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                                                                   Exhibit 10.35


                        SUPPLEMENTARY SECURITY AGREEMENT
                     SECURITY INTEREST IN GOODS AND CHATTELS

                                                           JULY 31, 1997
                                                 -------------------------------
                                                              DATE

TO:      FLEET NATIONAL BANK

Gentlemen:

         This is a supplement to our Inventory Accounts Receivable and
Intangibles Security Agreement (the "Agreement") with you bearing the effective
date of even date herewith. It is hereby incorporated into said Agreement, shall
have a term concurrent therewith and is part thereof.

         1.  In addition to your other security, we hereby grant you a
continuing security interest in all machinery, equipment and other goods (as
defined in Article 9 of the Uniform Commercial Code) whether now owned or
hereafter acquired by us and wherever located, all replacements and
substitutions therefor or accessions thereto and all proceeds thereof (all
herein referred to collectively as "Collateral") and including, also without
limitation, all proceeds of fire or other insurance covering the aforesaid
property.

         2.  The Collateral shall be security for all Obligations (as defined in
the Agreement). Until all obligations have been fully satisfied your security
interest in the Collateral shall continue in full force and effect and you will
at all times after the occurrence of any Event of Default under the letter
agreement described below have the right to the physical possession of the
Collateral and to maintain such possession on our premises or to remove the
Collateral or any part thereof to such other places as you may desire. If you
exercise your right to take possession of the Collateral, we shall, upon your
demand, assemble the Collateral and make it available to you at a place
reasonably convenient to you. In addition, with respect to all Collateral, you
shall have all of the rights and remedies set forth in the Agreement and all of
the rights and remedies provided in the Uniform Commercial Code.

         3.  We represent, warrant the covenant that (a) the Collateral is in
our possession at One Corporation Way, Peabody, County of Essex , Commonwealth
of Massachusetts and the other locations located on Exhibit A hereto; (b) we are
the lawful owners of the Collateral and have the sole right and lawful authority
to deliver this instrument; (c) the Collateral and every part thereof is and
will be free and clear of all security interests, liens and encumbrances of
every kind, nature and description except as follows: and we will warrant and
defend the Collateral against the claims and demands of all persons; (d) we will
keep the Collateral free and clear of all attachments, levies, taxes, liens,
security interests and encumbrances of every kind and nature, except as listed
above, and we will at our owns cost and expense, keep the Collateral in a good
state of repair and will not waste or destroy the same or any part thereof
except for items disposed of in the ordinary course to the extent expressly
permitted by the aforesaid letter agreement and will not be negligent in the
case and use thereof; (e) we will not without your prior written consent, sell,
assign, mortgage, lease or otherwise dispose of the Collateral except
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for obsolete or worn out items disposed of in the ordinary course and except for
liens permitted by the aforesaid letter agreement; (f) we will insure the
Collateral in your name against loss or damage by fire, theft, burglary,
pilferage, loss in transit and such other hazards as you shall specify, in
amounts and under policies by insurers acceptable to you, and if we fail to do
so, you may procure such insurance and charge the cost to our loan account; (g)
as further assurance for the payment and performance of the Obligations, we
hereby assign to you all sums, including returned or unearned premiums, which
may become payable under any policy of insurance on the Collateral and we hereby
direct each insurance company issuing any such policy to make payment of such
sums directly to you; (h) except for items disposed of in the ordinary course to
the extent expressly permitted by the aforesaid letter agreement we will not
remove the Collateral from its present location except to another location
described herein without your prior written consent and we will at all times,
allow you or your representatives free access to and right of inspection of the
Collateral; (i) we will comply with the terms and conditions of any leases
covering the premises wherein the Collateral is located and any orders,
ordinances, laws or statutes of any city, state or other governmental department
having jurisdiction with respect to such premises or the conduct of business
thereon, and, when requested by you, we will execute any written instruments and
do any other acts necessary to effectuate more fully the purposes and provisions
of the Agreement; (j) we will indemnify and save you harmless from all loss,
cost, damage, liability or expenses including attorneys' fees that you may
sustain or incur by reason of defending or protecting your security interest or
the priority thereof or enforcing the Obligations, or in the prosecution or
defense of any action or proceeding concerning any matter growing out of or
connected with the Agreement, the Obligations or the Collateral.

         4.  You may, at your option, discharge any taxes, liens, security
interests or other encumbrances at any time levied or placed on the Collateral
and not permitted by the letter agreement and you may pay for the maintenance
and preservation of the Collateral and we will reimburse you on demand for any
payment made or any expense incurred by you pursuant to the foregoing authority,
with interest at the rate provided in this Agreement.

                                       Very truly yours,

Witnessed by:                                   MICRION CORPORATION
                                       -----------------------------------------
                                                      Borrower

    Patricia V. Rozumek                By: David M. Hunter
-----------------------------             --------------------------------------
                                          Its Vice President, Finance and 
                                              Administration

                                       Accepted at Boston, Massachusetts 8/1/97

                                       By: Thomas W. Davies
                                          --------------------------------------
                                               Its SVP


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