

The following  table sets forth the location,  size and principal use of each of
our facilities:
<TABLE>
          Location              Square Footage             Principal Uses
<S>                               <C>                      <C>
Indianapolis, Indiana             165,000(1)               Corporate headquarters, design and
                                                           engineering, product testing, computer control
                                                           assembly, sales, application engineering and customer service

Farmington Hills, Michigan         37,500(2)               Design and engineering, product
                                                           testing,    computer   control   assembly,    sales,   application
                                                           engineering and customer service

Long Beach, California              3,000                  Warehouse and distribution

High Wycombe, England              45,000(3)               Sales, application engineering and customer service

Paris, France                       2,800                  Sales, application engineering and customer service

Munich, Germany                    17,100                  Sales, application engineering and customer service

Milan, Italy                        4,850                  Sales, application engineering and customer service

Singapore                           3,000                  Sales, application engineering and customer service

Taichung, Taiwan                   26,600                  Manufacturing

----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Approximately 45,000 square feet is sublet through fiscal 2001.
(2) Approximately 24,000 square feet is under sublease through fiscal 2001.
(3) Approximately 24,000 square feet have been sublet to a subtenant since 1995.
<PAGE>
We own the Indianapolis facility and lease all other facilities. The leases have
terms  expiring at various  dates  ranging from March 2001 to February  2005. We
believe that all of our facilities are well  maintained and are adequate for our
needs  now and in the  foreseeable  future.  We do not  believe  that  we  would
experience any  difficulty in replacing any of the present  facilities if any of
our leases were not renewed at expiration.

Item 3.  LEGAL PROCEEDINGS

As previously reported, Hurco and its subsidiary IMS Technology, Inc. (IMS) have
been  parties  to  a  number  of  legal   proceedings   which  involved  alleged
infringement of a United States interactive  machining patent (the Patent) owned
by IMS.  All  actions  have  been  settled  through  licensing  arrangements  or
litigation settlements.  On August 8, 2000, Hurco and IMS agreed to a settlement
with Haas  Automation  Inc.  and Gene Haas  (Haas).  Under the  settlement,  IMS
licensed the Patent to Haas and Haas made a one-time payment to IMS. We reported
license  fee  income  and  litigation  settlement  fees,  net of  expenses,  of
approximately  $5.4  million in the  fourth  quarter  of fiscal  2000  primarily
resulting from this settlement.

Item. 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.


                                     PART II



Item 5.    MARKET FOR THE REGISTRANT'S EQUITY AND RELATED
           STOCKHOLDER MATTERS


Our  common  stock is traded on the  Nasdaq  National  Market  under the  symbol
"HURC".  The  following  table sets  forth the high and low sales  prices of the
shares of our common stock for the periods indicated,  as reported by the Nasdaq
National Market.

                                     2000                             1999
                            ---------------------          ---------------------
Fiscal Quarter Ended:        High          Low                High          Low
--------------------        ---------------------          ---------------------
January 31............     $4.125       $3.000             $6.375        $4.156
April 30..............      5.875        3.188              5.000         3.875
July 31...............      4.750        3.625              6.625         4.250
October 31............      4.813        3.375              4.500         3.375


We do not  currently pay dividends on our common stock and intend to continue to
retain earnings for working capital, capital expenditures and debt reduction.

There were approximately 454 holders of record of our common stock as of January
2, 2001.

During the period covered by this report,  we did not sell any equity securities
that were not registered under the Securities Act of 1933, as amended.

<PAGE>
Item 6.  SELECTED FINANCIAL DATA

The  Selected  Financial  Data  presented  below  have  been  derived  from  our
Consolidated  Financial Statements for the years indicated and should be read in
conjunction  with the  Consolidated  Financial  Statements and related notes set
forth elsewhere herein.
<TABLE>
                                                                   Year Ended October 31,
                                                 2000            1999          1998          1997         1996
                                          --------------------------------------------------------------------
Statement of Operations Data:                        (In thousands, except per share amounts)
   <S>                                     <C>             <C>            <C>           <C>            <C>
   Sales and service fees................  $    96,204     $    88,238    $   93,422    $   95,729     $  99,351

   Gross profit..........................  $    25,377     $    24,174    $   27,939    $   27,773     $  28,421

   Selling, general and adminis-
     trative expenses....................  $    23,538     $    21,259    $   21,786    $   21,047     $  21,343

   Restructuring charge (credit).........  $       300     $     (103)    $    1,162    $       --     $      --

   Operating income......................  $     1,539     $     3,018    $    4,991    $    6,726     $   7,078

   Interest expense......................  $       939     $     1,293    $      876    $    1,938     $   3,211

   License fee income and litigation
     settlement fees, net................  $     5,365     $       304    $    6,974    $   10,095     $     590

   Net income............................  $     5,035     $     1,802    $    9,254    $   13,804     $   4,264

   Earnings
     per common share-diluted............  $       .84     $       .30    $     1.39    $     2.06     $     .72

   Weighted average common
     shares outstanding-diluted..........        6,020           6,061         6,670         6,704         5,907


                                                                     As of October 31,
                                           2000            1999                1998          1997         1996
                                         ---------------------------------------------------------------------
Balance Sheet Data:                                               (Dollars in thousands)

   Current assets........................  $    49,195     $   52,856     $   55,143    $   42,222     $  44,108

   Current liabilities...................  $    23,124     $   19,580     $   25,794    $   19,370     $  23,336

   Working capital ......................  $    26,071     $   33,276     $   29,349    $   22,852     $  20,772

   Current ratio.........................          2.1            2.7            2.1           2.2           1.9

   Total assets..........................  $    65,024     $   69,632     $   71,696    $   58,748     $  59,750

   Long-term obligations.................  $     3,009     $   13,904     $    8,162    $    9,602     $  20,273

   Total debt............................  $     3,736     $   14,172     $    8,358    $   10,043     $  22,110

   Shareholders' equity..................  $    38,891     $   36,148     $   37,740    $   29,776     $  16,141

</TABLE>
<PAGE>
Item 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
           CONDITION AND RESULTS OF OPERATIONS
------------------------------------------------------------

The  following  discussion  should  be read in  conjunction  with  the  Selected
Financial  Data and the  Consolidated  Financial  Statements  and Notes  thereto
appearing  elsewhere  herein.   Certain  statements  made  in  this  report  may
constitute  "forward-looking  statements"  within  the  meaning  of the  Private
Securities  Litigation  Reform  Act of 1995.  These  forward-looking  statements
involve known and unknown risks,  uncertainties and other factors that may cause
our actual results,  performance or achievements to be materially different from
any future  results,  performance or  achievements  expressed or implied by such
forward-looking  statements.  These factors  include,  among others,  changes in
general economic and business conditions that affect demand for computer numeric
control  (CNC)  systems,  machine  tools  and  software  products,   changes  in
manufacturing  markets,   innovations  by  competitors,   quality  and  delivery
performance  by  our  contract   manufacturers  and  governmental   actions  and
initiatives including import and export restrictions and tariffs.

Results of Operations

The following table  presents,  for the fiscal years  indicated,  selected items
from the  Consolidated  Statements  of  Operations  expressed as a percentage of
worldwide sales and service fees and the year-to-year  percentage changes in the
dollar amounts of those items.
<TABLE>
                                                  Percentage of Revenues             Year-to-Year % Change
                                                                                       Increase (Decrease)
                                               2000       1999        1998         00 vs. 99       99 vs. 98
                                               -----      -----       -----        ---------       ---------
   <S>                                        <C>        <C>         <C>          <C>               <C>
   Sales and service fees................     100.0%     100.0%      100.0%          9.0%            (5.6%)
   Gross profit..........................      26.4%      27.4%       29.9%          5.0%           (13.5%)
   Selling, general and
     administrative expenses.............      24.5%      24.1%       23.3%         10.7%            (2.4%)
   Operating income......................       1.6%       3.4%        5.3%        (49.0%)          (39.5%)
   License fee income and litigation
     settlement fees,  net...............       5.6%       0.3%        7.5%       1664.8%           (95.6%)
   Interest expense......................       0.9%       1.5%        0.9%        (27.4%)          (47.6%)
   Net income............................       5.2%       2.0%        9.9%        179.4%           (80.5%)

</TABLE>
Fiscal 2000 Compared With Fiscal 1999

Net income for the fiscal year ended October 31, 2000 was $5.0 million,  or $.84
per share, on a diluted basis,  compared to $1.8 million, or $.30 per share, for
the  preceding  year.  Fiscal  2000 net income was due  almost  entirely  to the
receipt in the fourth  quarter of proceeds from a settlement of a  long-standing
patent infringement claim.

Operating results for fiscal 2000,  however,  compared  unfavorably to those for
the prior year,  due to the  substantial  adverse  impact of converting  foreign
sales and costs,  particularly  those  denominated in Euros, to U.S. dollars for
financial  reporting  purposes.  Had exchange  rates in fiscal 2000 remained the
same as the average rate in effect during  fiscal 1999,  income before taxes for
fiscal 2000 would have increased by approximately $3.5 million.
<PAGE>
Sales and service fees were $96.2  million for fiscal 2000,  an increase of 9.0%
from the $88.2  million  reported  for fiscal  1999.  When  measured at constant
exchange   rates,   however,   net  sales  and  service  fees  would  have  been
approximately  $102.2 million for the fiscal year, an increase of 15.6% compared
to the prior year.

The  increase in sales and service fees was  primarily  driven by an increase in
sales of computerized  machine  systems.  Sales of computerized  machine systems
totaled $71.7 million in fiscal 2000 compared to $63.8 million in fiscal 1999, a
12.4% increase.  Domestic sales of  computerized  machine systems in fiscal 2000
increased by $4.3  million,  or 20.4%,  due primarily to a 25% increase in units
shipped.  Shipments of computerized  machine systems in Europe also increased by
15.5%.  Shipments  of  computerized  machine  systems  in  Southeast  Asia  also
benefited from significantly improved market conditions.

International sales, including export sales from the United States, approximated
57.5% of  consolidated  sales and service fees for fiscal 2000 compared to 58.4%
for fiscal 1999.

New order bookings for fiscal 2000 were $100.7 million compared to $89.9 million
for fiscal 1999, an increase of 12%.  Orders for  computerized  machine  systems
increased  $11.2 million  reflecting a 30% increase in unit orders.  Unit orders
for machine systems in the U.S.  increased 40% over fiscal 1999 as a result of a
very strong fourth  quarter,  which  reflected  favorable  acceptance of our new
products introduced at the biennial International  Manufacturing Technology Show
(IMTS) in September 2000, along with improved market conditions.  Outside of the
United  States,  orders for machine  systems  increased 23% due  principally  to
increased market penetration in continental Europe and Southeast Asia. Orders in
Southeast Asia also benefited from  significantly  improved  market  conditions.
Backlog was $10.2  million at October 31, 2000,  compared to $8.5 million at the
end of fiscal 1999.

Gross profit margin, as a percentage of sales,  declined in fiscal 2000 to 26.4%
from 27.4% in fiscal  1999,  due  primarily  to the  unfavorable  effects of the
stronger U.S.  dollar  particularly in relationship to the Euro. The unfavorable
effect was most pronounced in the fourth fiscal quarter.

Operating  expenses increased to $23.5 million in fiscal 2000 from $21.3 million
in fiscal 1999, due primarily to product  development  costs associated with the
our new line of computerized  machine  systems as well as costs  associated with
expanded  sales and  marketing  activities.  The increased  operating  expenses,
combined with the adverse margin impact of the strong U.S. dollar, resulted in a
decrease in operating profit from $3.0 million in fiscal 1999 to $1.5 million in
fiscal 2000.

In the fourth  quarter of fiscal  2000,  we recorded a  restructuring  charge of
$300,000 for  severance  costs  related to the  termination  of employees at our
subsidiary, Autocon Technologies,  Inc. in connection with the completion of the
consolidation  of this  operation  into our North  American  sales  and  service
business.

Interest expense for fiscal 2000 declined by $354,000,  or 27.4%, from the level
in fiscal 1999,  primarily due to the  significant  reduction in our outstanding
borrowings.

Other expense was $359,000 in fiscal 2000 compared to other income of $25,000 in
fiscal 1999.  The increase is  primarily  the result of realized and  unrealized
currency  losses  associated  with accounts  receivable  denominated  in foreign
currencies,  primarily  those linked to the Euro,  which for the most part, were
not hedged during fiscal 2000.
<PAGE>
The provision  for income taxes of $571,000 in fiscal 2000 is primarily  related
to the  earnings  of a  foreign  subsidiary  as well as to the  settlement  of a
previously disclosed German tax issue for approximately $275,000.

Domestic net operating loss carryforwards were substantially  utilized in fiscal
2000. We would have recorded an additional tax provision of  approximately  $1.9
million in fiscal 2000 without the benefit of net operating loss  carryforwards.
Note 6 to the Consolidated  Financial  Statements contains more information with
respect to our net operating loss carryforwards.

Fiscal 1999 Compared With Fiscal 1998

Net income for the fiscal year ending October 31, 1999 was $1.8 million, or $.30
per share, on a diluted basis, compared to $9.3 million, or $1.39 per share, for
the preceding year.  Results for fiscal 1999 are not comparable to the preceding
period because fiscal 1998 results include a $1.2 million  restructuring  charge
and $6.3 million of license fees and litigation  settlements net of expenses and
foreign  withholding  taxes.  As  discussed  below,  net  license fee income and
litigation settlements fees for fiscal 1999 were $304,000.

Sales and service  fees were $88.2  million for fiscal  1999, a decrease of 5.6%
from the $93.4 million reported in fiscal 1998. The decrease in sales was due in
part to the  negative  impact  converting  foreign  sales  to U.S.  dollars  for
financial reporting purposes.  At constant exchange rates, net sales and service
fees for fiscal 1999 would have been $89.2 million.

Sales of  computerized  machine  systems,  before foreign  currency  translation
effects were substantially unchanged from the prior year and accounted for 72.3%
of our annual sales and service fees.  Domestic  sales of  computerized  machine
systems in fiscal 1999 decreased by $3.2 million, or 13.2%, reflecting very weak
market  conditions  that have  existed  since the third  quarter of fiscal 1998.
Sales of computerized machine systems in Europe increased $1.7 million, or 4.3%,
in fiscal  1999 on a  constant  dollar  basis,  while  sales in  Southeast  Asia
increased $1.3 million.  The increase in international  sales was offset in part
by approximately $1.0 million negative effect from foreign currency translation.

Sales of  stand-alone  CNC systems and  software  declined by $4.1  million,  or
27.9%.  The decline in  stand-alone  CNC systems was  primarily the result of an
anticipated  reduction  in  shipments to original  equipment  manufacturers  and
retrofit  dealers of stand-alone CNC systems,  primarily  related to our DeltaTM
Series CNC systems,  as we have  repositioned  these  products as  components of
integrated machine systems.

International sales, including export sales from the United States, increased to
approximately  58.4% of  consolidated  sales and  service  fees for fiscal  1999
compared to 54.5% for fiscal 1998.

Orders for 1999 were $89.9 million  compared to $92.4 million in the prior year,
a $2.5 million, or 2.7%, decrease.  Computerized machine system orders increased
$1.5  million,  or 2.3%,  while  stand-alone  CNC system orders  decreased  $2.9
million, or 23.1%.  Computerized  machine system unit orders in Europe increased
7.2% while orders in the United States declined  10.5%.  Offsetting the increase
in computerized machine system orders in Europe was a decline in stand-alone CNC
system unit orders of 32.3%.  The decline in orders for  stand-alone CNC systems
is the result of our repositioning these products for marketing as components of
integrated computerized machine systems.
<PAGE>
Backlog was $8.5  million at October  31,  1999 and $7.5  million at October 31,
1998.

Gross profit margin as a percentage  of sales  decreased to 27.4% in fiscal 1999
compared to 29.9% in the prior year.  The decrease was  primarily  the result of
lower service  margin and the effects of a stronger  dollar  relative to foreign
currencies.

Interest  expense  for fiscal 1999  increased  $417,000 or 47.6% from the amount
reported for the corresponding period in fiscal 1998, primarily due to increased
borrowing to support an increase in finished  product  inventory  which began in
the second half of fiscal 1998.

License fee income and litigation  settlement fees for fiscal 1999 were $304,000
compared to $7.0 million in the prior year. As previously reported,  there are a
limited number of CNC users that are not already licensed. As a result,  license
fee income and  litigation  settlement  fees in fiscal 1999 were not expected to
equal  that  recorded  in fiscal  1998.  Note 10 to the  Consolidated  Financial
Statements  contains  more  information  on license  fee  income and  litigation
settlement fees.

The  provision  for  income  taxes in fiscal  1999 is  primarily  related to the
earnings  of a  foreign  subsidiary  which  no  longer  has the  benefit  of net
operating loss carryforwards to offset taxable income. The fiscal 1999 provision
was favorably  impacted by a $377,000 tax asset recorded by a foreign subsidiary
due to a change in its tax status.  The  provision  for foreign  income taxes in
fiscal 1998 consisted of $640,000 of foreign  withholding  taxes  resulting from
license fee income and litigation settlement fees and approximately $1.2 million
related  to  the  earnings  of  foreign   subsidiaries.   Net   operating   loss
carryforwards available to offset pre-tax income in future periods are described
in Note 6 to the Consolidated Financial Statements.

EURO Currency

Many of the  countries  in which we sell our  products  and  services are Member
States of the  Economic and Monetary  Union  (EMU).  Beginning  January 1, 1999,
Member  States of the EMU were  permitted to begin trading in either their local
currencies  or the Euro,  the  official  currency  of EMU  participating  Member
States.  Parties  are  free to  choose  the  unit  they  prefer  in  contractual
relationships during the transitional period,  beginning January 1999 and ending
June  2002.  Our  computer   system  contains  the   functionality   to  process
transactions  in either a country's  national  currency or the Euro. We have not
incurred and do not  anticipate  incurring any material  adverse  effects on our
operations related to the EMU's conversion to the Euro. However, there can be no
assurance  that the  conversion of EMU Member States to the Euro will not have a
material adverse effect on our operations.


Foreign Currency Risk Management

We manage our foreign  currency  exposure  through  the use of foreign  currency
forward exchange  contracts.  We do not speculate in the financial  markets and,
therefore,  do not enter into these  contracts  for  trading  purposes.  We also
moderate our currency  risk related to  significant  purchase  commitments  with
certain foreign vendors through price  adjustment  agreements that provide for a
sharing of, or otherwise limit,  the risk of currency  fluctuations on the costs
of purchased products.  Note 1 to the Consolidated Financial Statements has more
information on this subject.
<PAGE>

Liquidity and Capital Resources

At October 31, 2000, we had cash and cash  equivalents of $3.4 million  compared
to $3.5 million at October 31, 1999.  Cash provided by operations  totaled $12.9
million in fiscal  2000,  compared  to cash used by  operations  of  $827,000 in
fiscal 1999. Cash flow from operations in fiscal 2000 was enhanced by litigation
settlement receipts of approximately $5.4 million, net of legal fees and taxes.

Working  capital,  excluding  short-term  debt was $28.1  million at October 31,
2000,  compared  to $33.3  million at October 31,  1999.  The decline in working
capital is  attributable  to a decrease  in  inventory  of $4.6  million  and an
increase in accounts payable of $2.7 million.  The decrease in inventory relates
primarily to an increase in sales combined with a planned reduction in inventory
of finished products available for shipment. The increase in accounts payable is
the result of increased machine purchases from our contract manufacturers in the
fourth fiscal quarter under terms that generally range from 60 to 120 days.

Capital  investments  for the fiscal 2000 consisted  principally of expenditures
for software development projects and purchases of equipment.

We  repurchased  395,752 shares of our common stock during fiscal 1999 under our
previously  announced stock repurchase program.  These shares are reflected as a
reduction of common stock  outstanding in calculating basic and diluted earnings
per common share.

Total debt at October  31,  2000 was $3.7  million,  representing  8.8% of total
capitalization,  compared to $14.2 million, or 28.2%, of total capitalization at
October 31, 1999.

On December 29, 2000, we purchased 278,001 shares of our common stock for
approximately $1.2 million from a related party, Brynwood Partners II L.P.  The
purchased shares will be reflected as a reduction in common stock.

We were in  compliance  with all loan  covenants at October 31, 2000. We believe
that cash flow generated from our future operations and borrowings  available to
us  under  our  existing  credit  facilities  will be  sufficient  to  meet  our
anticipated cash requirements in the foreseeable future.

<PAGE>
Item 7A.  Quantitative and Qualitative Disclosures About Market Risks


Interest Rate Risk

Our bank line of credit is affected by the general  level of U.S.  and  European
interest rates and/or Libor. We had $950,000  outstanding under our bank line of
credit at October 31, 2000 and the effect of interest  rate  changes will likely
not be significant.


Foreign Currency Exchange Risk

A significant  portion of our product content is sourced from foreign  suppliers
or  built  to  our  specifications  by  contract  manufacturers   overseas.  Our
contractual arrangements with those suppliers typically include foreign currency
risk sharing  agreements  which reduce the effects of currency  fluctuations  on
product cost. The  predominant  portion of foreign  currency  exchange rate risk
regarding product cost relates to the New Taiwan Dollar.

In fiscal  2000,  approximately  58% of our sales and  service  fees,  including
export  sales,  were derived  from foreign  markets.  All  computerized  machine
systems,  CNC  systems and certain  proprietary  service  parts are sourced by a
central  engineering  and  manufacturing   division  of  our  U.S.  company  and
re-invoiced  to our foreign sales and service  subsidiaries,  primarily in their
functional  currencies.  The U.S.  company enters into forward foreign  exchange
contracts from time to time to hedge the cash flow risk related to inter-company
sales,  inter-company purchases,  inter-company accounts receivable and accounts
payable denominated in foreign currencies.  We do not speculate in the financial
markets and, therefore, do not enter into these contracts for trading purposes.

Forward contracts for the sale and purchase of foreign  currencies as of October
31, 2000:
<TABLE>

                          Notional Amount
                            in Foreign       Weighted Avg.     Notional Amount     Fair Value
Forward Contracts            Currency         Forward Rate        in U.S. $     October 31, 2000      Maturity Dates
-----------------         ---------------    -------------     ---------------  ----------------      --------------
<S>                         <C>                  <C>            <C>               <C>                 <C>
Sterling                      1,000,000          1.4549          1,454,871         1,450,000          Nov '00-Dec `00
Euro                          4,073,831           .8620          3,511,575         3,463,000          Nov '00-Dec `00
Singapore Dollar              1,989,000          1.7483          1,137,682         1,136,000          Nov '00-Dec `00
NT Dollar                   498,000,000           32.04         15,543,027        15,414,000          Nov '00-Oct `01

</TABLE>
<PAGE>


Item 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                    Report of Independent Public Accountants

To the Shareholders and
Board of Directors of
Hurco Companies, Inc.:

We have audited the accompanying consolidated balance sheets of Hurco Companies,
Inc. (an Indiana  corporation) and subsidiaries as of October 31, 2000 and 1999,
and the related consolidated statements of operations,  changes in shareholders'
equity and cash flows for each of the three  years in the period  ended  October
31, 2000. These financial  statements and the schedule referred to below are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the consolidated  financial position of Hurco Companies,
Inc.  and  subsidiaries  as of October 31, 2000 and 1999,  and the  consolidated
results of their  operations and their cash flows for each of the three years in
the period ended  October 31, 2000,  in conformity  with  accounting  principles
generally accepted in the United States.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial  statements  taken as a whole.  The schedule listed in Item 14(a) 2 is
presented  for  purposes  of  complying   with  the   Securities   and  Exchange
Commission's  rules  and is not  part of the  basic  financial  statements.  The
schedule has been subjected to the auditing  procedures applied in our audits of
the basic  financial  statements  and, in our opinion,  is fairly  stated in all
material  respects  in  relation to the basic  financial  statements  taken as a
whole.






                                                             ARTHUR ANDERSEN LLP


Indianapolis, Indiana,
December 5, 2000.
<PAGE>

                              HURCO COMPANIES, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
                                                                                 Year Ended October 31,
                                                                                 ----------------------
                                                                         2000              1999             1998
                                                                         ----              ----             ----
                                                                    (Dollars in thousands, except per share amounts)
<S>                                                                  <C>              <C>               <C>
Sales and service fees........................................       $ 96,204         $  88,238         $ 93,422

Cost of sales and service ....................................         70,827            64,064           65,483
                                                                     --------         ---------         --------

     Gross profit.............................................         25,377            24,174           27,939

Selling, general and administrative expenses..................         23,538            21,259           21,786

Restructuring charge (credit) (Note 15).......................            300              (103)           1,162
                                                                     ---------        ---------         --------

     Operating income ........................................          1,539             3,018            4,991

License fee income and litigation settlement fees, net
     (Note 12)................................................          5,365               304            6,974

Interest expense..............................................            939             1,293              876

Other income (expense), net...................................           (359)               25               99
                                                                     ---------        ---------         --------

     Income before income taxes...............................          5,606             2,054           11,188

Provision for income taxes (Note 6)...........................            571               252            1,934
                                                                     ---------        ---------         --------

Net income ...................................................       $  5,035         $   1,802         $  9,254
                                                                     =========        =========         ========


Earnings per common share - basic.............................       $    .85         $     .30         $   1.42
                                                                     =========        ==========        ========

Weighted average common shares outstanding - basic............          5,952             5,980            6,498
                                                                     =========        ==========        ========

Earnings per common share - diluted...........................       $    .84         $     .30         $   1.39
                                                                     =========        ==========        ========

Weighted average common shares outstanding - diluted..........          6,020             6,061            6,670
                                                                     =========        ==========        ========
</TABLE>

The accompanying  notes are an integral part of the Consolidated Financial
Statements.
<PAGE>
                               HURCO COMPANIES, INC.
                           CONSOLIDATED BALANCE SHEETS
                                     ASSETS
<TABLE>
                                                                                                   As of October 31,
                                                                                                 2000           1999
                                                                                                 ----           ----
                                                                                    (Dollars in thousands, except per share amounts)
<S>                                                                                            <C>            <C>
Current assets:
   Cash and cash equivalents.....................................................              $   3,384      $   3,495
   Accounts receivable, less allowance for doubtful accounts of $741 in 2000 and $687 in 1999     17,842         17,154
   Inventories ..................................................................                 26,176         30,767
   Other.........................................................................                  1,793          1,440
                                                                                               ---------      ---------
     Total current assets........................................................                 49,195         52,856
                                                                                               ---------      ---------
Long-term license fee receivables (Note 12)......................................                     --            434
                                                                                               ---------      ---------
Property and equipment:
   Land..........................................................................                    761            761
   Building......................................................................                  7,162          7,168
   Machinery and equipment.......................................................                 11,000         11,182
   Leasehold improvements........................................................                    992          1,005
                                                                                               ---------      ---------
                                                                                                  19,915         20,116
   Less accumulated depreciation and amortization................................                (11,122)       (11,165)
                                                                                               ---------      ---------
                                                                                                   8,793          8,951
Software development costs, less accumulated amortization of $6,505 in 2000 and $5,174 in 1999     3,326          3,951
Other assets.....................................................................                  3,710          3,440
                                                                                               ---------      ---------
                                                                                               $  65,024      $  69,632
                                                                                               ---------      ---------
                      LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Accounts payable..............................................................              $  10,896      $   8,519
   Accounts payable-related parties..............................................                  2,697          2,372
   Accrued expenses..............................................................                  6,714          5,935
   Accrued warranty expenses.....................................................                    831            968
   Current portion of long-term debt.............................................                  1,986          1,786
                                                                                               ---------      ---------
     Total current liabilities...................................................                 23,124         19,580
                                                                                               ---------      ---------
Non-current liabilities:
   Long-term debt ...............................................................                  1,750         12,386
   Deferred credits and other ...................................................                  1,259          1,518
                                                                                               ---------      ---------
                                                                                                   3,009         13,904
Commitments and contingencies (Notes 10 and 11)
Shareholders' equity:
   Preferred stock: no par value per share; 1,000,000 shares authorized; no shares issued             --             --
   Common stock: no par value; $.10 stated value per share; 12,500,000 shares authorized; 5,955,359
     and 5,951,859 shares issued and outstanding in 2000 and 1999, respectively..                    596            595
   Additional paid-in capital....................................................                 46,347         46,340
   Accumulated deficit...........................................................                   (313)        (5,348)
   Foreign currency translation adjustment.......................................                 (7,739)        (5,439)
                                                                                               ---------      ---------
     Total shareholders' equity..................................................                 38,891         36,148
                                                                                               ---------      ---------
                                                                                               $  65,024      $  69,632
                                                                                               =========      =========
The accompanying notes are an integral part of the Consolidated Financial Statements.
</TABLE>
<PAGE>
                                                 HURCO COMPANIES, INC.
                                         CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
                                                                                              Year Ended
                                                                                              October 31,
                                                                                    2000         1999          1998
                                                                                    ----         ----          ----
                                                                                      (Dollars in thousands)
<S>                                                                             <C>            <C>           <C>
Cash flows from operating activities:
   Net income .............................................................     $  5,035       $  1,802      $  9,254
   Adjustments to reconcile net income to
   net cash provided by (used for) operating activities:
     Depreciation and amortization.........................................        2,519          2,428         2,138
     Restructuring charge (credit) ........................................          300           (103)        1,162
     Change in assets/liabilities
      (Increase) decrease in accounts receivable...........................       (2,101)           974        (2,808)
      (Increase) decrease in inventories...................................        2,717            801        (8,775)
      Increase (decrease) in accounts payable..............................        2,917         (4,825)        6,864
      Increase (decrease) in accrued expenses..............................        1,023           (928)         (994)
      Other................................................................          440           (976)         (931)
                                                                                ---------      ---------      --------
         Net cash provided by (used for) operating activities..............       12,850           (827)        5,910
                                                                                ---------      ---------      --------

Cash flows from investing activities:
   Proceeds from sale of equipment.........................................           36             69            93
   Purchase of property and equipment......................................       (1,193)        (1,176)       (1,013)
   Software development costs..............................................         (706)          (981)       (1,315)
   Other ..................................................................         (138)          (288)         (411)
                                                                                ---------      ---------      --------
         Net cash (used for) investing activities..........................       (2,001)        (2,376)       (2,646)
                                                                                ---------      ---------      --------
Cash flows from financing activities:
   Advances on bank credit facilities......................................       28,500         61,920        15,053
   Repayments of bank credit facilities....................................      (37,150)       (54,320)      (14,953)
   Repayments of term debt.................................................       (1,786)        (1,786)       (1,786)
   Proceeds from exercise of common stock options..........................            8             18           120
   Purchase of common stock................................................           --         (2,379)       (1,827)
                                                                                --------       ---------      --------
         Net cash provided by (used for) financing activities..............      (10,428)         3,453        (3,393)
                                                                                --------       ---------      --------
Effect of exchange rate changes on cash....................................         (532)           (31)           34
                                                                                --------       ---------      --------
         Net increase (decrease) in cash...................................         (111)           219           (95)

Cash and cash equivalents at beginning of year.............................        3,495          3,276         3,371
                                                                                --------       ---------      --------

Cash and cash equivalents at end of year...................................     $  3,384       $  3,495       $ 3,276
                                                                                ========       =========      ========
Supplemental disclosures:
   Cash paid for:
      Interest.............................................................     $    834       $  1,016       $   702
      Income taxes.........................................................     $    739       $  1,003       $ 1,818

The accompanying notes are an integral part of the Consolidated
Financial Statements.
</TABLE>
<PAGE>


                             HURCO COMPANIES, INC.
           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
<TABLE>

                                                                                                       Accumulated
                                                                                                          Other
                                                                                                      Comprehensive
                                                                                                      Income (loss):
                                                                                                         Foreign
                                                        Common Stock      Additional                     Currency
                                                Shares Issued              Paid-In      Accumulated    Translation
                                                & Outstanding    Amount    Capital         Deficit      Adjustment       Total
                                                                                    (Dollars in thousands)
<S>                                               <C>           <C>       <C>            <C>            <C>            <C>
Balances, October 31, 1997.................       6,544,831      $ 654    $ 50,349       $(16,404)      $(4,823)       $29,776


Net income.................................              --         --          --          9,254            --          9,254

Translation of foreign currency financial
   statements..............................              --         --          --             --           417            417
Comprehensive Income.......................                                                                              9,671

Exercise of common stock options...........          49,780          5         115             --            --            120

Purchase of common stock...................        (254,500)       (25)     (1,802)            --            --         (1,827)
                                                 ----------     ------    ---------      ---------      --------       --------

Balances, October 31, 1998.................       6,340,111      $ 634    $ 48,662       $ (7,150)      $(4,406)       $37,740
                                                 ----------     ------    ---------      ---------      --------       --------

Net income.................................              --         --          --          1,802            --          1,802

Translation of foreign currency financial
   statements..............................              --         --          --             --        (1,033)        (1,033)
Comprehensive Income.......................                                                                                769

Exercise of common stock options...........           7,500          1          17             --            --             18

Purchase of common stock...................        (395,752)       (40)     (2,339)            --            --         (2,379)
                                                 ----------     ------    ---------      ---------      --------       --------

Balances, October 31, 1999.................       5,951,859      $ 595    $ 46,340       $ (5,348)      $(5,439)       $36,148
                                                 ----------     ------    ---------      ---------      --------       --------

Net income.................................             --          --          --          5,035            --          5,035

Translation of foreign currency financial
   statements..............................             --          --          --             --        (2,300)        (2,300)
Comprehensive Income.......................                                                                              2,735

Exercise of common stock options...........          3,500           1           7             --            --              8
                                                ----------      ------    ---------      ---------      --------        -------

Balances, October 31, 2000.................      5,955,359       $ 596    $ 46,347       $   (313)      $(7,739)        $38,891
                                                ==========      ======    =========      =========      ========        =======
</TABLE>
The   accompanying   notes  are  an  integral  part  of  the Consolidated
Financial Statements.
<PAGE>
                              HURCO COMPANIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation.  The consolidated  financial  statements  include the accounts of
Hurco  Companies,  Inc.  (an  Indiana  corporation)  and our  wholly  owned  and
controlled  subsidiaries.  We  have a 35%  and  24%  ownership  interest  in two
affiliates accounted for using the equity method. These investments are included
in Other Assets on the accompanying  Consolidated  Balance Sheets.  Intercompany
accounts and transactions have been eliminated.

Statements of Cash Flows.  We consider all highly liquid  investments  purchased
with a maturity of three months or less to be cash equivalents.  Cash flows from
hedges are classified consistent with the items being hedged.

Translation  of Foreign  Currencies.  All  balance  sheet  accounts  of non-U.S.
subsidiaries  are  translated  at the  exchange  rate as of the end of the year.
Income and  expenses are  translated  at the average  exchange  rates during the
year.  Foreign  currency  translation  adjustments  are  recorded  as a separate
component of shareholders' equity. Foreign currency transaction gains and losses
are recorded as income or expense as incurred.

Hedging.  We enter into foreign  currency  forward  exchange  contracts to hedge
certain  inter-company  sale and  purchase  commitments  denominated  in foreign
currencies  (primarily pound sterling,  Euro and New Taiwan Dollar). The purpose
of these  instruments  is to protect  us from the risk that the U.S.  dollar net
cash inflows and outflows resulting from the sales and purchases  denominated in
foreign  currencies  will be  adversely  affected by changes in exchange  rates.
Gains and losses on these hedge  contracts  are  deferred and  recognized  as an
adjustment to the related sale or purchase transactions.

We enter into  foreign  currency  forward  exchange  contracts  periodically  to
provide  a  hedge  against  the  effect  of  foreign  currency  fluctuations  on
receivables  and payables  denominated in foreign  currencies.  Gains and losses
related  to  contracts   designated  as  hedges  of  receivables   and  payables
denominated  in foreign  currencies are accrued as exchange rates change and are
recognized as "Other income  (expense),  net" in the Consolidated  Statements of
Operations.

The U.S.  dollar  equivalent  notional  amount of outstanding  foreign  currency
forward  exchange  contracts was  approximately  $22.0 million as of October 31,
2000 ($15.5  million  related to  intercompany  purchase  commitments)  and $4.5
million as of October 31, 1999 ($2.1 million related to firm intercompany  sales
commitments).  Deferred  losses  related to hedges of future sales  transactions
were  approximately  $155,300  and  $48,000  as of  October  31,  2000 and 1999,
respectively.  Contracts outstanding at October 31, 2000 mature at various times
through  October  2001.  Contracts  are for the sale  and  purchase  of  foreign
currency. We do not enter into these contracts for trading purposes.

On November  1, 2000,  we  adopted  Statement of Financial Accounting
Standards (SFAS) No. 133  Accounting  for Derivative  Instruments  and Hedging
Activities.  Refer to Footnote 16 for more information on the impact of SFAS
No. 133.

Inventories.  Inventories are stated at the lower of cost or market, with cost
determined using the first-in, first-out method.
<PAGE>


                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued


Property and Equipment. Property and equipment are carried at cost. Depreciation
and amortization of assets are provided primarily under the straight-line method
over the shorter of the estimated useful lives or the lease terms as follows:
                                                Number of Years
                  Building                             40
                  Machines                             10
                  Shop and office equipment             5
                  Leasehold improvements                5

Revenue  Recognition.  Sales of products and services are recorded when products
are shipped or services are performed.  Service fees from maintenance  contracts
are deferred and  recognized  in earnings on a pro rata basis over the period of
the agreement. Sales related to software products are recognized when shipped in
conformity with American Institute of Certified Public Accountants' Statement of
Position 97-2 Software Revenue Recognition.

License Fee Income and Litigation  Settlement  Fees, Net. From time to time, our
wholly owned subsidiary,  IMS Technology,  Inc. (IMS) enters into agreements for
the licensing of its  interactive  computer  numerical  control  (CNC)  patents.
License fees received or receivable  under a fully  paid-up  license,  for which
there are no future  performance  requirements or  contingencies  and litigation
settlement  fees, are recognized in income,  net of legal fees and expenses,  if
any, at the time the related  agreement  is executed.  License fees  received in
periodic  installments  that are contingent  upon the  continuing  validity of a
licensed  patent are  recognized in income,  net of legal fees and expenses,  if
any, over the life of the licensed patent.

Product Warranty.  Expected future product warranty expense is recorded when the
product is sold.

Research  and  Development   Costs.  The  costs  associated  with  research  and
development  programs for new products and significant product  improvements are
expensed  as incurred  and  included  in  selling,  general  and  administrative
expenses.  Research and development expenses totaled $3.2 million,  $2.5 million
and $2.4 million in fiscal 2000, 1999, and 1998, respectively.

Costs  incurred  to  develop   computer   software   products  and   significant
enhancements to software  features of existing  products to be sold or otherwise
marketed  are  capitalized,  after  technological  feasibility  is  established.
Software  development  costs are  amortized to Cost of Sales on a  straight-line
basis over the estimated product life of the related software, which ranges from
three to five years.  We capitalized  $706,000 in 2000, $1.0 million in 1999 and
$1.3  million in 1998  related to software  development  projects.  Amortization
expense was $1.3  million,  $1.3  million  and $1.1  million for the years ended
October 31, 2000, 1999, and 1998, respectively.

Earnings Per Share. Earnings per share of common stock are based on the weighted
average  number of common  shares  outstanding,  which,  for  diluted  purposes,
includes the effects of  outstanding  stock options  computed using the treasury
method.
<PAGE>
Income  Taxes.  We record income taxes under  SFAS 109 "Accounting for Income
Taxes". SFAS 109 utilizes the liability method for  computing  deferred  income
taxes and requires  that the benefit of certain loss  carryforwards  be recorded
as an asset and that a valuation  allowance  be established  against  the asset
to the extent it is "more  likely than not" that the benefit will not be
realized.
<PAGE>


                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

Estimates.  The preparation of financial statements in conformity with generally
accepted  accounting  principles  requires us to make estimates and  assumptions
that  affect  the  reported  amounts of assets and  liabilities,  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the reported amounts of sales and expenses during the reporting  period.  Actual
results could differ from those estimates.

2.  BUSINESS OPERATIONS

Nature of  Business.  We design and produce  computer  numerical  control  (CNC)
systems and software and  computerized  machine systems for sale through our own
distribution system to the worldwide machine tool industry.

The end market for our products  consists  primarily of precision  tool, die and
mold manufacturers,  independent job shops and specialized  short-run production
applications within large manufacturing  operations.  Industries served include:
aerospace,  defense,  medical  equipment,  energy,  transportation  and computer
industries. Our products are sold through independent agents and distributors in
countries  throughout  North America,  Europe and Asia. We also maintain  direct
sales  operations in the United  States,  England,  France,  Germany,  Italy and
Singapore.

Credit Risk.  We sell products to customers  located  throughout  the world.  We
perform  ongoing  credit  evaluations  of customers and generally do not require
collateral.  Allowances  are maintained  for potential  credit losses,  and such
losses have been within our expectations.

Concentration  of credit  risk with  respect  to trade  accounts  receivable  is
limited due to the large number of customers  and their  dispersion  across many
geographic  areas.  Although a significant  amount of trade receivables are with
distributors  primarily located in the United States,  no single  distributor or
region represents a significant concentration of credit risk.

Reliance on Contract Manufacturers.  We contract with manufacturing  contractors
located in Taiwan and Europe for the  manufacture  and assembly of  computerized
machine systems, based on our designs and specifications.  Any interruption from
these  sources  would  restrict the  availability  of our  computerized  machine
systems and would affect operating results adversely.

3. INVENTORIES

Inventories as of October 31, 2000 and 1999 are summarized below (in thousands):

                                                         2000           1999
                                                     --------       --------
       Purchased parts and sub-assemblies........    $ 10,526       $  9,104
       Work-in-process...........................       1,339          1,070
       Finished goods............................      14,311         20,593
                                                     --------       --------
                                                     $ 26,176       $ 30,767
                                                     ========       ========

<PAGE>

                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued


4.  DEBT AGREEMENTS


Long-term debt as of October 31, 2000 and 1999, consisted of (in thousands):
                                                        2000           1999
                                                    --------       --------
 Bank revolving credit facilities................   $    950       $  9,600
 Senior Notes....................................      1,786          3,572
 Economic Development Revenue Bonds, Series 1990.      1,000          1,000
                                                    --------       --------
                                                       3,736         14,172
 Less current portion............................      1,986          1,786
                                                    --------       --------
                                                    $  1,750       $ 12,386
                                                    ========       ========

As of October 31, 2000, long-term debt was payable as follows (in thousands):

         Fiscal 2001.............................   $  1,986
         Fiscal 2002.............................      1,150
         Fiscal 2003.............................        200
         Fiscal 2004.............................        200
         Fiscal 2005 ............................        200
                                                    --------
                                                    $  3,736
                                                    ========

As of  October  31,  2000 and  1999,  we had  $8.5  million  and  $7.2  million,
respectively,  of outstanding letters of credit issued to non-U.S. suppliers for
inventory purchase commitments. As of October 31, 2000, we had unutilized credit
facilities of $15.6 million available for either direct borrowings or commercial
letters of credit.

As of October 31, 2000 and 1999, the domestic bank revolving credit facility was
payable at an interest rate of 9.5% and  6.9-8.25%,  respectively.  Interest was
payable on the Senior Notes at 10.37% at October 31, 2000 and 1999.


The principal terms of the Bank Credit  Agreement and Senior Notes Agreement are
set forth below:

     a)  Bank Credit Agreement

         Our bank credit  agreement  provides for a revolving,  unsecured credit
         facility  expiring May 1, 2002,  which permits  borrowings,  at any one
         time  outstanding,  of up to $25.0 million  (inclusive  of  outstanding
         letters of credit up to $15.0 million). Of such borrowings,  up to $5.0
         million may be drawn in designated European currencies. Interest on all
         outstanding  borrowings  is payable at Libor  plus an  applicable  Euro
         dollar  rate  margin  ranging  from 1.0% to 2.0% based on a  prescribed
         formula,  or at our option,  the greater of the prime rate or 1.0% plus
         the Federal Funds Rate. An additional  margin of .25% may be charged if
         our fixed charge  coverage  ratio falls below 1.25 to 1. The  agreement
         requires us to maintain a specified  minimum net worth and  establishes
<PAGE>
         maximum leverage and fixed charge coverage  ratios.  We are required to
         maintain  consolidated tangible net worth (as defined) of not less than
         $30.0 million plus (i) 50% of cumulative  net income  subsequent to May
         1, 1999 and (ii) 75% of  proceeds  from  sales of capital  stock  after
         April  30,  1999.  Total  consolidated  debt  may  not  exceed  50%  of
         consolidated  capitalization  (defined as total debt plus  consolidated
         tangible net worth). Our fixed charge coverage ratio requirement varies
         within a range of 1.0-1.25 to 1 during the term of the agreement.
<PAGE>



                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued


     b)  Senior Notes

         At October 31, 2000, we had outstanding  approximately  $1.8 million of
         unsecured Senior Notes,  bearing an interest rate of 10.37%.  The final
         installment  of $1.8 million is due on December 1, 2000.  The financial
         covenants  substantially  conform to those contained in our bank credit
         agreement.

The  Economic  Development  Revenue  Bonds  are  payable  in five  equal  annual
installments  beginning  on  September  1, 2001 and are  secured  by a letter of
credit issued in the amount of $1.1 million by a bank. The Bonds' interest rates
adjust  weekly and, as of October 31, 2000 and 1999,  interest was accruing at a
rate of 4.65% and 3.7%, respectively.

We were in compliance with all loan covenants at October 31, 2000.


5. FINANCIAL INSTRUMENTS

The carrying amounts for trade  receivables and payables  approximate their fair
values.  At  October  31,  2000 the  carrying  amounts  and fair  values  of our
financial instruments,  which includes bank revolving credit facilities,  senior
notes and Economic Development Revenue Bonds are not materially different.

We also have  off-balance  sheet  financial  instruments  in the form of foreign
currency forward  exchange  contracts as described in Note 1 to the Consolidated
Financial Statements.  The U.S. dollar equivalent notional amount and fair value
of these  contracts  were $22.0  million and $21.5  million at October 31, 2000.
Current  market  prices  were used to  estimate  the fair  value of the  foreign
currency forward exchange contracts.

The future value of the foreign  currency  forward  exchange  contracts  and the
related currency  positions are subject to offsetting market risk resulting from
foreign currency exchange rate volatility. The counterparties to these contracts
are substantial and  creditworthy  financial  institutions.  Neither the risk of
counterparty  non-performance  nor the  economic  consequences  of  counterparty
non-performance associated with these contracts are considered material.
<PAGE>
                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

6.  INCOME TAXES

Deferred  income taxes reflect the effect of temporary  differences  between the
tax basis of assets and liabilities and the reported amounts of those assets and
liabilities for financial reporting purposes. Deferred income taxes also reflect
the value of net operating  losses and an offsetting  valuation  allowance.  Our
total deferred tax assets and corresponding  valuation  allowance at October 31,
2000 and 1999, consisted of the following (in thousands):
<TABLE>
                                                                                                   October 31,
                                                                                        -----------------------------
                                                                                            2000                1999
                                                                                        ---------           ---------
<S>                                                                                     <C>                 <C>
Tax effects of future tax deductible items related to:
     Accrued inventory reserves.................................................       $      890           $     824
     Accrued warranty expenses..................................................              226                 249
     Deferred compensation .....................................................              365                 310
     Other accrued expenses.....................................................              830                 745
                                                                                        ---------             -------
         Total deferred tax assets..............................................            2,311               2,128
                                                                                        ---------             -------

Tax effects of future taxable differences related to:
     Accelerated tax deduction and other tax over book
       deductions related to property, equipment and software...................           (1,552)             (1,774)
     Other......................................................................             (672)               (575)
                                                                                        ---------             -------
       Total deferred tax liabilities...........................................           (2,224)             (2,349)
                                                                                        ---------             -------

       Net tax effects of temporary differences.................................               87                (221)
                                                                                        ---------             -------

Tax effects of carryforward benefits:
     U.S. federal net operating loss carryforwards, ............................               --               1,636
     Foreign tax benefit carryforwards
       with various expiration years............................................            1,561               1,339
     U.S. federal general business tax credits,
       expiring 2008-2013.......................................................              548               1,001
     U.S. Alternative Minimum Tax Credit with no expiration.....................              508                 426
                                                                                        ---------           ---------
         Tax effects of carryforwards ..........................................            2,617               4,402
                                                                                        ---------           ---------

         Tax effects of temporary differences and carryforwards.................            2,704               4,181
         Less valuation allowance...............................................           (2,196)             (3,755)
                                                                                        ---------           ---------
         Net deferred tax asset.................................................        $     508           $     426
                                                                                        =========           =========
</TABLE>
Except as indicated above, our carryforwards expire at specific future dates and
utilization of certain  carryforwards  is limited to specific  amounts each year
and further  limitations  may be imposed if an  "ownership  change" would occur.
Realization is entirely dependent upon generating  sufficient future earnings in
specific tax  jurisdictions  prior to the expiration of the loss  carryforwards.
Due to the  uncertain  nature  of their  ultimate  realization  based  upon past
<PAGE>
performance and expiration dates, we have established a full valuation allowance
against  carryforward  benefits with expiration dates.  Alternative  minimum tax
credits may be carried forward  indefinitely  and as a result,  are not provided
with a  valuation  allowance.  While the need for this  valuation  allowance  is
subject to periodic review, if the allowance is reduced, the tax benefits of the
carryforwards will be recorded in future operations as a reduction of our income
tax expense.
<PAGE>
                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued


Income (loss) before income taxes (in thousands):
<TABLE>
                                                                               Year Ended October 31,
                                                                               ----------------------
                                                                       2000              1999             1998
                                                                   ----------       -----------      -----------
       <S>                                                         <C>              <C>              <C>
       Domestic...............................................     $   5,459        $    1,848       $    8,809
       Foreign................................................           147               206            2,379
                                                                    --------         ---------        ---------
                                                                   $   5,606        $    2,054       $   11,188
                                                                    ========         =========        =========
</TABLE>
Differences between the effective tax rate and
U.S. federal income tax rate were (in thousands):
<TABLE>
<S>                                                                <C>              <C>              <C>
Tax at U.S. statutory rate....................................     $  1,962         $      719       $    3,915

Foreign withholding taxes.....................................           19                  4              640

German tax settlement (Note 10)...............................          275                 --               --

Effect of tax rates of international jurisdictions
  in excess of U.S. statutory rates...........................           39                209              563

State income taxes............................................           46                 41               35

Utilization of net operating loss carryforwards...............       (1,770)              (721)          (3,219)
                                                                    --------         ---------        ---------

Provision for income taxes....................................     $     571        $      252       $    1,934
                                                                    ========         =========        =========
</TABLE>
Foreign  withholding taxes are the result of foreign  dividends  received during
fiscal 2000 and 1999 and certain  license fee payments  received  during  fiscal
1998.  Our provision for income taxes in fiscal 2000,  1999 and 1998  represents
taxes currently payable.

We have not provided any U.S. income taxes on the undistributed  earnings of our
foreign  subsidiaries or equity method  investments based upon our determination
that such earnings will be indefinitely reinvested.
<PAGE>
7.  EMPLOYEE BENEFITS

We have  defined  contribution  plans that  include a majority of our  employees
worldwide, under which our contributions are discretionary. The purpose of these
plans is generally to provide additional financial security during retirement by
providing  employees with an incentive to save throughout their employment.  Our
contributions to the plans are based on employee  contributions or compensation.
Our contributions  totaled  $321,422,  $331,605 and $357,000 for the years ended
October 31, 2000, 1999 and 1998, respectively.

We also have Split-Dollar Life Insurance Agreements with our executive officers.
Under the terms of the  agreements,  we pay all of the premiums on behalf of the
officers. We will be repaid the premiums from the policies' cash surrender value
when the  policies are  terminated  in  accordance  with the  provisions  of the
agreements.
<PAGE>


                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued


8.  STOCK OPTIONS


In March 1997,  we adopted the 1997 Stock  Option and  Incentive  Plan (the 1997
Plan)  which  allows us to grant  awards of  options to  purchase  shares of our
common stock,  stock  appreciation  rights,  restricted  shares and  performance
shares.  The 1997 Plan was amended in fiscal 2000 to increase the maximum number
of shares of common  stock that may be issued  from  500,000  to 750,000  and to
increase the maximum number of shares of common stock that may be granted to any
individual  during the term of the 1997 Plan from  100,000  to  200,000  shares.
Options granted under the 1997 Plan are exercisable for a period up to ten years
after date of grant and vest in equal  annual  installments  as specified by the
Compensation  Committee  of our Board of  Directors  at the time of  grant.  The
option price of options  intended to qualify as incentive  stock options may not
be less than  100% of the fair  market  value of a share of common  stock on the
date of grant.  As of October 31, 2000,  options to purchase  305,500 shares had
been granted under the 1997 Plan.

In 1990,  we adopted the 1990 Stock Option Plan (the 1990 Plan) which allowed us
to grant  options to  purchase  shares of our  common  stock and  related  stock
appreciation rights and limited rights to officers and our key employees.  Under
the  provisions of the 1990 Plan,  the maximum  number of shares of common stock
which may be issued  under  options and related  rights is 500,000.  There is no
annual  limit on the number of such  shares  with  respect to which  options and
rights may be granted. Options granted under the 1990 Plan are exercisable for a
period up to ten years after date of grant and vest in equal installments over a
period of three to five years from the date of grant.  The option  price may not
be less than  100% of the fair  market  value of a share of common  stock on the
date of grant and no options or rights may be granted  under the 1990 Plan after
April 30, 2000.
<PAGE>
A summary  of the  status  of the  options  under the 1990 and 1997  Plans as of
October  31,  2000,  1999 and 1998 and the related  activity  for the year is as
follows:
<TABLE>
                                                       Shares under    Weighted average exercise
                                                             option              price per share
----------------------------------------------- -------------------- ----------------------------
<S>                                                        <C>                             <C>
Balance October 31, 1997                                    421,860                        $4.07
  Granted                                                    26,000                         8.25
  Cancelled                                                 (4,000)                         5.13
  Expired                                                         -                            -
  Exercised                                                (49,780)                         2.43
----------------------------------------------- -------------------- ----------------------------
Balance October 31, 1998                                    394,080                         4.54
  Granted                                                   305,500                         5.68
  Cancelled                                                (20,400)                         4.91
  Expired                                                         -                            -
  Exercised                                                 (7,500)                         2.42
----------------------------------------------- -------------------- ----------------------------
Balance October 31, 1999                                    671,680                         5.07
  Granted                                                   180,600                         3.76
  Cancelled                                                (22,120)                         6.15
  Expired                                                         -                            -
  Exercised                                                 (3,500)                         2.13
----------------------------------------------- -------------------- ----------------------------
Balance October 31, 2000                                    826,660                        $4.77
=============================================== ==================== ============================
</TABLE>
<PAGE>

                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

Stock options outstanding and exercisable on October 31, 2000 are as follows:
<TABLE>
                                                          Weighted average      Weighted average remaining
Range of exercise prices     Shares under option  exercise price per share       contractual life in years
per share
--------------------------- --------------------- ------------------------- -------------------------------
<S>                                      <C>                         <C>                              <C>
Outstanding
  $2.125-5.125                           465,160                     $3.60                             6.2
    5.813-8.250                          361,500                      6.28                             6.8
--------------------------- --------------------- ------------------------- -------------------------------
  $2.125-8.250                           826,660                     $4.77                             6.5
=========================== ===================== ========================= ===============================
Exercisable
  $2.125-5.125                           300,419                     $3.44                               -
    5.813-8.250                          187,400                      6.55                               -
--------------------------- --------------------- ------------------------- -------------------------------
  $2.125-8.250                           487,819                     $4.63                               -
=========================== ===================== ========================= ===============================
</TABLE>

We apply Accounting Principles Board Opinion No. 25 "Accounting for Stock Issued
to Employees" (APB25), and related  interpretations in accounting for the plans,
and,  therefore,  no compensation  expense has been recognized for stock options
issued  under the plans.  For  companies  electing to continue the use of APB25,
SFAS No. 123  "Accounting  for  Stock-Based  Compensation",  requires  pro forma
disclosures  determined  through  the use of an  option-pricing  model as if the
provisions of SFAS No. 123 had been adopted.

The  weighted  average  fair value at date of grant for options  granted  during
fiscal 2000, 1999, and 1998 was $2.72, $3.85, and $6.10 per share, respectively.
The fair value of each option grant was estimated on the date of the grant using
the Black-Scholes option-pricing model with the following assumptions:

                                      2000        1999        1998
---------------------------------- ----------- ----------- -----------
---------------------------------- ----------- ----------- -----------
Expected dividend yield                 0.00%       0.00%      0.00%
Expected volatility                    56.33%      55.09%     57.50%
Risk-free interest rate                 6.20%       4.69%      5.83%
Expected term in years                  10          10         10
---------------------------------- ----------- ----------- -----------

If we had adopted the provisions of SFAS No. 123, net income and earnings per
share would have been as follows:

                                        2000              1999             1998
---------------------------- ---------------- ----------------- ----------------
---------------------------- ---------------- ----------------- ----------------
Net income (in thousands)             $4,726            $1,484           $9,181
Earnings per share:
  Basic                                 $.79              $.25            $1.41
  Diluted                               $.79              $.24            $1.38
---------------------------- ---------------- ----------------- ----------------
<PAGE>
                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

As of October 31, 2000,  there were outstanding  non-qualified  options that had
been granted  outside of the 1990 and 1997 plans to outside members of the Board
of Directors to purchase  50,000 and 75,000 shares at $5.13 and $5.81 per share,
respectively.  These shares are  exercisable as of October 31, 2000. The options
expire at various  dates  between  2001 and 2004.  During  fiscal  2000,  30,000
non-qualified  options were granted to two new  directors at $3.75 per share and
are exercisable in May 2001.

9.  RELATED PARTY TRANSACTIONS

We own approximately 24% of one of our Taiwanese-based  contract  manufacturers.
This  investment  of $361,000 is  accounted  for using the equity  method and is
included in Other Assets on the Consolidated Balance Sheet. Purchases of product
from this  contract  manufacturer  are  negotiated  on an arms length  basis and
totaled $8.6 million,  $7.8 million and $7.4 million for the years ended October
31,  2000,  1999  and  1998,  respectively.  Trade  payables  to  this  contract
manufacturer  were $2.2  million and $1.5  million at October 31, 2000 and 1999,
respectively.

As of October 31, 2000, we own 35% of Hurco  Automation,  Ltd.  (HAL),  a Taiwan
based company. HAL's scope of activities includes the design, manufacture, sales
and distribution of industrial automation products, software systems and related
components, including CNC systems and components manufactured under contract for
sale  exclusively to us. We are  accounting for the investment  using the equity
method.  The  investment  of  $932,000  at October 31, 2000 is included in Other
Assets  on the  Consolidated  Balance  Sheet.  Purchases  of  product  from this
supplier  are  negotiated  on an arms length  basis and  amounted to $4.2,  $3.6
million and $3.1 million in 2000, 1999 and 1998, respectively. Trade payables to
HAL were $542,000 and $672,000 at October 31, 2000 and 1999, respectively. Trade
receivables  from  HAL were  $461,000  and $0 at  October  31,  2000  and  1999,
respectively.

10.  LITIGATION AND CONTINGENCIES

As previously reported, Hurco and its subsidiary IMS Technology, Inc. (IMS) have
been  parties  to  a  number  of  legal   proceedings   which  involved  alleged
infringement of a United States interactive  machining patent (the Patent) owned
by IMS.  All  actions  have  been  settled  through  licensing  arrangements  or
litigation settlements.  On August 8, 2000, Hurco and IMS agreed to a settlement
with Haas  Automation  Inc.  and Gene Haas  (Haas).  Under the  settlement,  IMS
licensed the Patent to Haas and Haas made a one-time payment to IMS. We reported
license  fee  income  and  litigation settlement  fees,  net of  expenses,  of
approximately  $5.4  million in the  fourth  quarter  of fiscal  2000  primarily
resulting from this settlement.

A German tax examiner had contested our transfer of net operating losses between
two of our German  subsidiaries  that merged in fiscal 1996.  The contingent tax
liability  resulting  from this issue was  approximately  $1.4  million.  In the
fourth  quarter of fiscal  2000,  this  matter  was  settled  for  approximately
$275,000.  The  contingency  was not  previously  accrued  and as a result,  the
settlement  was recorded in the fourth  quarter and is included in the provision
for income taxes.

In addition, we are involved in various other claims and lawsuits arising in the
normal  course of  business.  We believe that none of these claims are likely to
have a material adverse effect on our consolidated financial position or results
of operations.
<PAGE>

                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued


11.  OPERATING LEASES

We lease  facilities and vehicles under operating  leases that expire at various
dates  through  2005.  Future  payments,  exclusive of amounts  reflected in the
balance  sheet,  required  under  operating  leases as of October 31, 2000,  are
summarized as follows (in thousands):


         2001............................................      $ 1,592
         2002............................................          948
         2003............................................          402
         2004............................................          308
         2005............................................          158
                                                              --------
         Total...........................................      $ 3,408
                                                              ========

Rent  expense for the years  ended  October 31,  2000,  1999,  and 1998 was $1.7
million, $1.7 million and $1.8 million, respectively.


12.  LICENSE FEE INCOME AND LITIGATION SETTLEMENT FEES, NET

License fee income and litigation settlement fees, net for fiscal 2000, 1999 and
1998 were attributable to agreements  entered into by IMS, pursuant to which IMS
granted fully paid-up  licenses of its  interactive  CNC patents in exchange for
cash and other consideration. As of October 31, 2000, additional license fees of
approximately  $300,000,  net of legal  fees and  expenses,  related  to  future
payments under completed license  agreements have been deferred and are expected
to be  recognized  in income over the  one-year  remaining  life of the licensed
patent.
<PAGE>

                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued


13.  QUARTERLY HIGHLIGHTS (Unaudited)
<TABLE>
2000 (In thousands, except per share data)
                                                         First Quarter     Second Quarter     Third Quarter      Fourth Quarter
<S>                                                      <C>               <C>                <C>                 <C>
Sales and service fees...............................    $  24,524         $   24,197         $   22,676          $  24,807

Gross profit.........................................        6,721              6,732              6,115              5,809

Gross profit margin percentage.......................        27.4%              27.8%              27.0%              23.4%

Selling, general and administrative expenses.........        5,820              5,623              5,768              6,627

Operating income (loss)..............................          901              1,109                347              (818)

Net income ..........................................          459                602                407              3,567

Earnings per common share - basic....................    $     .08         $      .10         $      .07          $     .60

Earnings per common share - diluted..................    $     .08         $      .10         $      .07          $     .59


1999 (In thousands, except per share data)
                                                         First Quarter     Second Quarter     Third Quarter      Fourth Quarter

Sales and service fees...............................    $  21,147            $21,532            $20,783            $24,776

Gross profit.........................................        6,004              5,858              5,915              6,397

Gross profit margin percentage.......................        28.4%              27.2%              28.5%              25.8%

Selling, general and administrative expenses.........        5,335              5,352              5,152              5,420

Restructuring charge (credit)........................           --              (103)                 --                 --

Operating income.....................................          669                609                763                977

Net income ..........................................          175                554                400                673

Earnings per common share - basic....................    $     .03         $      .09         $      .07          $     .11

Earnings per common share - diluted..................    $     .03         $      .09         $      .07          $     .11
</TABLE>
<PAGE>


                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

14.  SEGMENT INFORMATION

We operate in a single segment:  industrial  automation  systems.  We design and
produce  interactive  computer  numerical control (CNC) systems and software and
computerized  machine systems for sale through our own  distribution  network to
the worldwide  metal  working  market.  We also provide  software  options,  CNC
upgrades,  accessories  and  replacement  parts  for  our  products,  as well as
customer service and training support.

Substantially  all of our machine systems and CNC systems are  manufactured
to our specifications by contract manufacturing  companies in Taiwan and Europe.
Our  executive  offices and principal  design,  engineering,  and  manufacturing
management  operations are headquartered in Indianapolis,  Indiana.  We sell our
products  through over 240 independent  agents and  distributors in 45 countries
throughout North America, Europe and Asia. We also have our own direct sales and
service organizations in the United States, England,  France, Germany, Italy and
Singapore,  which are considered to be among the world's principal  computerized
machine system consuming  countries.  During fiscal 2000, no customer  accounted
for more than 5% of our sales and service fees.

The following table sets forth the contribution of each of our product groups to
our total sales and service  fees during each of the past three fiscal years (in
thousands):

                                               Year Ended October 31,
                                      2000              1999             1998
                                    -------           -------          -------

 Computerized Machine Systems...    $71,708           $63,793          $64,770
 CNC Systems and Software*......      9,605            10,623           14,727
 Service Parts..................     10,649             9,574            9,424
 Services Fees..................      4,242             4,248            4,501
                                    -------           -------          -------
                                    $96,204           $88,238          $93,422
                                    =======           =======          =======
--------------
*Amounts  shown do not include CNC systems  sold as an  integrated  component of
computerized machine systems.
<PAGE>
Revenues by geographic area, based on customer location, for each of the past
three fiscal years were (in thousands):
                                               Year Ended October 31,
                                    ------------------------------------------
                                      2000              1999             1998
                                    -------           -------          -------

         United States.........     $40,920           $36,730          $42,486
                                    -------           -------          -------

         Germany...............      23,654            25,388           24,949
         United Kingdom........      10,128             9,567            9,454
         Other Europe..........      12,932            12,087           12,112
                                    -------           -------          -------
           Total Europe........      46,714            47,042           46,515

         Asia and Other........       8,570             4,466            4,421
                                    -------           -------          -------
           Total Foreign.......      55,284            51,508           50,936
                                    -------           -------          -------
                                    $96,204           $88,238          $93,422
                                    =======           =======          =======
<PAGE>
                              HURCO COMPANIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

Long-lived assets by geographic area were (in thousands):
                                                  October 31,
                                            -------------------------
                                                2000           1999
                                            ----------     ----------
         United States.................     $   14,257     $   15,105
         Foreign Countries.............          1,064          1,671
                                            ----------     ----------
                                            $   15,321     $   16,776
                                            ==========     ==========

15.  RESTRUCTURING CHARGE

In fiscal 1998, we recorded a reserve for anticipated  costs associated with the
restructuring  of a  subsidiary  to convert its  operations  from  manufacturing
computer  controls to sales and service of computerized  machine  systems.  This
restructuring program, which was completed during the first half of fiscal 1999,
resulted in a special  charge to  operations  of $1.2 million  consisting of the
following components:

         Excess building capacity                       $   500
         Discontinued capitalized software projects         301
         Fixed asset impairments                            170
         Equipment leases                                   101
         Severance costs                                     90
                                                        --------
                                                        $ 1,162

Of the $1.2 million provision, $691,000 was charged to the restructuring reserve
while the  remainder  was used for asset  impairments.  On April 30,  1999,  the
excess  building space was  subleased,  effective June 15, 1999 through July 31,
2001. The reserve was adjusted to reflect the terms of the sublease resulting in
a restructuring credit of approximately  $103,000.  The excess building capacity
reserve  represents  the final  year of the  building  lease  which has not been
sublet. In the fourth quarter of fiscal 2000, we recorded a restructuring charge
of $300,000 for severance  costs related to the  termination of employees at our
subsidiary, Autocon Technologies,  Inc. in connection with the completion of the
consolidation  of this  operation  into our North  American  sales  and  service
business.   At  October  31,  2000,  the   restructuring   reserve  balance  was
approximately $640,000 and consisted of the following:

                          Balance                     Charges to        Balance
      Description         10/31/99     Provision        Accrual         10/31/00
      -----------         --------     ----------       -------         --------
Excess Building Capacity   $  286        $  --           $  --           $  286
Equipment Leases               77           --             (23)              54
Severance                      --          300              --              300
                          --------     ----------       -------         --------
                           $  363        $ 300           $ (23)          $  640
                          ========     ==========       =======         ========
<PAGE>
16.  NEW ACCOUNTING PROUNCEMENT

In June 1998, the FASB issued SFAS No. 133,  "Accounting  for Derivative
Instruments  and Hedging  Activities". This  statement  which is effective for
the Company on November 1, 2000,  establishes  accounting  and reporting
standards for derivative  instruments,  including certain  derivative
instruments  embedded in other contracts. This  statement  requires that every
derivative  instrument be recorded in the balance sheet as either an asset
or a liability  measured at its fair value.  Changes in the fair value of
derivatives  are to be recorded  each period in earnings or comprehensive
income,  depending on whether the derivative is designated and effective as part
of a hedged transaction,  and on the type of hedge transaction.  Gains or losses
on derivative  instruments reported in other  comprehensive  income must be
reclassified  as earnings in the period in which  earnings are affected  by the
underlying  hedged  item,  and the  ineffective  portion of all hedges must be
recognized  in earnings in the current period.  This new standard could results
in additional  volatility in reported  earnings and other comprehensive income.

SFAS No. 133 requires  that as of the date of initial  adoption,  the difference
between the fair value of the derivative  instruments  recorded on the balance
sheet and the previous  carrying amount of those derivatives be reported in net
income or other  comprehensive  income, as appropriate,  as the cumulative
effect of a change in accounting principle in accordance with APB 20
"Accounting Changes".

On November 1, 2000,  we  recorded  the effect of the  transition  to SFAS
No. 133 as a  cumulative  effect of a change in accounting  principle,  the
result of which was not material to the Company's  consolidated  financial
position or results of operations.


17.  SUBSEQUENT EVENTS (unaudited)

On December  29,  2000,  we  purchased  278,001  shares of our common  stock for
approximately  $1.2 million from a related party,  Brynwood Partners II L.P. The
purchased shares will be reflected as a reduction in common stock.


Item 9.   Changes in and Disagreements with Accountants on Accounting
          and Financial Disclosures
--------------------------------------------------------------------------------

Not applicable.
<PAGE>

                                    PART III

Item 10.  EXECUTIVE OFFICERS AND DIRECTORS OF THE REGISTRANT


The  following  information  sets forth the name of each  executive  officer and
director,  his age,  tenure as a director,  principal  occupation  and  business
experience for the last five years:
<TABLE>
<S>                                        <C>       <C>
Name                                       Age       Position(s) with the Company

Brian D. McLaughlin                        58        President, Chief Executive Officer and Director

Roger J. Wolf                              60        Senior Vice President, Secretary,
                                                     Treasurer and Chief Financial Officer

James D. Fabris                            49        Executive Vice President - Operations

Bernard C. Faulkner                        49        President - Hurco North America

David E. Platts                            48        Vice President, Technology and Business Development

Stephen J. Alesia                          34        Corporate Controller, Assistant Secretary

Robert W. Cruickshank                      55        Director

Michael Doar                               45        Director

Hendrik J. Hartong, Jr.                    61        Director

Richard T. Niner                           61        Director

O. Curtis Noel                             65        Director

Charles E. Mitchell Rentschler             61        Director
</TABLE>


Brian D.  McLaughlin has been  President and Chief  Executive  Officer of Hurco
since  December  1987.  Mr.  McLaughlin has also been a director since 1987.

Roger J. Wolf has been Senior Vice President, Secretary, Treasurer and Chief
Financial Officer since January 1993.

James D. Fabris was elected  Executive  Vice  President - Operations in November
1997 and Vice President of Hurco in February 1995. Mr. Fabris was President of
Hurco Machine Tool Products Division from November 1993 to December 1997.

David E. Platts has been  employed by Hurco  since  1982,  and was elected  Vice
President, Technology and Business Development in 1989.

Bernard C.  Faulkner  joined  Hurco in March 2000 and was  elected  an Executive
Officer  in May 2000.  Prior to joining  Hurco,  Mr. Faulkner was Vice President
and General Manager for the Industrial  Products division of Flair  Corporation.
Mr. Faulkner was employed by the Flair Corporation for four years.
<PAGE>
Stephen J. Alesia has been the Corporate  Controller since joining Hurco in June
1996 and was elected an executive  officer in September  1996.  Prior to joining
Hurco,  Mr.  Alesia was  employed  for seven  years by Arthur  Andersen  LLP, an
international public accounting firm.

Robert W.  Cruickshank has been owner of R. W. Cruickshank  Company, a financial
services firm since 1981. Mr.  Cruickshank is also a director of Calgon Carbon
Corporation and Friedman's Jewelers, Inc.  Mr. Cruickshank has been a director
since 2000.

Michael Doar has been President of Ingersoll Contract  Manufacturing  Company, a
subsidiary of Ingersoll International, since 1999. From 1989 until 1998, he held
various  management  positions with Ingersoll Milling Machine Company.  Mr. Doar
has been a director since 2000.

Hendrik J. Hartong,  Jr. is a general  partner of Brynwood  Management III and
Brynwood  Management  IV, L.P.,  the general  partner of Brynwood  Partners  III
and Brynwood  Partners IV, L.P. Mr.  Hartong is also a general  partner of
Brynwood  Management  II, L.P.,  the general partner of Brynwood Partners II,
L.P., and until December 31, 1998, was a general partner of Brynwood Management,
the general partner of  Brynwood  Partners  Limited  Partnership.  Mr.  Hartong
has served as a director of Lincoln  Snacks  since June 1998.  Mr. Hartong has
been a director since 1986.

Richard T.  Niner was  elected  Chairman  of the Board of  Directors on March 9,
1999.  Mr.  Niner is a general  partner of Wind River Associates.  Mr. Niner is
also a general partner of Brynwood  Management II, L.P., the general  partner of
Brynwood  Partners II, L.P., and until  December  31,  1998,  was a general
partner of Brynwood  Management,  the  general  partner of  Brynwood  Partners
Limited Partnership.  Mr.  Niner is a director of Arrow  International,  Inc.
and Case,  Pomeroy & Company,  Inc. Mr. Niner has been a director since 1986.

O. Curtis Noel has been an  independent  business  consultant  for more than ten
years  specializing  in market and  industry  studies, competitive analysis and
corporate development programs with clients in the U.S. and abroad.  Mr. Noel
has been a director since 1993.

Charles E. Mitchell  Rentschler has served as President and Chief Executive
Officer of The Hamilton  Foundry & Machine Co. since 1985. The  Hamilton Foundry
& Machine Co. filed a petition  for relief under Chapter 11 of the Bankruptcy
Code on October 10, 2000. Mr. Rentschler has been a director since 1986.

<PAGE>

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities  Exchange Act of 1934 requires our directors and
executive  officers,  and persons who own more than 10% of our common stock,  to
file reports of  ownership  with the  Securities  and  Exchange  Commission  and
Nasdaq.  Such persons are also required to furnish us with copies of all Section
16(a) forms they file.

Based  solely on our  review of the  copies of such  forms  received  or written
representations  from certain  reporting  persons that they were not required to
file a Form 5 to report previously unreported ownership or changes in ownership,
we believe that,  during our fiscal year ending  October 31, 2000, our officers,
directors  and  greater  than 10%  beneficial  owners  complied  with all filing
requirements under Section 16(a).

<PAGE>

Item 11.  EXECUTIVE COMPENSATION

Summary Compensation

The following table sets forth all  compensation  paid or accrued during each of
the last three fiscal years to the Chief Executive Officer and each of the other
four executive officers of Hurco (the Named Executive Officers) whose salary and
bonus exceeded $100,000 during fiscal 2000.

                           Summary Compensation Table
<TABLE>
                                                                                            Long-Term
                                                 Annual Compensation                       Compensation        All Other
                                    ------------------------------------------             ------------         Compen-
Name and                 Fiscal     Salary         Bonus       Other Annual           Securities Underlying     sation
Principal Position         Year       ($)          ($)(1)   Compensation ($)(2)              Options(3)          ($)(4)
------------------       ------     ------         ------  -------------------             ------------        --------
<S>                        <C>    <C>            <C>               <C>                      <C>                 <C>
Brian D. McLaughlin        2000   $278,076       90,000                --                   40,000              $52,506
President and CEO          1999    268,077          --                 --                   50,000               52,206
                           1998    258,077       75,000                --                       --               52,206

Roger J. Wolf              2000   $173,462       50,000                --                   30,000              $46,933
Sr. VP, Secretary          1999    165,946           --                --                   25,000               47,566
Treasurer and CFO          1998    160,039       50,000                --                       --               48,064

James D. Fabris            2000   $185,576       65,000                --                   20,000              $24,284
Executive Vice             1999    165,904           --                --                   35,000               23,984
President - Operations     1998    156,154       65,000                --                       --               24,054

Bernard C Faulkner         2000   $108,596       25,000            36,939                   25,000              $17,151
President - Hurco
North America

David E. Platts            2000   $105,182       20,000                --                   10,000              $14,577
Vice President of          1999    105,000           --                --                   10,000               14,802
Technology &               1998    104,038       10,000                --                       --               15,436
Business Development
---------------------------
</TABLE>
(1)      Represents cash bonuses earned and paid in the subsequent year.
(2)      Represents compensation related to relocation costs.
(3)      Represents  shares of common  stock  underlying  grants of options
         made  during the year.  We have not  granted any Stock Appreciation
         Rights (SARs).
(4)      Represents contributions to defined contribution plans and split dollar
         life insurance premiums.

                          Defined Contribution Plan    Company Paid Split-Dollar
Name                             Company Match          Life Insurance Premiums

Brian D. McLaughlin                 $5,100                      $47,406
Roger J. Wolf                        4,167                       42,766
James D. Fabris                      5,100                       19,184
Bernard C. Faulkner                  2,776                       14,375
David E. Platts                      2,362                       12,215
<PAGE>

Stock Options

The  following  table sets forth  information  related  to options  granted  and
exercised  during  fiscal 2000 and options held at fiscal  year-end by the Named
Executive Officers. We do not have any outstanding SARs.

                        Option Grants During Fiscal 2000
<TABLE>
                                                    % of Total                                 Potential Realizable
                                      Number of      Options                                 Value at Assumed Annual
                                      Securities    Granted to                                 Rates of Stock Price
                                      Underlying    Employees     Exercise                   Appreciation for Option
                                       Options      in Fiscal       Price      Expiration             Term(1)
Name                                   Granted(2)      Year        ($/SH)         Date         5%($)        10%($)
----                                   --------        ----        ------         ----         -----        ------
<S>                                     <C>           <C>           <C>         <C>          <C>          <C>
Brian D. McLaughlin                     40,000        22.1%         $3.75       12/07/09     $94,334      $239,061
Roger J. Wolf                           30,000        16.6%         $3.75       12/07/09      70,751       179,296
James D. Fabris                         20,000        11.1%         $3.75       12/07/09      47,167       119,531
Bernard C. Faulkner                     25,000        13.8%         $3.63       02/09/10      58,959       149,143
David E. Platts                         10,000         5.5%         $3.75       12/07/09      23,584        59,765
</TABLE>

(1) The potential  realizable value  illustrates value that might be realized
upon the exercise of the options  immediately prior to the expiration of their
terms, assuming the specified  compounded rates of appreciation of Hurco's
common stock from the date of grant through the term of the options.

(2) Options may be exercised in three annual installments commencing on the
first anniversary of the date of grant except for Bernard C. Faulkner's options
which may be exercised in five annual installments.

      Aggregated Option Exercises in Fiscal 2000 and Year-End Option Values
<TABLE>
                                                                                                Value of
                                                                  Number of                   Unexercised
                                                          Securities Underlying              In-the-Money
                            Shares                        Unexercised Options                   Options
                            Acquired                           at FY-End (#)               at FY-End ($)(1)
                              on           Value         ------------------------        ---------------------
                           Exercise       Realized         Exer-           Unexer-          Exer-      Unexer-
Name                         (#)            ($)          cisable           cisable        cisable      cisable
----                       ---------     ---------       -------           -------        -------      -------
<S>                        <C>           <C>             <C>                <C>           <C>               <C>
Brian D. McLaughlin           --             --          145,000            70,000        $61,250           --
Roger J. Wolf                 --             --           60,000            45,000          6,125           --
James D. Fabris            3,000         $6,375           49,000            43,000         26,375           --
Bernard C. Faulkner           --             --               --            25,000             --
David E. Platts               --             --           33,000            17,000         18,750           --
-----------------------------------------
</TABLE>
(1)  Value is calculated  based on the closing  market price of the common stock
     on October 31, 2000 ($ 3.75) less the option exercise price.

<PAGE>
Compensation of Directors

During 2000,  each director who is not a full-time  employee of Hurco received a
fee of $1,500 for each meeting of the Board of Directors  attended and each such
director  also  received  $5,000 per  quarter.  Directors  are also  entitled to
receive  reimbursement  for travel and other expenses incurred in attending such
meetings.  Mr. Niner received annual compensation of $72,000 for his services as
Chairman of the Executive Committee of the Board of Directors.


Employment Contracts

Brian D.  McLaughlin  entered into an employment  contract on December 14, 1987.
The  contract  term  is  month-to-month.   Mr.  McLaughlin's  salary  and  bonus
arrangements  are set annually by the Board of  Directors.  Other  compensation,
such as stock option grants,  is awarded  periodically  at the discretion of the
Board of Directors.  As part of that contract,  Mr. McLaughlin is entitled to 12
months'  salary if we terminate his  employment  for any reason other than gross
misconduct.

Roger J. Wolf entered into an employment  contract on January 8, 1993.  The
contract term is  unspecified.  Mr. Wolf's salary and bonus arrangements are set
annually by the Board of Directors.  Other compensation,  such as stock option
grants, is awarded  periodically at the discretion of the Board of Directors.
Mr. Wolf is entitled to 12 months' salary if we terminate employment without
just cause.

James D. Fabris  entered into an employment  contract on November 18, 1997.  The
contract term is unspecified.  Mr. Fabris' salary and bonus  arrangement are set
annually by the Board of  Directors.  Other  compensation,  such as stock option
grants, is awarded periodically at the discretion of the Board of Directors.  As
part of the  contract,  Mr.  Fabris  is  entitled  to 12  months'  salary  if we
terminate employment for any reason other than gross misconduct.

Bernard C.  Faulkner  entered  into an employment  contract on February 4, 2000.
The contract term is unspecified.  Mr. Faulkner's salary and bonus arrangements
are set annually by the Compensation  Committee of the Board of Directors. Other
compensation,  such as stock option grants, is awarded  periodically at the
discretion of the Compensation Committee. Mr. Faulkner is entitled to 12 months'
salary if we terminate his employment for any reason.

Compensation Committee Interlocks and Insider Participation

During fiscal 2000, the members of the Compensation Committee were O. Curtis
Noel, Michael Doar and Robert W. Cruickshank.  None of the Committee members is
a current or former officer or employee of Hurco or any of its subsidiaries.
<PAGE>


Item 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
               AND MANAGEMENT

The  following  table sets forth  information  as of January 2, 2001,  regarding
beneficial  ownership of the  Company's  common stock by each director and Named
Executive  Officer,  by all directors and executive  officers as a group, and by
certain other beneficial  owners of more than 5% of the common stock.  Each such
person has sole voting and  investment  power with  respect to such  securities,
except as otherwise noted.

                                                 Shares Beneficially Owned
Name and Address                               Number                Percent

                           Other Beneficial Owners

Wellington Management Co.                      645,000 (1)            11.3%
75 State Street
Boston, Massachusetts 02109

The Prudential Insurance Company of America    489,364 (2)             8.6%
4 Gateway Center
Newark, New Jersey 07102

The TCW Group, Inc.                            324,800 (3)             5.7%
865 South Figueroa Street
Los Angeles, California  90017

Dimensional Fund Advisors                      398,900 (4)             7.0%
1299 Ocean Avenue
Santa Monica, CA  90401

FMR Corporation                                379,028 (5)             6.7%
82 Devonshire Street
Boston, Massachusetts 02109

Richard T. Niner                               452,448 (6)             7.4%
1055 Washington Blvd.
Box 9-5th Floor
Stamford, CT 06901

<PAGE>


                        Directors and Executive Officers

Robert W. Cruickshank                          10,100                  0.2%
Michael Doar                                       --                   --
James D. Fabris                                52,500 (11)             1.0%
Hendrik J. Hartong, Jr.                        67,912 (6)              1.1%
Brian D. McLaughlin                           193,576 (7,8)            3.4%
Richard T. Niner                              452,448 (6)              7.4%
O. Curtis Noel                                 25,000 (6)              0.4%
David E. Platts                                44,700 (12)             0.8%
Charles E. Mitchell Rentschler                 35,100 (6,9)            0.6%
Roger J. Wolf                                  73,492 (10)             1.4%
Executive officers and directors              999,494 (13)            16.3%
as a group (12 persons)

(1)      According to a Schedule 13G, dated December 31, 1999, Wellington
         Management Co. has shared voting power for all shares.

(2)      According to a Schedule 13G, dated December 31, 1999,  the Prudential
         Insurance  Company of America has sole voting power for
         all shares.

(3)      According to a Schedule 13G, dated December 31, 1999, the TCW Group,
         Inc. has shared voting power for all shares.

(4)      According to a Schedule 13G, dated December 31, 1999, Dimensional
         Fund Advisors has sole voting power for all shares.

(5)      According to a Schedule 13G, dated December 31, 1999, FMR Corporation
         has no voting power for any of the shares.

(6)      Includes 25,000 shares subject to options that are exercisable within
         60 days.

(7)      Includes 158,333 shares subject to options held by Mr. McLaughlin that
         are exercisable within 60 days.

(8)      Includes  10,986  shares  owned by Mr.  McLaughlin's wife and children,
         as to which  he may be  deemed  to have  beneficial ownership.

(9)      Includes 10,100 shares owned by Mr. Rentschler's wife, as to which he
         may be deemed to have beneficial ownership.

(10)     Includes 70,000 shares subject to options that are exercisable within
         60 days.

(11)     Includes 55,667 shares subject to options that are exercisable within
         60 days.

(12)     Includes 36,333 shares subject to options that are exercisable within
         60 days.

(13)     Includes 431,666 shares subject to options that are exercisable within
         60 days.

Item 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None
<PAGE>
PART IV

Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)  1.  Financial  Statements.  The following  consolidated  financial
         statements of Registrant  are included  herein under Item 8 of
         ---------------------
         Part II:
                                                                           Page
         Reports of Independent Accountants...........................       20
         Consolidated Statements of Operations - years
           ended October 31, 2000, 1999, and 1998 ....................       21
         Consolidated Balance Sheets - as of October 31, 2000 and 1999       22
         Consolidated Statements of Cash Flows - years
           ended October 31, 2000, 1999, and 1998.....................       23
         Consolidated Statements of Changes in Shareholders' Equity -
           years ended October 31, 2000, 1999, and 1998...............       24
         Notes to Consolidated Financial Statements...................       25




     2.  Financial Statement Schedules.  The following financial statement
         schedule is included in this Item.
         -----------------------------

                                                                           Page
         Schedule II - Valuation and Qualifying
           Accounts and Reserves.......................................      48


     All other  financial  statement  schedules are omitted because they are not
     applicable  or the  required  information  is included in the  consolidated
     financial statements or notes thereto.

(b)  Reports on Form 8-K

     No reports on Form 8-K were filed during the three months ended October 31,
2000.

(c)  Exhibits

     Exhibits are filed with this Form 10-K or incorporated  herein by reference
as listed on pages 49 and 50.

<PAGE>

          Schedule II - Valuation and Qualifying Accounts and Reserves
              for the years ended October 31, 2000, 1999, and 1998
                             (Dollars in thousands)
<TABLE>

                                        Balance at         Charged to      Charged                                Balance
                                        Beginning           Costs and      to Other                                at End
Description                             of Period           Expenses       Accounts          Deductions         of Period
-----------                             ----------         -----------     --------          ----------         ---------
Allowance for doubtful accounts for the year ended:
   <S>                                  <C>                  <C>            <C>               <C>               <C>
   October 31, 2000                     $     687            $    185       $     --          $     131 (1)     $     741
                                         ========             =======        =======           ========          ========

   October 31, 1999                     $     769            $    231       $     --          $     313 (2)     $     687
                                         ========             =======        =======           ========          ========

   October 31, 1998                     $     757            $    280       $     --          $     268 (3)     $     769
                                         ========             =======        =======           ========          ========




Accrued warranty expenses for the year ended:
   October 31, 2000                     $     968            $    430       $     --          $     567         $     831
                                         ========             =======        =======           ========          ========

   October 31, 1999                     $   1,060            $    533       $     --          $     625         $     968
                                         ========             =======        =======           ========          ========

   October 31, 1998                     $   1,452            $    503       $     --          $     895         $   1,060
                                         ========             =======        =======           ========          ========




Accrued restructuring expenses for the year ended:
     October 31, 2000                   $     363            $    300       $     --           $     23          $    640
                                         ========             =======       ========           ========          ========

     October 31, 1999                   $     690            $  (103)       $     --           $    224          $    363
                                         ========             =======       ========           ========          ========

     October 31, 1998                   $      --            $ 1,162        $     --           $    472          $    690
                                         ========             =======       ========           ========          ========
</TABLE>

(1) Receivable  write-offs  of  $140,000,  net of  cash recoveries  on  accounts
    previously  written off of $9,000.
(2) Receivable  write-offs of $337,000,  net of cash  recoveries  on accounts
    previously  written off of $24,000.
(3) Receivable write-offs of $280,000,  net of cash recoveries on accounts
    previously  written off of $12,000.
<PAGE>


EXHIBITS INDEX

Exhibits Filed.  The following exhibits are filed with this report:
--------------

11            Statement re: computation of per share earnings

21            Subsidiaries of the Registrant

23            Consent of Arthur Andersen LLP.


Exhibits Incorporated by Reference.  The following exhibits are incorporated
----------------------------------   into this report:

3.1      Amended and  Restated  Articles  of  Incorporation  of the  Registrant,
         incorporated by  reference  to  Exhibit  3.2 to the Registrant's Report
         on Form 10-Q for the quarter ended January 31, 2000.

3.2      Amended and Restated  By-Laws of the  Registrant  dated  September 12,
         1995,  incorporated  by reference to Exhibit 3.3 to the Registrant's
         Report on Form 10-Q for the quarter ended January 31, 1996.

10.1     The Underlease  between  Dikappa  (Number 220) Limited and Northern &
         London  Investment  Trust Limited dated December 2, 1982,  incorporated
         by reference to Exhibit 10.13 to the  Registrant's  Registration
         Statement on Form S-1,  No.2-82804 dated April 1, 1983.

10.2*    Non-qualified Stock Option Agreement between the Registrant and O.
         Curtis Noel effective, March 3, 1993, incorporated by reference to
         Exhibit 10.44 to the Registrant's Report on Form 10-K for the year
         ended October 31, 1993.

10.3*    Employment  Agreement  between  the  Registrant  and Roger J. Wolf
         dated January 8, 1993,  incorporated by reference to Exhibit 10.45
         to the Registrant's Report on Form 10-K for the year ended October
         31, 1993.

10.4*    Non-qualified  Stock  Option  Agreement  between the  Registrant  and
         Hendrik J.  Hartong,  Jr.,  effective  July 8, 1996 incorporated by
         reference to Exhibit 10.47 to the Registrant's Report on Form 10-K
         for the year ended October 31, 1996.

10.5*    Form of Director  Non-qualified  Stock Option  Agreement  between the
         Registrant and Hendrik J. Hartong,  Jr.,  Andrew L. Lewis IV,
         Richard T. Niner, O. Curtis Noel and Charles E. Mitchell Rentschler,
         incorporated by reference as Exhibit 10.2 to the Registrant's Form 10-K
         for the year ended October 31, 1999.

10.6*    Non-qualified  Stock Option  Agreement  between the Registrant and
         Richard T. Niner, effective July 8, 1996 incorporated by reference
         to Exhibit 10.49 to the  Registrant's  Report on Form 10-K for the
         year ended October 31, 1996.

10.7*    Non-qualified Stock Option Agreement between the Registrant and O.
         Curtis Noel,  effective July 8, 1996  incorporated by reference to
         Exhibit 10.50 to the Registrant's Report on Form 10-K for the year
         ended October 31, 1996.
<PAGE>
10.8*    Non-qualified  Stock Option  Agreement  between the Registrant and
         Charles   E.   Mitchell   Rentschler,   effective   July  8,  1996
         incorporated  by  reference to Exhibit  10.51 to the  Registrant's
         Report on Form 10-K for the year ended October 31, 1996.

10.9*    Amended 1997 Stock Option and Incentive  Plan,  incorporated by
         reference as Exhibit 10.1 to the  Registrant's  Report on
         Form 10-Q for the quarter ended July 31, 2000.

10.10    Amended  and   Restated   Credit   Agreement   and   Amendment  to
         Reimbursement  Agreement,  effective September 8, 1997 between the
         Registrant  and NBD  Bank,  N.A.  and  NBD  Bank  incorporated  by
         reference to Exhibit 10.10 to the Registrant's Report on Form 10-K
         for the year ended October 31, 1997.

10.11    Second  Amended and  Restated  Senior Note  Agreement  between the
         Registrant and Principal Mutual Life Insurance  Company  effective
         September 8, 1997  incorporated  by reference to Exhibit  10.11 to
         the  Registrant's  Report on Form 10-K for the year ended  October
         31, 1997.

10.12    Letter  Agreement  (European  Facility)  dated  September 8, 1997,
         between  Registrant's  subsidiaries and The First National Bank of
         Chicago   incorporated  by  reference  to  Exhibit  10.12  to  the
         Registrant's  Report on Form 10-K for the year ended  October  31,
         1997.

10.13    Guaranty Agreement dated September 8, 1997, between the Registrant
         and The First National Bank of Chicago  incorporated  by reference
         to Exhibit 10.13 to the  Registrant's  Report on Form 10-K for the
         year ended October 31, 1997.

10.14    Guaranty  Agreement  dated  September  8,  1997,  between  Autocon
         Technologies,   Inc.  and  The  First  National  Bank  of  Chicago
         incorporated  by  reference to Exhibit  10.14 to the  Registrant's
         Report on Form 10-K for the year ended October 31, 1997.

10.15    Employment  agreement  between the  Registrant and James D. Fabris
         dated  November  18,  1997,  incorporated  by reference as Exhibit
         10.15 to the  Registrant's  Report  on Form  10-Q for the  quarter
         ended January 31, 1998.

10.16    The First Amendment to The Amended and Restated  Credit  Agreement
         and Amendment to  Reimbursement  Agreement  between the Registrant
         and NBD Bank  N.A.  dated  September  29,  1998,  incorporated  by
         reference as Exhibit 10.1 to the Registrant's  Report on Form 10-K
         For the year ended October 31, 1998.

10.17    The Second  Amendment to the Amended and  Restated  Credit  Agreement
         and Amendment to  Reimbursement  Agreement  between the Registrant and
         NBD Bank N.A. dated December 19, 1998,  incorporated  by reference
         as Exhibit  10.1 to the  Registrant's  Report of Form 10-Q for the
         quarter ended January 31, 1999.

10.18    Sublease between Autocon Technologies, Inc. and Robert Bosch
         Corporation dated April 30, 1999, incorporated by reference
         as Exhibit 10.1 to the Registrant's Report on Form 10-Q for the quarter
         ended April 30, 1999.
<PAGE>
10.19*   Employment   agreement  between  the  Registrant  and  Bernard  C.
         Faulkner  dated  February 4, 2000,  incorporated  by  reference as
         Exhibit  10.1 to the  Registrant's  Report  of Form  10-Q  for the
         quarter ended April 30, 2000.

10.20    The Third Amendment to The Amended and Restated  Credit  Agreement
         and Amendment to  Reimbursement  Agreement  between the Registrant
         and Bank One, Indiana National  Association and Bank One, Michigan
         (formerly  known as NBD Bank) dated August 17, 1999,  incorporated
         by reference as Exhibit  10.1 to the  Registrant's  Report on Form
         10-K for the year ended October 31, 1999.

10.21    Third  amendment to European  facility  between the Registrant and
         The  First  National  Bank  of  Chicago  dated  August  17,  1999,
         incorporated  by  reference  as Exhibit  10.2 to the  Registrant's
         Report on Form 10-K for the year ended October 31, 1999.
-------------------------------
         *    The indicated exhibit is a management contract, compensatory plan,
              or arrangement required to be listed by Item 601 of Regulation S-K

<PAGE>


SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this Report to be signed on its
behalf by the undersigned,  thereunto duly authorized, this 27th day of January,
2001.

                                      HURCO COMPANIES, INC.


                                      By: /s/ ROGER J. WOLF
                                         ---------------------
                                         Roger J. Wolf
                                         Senior Vice-President,
                                         Secretary, Treasurer and
                                         Chief Financial Officer




Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the dates indicated:


Signature and Title(s)                                    Date


/s/ BRIAN D. McLAUGHLIN                              January 26, 2001
-----------------------------------
Brian D. McLaughlin, Director,
President and Chief Executive Officer
of Hurco Companies, Inc.
(Principal Executive Officer)


/s/ ROGER J. WOLF                                    January 26, 2001
------------------------------------
Roger J. Wolf
Senior Vice-President,
Secretary, Treasurer and
Chief Financial Officer
of Hurco Companies, Inc.
(Principal Financial Officer)


/s/ STEPHEN J. ALESIA                                January 26, 2001
------------------------------------
Stephen J. Alesia
Corporate Controller
of Hurco Companies, Inc.
(Principal Accounting Officer)

<PAGE>

/s/ HENDRIK J. HARTONG, JR.                           January 26, 2001
--------------------------------------------
Hendrik J. Hartong, Jr., Director


/s/ ROBERT W. CRUICKSHANK                             January 26, 2001
--------------------------------------------
Robert W. Cruickshank, Director


/s/ MICHAEL DOAR                                      January 26, 2001
--------------------------------------------
Michael Doar, Director


/s/ RICHARD T. NINER                                  January 26, 2001
--------------------------------------------
Richard T. Niner, Director


/s/ O. CURTIS NOEL                                    January 26, 2001
--------------------------------------------
O. Curtis Noel, Director


/s/ CHARLES E. M. RENTSCHLER                          January 26, 2001
--------------------------------------------
Charles E. M. Rentschler, Director