Document:

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EXHIBIT 10.12

                            CREDIT FACILITY AGREEMENT

THIS AGREEMENT is made this February 25, 1999

between:

1.   FEI COMPANY, having its registered seat at 7451 N.W. Evergreen Parkway,
     Hillsboro, Oregon, United States of America, 97124-5830,

2.   PHILIPS ELECTRON OPTICS INTERNATIONAL B.V., having its registered seat at
     Achtse Weg Noord 5, 5651 GG, Eindhoven, the Netherlands,

     (the "Borrowers")

     and

3.   KONINKLIJKE PHILIPS ELECTRONICS N.V., having its registered seat at
     Groenewoudseweg 1, 5621 BA Eindhoven, the Netherlands (Lender")

WHEREAS

The Borrowers desire to obtain from the Lender and the Lender has agreed to
grant to the Borrowers, a credit facility of 50 million US-Dollars (or its
equivalent from time to time in Optional Currencies).

NOW, THEREFORE, IT IS AGREED AS FOLLOWS:

1.   DEFINITIONS

Words and expressions used in this Agreement shall have the following meaning
unless the context otherwise requires:

"AGREEMENT" means the present agreement entered into by the Borrowers and the
Lender, including the Schedule attached thereto, and any amendment thereto;

"AVAILABLE FACILITY" means the Facility minus the Outstanding Amounts;

"AVAILABLE REVOLVING CREDIT FACILITY" means the Revolving Credit Facility minus
the Outstanding Amounts;

"BORROWERS" means either FEI or PEOI, or FEI and PEOI jointly;

"BUSINESS DAY" means a day on which banks are open for business of the nature
contemplated in this Agreement in Amsterdam and in the financial center of the
relevant currency (the relevant financial center for EUR is deemed to be
London);

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EXHIBIT 10.12

"CURRENT ACCOUNT" means the current account (also within the Philips
organization referred to as "Intercompany Bank Account" or "IBA") of PEOI
denominated in EUR with the Lender;

"DOLLAR AMOUNT" means in relation to a Revolving Advance: (i) if the request for
a Revolving Amount is denominated in US-Dollars, the amount specified in that
request; or (ii) if such request is denominated in an Optional Currency, the
US-Dollars equivalent (at the time the Lender receives such request) of the
amount specified in the request;

"DRAWDOWN DATE" means, in respect of a Revolving Advance, the date of the making
thereof as (deemed) specified in the relevant request;

"EUR" means the lawful currency of countries participating in the third stage of
the Economic and Monetary Union;

"EVENT OF DEFAULT" means any of the events set out in Clause 14 hereunder;

"FACILITY" means the US-Dollars credit facility set out in Clause 2.2 hereunder;

"FEI" means FEI Company;

"FEI GROUP" means FEI and its subsidiaries;

"FINAL MATURITY DATE" means the third anniversary of this Agreement (February
26, 2002);

"INTEREST DETERMINATION DATE" means, in respect of an Interest Period, the day
which is two Business Days prior to the first day of such Interest Period;

"INTEREST PAYMENT DATE" means, in relation to any Revolving Advance, the last
day of an Interest Period relative thereto;

"INTEREST PERIOD" means, in relation to any Revolving Advance, a period as
selected or deemed to have been selected by the Borrowers in accordance with
Clause 5.1 hereunder;

"JPY" means the lawful currency of Japan;

"LENDER" means Koninklijke Philips Electronics N.V.;

"NLG" means the lawful legal tender of the Netherlands;

"NOTICE" means a notice of drawdown of a Revolving Advance or a notice
requesting a next Interest Period substantially in the form as set out in
Schedule A hereto;

"MAXIMUM AMOUNT" means the maximum amount of the Facility as specified in Clause
2.1 hereunder and as may be amended in accordance with Clause 15.1 hereof;

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EXHIBIT 10.12

"OPTIONAL CURRENCIES" means Dutch Guilders (NLG), Euro (EUR) or Japanese Yen
(JPY);

"OUTSTANDING ACCOUNTS" the sum of all Revolving Advances outstanding, the debit
balance on the Current Account and the interest due

"PEOP" means Philips Electron Optics International BV;

"REQUIRED AMOUNT" means (i) in the case of US-Dollars drawn under the Revolving
Credit Facility, a minimum of 10,000 US-Dollars and a higher whole multiple of
US-Dollars 10,000, and (ii) in case of an Optional Currency, such amount as is
agreed between the Borrowers and the Lender, or failing agreement, the
equivalent of the Required Amounts relevant to the Revolving Credit Facility for
US-Dollars;

"REVOLVING ADVANCE" means any revolving advance made or to be made available by
the Lender to the Borrowers in any one currency in accordance with the
provisions of this Agreement and for the time being outstanding under the
Revolving Credit Facility,

"REVOLVING CREDIT FACILITY" means the credit facility as specified in Clause 2.2
hereof;

"TERM" means in relation to a Revolving Advance, the period for which it is to
be borrowed, being one, three or six months, ending not later than the Final
Maturity Date;

"US-DOLLAR" AND "USD" mean the lawful currency of the United States of America.

2.   THE FACILITY

2.1  AMOUNT

The Lender grants to the Borrowers a total credit facility of 50 million
US-Dollars (or its equivalent from time to time in Optional Currencies). This
amount may be reduced by FEI in accordance with Clause 15 hereof (partial
cancellation).

2.2  REVOLVING CREDIT FACILITY AND CURRENT ACCOUNT

The Facility consists of a revolving credit facility for the Maximum Amount (or
its equivalent from time to time in Optional Currencies) (the "Revolving Credit
Facility") including a credit facility on the Current Account for the maximum of
10 million US-Dollars. If there is a debit balance on the Current Account, the
Available Revolving Credit Facility will be reduced accordingly. The Outstanding
Amounts will at no time exceed the Maximum Amount.

PEOI has entered into an agreement with the Lender specifying the terms and
conditions applicable to the Current Account.

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EXHIBIT 10.12

2.3  PROCEEDS

The proceeds of the Facility will be used for general corporate business
purposes of the FEI Group only and not for the purpose of acquisitions or
take-overs.

2.4  COMMITMENT FEE

FEI will pay to Lender a commitment fee of 0.25 per cent (25 basis points) per
annum. from day to day during the period starting February 25, 1999 and ending
on the Final Maturity Date on the amount to be calculated as follows: the
Maximum Facility minus US-Dollars 10 million minus the sum of the Revolving
Advances outstanding. If the aggregate of the Revolving Advances outstanding
exceeds or equals the Maximum Amount minus 10 million US-Dollars, no commitment
fee has to be paid. The commitment fee will be paid to the bank account of the
Lender at the end of each period of six (6) months, for the first time in July
1999 (so the first commitment fee will be paid over a period of six months less
55 days) within 5 Business Days upon the written request of the Lender. Such
request will contain a specification of the fee to be paid.

3.   CONDITIONS PRECEDENT

The several obligations of the Lender under this Facility shall be expressly
subject to the Lender having received, in form and substance satisfactory to the
Lender, not later than the date set out in Clause 4.1 on which the Borrower
gives a Notice for the drawdown hereunder, evidence of authority of those
persons authorized to execute, deliver and perform this Agreement and any
notices required hereunder on behalf of the Borrowers.

4.   DRAWDOWN OF REVOLVING ADVANCES

4.1  NOTICE

Revolving Advances will be made by the Lender to FEI or PEOI at the request of
the Borrowers (or any one of them), if the following additional conditions are
fulfilled:

I.   The Lender has received from the relevant Borrower not later than 10:00
     a.m. (Amsterdam time) on the third Business Day before the Drawdown Date of
     the Revolving Advance, a written notice specifying:

     (a)  the Drawdown Date of the Revolving Advance, which must be a Business
          Day ultimately one month before the Final Maturity Date;

     (b)  its amount, which may not result in a breach of Clause 2.2 and so that
          (i) its Dollar Amount must be equal to or less than the Available
          Revolving Credit Facility and (ii) if its Dollar Amount is less than
          the Available Revolving Credit Facility, the amount of that Revolving
          Advance must be the Required Amount;

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EXHIBIT 10.12

     (c)  its currency (in US-Dollars or one of the Optional currencies);

     (d)  its Term, which must be in accordance with clause 4.2;

     (e)  the name of the borrower (either FEI or PEOI);

     (f)  details of the bank and account to which FEI wishes the proceeds of
          that Revolving Advance to be made available.

II.  All representations and warranties in this Agreement have been complied
     with in all material respects as at the date of the request of the
     Revolving Advance, and would be correct in all material respects if
     repeated on the Drawdown Date of that Revolving Advance, by reference to
     the circumstances then existing.

III. No Event of Default has occurred on or before the Drawdown Date of that
     Revolving Advance and is continuing or will occur as a result of making
     that Revolving Advance.

IV.  The request is duly signed by an authorized person or persons as specified
     in Schedule B hereto.

Borrowers shall notify the Lender in writing of any change in or withdrawal of
the authorization of any person mentioned on Schedule B, notwithstanding their
entry in public registers, in default of which notification such change or
withdrawal cannot be invoked against the Lender.

4.2  TERM

The Term of a Revolving Advance shall begin on the Drawdown Date of that
Revolving Advance and shall have a duration of one, three or six months, or a
period of less than six months ending on the Final Maturity Date, as selected by
the relevant Borrower in the notice requesting that Revolving Advance, except
that the Borrowers may not select a Term ending after the Final Maturity Date.

4.3  SUBSTITUTION OF BALANCE ON CURRENT ACCOUNT INTO REVOLVING ADVANCE

Revolving Advances will be deemed requested by PEOI and deemed made by the
Lender to PEOI if the debit balance on the Current Account is exceeding the
equivalent of US-Dollars 10 million for more than 5 consecutive Business Days
under the following conditions:

I.

     (a)  the Drawdown Date of the Revolving Advance, being a Business Day
          before the Final Maturity Date, is the day on which the balance on the
          Current Account is exceeding the equivalent of US-Dollars 10 million
          for 5 consecutive Business Days (the "Overdrawn Date");

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EXHIBIT 10.12

     (b)  the amount of such Revolving Advance will be a minimum of EUR 10,000,
          or such higher whole multiple of EUR 10,000 that the amount of the
          Revolving Advance will not exceed the debit balance on the Current
          Account on the Overdrawn Date minus the equivalent of US-Dollars 10
          million,

     (c)  its Term will be one month; provided that such Revolving Advance does
          not result in a breach of Clause 2.2;

II.  All representations and warranties in this Agreement have been complied
     with in all material respects as at the date of the request of the
     Revolving Advance, and would be correct in all material respects if
     repeated on the Drawdown Date of that Revolving Advance, by reference to
     the circumstances then existing.

III. No Event of Default has occurred on or before the Drawdown Date of that
     Revolving Advance and is continuing or will occur as a result of making
     that Revolving Advance.

If a Revolving Advance is made in accordance with this Clause, the Current
Account will be credited on the Overdrawn Date for the amount of such Revolving
Advance deemed made.

5.   INTEREST

5.1  INTEREST PERIODS REVOLVING ADVANCES

Each Revolving Advance shall bear interest calculated by reference to the
successive Term of that Revolving Advance.

FEI shall notify its selection as to the duration of each Interest Period, in
the Notice relative to the Revolving Advance (in case of the first Interest
period of the Revolving Advance) and subsequently by Notice in writing to the
Lender to be received by it not later than 10:00 am. (Amsterdam time) on the
third Business Day prior to the first day of each subsequent Interest Period,
provided that if FEI fails to give notice of its selection in relation to the
duration of an Interest Period, such duration shall be of one month and further
provided that:

(a)  the first Interest Period in respect of each Revolving Advance shall
     commence on the Drawdown Date referred to in Clause 4.1 sub I and shall end
     upon the expiry of the period selected or otherwise determined in
     accordance with this sub-Clause;

(b)  each subsequent Interest Period shall commence on the last day of the
     preceding Interest Period,

(c)  if any Interest Period would otherwise end on a day which is not a Business
     Day, that Interest Period shall be extended to the next succeeding Business
     Day, unless such succeeding Business Day falls in another calendar month
     in which event that Interest Period shall end upon the immediately
     preceding Business Day;

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EXHIBIT 10.12

(d)  if an Interest Period is extended or shortened by application of the
     preceding paragraph, the following Interest Period shall end on the day on
     which it would have ended if the preceding Interest Period had not been so
     extended or shortened;

(e)  any Interest Period which commences on a day of a calendar month (whether
     the last day or another day) for which there is no numerically
     corresponding day in the month in which the relevant Interest Period should
     end shall, subject to paragraph (_), end on the last Business Day of such
     month; and

(f)  no Interest Period shall extend beyond the Final Maturity Date.

5.2  INTEREST REVOLVING ADVANCES

The rate of interest applicable to each Revolving Advance for each Interest
Period relative thereto shall be the aggregate of the rate per annum which
appears on the Interest Determination Date in London on the relevant page of the
Telerate Service designated for the display of London Interbank Offered Rate for
that Term in the currency in which the Revolving Advance to which that Term
relates is to be denominated plus 0.75% (75 basis points).

Interest in relation to a Revolving Advance shall be payable on each Interest
Payment Date relative thereto.

Interest shall accrue from day to day and shall be computed on the basis of a
year of 360 days.

5.3  INTEREST CURRENT ACCOUNT

The rate of debit interest applicable to the Current Account shall be the
aggregate of the rate per annum. which appears on the relevant page of the
Telerate Service designated for the display of London Interbank Offered Rate for
a period of one week in the currency in which the Current Account is
denominated plus 0.75% (75 basis points).

The rate of credit interest on a day to day basis applicable to the Current
Account shall be the "LIBID" rate for a period of one week in the currency in
which the Current Account is denominated (approximately London Interbank Offered
Rate minus 0.125% (12.5 basis points).

Interest in relation to the Current Account shall be automatically debited or
credited as the case may be from or to the Current Account at the end of each
month (a month in this respect win be a month as determined by the 'Philips
Concern Calendar', attached as Schedule F). On the request of the Borrowers, the
Lender will inform them timely of such periods not covered by Schedule F. The
Lender will give a specification of the interest (to be) paid.

Interest shall accrue from day to day and shall be computed on the basis of a
year of 365 days.

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EXHIBIT 10.12

5.4  DETERMINATION OF INTEREST

Each determination of the rate of interest by the Lender hereunder shall be in
writing and shall in the absence of manifest error be conclusive and binding
upon the Borrowers.

5.5  DEFAULT INTEREST

The rate of interest on a day to day basis applicable to a Revolving Advance not
paid when (declared) due hereunder shall be the aggregate of the interest rate
applicable to such Revolving Advance plus one percent (100 basis points).

The rate of interest on a day to day basis applicable to any other amount not
paid when (declared) due hereunder shall be the aggregate of the interest rate
specified in Clause 5.3 plus one percent (100 basis points).

6.   REPAYMENT

6.1  NORMAL REPAYMENT

The Facility shall be repaid in the respective currencies of the Revolving
Advances in full on the Final Maturity Date, unless it is prepaid earlier in
accordance with the provisions of this Agreement.

6.2      PREPAYMENT

(a)  The Borrowers may prepay any part of all of the outstanding Revolving
     Advances in the several currencies at any one time, without premium or
     penalty at any time, if they give to the Lender not less than 5 Business
     Days written notice of the Revolving Advance(s) to be prepaid and the date
     and amount of the prepayment. Any such prepayment must be accompanied by
     accrued interest on the amount prepaid and by any other sum then due
     pursuant to this Agreement.

(b)  Any notice of intention to make a prepayment shall be irrevocable and shall
     oblige the Borrowers to make such prepayment on the relevant Interest
     Prepayment Date.

(c)  As the Credit Facility is revolving, any amount prepaid before the Final
     Termination Date will remain available for reborrowing on the terms and
     conditions of this Agreement.

7.   PAYMENTS

All payments to be made hereunder by the Borrowers or the Lender shall be. made
in the relevant currency to the relevant account on the date upon which the
RELEVANT PAYMENT is due by credit to the account numbers as specified in
Schedule C HERETO, OR, as the case may be, such other accounts and/or banks as
the parties may from time to time agree upon.

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EXHIBIT 10.12

8.   TAXES

Subject as hereinafter provided, all payments to be made by the Borrowers
hereunder (whether of principal, interest or otherwise) shall be made FREE AND
clear of and without any deductions or withholdings whatsoever, save and to the
extent required by applicable law.

If the Borrowers are compelled by law to make any such deduction or withholding,
they shall ENSURE THAT such deduction or withholding does not exceed the minimum
liability therefor and shall promptly pay to the Lender such additional amount
as is necessary to ensure that the net amount received and retained by the
Lender is equal to the amount payable by the Borrowers had there been no
deduction or withholding.

9.   ILLEGALITY

Notwithstanding any other provision herein, if any change in law, regulation or
treaty or in the official interpretation or application thereof by any competent
authority or any competent court shall make it unlawful for the Lender to make
or to fund or continue to fund a Revolving Advance or part THEREOF, THEN the
Lender shall be entitled by written notice thereof to the Borrowers, to declare
that its participation in the relevant Revolving Advance shall be terminated
forthwith or upon expiry of any legally admissible delay, whereupon the
Borrowers shall prepay such Revolving Advance TOGETHER WITH accrued interest
thereon, whereupon the Facility shall be reduced to the then outstanding
Revolving Advances.

Notwithstanding the provisions of the Dutch law in this respect, the Lender will
make its best efforts in the occurrence of any of the events mentioned in this
Clause 9 to secure, in agreement with the Borrowers, a satisfactory solution
which would make the reduction of the Facility unnecessary.

10.  REPRESENTATIONS AND WARRANTIES

The Borrowers hereby REPRESENT AND warrant to and for the benefit of the Lender
that:

10.1 FEI is a legal entity duly incorporated in the State of Oregon and validly
     organized under the laws of the State of Oregon and has the corporate power
     to carry on its business as it is now being conducted;

10.2 PECII is a limited liability body duly incorporated in the Netherlands and
     validly existing under the laws of the Netherlands and has the corporate
     power to carry on its business as it is now being conducted;

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EXHIBIT 10.12

10.3 each of the Borrowers has the corporate power and authority to enter into
     and perform its obligations under this Agreement and has taken all
     necessary action to authorize the making of the drawdown upon the terms and
     conditions of this Agreement and to authorize the execution and performance
     of this Agreement in accordance with its respective terms;

10.4 this Agreement constitutes legal, valid and binding obligations of the
     Borrowers fully enforceable against them in accordance with its respective
     terms and the terms thereof have been (or will be where applicable)
     complied with by the Borrowers in all material respects, the same will
     constitute legal, valid and binding obligations of the Borrowers
     enforceable in accordance with its terms subject to the laws of bankruptcy
     and other laws affecting the rights of creditors generally,

10.5 the execution, delivery and performance by the Borrowers of this Agreement
     do not and will not violate in any respect any provision of the articles of
     incorporation of FEI and/or PEOI;

10.6 no litigation, arbitration or administrative proceedings are at present
     current or pending or, to the knowledge of the Borrowers, threatened which
     would have a material adverse effect on their ability to perform and comply
     with their respective obligations under this Agreement;

10.7 no Event of Default and no other event which, with the giving of notice or
     lapse of time or both, might constitute an Event of Default has occurred
     and is continuing.

11.  DEFINITIONS WITH RESPECT TO FINANCIAL RATIOS

The following expressions used in this Clause II and Clause 13 shall be
construed in accordance with US Generally Accepted Accounting Principles but so
that:

"INTEREST EXPENSE" in relation to any fiscal year of FEI Group, means the
consolidated interest expense under US Generally Accepted Accounting Principles
as shown or determined from the Financial Statements for such fiscal year, and
in relation to the 12 month period ending at the end of each quarter means the
consolidated interest expense under US Generally Accepted Accounting Principles
as shown or determined from the Financial Statements for such period.

"INCOME FROM OPERATIONS" in relation to any fiscal year of FEI Group, means
income (loss) Before Taxes plus or minus the sum of the amounts for such fiscal
year included in determining such income (loss) Before Taxes of (A) consolidated
interest expense, (B) amortization of intangibles arising from the merger of
PEOI with FEI and the acquisition of Micrion by FEI Group for that fiscal year
and (C) unusual and non-recurring items for that fiscal year including (a)
write-off of in-process research and development, (b) other non cash costs of
mergers and acquisitions activity relating to the merger of PEOI with FEI and
the acquisition of Micrion (c) restructuring and reorganization costs (d) other
non-recurring non-cash losses/gains and charges

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EXHIBIT 10.12

(e) extraordinary items (i) cumulative effects of a change in accounting
principles, all as determined in accordance with US Generally Accepted
Accounting Principles, and in relation to the 12 month period ending at the end
of each quarter, means income (loss) Before Taxes plus or minus the sum of the
amounts for the previous four quarters included in determining such income
(loss) Before Taxes of (A) consolidated interest expense, (B)
amortization of intangibles arising from the merger of PEOI with
FEI and the acquisition of Micrion by FEI Group for the previous
four quarters and (C) unusual and non-recurring for the previous
four quarters items including (a) write-off of in-process research
and development, (b) other non cash costs of mergers and
acquisitions activity relating to the merger of PEOI with FEI and
the acquisition of Micrion (c) restructuring and reorganization
costs (d) other non-recurring non-cash losses/gains and charges (e)
extraordinary items (ii) cumulative effects of a change in
accounting principles, all as determined in accordance with US
Generally Accepted Accounting Principles, all as shown in or
determined from the Financial Statements for the relevant period.

"STOCKHOLDERS' EQUITY" at any time means the aggregate (expressed in US-Dollars)
at such time of the total shareholders' equity as shown in or determined by the
Financial Statements for the relevant period.

"TOTAL CAPITALIZATION" at anytime means the aggregate at such time of Total
Debt and Stockholders' Equity as shown in or determined by the Financial
Statements for the relevant period.

"TOTAL DEBT" at any time means the aggregate (expressed in US-Dollars) of (i)
all long term liabilities expressed as being due after one or more years from
the relevant balance sheet date, excluding for this purpose all such liabilities
classified as "other liabilities (non-interest-bearing)" or "deferred income
taxes" plus (ii) all current liabilities but excluding for this purpose all such
liabilities classified as "non-interest-bearing debt"; all as shown in or
determined from the Financial Statements for the relevant period.

"AUDITORS' CERTIFICATE" means a certificate by the auditors of FEI as to the
amount of Interest Expense, Income from Operations, Stockholders' Equity, and
Total Debt at any date and shall be final and conclusive except for manifest
error.

"FINANCIAL STATEMENTS" mean the annual audited consolidated financial statements
of FEI Group or the quarterly unaudited consolidated financial statements of FEI
Group as filed at the SEC (form "10 Q" or "10K"), all expressed in US-Dollars
and prepared in accordance with US Generally Accepted Accounting Principles.

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EXHIBIT 10.12

12.  COVENANTS

12.1 FEI hereby covenants and agrees, so long as any amounts remain outstanding
     hereunder or, in the event that there are no such amounts outstanding, so
     long as this Agreement remains in effect that:

     (a)  as soon as available but not later than 50 days after the end of each
          quarter (beginning with the current one) and with the exception of
          each fourth quarter of the year, FEI will deliver to the Lender the
          Financial Statements as at the end of and for that quarter together
          with copies of the related SEC report "10 Q";

     (b)  as soon as available but not later than 95 days after the end of each
          fiscal year (beginning with the current one), FEI will deliver to the
          Lender its Financial Statements (and one copy of its annual report) as
          at the end of and for that financial year together with copies of the
          related SEC reports "10 K" and the related auditors' report.

12.2 Borrowers hereby covenant and agree, so long as any amounts remain
     outstanding hereunder or, in the event that there are no such amounts
     outstanding, so long as this Agreement remains in effect that:

     (a)  each of the Borrowers shall duly perform and observe all its
          obligations under this Agreement and promptly inform the Lender of any
          circumstance having or which could have a material adverse effect on
          its ability to perform its obligations hereunder,

     (b)  the Borrowers shall notify the Lender in writing of any Event of
          Default and of the steps being taken to remedy such Event of Default
          forthwith upon becoming aware of the occurrence thereof.

13.  GUARANTEE AND OTHER CONDITIONS

The Borrowers acknowledge that the Lender has agreed to make the Facility
available to the Borrowers in reliance on the following guarantee and covenants:

13.1 the Borrowers hereby jointly and severally unconditionally and irrevocably
     guarantee to the Lender due and punctual payment of the principal of and
     interest on the Revolving Advances and the Current Account and all other
     sums due under this Agreement when and as the same shall become due and
     payable, whether a Revolving Advance is drawn by FEI or PEOI.

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EXHIBIT 10.12

13.2 FEI shall be subrogated to all rights of the Lender against PEOI in respect
     of any amounts paid by FEI pursuant to the provisions of this guarantee,
     provided, however, that FEI shall not be entitled to enforce or to receive
     any payments arising out of, or based upon, such rights of subrogation.
     until all the principal of and interest on the Revolving Advances and the
     Current Account shall have been paid in full or duly provided for.

13.3 the Borrowers jointly and severally undertake that, so long as any sum
     remains to be payable by it under this Agreement:

(a)  their payment obligations under this Agreement rank and will at all times
     rank at least equally and ratable in all respects (Pari passu) with all
     their other unsecured and unsubordinated indebtedness for borrowed money
     except for such indebtedness preferred only by mandatory provisions of law.

(b)  they will not create or have outstanding any security for their
     indebtedness for borrowed money on or over the Borrowers' assets except
     for: (i) the securities listed in Schedule D hereto (ii) any security
     existing on or over assets acquired by the Borrowers from a Subsidiary not
     created in contemplation of or in connection with the acquisition of those
     assets by the Borrowers, (iii) to the extent that any off-balance sheet
     financing of itself constitutes security over any assets of the Borrowers,
     that security over such assets, (iv) to the extent that any discounting,
     factoring or other disposal of any book debts or receivables of themselves
     constitutes security over such book debts or receivables, that security
     over such book debts or receivables, (v) securities directly relating to
     advance payments, received with a maximum of USD 3 million at any time,
     (vi) any other security created or outstanding with the prior consent of
     the Lender, (vii) any rights of set-off arising by operation of law only or
     in the ordinary course of banking other than rights of set-off arising
     pursuant to an agreement relating to indebtedness for borrowed money having
     an initial maturity of more than 1 year entered into after the date of this
     Agreement.

(c)  FEI will with each set of the Financial Statements delivered under Clause
     12 sub 1 deliver to the Lender an Auditors' Certificate confirming
     compliance with Clause 13.4 as at the end of a fiscal year or a certificate
     signed by the Chief Executive Officer or Chief Financial Officer of FEI
     confirming compliance with Clause 13.4. Each such certificate will set out
     in reasonable detail and in a form reasonably satisfactory to the Lender
     the computations necessary to demonstrate such compliance. A draft of such
     certificate is attached as Schedule E.

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EXHIBIT 10.12

13.4 The Borrowers will jointly and severally ensure that, based on the
     Financial Statements and per the date to which they relate, as any sum
     remains to be lent to or remains payable under this Agreement:

     (a)  the Stockholders' Equity will in the year 1999 not be less than
          US-Dollars 92 million;

     (b)  the Stockholders' Equity will in the year 2000 and 2001 not be less
          than US Dollars 100 million;

     (c)  the ratio of Stockholders Equity to Total Capitalization will be more
          than 1 to 2;

     (d)  the ratio of Income from Operations to Interest Expense will not in
          respect of any financial year of the FEI Group, or any 12 month period
          ending on the last day of a quarter, be less than 4 for the first and
          second quarter of 1999 and thereafter not less than 6.

     If FEI Group acquires assets for an amount exceeding 25% of its
     Stockholders' Equity according to its latest Financial Statements before
     such acquisition, the Borrowers may request the Lender to adjust the
     minimum ratios mentioned under 13.4 sub (d) to reflect such acquisition.

13.5 FEI will not dispose and will procure that none of its subsidiaries
     (including PEO) will, except with the consent of the Lender (disregarding
     disposals in the ordinary course of business and any sale, lease, transfer
     or other disposal of any of its revenues or its assets on an arm's length
     basis for fair market value and the payment of lawful dividends) sell,
     lease, transfer, lend (other than the lending of cash to any of its
     subsidiaries) or otherwise dispose of, by one or more transactions or
     series of transactions (whether related or not), the whole or any material
     part of its respective business, revenues or assets ("material" in this
     context means a sale, lease, transfer, loan or disposal of any part of its
     business, assets or revenues which, by itself (in the case of a single
     transaction) or which aggregated (in the case of a number of related
     transactions), is more than 10 percent of the revenues or assets of the FEI
     Group taken as a whole or, in any case, the disposal of which (alone or so
     aggregated) would have a material adverse effect on any Borrower's ability
     to perform or comply with its obligations under this Agreement).

13.6 FEI will ensure that there is no material change in the nature of the
     business of the FEI Group taken as a whole (whether by a single transaction
     or a number of related or unrelated transactions, whether at one time or
     over a period of time and whether by disposal, acquisition or otherwise)
     which has or could have a material adverse effect on any Borrower's ability
     to perform and comply with its obligations under this Agreement.

<PAGE>

EXHIBIT 10.12

14.  EVENTS OF DEFAULT

The following are Events of Default:

(a)  Non-payment: The Borrowers do not pay in the manner provided in this
     Agreement (i) any principal payable under it when due, unless the Borrowers
     satisfy the Lender that non-payment is due solely to administrative error
     (whether by the Borrowers or a bank involved in transferring funds to the
     Lender) and payment is made within 5 Business Days after written notice of
     that non-payment has been given to it by the Lender or (ii) any other sum
     payable under it within 10 Business Days after written notice of that
     non-payment has been given to it by the Lender.

(b)  Breach of Representation or Warranty: Any representation or warranty by the
     Borrowers pursuant to Clause 10 is not complied with in any material
     respect or is or proves to have been incorrect, in any material respect,
     when made.

(c)  Breach of Other Obligation: The Borrowers do not perform or comply in any
     material respect with any one or more of their other obligations under this
     Agreement and, if that default is capable of remedy, it is not remedied
     within 30 days after written notice of that default has been given to it by
     the Lender.

(d)  Cross Default: Any other indebtedness of the Borrowers in respect of
     borrowed money and forming part of its Total Debt (i) is payable (whether
     automatically under the provisions of any agreement relating to that
     indebtedness or as a result of any declaration or the Eke made under any
     such agreement) before its normal maturity by reason of any actual default
     or event of default, however described, and is not paid on becoming so
     payable or within any applicable grace period unless it is being contested
     in good faith by appropriate means or (ii) is not paid by reason of the
     actual default of the Borrowers when due nor within any applicable grace
     period in any agreement relating to that indebtedness unless it is being
     contested in good faith by appropriate means, except in any such case where
     the Borrowers is prevented, directly or indirectly, by any government or
     other authority from fulfilling the relevant obligation. However, no Event
     of Default will occur under this Clause 14 (d) unless the amount of the
     indebtedness for borrowed money in respect of which any event mentioned in
     this Clause 14 (d) has occurred equals or exceeds US-Dollars 5 million or
     its equivalent in other currencies (as reasonably determined by the
     Lender).

<PAGE>

EXHIBIT 10.12

(e)  INSOLVENCY: FEI or PEOI is (or is deemed by law or a court to be) insolvent
     (including a faillissement (within the meaning of the Netherlands'
     bankruptcy act) or unable to pay its debts or one of the Borrowers stops,
     suspends or threatens to stop or suspend payment of all or a material part
     of its indebtedness (including a surse'ance van betaling, within the
     meaning of the Netherlands' bankruptcy act), begins negotiations or takes
     any other step with a view to the deferral, rescheduling or other
     readjustment of all of its indebtedness (or of any material part which it
     will or might otherwise be unable to pay when due), proposes or makes a
     general assignment or an arrangement or composition with or for the benefit
     of the relevant creditors or a moratorium is agreed or declared in respect
     of or affecting all or a material part of the indebtedness of the
     Borrowers.

(f)  WINDING-UP: An order is made or an effective resolution is passed for the
     winding-up of one of the Borrowers.

(g)  ANALOGOUS EVENTS: Any event occurs which, under the law of any relevant
     jurisdiction, has an analogous or equivalent effect to any event mentioned
     in Clause 14 (e).

(h)  CHANGE OF CONTROL: The Lender has given written notice to FEI that it
     ceases to own directly or indirectly more than 50 per cent of the issued
     equity share capital of FEI. However, no Event of Default will occur under
     this clause 14 (h) unless 120 days have elapsed since the Lender ceased to
     own directly or indirectly more than 50 per cent of the issued equity share
     capital of FEI, or since the relevant written notice, whichever is latest.

(i)  CHANGE IN RELATIONSHIP BORROWERS: FEI ceases to own directly or indirectly
     100 per cent of the issued equity share capital of PEOI, unless such
     reduction is approved beforehand in writing by the Lender.

If at any time and for any reason (and whether within or beyond the control of
any party to this Agreement) any Event of Default has occurred then at any time
thereafter, the Lender shall by written notice to the Borrowers declare all
Outstanding Amounts, all unpaid accrued interest or fees and any other sum then
payable under this Agreement to be immediately due and payable, whereupon they
shall become so due and payable, unless the event which constitutes the Event of
Default is remedied before the Lender has sent the aforementioned notice and the
Lender is informed of such remedy by the Borrowers in writing before the Lender
sent such notice.

<PAGE>

EXHIBIT 10.12

However, if the Event of Default as referred to under Clause 14 (e) or 14 (g) is
capable of being cured, the Outstanding Amounts, all unpaid accrued interest or
fees and any other sum then payable under this Agreement, shall become due and
payable 5 days after the notice to declare all such amounts due and payable has
been sent by the Lender, unless the Lender explicitly mentions a different
period in such notice, and unless FEI Group did not meet the ratios mentioned in
Clause 13.4, based on latest monthly management report as FEI submits to the
Lender each month, in which case all amounts outstanding as referred to win
become due and payable immediately. If an Event of Default as referred to under
Clause 14 (e) or 14 (g) has
occurred, no Revolving Advances or draw downs form the Current Account will be
possible till such Event of Default is cured, unless approved by the Lender
beforehand.

At any time after such occurrence the Lender may, by notice in writing to the
Borrowers, declare that the Facility is cancelled and that all amounts
outstanding thereunder, if any, are immediately due and payable, together with
interest thereon and any other costs, charges and expenses. Such declaration
shall be effective forthwith.

The Borrowers jointly and severally under-take to indemnify the Lender against
any reasonable direct loss or expenses which any of them may sustain or incur as
a consequence of the occurrence of any Event of Default hereunder.

15.  CANCELLATION BY BORROWERS

15.1 NOTICE OF CANCELLATION

     FEI may declare on behalf of the Borrowers in writing that the Facility is
     cancelled in full or in part. If the Facility is cancelled in part, such
     notice shall state the new Maximum Amount (in US-Dollars). The cancellation
     will be effective on the date mentioned in the notice ("Cancellation
     date"). The Cancellation Date should be at least five (5) Business Days
     after receipt by the Lender of such notice.

15.2 PARTIAL CANCELLATION

     A partial cancellation will only become effective if on the Cancellation
     Date the Outstanding Amounts are less than the proposed amended Maximum
     Amount.

15.3 CANCELLATION IS IRREVOCABLE

     Any cancellation in accordance with this article 15 will be irrevocable.
     Any reduction of the Maximum Amount made in accordance with this Clause 15,
     will not be available for reborrowing.

<PAGE>

EXHIBIT 10.12

16   MISCELLANEOUS

16.1 Expenses

The Borrowers and the Lender will pay their own costs and expenses (including
taxes thereon and legal fees) incurred in connection with the preparation,
negotiation or entry into this Agreement and/or any amendment of, supplement to
or waiver in respect of this Agreement.

Where any repayment of principal by the Borrowers is made on a day which is not
an Interest Payment Date, the Borrowers shall pay all such amounts as shall be
necessary to compensate the Lender for any direct loss or expenses incurred by
it for the remainder (if any) of the then current Interest Period(s) as a result
of such prepayment unless such prepayment is made in compliance with Clause 6.2
sub (a) and the certificate of the Lender as to such amounts shall be conclusive
and binding on the Borrowers save for manifest error.

16.2 LAW AND JURISDICTION

This Agreement shall be governed by and construed in all respects in accordance
with the laws of The Netherlands. The Borrowers hereby irrevocably submit, in
respect of any suit, action or proceeding arising out of this Agreement, to the
non-exclusive jurisdiction of the Courts of the Netherlands.

16.3 REMEDIES AND OTHER WAIVERS

Save as otherwise provided in this Agreement no failure to exercise nor any
delay in exercising on the part of any Lender any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise of any right, power or privilege preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided are cumulative and not exclusive of any rights or
remedies provided by law.

16.4 ENTIRE AGREEMENT AND SCHEDULES

This Agreement constitutes the entire Agreement between the parties with respect
to the subject matter hereof as of the date of this Agreement and supersedes all
prior agreements, negotiations, representations and proposals whether written or
oral with respect to the credit facility contemplated herein. The Appendices to
this Agreement are incorporated in full in this Agreement and form part thereof.

<PAGE>

EXHIBIT 10.12

16.5 COMMUNICATIONS

All notices (including Notices), requests, demands or other communications to or
upon the parties hereto shall be in writing and deemed to have been duly given
or made when delivered (in the case of personal delivery or letter) and when
dispatched to the party to which the same is required or permitted to be Oven
under this Agreement, addressed as follows:

<TABLE>

<S>                                                    <C>
IF TO THE LENDER:
Koninklijke Philips Electronics N.V. as well as to:    Koninkfijke Philips Electronics N.V.
Corporate Treasury Department                          Corporate Treasury Department
Attn: Mr. Jan Maarten Ingen Housz                      Attn: Mrs Laura Munisteri
Building HRT-28                                        Building HRT-28
Rembrandt Tower, Amstelplein 1                         Rembrandt Tower, Amstelplein 1
P.O. Box 77900                                         P.O. Box 77900
1070 MX Amsterdam                                      1070 MX Amsterdam
The Netherlands                                        The Netherlands
Tel: 3120 59 77 350                                    Tel: 3120 59 77 363
Fax: 3120 59 77 357                                    Fax: 3120 59 77 370

IF TO THE BORROWERS:
FEI Company as well as to:                             FEI Company
Attn: Mr. Mark V. Allred                               Attn: Mr. Derek Garrett
7451 N.W. Evergreen Parkway,                           7451 N.W. Evergreen Parkway,
Hillsboro, Oregon, 97124-5830,                         Hillsboro, Oregon, 97124-5830,
United States of America                               United States of America
Tel: 1503 844 2666                                     Tel: 1503 844 2699
Fax: 1503 726 2720                                     Fax: 1503 726 2720

As well as to:
Philips Electron Optics International B.V. and         Philips Electron Optics International B.V.
Attn: Mr. Michel G. van Woesik                         Attn: Mr. Nico. H.W. Vrijenhoek
Achtseweg Noord 5                                      Achtseweg Noord 5
P.O. Box 218                                           P.O. Box 218
5600 NID Eindhoven                                     5600INID Eindhoven
The Netherlands                                        The Netherlands
Tel: 3140 276 63 47                                    Tel: 3140 276 60 34
Fax: 3140 276 6164                                     Fax: 3140 276 6164
Building AAE Philips                                   Electron Optics International B.V.

</TABLE>

17.  NOVATION

17.1 This Agreement shall benefit and bind the parties, their assignees and
     their respective successors. Any reference in this Agreement to any party
     shall be construed accordingly.

<PAGE>

EXHIBIT 10.12

17.2 The Borrowers may not novate or assign its rights or obligations under this
     Agreement without the prior written approval of the Lender.

17.2 The Lender may novate or assign its rights or obligations under this
     Agreement to a group company of the Lender (in the sense of article 2:24b
     of the Dutch Civil Code), unless such novation or assignment will have any
     adverse effects with respect to (one of) the Borrowers. In the event of an
     allowed novation or assignment the Borrowers will co-operate to effect such
     novation or assignment.

<PAGE>

EXHIBIT 10.12

IN WITNESS WHEREOF the parties hereto have executed this Agreement as per
February 17th, 1999.

FEI COMPANY

__________________________________          ____________________________________
V. Sarkissian                               Mr. Mark V. Allred
Title: Chief Executive Officer              Title: Corporate Controller
Date:                                       Date:

PHILIPS ELECTRON OPTICS INTERNATIONAL B.V.

__________________________________          ____________________________________
Mr. Nico H. W. Vrijenhoek                   Mr. Michel G. van Woesik
Title: General Manager                      Title:   Treasurer
Date:                                       Date:

KONINKLIJKE PHILIPS ELECTRONICS N.V.

__________________________________
Mr. J.M.L.M. Ingen Housz
Title:   Director Philips Corporate Treasury
Date:<PAGE>

EXHIBIT 10.14
CONFIDENTIAL

                           MASTER DIVESTMENT AGREEMENT

This master divestment agreement is made the 28th day of October, 1999

BY AND BETWEEN

FEI Company, having its registered office at 7451 NW Evergreen Parkway,
Hillsboro, Oregon, 97124-5830, USA ("FEI"), on the one hand,

and

Koninklijke Philips Electronics NV, having its registered office at
Groenewoudseweg 2, Eindhoven, The Netherlands, acting also to the benefit of its
worldwide subsidiaries ("Philips"), on the other hand.

WHEREAS in October 1996 Philips Electron Optics BV ("PEO") and Philips
Industrial Electronics International BV ("PIE") entered into a Heads of
Agreement for the future distribution by PIE of PEO's products; subsequently FEI
and Philips entered into various agreements on the basis of which (i) FEI
acquired certain electron optics business from Philips and (ii) ultimately
Philips Industrial Electronics International BV acquired the majority of shares
in FEI;

WHEREAS subsequently PIE changed its corporate name into Philips Business
Electronics International B.V. (PBE).

WHEREAS FEI acquired the sales and service activities in certain countries but
the parties agreed that in certain other countries, other companies within the
Philips group of companies ("Philips Group") would continue to act as
distributor for FEI's product range;

WHEREAS the parties hereto have now agreed to transfer all sales and service
activities carried on by the Philips Group at the date of this Agreement in all
remaining countries to FEI and terminate any and all Philips distributorships
and sell such sales and service activities as a going concern on the terms and
conditions set out in this Agreement.

NOW IT IS AGREED

                                    ARTICLE 1
                                   DEFINITIONS

In this Agreement the following expressions have the following meanings:

<PAGE>
                                       2

1.01      "AGREED FORM": a document in a form agreed between the parties prior
          to the entering into of this Agreement, the list of such documents
          being set forth in Article 4.02;

1.02      "AGREEMENT": the contract made herein between the parties including
          the Schedules and the Agreed Form documents;

1.03      "ASSETS": all assets and associated liabilities directly belonging to
          the Business, including trade accounts receivable, Books, Fixed
          Assets, Inventories, Contracts and Assigned IP;

1.04      "ASSIGNED IP": the technical information and commercial know-how which
          is used at the date hereof in the Business and which, for the
          avoidance of doubt, excludes any patents or patent applications and
          trademarks but includes all customers' lists, vendor lists, telephone
          numbers, technical know how, trade secrets, tradenames and copyrights
          in relation to the Business together with the exclusive right for FEI
          and any assignee to represent itself as carrying on the Business in
          succession to Philips;

1.05      "BOOKS": the books, records, documents of title, Employee Records and
          other documents which Philips uses exclusively in the Business as at
          the date hereof;

1.06      "BUSINESS": the marketing, sale and servicing of FEI products, as
          carried out at the date of this Agreement by various Local Philips
          Companies on the basis of distribution agreements;

1.07      "CLOSING": the completion of the transactions contemplated hereunder,
          as described in Article 4 on the respective Closing Dates;

1.08      "CLOSING ACCOUNTS" the accounts of the Business for the accounting
          reference period beginning on April 4, 1999 and ending on the
          respective Closing Date (comprising a NOC statement);

1.09      "CLOSING AMOUNT": the amount indicated in Article 3.02 to be paid by
          FEI to Philips on the respective Closing Date, in accordance with
          Article 4;

1.10      "CLOSING DATE": 5.00 p.m. on the date on which the respective Closing
          takes place;

1.11      "CONSISTENTLY APPLIED" means the consistent application of Philips
          Accounting Policies by the individual business organizations within
          the Business in the national sales organizations ("NSO's"). Such
          application shall be measured on the basis of the application of
          Philips Accounting Policies by such individual business organizations
          in their financial statements for the financial year 1998, as
          consolidated in the audited financial statements of Koninklijke
          Philips Electronics N.V. for the financial year 1998. Should any of
          such individual business organizations have applied different methods
          for the same item, but both such methods are acceptable under Philips

<PAGE>
                                       3

          Accounting Policies, then the only criterion for measuring whether or
          not Philips Accounting Policies have been consistently applied shall
          be whether each of the individual business organizations in question
          has applied those accounting policies consistently with those used in
          its own financial figures which were consolidated in the Annual Report
          1998 of Philips.

1.12      "CONTRACTS": all contracts (except employment agreements) to which a
          Local Philips Company is a party relating solely to the Business;

1.13      "COUNTRY AGREEMENT": the respective contract to be entered into prior
          to the Closing Date for the agreed upon transfer of the Local
          Activities from the Local Philips Company to the Local FEI Company,
          substantially in the form set forth in Schedule 1.13;

1.14      "CREDITORS": amounts owed by the Philips Group as at Closing solely in
          relation to the Business;

1.15      "DEBTORS": amounts owed to the Philips Group as at Closing solely in
          relation to the Business;

1.16      "DISCLOSURE LETTER": the letter (together with any schedules thereto)
          of even date making certain disclosures against the Warranties
          addressed by Philips to FEI for the purposes of Article 13.02;

1.18      "EMPLOYEES": those persons employed in each of the Local Philips
          Companies as per October 25, 1999 and listed on Schedule 1.18 who
          devote at least 50% of their working hours to the Business;

1.19      "EMPLOYEE RECORDS": all records in respect of the Employees;

1.20      "FIXED ASSETS": all service tools, furniture and other equipment used
          exclusively by the Philips Group for the purposes of the Business as
          at Closing (as the same are listed at Schedule 1.20);

1.21      "IFO" income from operation, excluding interest, taxation and
          extraordinary items as defined in the 1998 Annual Report of Philips;

1.22      "INVENTORIES": all inventories of materials and work-in-progress,
          packaging, consumables, service parts and other stock-in-trade held by
          the Philips Group for the purposes of the Business as at Closing;

1.23      "LIABILITIES": all liabilities solely relating to the Business
          including the Contracts but excluding real property leases and any
          tort liability arising from the actions of the Philips Group prior to
          or after the Closing and any breach of contract claim arising out of
          the actions of the Philips Group (unless due to the products purchased
          from

<PAGE>
                                       4

          the FEI Group) or a third party claiming damages solely because
          the Local Philips Company is selling the Business;

1.24      "LOCAL ACTIVITIES": the Assets, Business and Liabilities in a
          particular country which are to be transferred by a Local Philips
          Company to the respective Local FEI Company;

1.25      "LOCAL FEI COMPANY": a legal entity indicated by FEI in the respective
          country to which all Local Activities are to be transferred (whether
          it be a FEI subsidiary or a third party);

1.26      "LOCAL PHILIPS COMPANY": a (direct or indirect) subsidiary of Philips
          which has entered into a distributor/agency agreement with FEI or a
          subsidiary thereof, and which is to terminate such distributorship and
          to transfer the Local Activities on the basis of this Agreement (a
          list of countries is attached as Schedule 2.03);

1.27      "NOC" shall have the meaning in accordance with the definition as
          mentioned in the 1998 Annual Report of Philips: (in)tangible fixed
          assets, provisions, current assets (excluding cash and cash
          equivalents), current liabilities (excluding deferred tax positions,
          pension liabilities and interest bearing debt).

1.28      "PENSIONS SCHEDULE": the agreement relating to the pensions of those
          Employees who are members of a Pension Scheme at Closing;

1.29      "PENSION SCHEME": a local Philips pension fund arrangement, if any,
          for the benefit of Employees of the respective Philips entities.

1.30      "PHILIPS ACCOUNTING POLICIES" as set out in the Annual Report 1998 of
          Philips, and as applied by the Local Philips Companies;

1.31      "PRINCIPAL CLOSING AMOUNT" means the amount to be paid for the
          Businesses to be transferred on the Principal Closing Date;

1.32      "PRINCIPAL CLOSING DATE" means the date referenced in Article 4.01;

1.33      "PURCHASE PRICE": the total purchase price for the Business, being the
          Principal Closing Amount and the Second Closing Amount, as may be
          adjusted pursuant to Article 5.1;

1.34      "REFERENCE ACCOUNTS" the unaudited accounts of the Business for the
          accounting reference period which ended on the April 4, 1999
          (comprising a NOC statement), annexed hereto as Schedule 1.34;

1.35      "SECOND CLOSING AMOUNT" means the amount to be paid for the Businesses
          to be transferred on the Second Closing Date;

<PAGE>
                                       5

1.36      "SECOND CLOSING DATE" means November 26, 1999;

1.37      "SIGNING DATE": means the date on which this Agreement is signed.

1.38      "SITE AND OTHER SERVICES AGREEMENT": the agreement relating to the
          provision of site and other services by a Local Philips Company to a
          Local FEI Company;

1.39      "WARRANTIES": the warranties and representations contained in Schedule
          1.39.

In this Agreement words importing the singular include the plural and vice versa
and words importing gender include any other gender.

The headings of Articles are for ease of reference and shall not affect the
construction of this Agreement.

References in this Agreement to Articles or Schedules are references to clauses
of or schedules to this Agreement. The Schedules form part of this Agreement and
shall have the same force and effect as if expressly set out in the body of this
Agreement.

                                    ARTICLE 2
                         AGREEMENT FOR SALE AND TRANSFER

2.01      On the terms and subject to the conditions of this Agreement, Philips
          hereby sells and FEI hereby purchases and assumes the Business as a
          going concern and comprising the Assets and Liabilities.

2.02      Each acquisition of any Local Activity shall be made on substantially
          the terms set out in the form of the model Country Agreement, subject
          to such modifications and amendments as may be necessary in the case
          of the respective countries, including any which may be necessary to
          take account of any legal requirements in a country in which the
          respective Business is conducted. Philips and FEI agree and warrant to
          procure

          2.02.1    (in the case of the Philips Group) that its respective Local
                    Philips Companies owning the respective Businesses will
                    comply with the respective Country Agreement and become a
                    signatory to such agreement prior to or on the respective
                    Closing Date;

          2.02.2    (in the case of FEI) that its respective Local FEI Companies
                    or appointed third parties through which FEI will acquire
                    the respective Businesses will comply with the respective
                    Country Agreement and become a signatory to such agreement
                    prior to or on the respective Closing Date.

<PAGE>
                                       6

2.03      The list of countries to be transferred on the Principal Closing Date
          and the Second Closing Date respectively is attached hereto as
          Schedule 2.03. The Local Philips Companies in these 27 countries will
          abstain from distributing electron miscroscopes in their respective
          territory for a period of three years as from the respective Closing
          Date.

                                    ARTICLE 3
                                 PURCHASE PRICE

3.01      In consideration for the purchase of the Business, FEI shall pay to
          Philips the Purchase Price.

3.02      On the Principal Closing Date , no payment shall take place and on the
          Second Closing Date, FEI shall pay the sum of the Principal Closing
          Amount (being EUR -142,000; minus one hundred and forty two thousand,
          excluding VAT) and the Second Closing Amount (being EUR 1,764,000; one
          million, seven hundred and sixty four thousand EURO's; excluding VAT;
          totalling 1,622,000 EURO) to Philips by electronic funds transfer in
          immediately available funds, to the credit of such account of Philips
          with a Dutch clearing bank as Philips shall notify in writing to FEI
          not less than five business days prior to each Closing. The allocation
          of the Purchase Price to the respective Local Activities is defined in
          Schedule 3.02.

                                    ARTICLE 4
                      CLOSING AND COVENANTS TO CLOSING DATE

4.01      The parties undertake commercial best endeavours to sign all Country
          Agreements by the end of business on October 28 and have the Principal
          Closing occur by no later than October 31, 1999 and the Second Closing
          by November 26, 1999. In case of a delay in a either South Africa or
          Brasil, Philips will continue as FEI's distributor in these countries
          through December 31, 1999. In case a Country Agreement for South
          Africa or Brasil is not signed as per December 31, 1999, the
          pertaining Local Activities will be terminated at the sole risk and
          expense of FEI and the Business will be deemed transferred as from
          December 31, 1999. In case of a delay in the other countries after the
          agreed Closing Date, Philips will continue to act for the sole risk
          and account of FEI, under sole managerial decision-making of FEI
          appointed personnel; Philips will cause such Business to continue
          operation in a normal, business like fashion in accordance with past
          practice and will not cause or permit its Businesses to enter into any
          transaction outside the ordinary course of business. However, in case
          within five working days from November 26 next, in any country a
          Closing can still take place, Philips will waive its rights as regards
          acting for the sole risk and

<PAGE>
                                       7

          account of FEI and the Closing will take place (with retroactive
          effect) as of November 26. In case a certain Country Agreement is not
          signed as per December 31, 1999, the pertaining Local Activities will
          be terminated at the sole risk and expense of FEI and the Business
          will be deemed transferred as from the respective Closing Date.

4.02      On Closing, each party shall cause to be delivered to the other the
          following documents in the Agreed Form (with changes agreed to by the
          parties):

          *all applicable signed Country Agreements (facsimile copies thereof).
          *the list of Employees and if applicable, a Pensions Schedule

          *such other documents as are material to the Business and necessary to
          effect the transactions contemplated under this Agreement and each
          Country Agreement.

4.03      Philips hereby agrees and declares that it will execute and deliver
          and procure the execution and delivery of any other documents and take
          any other steps as shall reasonably be required by FEI to vest the
          Local Activities in FEI or the Local FEI Company and transfer the
          Assigned IP. FEI hereby agrees and declares that it will execute and
          deliver and procure the execution and delivery of any other documents
          and take any other steps as shall reasonably be required by Philips to
          vest the Local Activities in FEI or the Local FEI Company. If and to
          the extent the Local Philips Company has provided its customers with a
          prepayment/ bankguarantee, then the Local FEI Company shall undertake
          to replace same by a similar prepayment/bankguarantee acceptable to
          the customer, or, in case customer refuses, provide same as a
          guarantee to the Local Philips Company.

4.04      This agreement becomes effective and binding upon the parties as from
          the Signing Date. The Parties agree as follows with respect to the
          period between the Signing Date and the respective Closing Date:

          a. Each Party will file (and each Party will cause its Group Companies
          to file) any notification and report forms and related material that
          each Party or its Group Company may be required to file with any
          governmental authority, will use its best commercial efforts to obtain
          the expiration or early termination of the applicable waiting period
          (or any extension thereof) for any required pre-acquisition or
          pre-merger notice to such authority, and will make any further
          filings, including the submission of any additional information or
          documentary material, pursuant thereto that may be necessary.

          b. Philips will cause its Businesses to continue operation in a
          normal, business like fashion in accordance with past practice and
          will not cause or permit its Businesses to enter into any transaction
          outside the ordinary course of business.

                                    ARTICLE 5
                     REFERENCE ACCOUNTS AND CLOSING ACCOUNTS

5.01      REFERENCE ACCOUNTS

<PAGE>
                                       8

          Philips has delivered to FEI the Reference Accounts of the Business as
          of April 4, 1999, attached hereto as Schedule 1.32. The financial
          statements referred in this Article 5.1 have been prepared by Philips.
          Since the Business has not been accounted for separately within
          Philips, FEI understands that these financial statements have required
          allocations in which Philips utilized its reasonable judgement.
          Philips represents that the Reference Accounts have been prepared in
          accordance with the Philips Accounting Policies Consistently Applied.

5.02      CLOSING ACCOUNTS
          Philips shall prepare the Closing Accounts using the Philips
          Accounting Policies Consistently Applied. Such Closing Accounts shall
          be delivered to FEI by Philips as soon as possible and in any event no
          later than sixty (60) days after the respective Closing Date.

          FEI shall be entitled to review the Closing Accounts in order to
          establish that the agreed accounting policies (the Philips Accounting
          Policies) have indeed been Consistently Applied.

          In case of such audit, FEI shall provide a copy of its full report to
          Philips within 60 days after receipt by FEI of the Closing Accounts.
          Unless FEI within twenty (20) days after delivery of said report,
          notifies Philips in writing that it disputes the Closing Accounts or
          any portion thereof and specifies the basis for its dispute, the
          Closing Accounts shall become final and binding on the parties for the
          purpose of determining the corrective payment as referred to in
          Article 5.3 hereof.

5.03      PROCEDURE FOR DISPUTE AND THE CLOSING ACCOUNTS
          In the event FEI notifies Philips in accordance with Article 5.2, that
          a dispute does exist in respect of the Closing Accounts and if FEI and
          Philips are unable to resolve such dispute within thirty (30) business
          days after any such notification has been given, the dispute shall be
          submitted to a jointly appointed independent auditor, ("Arbitrator")
          or in case of disagreement a request for the appointment shall be
          submitted to the President of the Dutch Accounting Federation. Should
          FEI notify Philips that a dispute does exist in respect of the Closing
          Accounts, then Philips shall be entitled to bring into the dispute any
          other items whether or not those items have been valued. A final
          settlement shall fully take these positions into account in
          determining the amount of the settlement or the award, as the case may
          be. Philips and FEI shall provide full cooperation to the Arbitrator
          and the Arbitrator shall be asked to make a final and binding
          determination as to the matter or matters in dispute within sixty (60)
          days after the dispute is presented to him (unless the Arbitrator and
          both parties agree that a longer period is appropriate) after its
          appointment. The Arbitrator shall use the Philips Accounting Policies,
          Consistently Applied as the basis for its determination, unless same
          have been explicitly deviated from in the main body of this Agreement.

<PAGE>
                                       9

         The Arbitrator shall confine himself only to unresolved adjustments.
         The Arbitrator, in reaching a decision, shall provide a written
         explanation of his conclusions to each Party, and his determination
         shall be conclusive and binding upon the Parties. The Arbitrator will
         allocate between claimant and defendant his fees and expenses.

5.04      CLOSING ACCOUNTS AND SETTLEMENT FOR THE PERIOD BETWEEN APRIL 4, 1999
          AND CLOSING DATE
          FEI shall be entitled to all of the Assets and shall assume all of the
          Liabilities pertaining to each of the respective Business as of the
          respective Closing Date. In addition, the Parties will settle the NOC;
          the respective settlement shall be determined on the basis of the
          Reference Accounts and the Closing Accounts as set forth hereinafter.

5.05      Once the respective Closing Accounts have been determined in
          accordance with the above, any differences in the NOC resulting from a
          comparison of the Reference Accounts and the respective Closing
          Accounts will give rise to an adjustment, pursuant to which:

          (i) Philips shall pay the difference to FEI in the event the NOC in
          the Closing Accounts is lower than the NOC in the Reference Accounts,
          such payment on an after tax basis only if Philips is obliged to pay
          the related taxes and the payment is not tax deductible;

          (ii) FEI shall pay the difference to Philips in the event the NOC in
          the Closing Accounts is higher than the NOC in the Reference Accounts,
          such payment on an after tax basis if Philips is obliged to pay the
          related taxes and the payment is not tax deductible.

          Any payment to be made hereunder is subject to an interest charge at
          EURIBOR (3 months rate at Closing) + 2% calculated as from the Closing
          Date until the day payment is actually received.

                                    ARTICLE 6
                                    CONTRACTS

6.01      As further consideration for the sale and purchase hereunder and
          subject as hereinafter mentioned, FEI undertakes with Philips:

          6.01.1    that it will with effect from the Closing Date carry out,
                    perform and complete all obligations and liabilities created
                    by or arising under the Contracts; and

          6.01.2    that it will indemnify Philips and any other member of the
                    Philips Group fully at all times from and against any and
                    all actions,

<PAGE>
                                       10

                    proceedings, costs, claims, demands, expenses and
                    liabilities which may be suffered or incurred by them as a
                    result of (a) any failure by FEI so to do, (b) any tort or
                    breach of contract claim due to the acts or omissions of the
                    Local FEI Company, including but not limited to any breach
                    of any representation, warranty or covenant set out herein.

          And Philips undertakes with FEI:

          6.01.3    that it will indemnify FEI and any other member of the FEI
                    Group fully at all times from and against any and all
                    actions, proceedings, costs, claims, demands, expenses and
                    liabilities which may be suffered or incurred by them as a
                    result of any tort or breach of contract claim due to
                    Philips or the Local Philips Company including but not
                    limited to any breach of any representation, warranty or
                    covenant set out herein.

6.02      If any claim shall be made by any third party (i) against Philips (or
          a Philips Company) in respect of which Philips (for the purpose of
          this Article deemed to include a Philips Company, as the case may be)
          seeks to be indemnified under Article 6.01 or (ii) against FEI (or an
          FEI Company) in respect of which FEI (for the purpose of this Article
          deemed to include an FEI Company, as the case may be) seeks to be
          indemnified under Article 6.01 (hereinafter the party seeking to be
          indemnified being "the Indemnitee", and the party requested to
          indemnify "the Indemnitor"), then the Indemnitee shall promptly inform
          the Indemnitor and:

          6.02.1    the Indemnitor shall have the right upon written notice to
                    the Indemnitee to have the conduct of all litigation or
                    other proceedings ("proceedings") in respect thereof and in
                    that connection the Indemnitee shall give or cause to be
                    given to the Indemnitor all such assistance as the
                    Indemnitor may reasonably require in disputing any such
                    claim and conducting proceedings and shall instruct such
                    solicitors or other professional advisers as the Indemnitor
                    may nominate (and to whom the Indemnitee shall have no
                    reasonable objection) to act on behalf of the Indemnitee but
                    in accordance with the instructions of the Indemnitor;

          6.02.2    the Indemnitor shall keep the Indemnitee fully and promptly
                    informed of the conduct of any proceedings of which it has
                    conduct, shall consult the Indemnitee on any matter which is
                    or is likely to be material in relation thereto and shall
                    take account of all reasonable requirements of the
                    Indemnitee in relation thereto;

          6.02.3    neither the Indemnitee (where the Indemnitee is responsible
                    for the conduct of any proceedings) nor the Indemnitor
                    (where such proceedings are delegated to it in accordance
                    with 6.02.1 above) shall

<PAGE>
                                       11

                    make any settlement or compromise of the claim which is the
                    subject of proceedings nor agree to any matter in the
                    conduct of proceedings which may affect the amount of the
                    liability in connection with such claim without the prior
                    approval of the Indemnitor or, as the case may be, the
                    Indemnitee , such approval not to be unreasonably withheld
                    or delayed;

          6.02.4    where the Indemnitor takes over the conduct of any
                    proceedings pursuant to the provisions of 6.02.1 above, the
                    Indemnitor shall indemnify and keep the Indemnitee
                    indemnified in respect of all liabilities and out-of-pocket
                    costs, charges and expenses properly incurred by the
                    Indemnitee as a consequence of such proceedings, save to the
                    extent that such costs, charges or expenses are recovered
                    from another party to the proceedings.

6.03      Insofar as the benefit or burden of any Contracts or the benefit of
          any other Asset, or component of Liability cannot effectively be
          assigned by Philips to FEI or assumed by FEI except by an agreement of
          novation with the agreement or consent of any other party thereto or
          of any third party and, even though the Local FEI Company has
          requested the Local Philips Company to procure same, such novation,
          agreement or consent shall not have taken place or have been obtained
          prior to Closing (each be a "Nonassigned Right"):

          6.03.1    Philips shall use all reasonable endeavours in assisting FEI
                    to procure that agreement or consent as aforesaid is
                    obtained, wherever FEI requests same;

          6.03.2    unless and until the said Nonassigned Rights shall be
                    novated or assigned as aforesaid Philips shall:

                    6.03.2.1  hold the same in trust for FEI and FEI shall (if
                              sub-contracting is permissible and lawful under
                              the Contract(s) in question) perform all the
                              obligations of Philips thereunder as Philips'
                              sub-contractor; and

                    6.03.2.2  (so far as it lawfully may) give to FEI the
                              benefit and burden to the same extent as if the
                              same had been novated, act under the reasonable
                              direction of FEI and account to and be indemnified
                              by FEI accordingly;

          6.03.3    if any of the Nonassigned Rights does not permit
                    sub-contracting the parties will make such other
                    arrangements between themselves as may be permissible to
                    implement as far as possible the effective transfer of the
                    benefits and obligations of such Nonassigned Right to FEI;
                    and

<PAGE>
                                       12

          6.03.4    unless and until the Nonassigned Rights shall be novated or
                    assigned Philips will (so far as it lawfully may) give all
                    reasonable assistance to FEI to enable FEI to enforce
                    Philips' rights thereunder.

6.04      As from the Closing Date, each party will afford the other and their
          affiliates with all reasonable assistance in connection with the
          administration of and collection of sums owing (subject to
          reimbursement of all out-of-pocket expenses but otherwise free of
          charge) to the other party. Provided, further, that the assisting
          party shall give to the claiming party an accounting of all amounts
          but in no event shall the assisting party assume any liability for any
          outstanding obligation owed, except to the extent it does not comply
          with the provisions of this section. This section will not be
          construed as obligating the Local FEI Company to continue any Business
          or Local Activity for any period subsequent to the Closing.

6.05      All notices, correspondence, information, orders or inquiries relating
          to the Contracts or Business which are received by Philips or a Local
          Philips Company on or after Closing shall (to the extent to which they
          relate to the Business) promptly be passed to FEI or the respective
          Local FEI Company.

6.06      For a short period and on conditions set forth in Schedule 6.06, the
          Local FEI Companies (those remaining part of the FEI Group of
          Companies) are authorized to continue using the Local Philips
          Company's name and letterhead in order to execute a smooth and
          efficient transition to the new company.

                                    ARTICLE 7
                                    EMPLOYEES

7.01      It is the intention of the parties that the Businesses are transferred
          on a `going concern' basis and henceforth that the Employees are
          transferred to the Local FEI Company by means of the Country
          Agreements. If and to the extent such transfer can not take place by
          means of executing a Country Agreement, FEI undertakes that it and/or
          the Local FEI Company will timely offer all the Employees employment.
          It is understood that said Employees shall no longer have resort under
          any individual employment agreement and any Philips' Collective Labor
          Agreements or similar agreements after the respective Closing Date,
          unless agreed otherwise. Accordingly, the Local Philips Company's
          rights, powers, duties, liabilities and obligations in respect of any
          contract of employment with the Employees in force immediately before
          Closing shall be automatically transferred to the Local FEI Company by
          operation of law (wherever possible).

          It is agreed that salary rights (including bonus, accrued vacation
          rights, etc) accrued by the Employees until the Closing Date shall
          automatically transfer to the Local FEI Company, unless and to the
          extent same exceed the Local Philips Company's policies at Closing

<PAGE>
                                       13

7.02      FEI shall be responsible for and shall at all times from the Closing
          Date indemnify and hold Philips fully and effectively indemnified from
          and against all costs, claims, demands, proceedings and expenses
          incurred or suffered in connection with claims by all or any of the
          Employees in respect of any period of employment from and after the
          Closing Date or the termination of the employment of all or any of the
          Employees by FEI or the Local FEI Company other than (a) as a result
          of a tort, any negligent act or omission of Philips prior to Closing,
          or (b) as set forth in Schedule 4.6 to a Country Agreement in case it
          pertains to a `shared' Employee listed therein. Philips shall at all
          times hereafter indemnify and hold FEI fully and effectively
          indemnified from and against all costs, claims, demands, proceedings
          and expenses incurred or suffered in connection with claims by all or
          any of the Employees in respect of any period of employment up to the
          Closing Date.

7.03      The parties anticipate that certain Local Companies will wish to
          ensure the continuation of the services of (a) certain Philips
          employees who will not be transferred and (b) certain Employees who
          should continue to serve Philips Analytical.

          In such cases, the Country Agreement will contain a consultancy or
          local services agreement arranging for such continuation of service
          provision to the other, which shall be substantially in the form as
          the model attached hereto as Schedule 7.03.

                                    ARTICLE 8
                                    PENSIONS

8.01      Entitlements to pension benefits, termination benefits, severance
          indemnities and retiree medical benefits as accrued with occupational
          plans of Philips by the employees concerned up to the Closing Date are
          as to their funding either funded with a company pension fund,
          insured, book reserved plan or financed otherwise. Depending on the
          funding made the following will apply:

          A) FUNDING EFFECTUATED BY WAY OF A PENSION SCHEME:
          With respect to the pensionable service of the employees concerned up
          to the Closing Date the employees participating in the Philips'
          Pension Scheme will become entitled to a deferred pension (also known
          as a paid-up policy) in accordance with the rules and regulations of
          the particular Pension Scheme. If requested by FEI, Philips will make
          reasonable endeavours to have the liabilities (and associated assets)
          transferred by such Pension Scheme to a funding vehicle to be
          indicated by FEI, subject to the necessary approvals being obtained,
          and in accordance with the rules and regulations of the relevant
          Pension Scheme.

          B) FUNDING EFFECTUATED BY WAY OF AN INSURANCE:

<PAGE>
                                       14

          In case the entitlements have been insured Philips will make
          reasonable efforts, if requested by FEI, to have the liabilities
          accrued up to the Closing Date transferred to a funding vehicle to be
          indicated by FEI, subject to the necessary approvals being obtained
          and in accordance with applicable legislation.

          C) FUNDING EFFECTUATED BY WAY OF A BOOK RESERVE WITH PHILIPS:
          In those cases where entitlements have been taken care of by way of a
          book reserve Philips shall include a provision in the Reference
          Accounts of the local Business which is equal to the actuarial present
          value of rights accrued up to Closing Date as calculated by Philips
          under the relevant local book reserve system.

          D) FUNDING OTHERWISE:
          If entitlements have not been funded according to A, B or C above, a
          comparison will be made between the liability value of the rights as
          accrued up to the Closing Date and the present value of the accrued
          amounts included in the Reference Accounts; the difference between the
          two will be taken into consideration as a price adjustment.

8.02      In principle the Parties hereto will undertake all reasonable
          commercial endeavours to try to obtain the necessary approvals in
          order to support a temporary continuation of the affiliation to the
          plans as indicated under A and B (note: under C and D, is excluded),
          subject to local (statutory and Pension Scheme) rules and regulations.

                                    ARTICLE 9
                          INTELLECTUAL PROPERTY RIGHTS

9.01      All Assigned IP shall transfer at Closing. Except for Assigned IP, no
          other intellectual property rights are transferred or licensed by
          means of this Agreement.

                                   ARTICLE 10
                             SITE AND OTHER SERVICES

10.01     A Local Philips Company may provide to the Local FEI Company such site
          and other services, if any, in accordance with the provisions of the
          respective Local Agreement.

                                   ARTICLE 11
                       DISCONTINUATION OF DISTRIBUTORSHIPS

11.01     By signing a Country Agreement, each existing distribution or agency
          agreement between the Local Philips Company and FEI or any of its
          affiliates is terminated as from the respective Closing Date.

<PAGE>
                                       15

                                   ARTICLE 12
                                    TAXATION

12.01     The Country Agreements will contain one of the clauses set forth below
          (depending on whether they are located within or outside the European
          Union):

          {{FOR THE EU COUNTRIES:}}
          Parties agree that the transaction as set forth herein in principle
          qualifies as a totality of assets as mentioned in article 6 - 8 of the
          Sixth Directive. This implies that in principle no VAT is due. If
          however article 6-8 of the Sixth Directive is not applicable or the
          tax authorities would at any moment judge that article 6-8 is not
          applicable, Philips will be allowed to charge VAT to the Local FEI
          Company, which will as then immediately be paid by the Local FEI
          Company to Philips.

          {{FOR THE NON EU COUNTRIES:}}
          All prices are excluding any VAT, sales tax, import tax, customs duty
          or any other kind of similar tax (hereinafter referred to as "Turnover
          Tax").

          If any payment to be made by Local FEI Company to Philips is
          subject to a Turnover Tax, Philips will invoice this Turnover Tax to
          Local FEI Company on the original invoice. If to the contrary any
          invoice by Philips to Local FEI Company has been made in error without
          any such Turnover Tax, Philips shall promptly notify Local FEI Company
          of such event and may at any time issue a separate invoice for such
          Turnover Tax which invoice shall be paid by Local FEI Company.

12.02     FEI will indemnify and hold harmless a Local Philips Company on an
          after tax basis if and to the extent such Local Philips Company is
          obliged by local tax authorities to make payments directly related to
          FEI's transfer pricing practiced prior to the Closing Date.

                                   ARTICLE 13
                                   WARRANTIES

13.01     This Agreement has been entered into by FEI in reliance upon the
          Warranties to the intent that each of the Warranties shall be
          construed as a separate and independent Warranty so that FEI shall
          have a separate claim and right of action in respect of every breach
          of each Warranty.

13.02     No claim shall be made by FEI for breach of any of the Warranties or
          other provisions of this Agreement if the fact, omission, circumstance
          or occurrence giving rise to or forming the basis of the claim has
          been fairly disclosed to FEI in the Disclosure Letter delivered at
          least five days prior to Closing (but updated by Philips prior to
          Closing) or was otherwise known prior to the date hereof.

<PAGE>
                                       16

13.03     No claim shall be made by FEI for breach: (i) of the covenants in
          Section 5.02 that the Closing Accounts will be prepared in accordance
          with Philips Accounting Policies Consistently Applied (the "NOC
          Financial Covenant"), unless such claim is in repsect of one single
          matter and it is for an amount in excess of 5% of the asset component
          of the applicable NOC for the Local Activity transferred and (ii) of
          any of the other Warranties or other provisions of this Agreement
          unless such claim is in respect of one single matter and it is for an
          amount in excess of EUR 25,000.

13.04     No claim shall be made by FEI for breach of any of the Warranties or
          other provisions of this Agreement unless the aggregate loss or damage
          (in respect of one or more matters) exceeds EUR 125,000 in which event
          a claim in respect of the excess over EUR 25,000 may be made;
          provided, however that this limitation shall not apply to breaches of
          the NOC Financial Covenant.

13.05     The liability of Philips in respect of the aggregate of all the claims
          made by FEI for breach of any of the Warranties or other provisions of
          this Agreement shall not exceed the Purchase Price.

13.06     No claim may be brought by FEI for breach of any of the Warranties or
          other provisions of this Agreement unless written notice thereof shall
          have been given to Philips accompanied by reasonable particulars of
          the claim including the amount of the claim within 15 months of the
          Principal Closing Date.

13.07     No claim shall be made by FEI for breach of any of the Warranties or
          other provisions of this Agreement in respect of any matter to the
          extent that the subject matter of the claim shall be tax deductible,
          and/or can be recovered in whole or in part by FEI under a policy of
          insurance

13.08     If any claim for breach of any of the Warranties is based upon a
          liability of FEI which is contingent only, Philips shall not be liable
          hereunder to make any payment to FEI unless and until such contingent
          liability becomes an actual liability and is discharged.

13.09     Where any claim is made by a third party against FEI in relation to
          which it appears that Philips is or may be liable hereunder and FEI
          claims indemnification from Philips under this Article 13, FEI shall
          as soon as practicable give notice thereof to Philips and transfer to
          Philips' sole control the defense of such claim and FEI shall take
          such action as Philips may reasonably require to avoid, dispute,
          resist, appeal against, compromise or defend the claim and any
          adjudication in respect thereof and FEI shall render to Philips all
          such assistance as it may reasonably request in relation to such claim
          including instructing such professional advisers as Philips may
          nominate to the intent that the conduct of such claim shall be
          delegated to Philips entirely.

13.10     Where any third party is liable to FEI in relation to any matter which
          has given rise to a liability on the part of Philips hereunder, FEI
          shall procure that all reasonable

<PAGE>
                                       17

          endeavours are used to recover any amounts due from any such third
          party and shall forthwith upon such recovery reimburse Philips an
          amount equal to any sum paid by it in respect of such liability
          subject to a deduction of the net (i.e. out of pocket) expenses
          incurred by FEI.

13.11     Any sum recovered from Philips pursuant to any claim under the
          Warranties will be deemed to be a reduction of the Purchase Price and
          shall be deemed to reduce the amount apportioned to the Asset(s) to
          which it most closely relates.

13.12     Philips shall not be liable hereunder and no claim or claims shall be
          made against it in relation to any breach or non-fulfillment of any of
          the Warranties which occurs as a result of or is otherwise
          attributable to:

          -         any matter provided for under the terms of this Agreement or
                    carried out in the implementation hereof;

          -         any voluntary act of FEI carried out after the date hereof;

          -         any act, matter or thing done or omitted to be done by or at
                    the written request or with the written approval of FEI; or

          -         any legislation not in force at the date hereof or any
                    change of law or administrative practice which takes effect
                    retroactively.

                                   ARTICLE 14
                              ACCESS TO INFORMATION

14.01     Each Party shall give the other access to (and the opportunity to make
          copies of) all data and information, including all updates and
          amendments thereof existing at the Closing Date, which form part of or
          relate to any item, matter or part thereof transferred pursuant to
          this Agreement and will provide all reasonable assistance to the other
          to enable it to execute financial reporting and finalize tax returns
          for all periods prior to the Closing Date.

                                   ARTICLE 15
                                 CONFIDENTIALITY

15.01    The parties agree that the contents of this Agreement and all
         information disclosed by either party to the other relating to the
         business of either party (including the Business) shall remain
         confidential and, save as required by any applicable rules of any Stock
         Exchange or other government department or similar authority or court
         or tribunal of competent jurisdiction (in which event the party
         required to make a disclosure shall give prior written notice to the
         other of such required disclosure),

<PAGE>
                                       18

          shall not be used or communicated to any other person whatsoever
          except professional advisers in confidence without the prior written
          agreement of the parties and then only to such extent as may be
          reasonably necessary to enable the parties to carry out their
          obligations or enforce their rights under this Agreement. Save as
          aforesaid, no announcement or publicity relating thereto shall be made
          or issued at any time by either party without the prior written
          consent of the other. The parties further agree that the obligations
          in this Article shall survive Closing of this Agreement for so long as
          such information is not (otherwise than by breach of any obligation of
          confidentiality) in the public domain.

                                   ARTICLE 16
                                      COSTS

16.01     Save as otherwise agreed all expenses incurred by or on behalf of the
          parties, including all fees of agents, solicitors, accountants and
          actuaries employed by either of the parties in connection with the
          negotiation, preparation and execution of this Agreement and related
          agreements shall be borne solely by the party which incurred them.

                                   ARTICLE 17
                                     NOTICES

17.01     All notices, requests and other communications hereunder shall be in
          writing and shall be deemed to have been duly given if addressed, and
          delivered by hand, with recorded delivery, or sent by registered mail,
          with postage pre-paid, or sent by facsimile and confirmed by
          registered mail, with postage pre-paid, to the addresses set forth in
          Article 17.03 (or to such other address as may be given by written
          notice).

17.02     Any such communication shall be deemed to have been made to the other
          party two days from the date of posting (if by letter) and if by
          facsimile transmission on the day of such transmission.

17.03     If to Philips, addressed to:

          Koninklijke Philips Electronics NV
          Groenewoudseweg 1
          5621 BA Eindhoven
          The Netherlands
          marked for the attention of Corp. Legal Dept.

          If to FEI, addressed to:

          FEI Company

<PAGE>
                                       19

          7451 NW Evergreen Parkway,
          Hillsboro, Oregon, 97124-5830
          USA
          marked for the attention of the General Counsel

                                   ARTICLE 18
                              CONDITIONS TO CLOSING

18.01     CONDITIONS TO THE OBLIGATIONS OF PHILIPS AND FEI
          The obligations of the parties hereto to effect the Closing are
          subject to the satisfaction (or waiver) prior to the respective
          Closing of the following conditions:

          (a) BOARD APPROVALS. At the Board Meeting of FEI, the Board Members of
          FEI shall have voted to approve (i) the Agreement and the intended
          transaction, and (ii) any further actions necessary to consummate the
          transaction. At the Board of Management Meeting of Philips, the Board
          Members shall have voted to approve (i) the Agreement and the intended
          transaction and (ii) any further actions necessary to consummate the
          transaction.

          (b) NO INJUNCTIONS. There shall not (i) be in effect any statute,
          regulation, order, decree or judgment of any governmental entity which
          makes illegal or which enjoins, prevents in any material respect or
          imposes any burdensome condition or restriction as a consequence of
          the consummation of the transactions contemplated by this Agreement or
          (ii) have been commenced or threatened in writing, and shall be
          continuing, any action or proceeding by any governmental entity which
          seeks to prevent, enjoin in any material respect or imposes any
          burdensome condition or restriction as a consequence of the
          transactions contemplated by this Agreement;

          (c) WORKERS COUNCIL. All required employee consultation procedures
          shall have been pursued to the extent that they can no longer lead to
          a substantial change or delay in the transactions contemplated hereby.

18.02     CONDITIONS TO THE OBLIGATIONS OF FEI
          The obligation of FEI to effect the Closing is subject to the
          satisfaction (or waiver by FEI) prior to the respective Closing, of
          the following conditions:

          (a) REPRESENTATIONS AND WARRANTIES. Each of the representations and
          warranties of Philips contained herein that is qualified by
          materiality shall be true and correct, and each of the representations
          and warranties of Philips that is not so qualified shall be true and
          correct in all material respects, in each case as if made as of the
          Closing (except that representations and warranties that are made as
          of a specific date need be true or true in all material respects, as
          the case may be, only as of such date), and FEI shall have received a
          certificate to such effect dated the Closing Date and executed by a
          duly authorized officer of Philips;

          (b) COVENANTS. The covenants and agreements of Philips to be performed
          on or prior to the Closing shall have been duly performed in all
          material respects, and FEI shall have received a certificate to such
          effect dated the Closing Date and executed by a duly authorized
          officer of Philips;

<PAGE>
                                       20

18.03     CONDITIONS TO THE OBLIGATIONS OF PHILIPS
          The obligation of Philips to effect the Closing is subject to the
          satisfaction (or waiver) prior to the respective Closing of the
          following conditions:

          (a) REPRESENTATIONS AND WARRANTIES. Each of the representations and
          warranties of FEI contained herein that is qualified by materiality
          shall be true and correct, and each of the representations and
          warranties of FEI that is not so qualified shall be true and correct
          in all material respects, in each case as if made as of the Closing
          (except that representations and warranties that are made as of a
          specific date need be true or true in all material respects, as the
          case may be, only as of such date), and Philips shall have received a
          certificate to such effect dated the Closing Date and executed by a
          duly authorized officer of FEI;

          (b) COVENANTS. The covenants and agreements of FEI to be performed on
          or prior to the Closing shall have been duly performed in all material
          respects, and Philips shall have received a certificate to such effect
          dated the Closing Date and executed by a duly authorized officer of
          FEI.

                                   ARTICLE 19
                                  MISCELLANEOUS

19.01     Failure by either party to exercise or enforce any right conferred by
          this Agreement shall not be deemed to be a waiver of any such right
          nor operate so as to bar the exercise or enforcement thereof or of any
          other right on any other occasion.

19.02     This Agreement represents the entire understanding between the parties
          in relation to the subject matter hereof and supersedes all agreements
          and representations made by either party, whether oral or written and
          this Agreement may only be modified if such modification is in writing
          and signed by a duly authorized representative of each party. This
          Agreement shall prevail over any inconsistent terms and conditions in
          any other agreement between the parties or referred to in
          correspondence or elsewhere (including Country Agreements) and any
          conditions or stipulations to the contrary are hereby excluded and
          extinguished.

19.03     The parties shall, and shall use all reasonable endeavours
          respectively to procure that any necessary third party shall, do
          execute and perform all such further deeds, documents, assurances,
          acts and things as either party hereto may reasonably require by
          notice in writing to the other party to carry the provision of this
          Agreement into full force and effect.

19.04     This Agreement shall be governed by and construed and interpreted in
          accordance with the law of THE NETHERLANDS, and the parties hereby
          agree that all matters arising out of or in connection with this
          Agreement shall be subject to UNCITRAL Arbitration which shall take
          place in Amsterdam.

<PAGE>
                                       21

IN WITNESS WHEREOF the parties or their authorized representatives have set
their hands the day and year first above written.

KONINKLIJKE PHILIPS ELECTRONICS             FEI COMPANY
N.V.

______________________________________      _________________________
Name:                                       Name:
Title:                                      Title:

<PAGE>
                                       22

<TABLE>
<CAPTION>

LIST OF SCHEDULES:
<S>                        <C>
Schedule 1.13:             Model Country Agreement
Schedule 1.18:             List of Employees as per October 25, 1999
Schedule 1.20:             List of all Fixed Assets
Schedule 1.34:             Reference Accounts
Schedule 1.39:             Warranties and Representations
Schedule 2.03:             List of countries for Principal and Second Closing respectively
Schedule 3.02:             The allocation of the Purchase Price to the respective Local Activities
Schedule 6.06:             Terms and Conditions for using the Local Philips Company name
Schedule 7.03:             Employee continuation arrangements

</TABLE>

<PAGE>
                                       23

SCHEDULE 7.03 (TO THE MASTER AGREEMENT)

ADDITIONAL (OPTIONAL) LOCAL ARRANGEMENT ON SHARED EMPLOYEES

The general ruling applicable within Philips also applies here: an employee will
be on the payroll of a party which makes use of 50% or more of the time of the
employee involved ("Hiring Party"). No cherry picking.

In most countries such Local Arrangements are required between the Local FEI
Company and the local Philips Analytical organisation for the services of
identified Sales and Customer Support employees to be provided to the other
party ("Receiving Party").

The Local Arrangement will be made for a period of one year (the first ending
December 31, 2000) and is automatically annually extended; termination is only
possible by giving a six (6) months' written notice prior to the expiration date
(so each year before July 1).

The Local Arrangement will be based on a fixed percentage of the time and cost
of the identified employees as estimated per year. It is assumed that this
percentage also applies for each month. The sharing ratio may vary from year to
year only by plus or minus 20%, unless otherwise agreed (e.g. in case of a
`60-40' sharing in year one, a `68-32' in year two is allowed, an `80-20'
sharing not).

The employees involved must register their time spending per business. This
register will be made available to both parties per month. By determining the
priority of time allocation per month beyond the contracted percentage of time,
the Hiring Party will decide on the priority after consultation with the
Receiving Party. Any time spent in addition to the contracted time will be
invoiced per quarterly period by the Hiring Party to the Receiving Party.

On termination of the Local Arrangement for whatsoever reason, the terminating
party will pay an equal percentage of the redundancy cost of the employee
involved as the allocation in time and cost, based on the average of the last 2
full years, provided (a) the person involved receives notice of termination
within 9 months as from receipt of the terminating party's intention to stop
using the respective person's services, and (b) the total amount spent by the
party incurring redundancy costs is above 200,000 euro (at which point the
amounts above said threshold are subject to this paragraph).

List of `shared' employees:

<TABLE>
<CAPTION>

-----------------------------------------------------------------------------------------------------------
NAME:                          BIRTHDATE:                   EMPLOYED BY:                 % ANA; %FEI
-----------------------------------------------------------------------------------------------------------
<S>                            <C>                          <C>                          <C>
-----------------------------------------------------------------------------------------------------------

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</TABLE>

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