Exhibit 10.7


                                                              March 11, 1998



Charles E. Bradley
c/o Stanwich Partners, Inc.
One Stamford Landing
62 Southfield Avenue
Stamford, Connecticut  06902

John G. Poole
c/o Stanwich Partners, Inc.
One Stamford Landing
62 Southfield Avenue
Stamford, Connecticut  06902

Banc One Capital Partners Corporation
150 E. Gay Street
Columbus, Ohio  43215

PNC Capital Corp.
3100 CNG Tower
625 Liberty Avenue
Pittsburgh, Pennsylvania  15222

                  Re:  Amendment to Intercreditor Agreement ("Amendment")

Gentlemen:

     Reference  is made to the  Intercreditor  Agreement  made as of October 23,
1995  between  The  CIT  Group/Business   Credit,   Inc.  ("CIT"),  a  financial
institution,  Charles E. Bradley, Sr. ("Bradley"), John G. Poole ("Poole"), Banc
One Capital  Partners  Corporation,  a Texas  Corporation,  ("Bank One") and PNC
Capital Corp., a Delaware  corporation  ("PNC"),  as amended (the "Intercreditor
Agreement").   Capitalized  terms  used  in  this  letter  and  defined  in  the
Intercreditor


                                       
<PAGE>

Agreement  shall have the same  meanings in this letter as in the  Intercreditor
Agreement unless otherwise specifically defined in this letter.

     Each of the undersigned  hereby agree that Paragraph A of the  Introduction
to the Intercreditor Agreement is amended in full to read:

          "A. DeVLIEG BULLARD,  INC. (the "Borrower") is indebted to CIT and BNY
     Financial  Corporation  and their  respective  successors  in interest  and
     assigns  (referred to herein  collectively  as the "Senior Debt Holder") in
     the original principal amount of up to $40,000,000 (together with all other
     indebtedness,  liabilities  and  obligations  of the Borrower to any Senior
     Debt Holder  under the  Financing  Agreement  hereinafter  referred to, the
     "Senior Indebtedness"), as evidenced by, among other things, an Amended and
     Restated  Financing  and  Security  Agreement  between CIT and the Borrower
     dated  January 17, 1997 (as amended and as it may be amended in the future,
     the "Financing  Agreement"),  the Borrower's  $30,000,000  revolving credit
     promissory  notes and the Borrower's  $7,600,000 term loan promissory notes
     (collectively  and as amended and  assigned  and as they may be amended and
     assigned,  the "Senior  Notes").  All  documents and  agreements  delivered
     pursuant  to or in  connection  with the  Senior  Indebtedness  are  herein
     referred to as the "Senior Financing Documents"."

     In addition,  each of the  undersigned  hereby agrees that CIT executed the
Intercreditor  Agreement for itself and as Agent for each Senior Debt Holder and
all Senior Debt Holders are  entitled to rely on the terms of the  Intercreditor
Agreement.

     This  Amendment  shall  become  effective  on the date  when the  Borrower,
Bradley,  Poole,  Banc One, PNC and CIT shall have executed and  delivered  this
Amendment.

     This Amendment may be executed in counterparts.

     The  execution  and  delivery  of  this  Amendment  shall  not,  except  as
specifically  provided above,  constitute a waiver of any right, power or remedy
of any  Senior  Debt  Holder  under  the  Intercreditor  Agreement  or any other
document


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<PAGE>


related thereto and the Intercreditor  Agreement and each other document related
thereto  shall  remain in full  force and effect  and are  hereby  ratified  and
confirmed.

                                                 Very truly yours,

                                                 THE CIT GROUP/BUSINESS
                                                 CREDIT, INC.


                                                 By /s/ Edward Hirshfield
                                                    ---------------------------
                                                     Name: Edward Hirshfield
                                                     Title: Assistant Secretary



Agreed and Accepted:

CHARLES E. BRADLEY


By /s/ Charles E. Bradley
   -------------------------
    Name:


JOHN G. POOLE


By /s/ John G. Poole
   --------------------
    Name:


BANC ONE CAPITAL PARTNERS


By /s/  James H. Wolfe
   -------------------------
  Name: James H. Wolfe
    Title: Managing Director


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<PAGE>


PNC CAPITAL CORP.


By: /s/ David J. Blair
    -------------------------
    Name:  David J. Blair
    Title: Senior Vice President
           and Principle


DeVLIEG-BULLARD, INC.


By /s/ WO Thomas
   ---------------------------
    Name: WO THOMAS
    Title: PRESIDENT


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