Credit Facility Agreement

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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"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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"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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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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(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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(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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(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.


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