<DOCUMENT>
<TYPE>EX-1.2
<SEQUENCE>4
<FILENAME>u45117exv1w2.txt
<DESCRIPTION>FORM OF DISTIBUTION AGREEMENT
<TEXT>
<PAGE>
                                                                     Exhibit 1.2


                             KONINKLIJKE PHILIPS ELECTRONICS N.V.

                                 Up to U.S. $[ ]
                                MEDIUM-TERM NOTES
                     Guaranteed as to Payment of Principal,
                        Premium (if any) and Interest by


                         FORM OF DISTRIBUTION AGREEMENT

                                                                       [ ], 2002

[NAME & ADDRESS OF AGENT(S)]





Ladies and Gentlemen:

        Koninklijke Philips Electronics N.V., a public limited company
incorporated under the laws of The Netherlands (the "Issuer"), proposes to issue
and sell from time to time their Medium-Term Notes, [Due 18 Months to 30 Years
From Date of Issue (the "Securities"), at an aggregate initial offering price up
to U.S.$[ ] (or the equivalent thereof at the time of original issuance in one
or more foreign currencies or composite currencies), and each of them agrees
with each of you (individually, an "Agent", and collectively, the "Agents") as
set forth in this Agreement. The Securities are to be issued pursuant to the
provisions of an indenture, dated August 1, 1993, as supplemented by a First
Supplemental Indenture dated May 6, 1994 and a Second Supplemental Indenture
dated [ ], 2002 (the "Indenture"), between Koninklijke Philips Electronics N.V.,
and Citibank, N.A., as Trustee (the "Trustee").

        Subject to the terms and conditions stated herein and to the reservation
by the Issuer of the right to sell Securities directly on its own behalf, the
Issuer hereby (i) appoints each Agent as an agent of the Issuer for the purpose
of soliciting and receiving offers to purchase Securities from the Issuer
pursuant to Section II(a) hereof and (ii) agrees that, except as otherwise
contemplated herein, whenever it determines to sell Securities directly to any
Agent as principal, it will enter into a separate agreement (each a "Terms
Agreement"), which may be oral and confirmed in writing or which may be
substantially in the form of Annex I hereto, relating to such sale in accordance
with Section II(b) hereof.

        The Issuer has filed with the Securities and Exchange Commission (the
"Commission") registration statements on Form F-3 (nos. 333-4582 and [-])
including a prospectus relating to the Securities to be issued severally from
time to time by the Issuer.
<PAGE>
The Issuer also has filed with, or proposes to file with, the Commission
pursuant to Rule 424 under the Securities Act of 1933, as amended (the
"Securities Act"), a prospectus supplement specifically relating to the
Securities (the "Prospectus Supplement"). Upon request, but not without the
agreement of each applicable Agent, the applicable Issuer may also file a
registration statement in accordance with Rule 462(b) under the Securities Act.
The registration statements as amended to the Commencement Date (as hereinafter
defined) and any Rule 462(b) Registration Statement that becomes effective
thereafter are hereinafter referred to as the "Registration Statement" and the
related prospectus covering the Securities in the form first used to confirm
sales of the Securities is hereinafter referred to as the "Basic Prospectus".
The Basic Prospectus as supplemented by the Prospectus Supplement specifically
relating to the Securities in the form first used to confirm sales of the
Securities is hereinafter referred to as the "Prospectus". Any reference in this
Agreement to the Registration Statement, the Basic Prospectus, any preliminary
form of prospectus (including the Basic Prospectus, a "preliminary prospectus")
previously filed with the Commission pursuant to Rule 424 or the Prospectus
shall be deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 6 of Form F-3 under the Securities Act which were filed
under the Securities Exchange Act of 1934, as amended (the "Exchange Act") on or
before the date of this Agreement or the date of the Basic Prospectus, any
preliminary prospectus or the Prospectus, as the case may be; and any reference
to "amend", "amendment" or "supplement" with respect to the Registration
Statement, the Basic Prospectus, any preliminary prospectus or the Prospectus
shall be deemed to refer to and include any documents filed under the Exchange
Act after the date of this Agreement, the date of the Basic Prospectus, the date
of any preliminary prospectus or the date of the Prospectus, as the case may be,
which are deemed to be incorporated by reference therein. Any reference to "Rule
462(b) Registration Statement" shall be deemed to refer to a registration
statement and any amendments thereto filed pursuant to Rule 429 or Rule 462(b)
relating to the offering covered by the initial Registration Statement.

                                       I.

        The Issuer represents and warrants to each of the Agents that:

                  (a) The Registration Statement has become effective; no stop
        order suspending the effectiveness of the Registration Statement is in
        effect, and no proceedings for such purpose are pending before or, to
        the Issuer's knowledge, threatened by the Commission.

                  (b) (i) Each document filed or to be filed pursuant to the
        Exchange Act and incorporated by reference in the Prospectus complied or
        will comply when so filed in all material respects with the Exchange Act
        and the applicable rules and regulations of the Commission thereunder,
        (ii) each part of the Registration Statement, when such part became
        effective, did not contain and each such part, as amended or
        supplemented, if applicable, will not contain any untrue statement


                                      -2-
<PAGE>
        of a material fact or omit to state a material fact required to be
        stated therein or necessary to make the statements therein not
        misleading, (iii) the Registration Statement and the Prospectus comply
        and, as amended or supplemented, if applicable, will comply in all
        material respects with the Securities Act and the applicable rules and
        regulations of the Commission thereunder and (iv) the Prospectus does
        not contain and, as amended or supplemented, if applicable, will not
        contain any untrue statement of a material fact or omit to state a
        material fact necessary to make the statements therein, in the light of
        the circumstances under which they were made, not misleading, except
        that the representations and warranties set forth in this paragraph I(b)
        do not apply (A) to statements or omissions in the Registration
        Statement or the Prospectus based upon information relating to any Agent
        furnished to the Issuer in writing by such Agent expressly for use
        therein or (B) to that part of the Registration Statement that
        constitutes the Statement of Eligibility (Form T-1) under the U.S. Trust
        Indenture Act of 1939, as amended (the "Trust Indenture Act"), of the
        Trustee.

                  (c) The Issuer is a limited liability stock corporation duly
        organized and validly existing under the laws of The Netherlands, has
        the power and authority (corporate and other) to own its property and to
        conduct its business as described in its Articles of Association and in
        the Prospectus.

                  (d) Each Significant Subsidiary (as such term is defined in
        Regulation S-X under the Securities Act) of the Issuer has been duly
        incorporated, is validly existing as a corporation in good standing
        under the laws of the jurisdiction of its incorporation, has the power
        and authority to own its property and to conduct its business as
        conducted as of the date hereof , is duly qualified to transact business
        and is in good standing in each jurisdiction in which the conduct of its
        business or its ownership or leasing of property requires such
        qualification, except to the extent that the failure to be so
        incorporated or validly existing, to have such power or to be so
        qualified or be in good standing, would not have a material adverse
        effect on the consolidated financial position or results of operations
        of the Issuer and its subsidiaries taken as a whole (a "Material Adverse
        Effect").

                  (e) The Securities have been duly authorized and, when
        executed and authenticated in accordance with the provisions of the
        Indenture and delivered to and paid for by the Agent or Agents or when
        delivered to and paid for by purchasers of the Securities in accordance
        with the terms of this Distribution Agreement, will be entitled to the
        benefits of the Indenture and will be valid and binding obligations of
        the Issuer enforceable in accordance with their terms, subject to
        bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
        and similar laws of general applicability relating to or affecting
        creditors' rights and to general equity principles.

                  (f) This Distribution Agreement has been duly authorized,
        executed


                                      -3-
<PAGE>
        and delivered by the Issuer.

                  (g) The Indenture has been duly qualified under the Trust
        Indenture Act and has been duly authorized, executed and delivered by
        the Issuer and is a valid and binding agreement of the Issuer
        enforceable in accordance with its terms, subject to bankruptcy,
        insolvency, fraudulent transfer, reorganization, moratorium and similar
        laws of general applicability relating to or affecting creditors' rights
        and to general equity principles.

                  (h) The execution and delivery by the Issuer of, and the
        performance by the Issuer of its obligations under, this Distribution
        Agreement, the Indenture and the Securities will not contravene (x) any
        provision of the Articles of Association of the Issuer or (y) any
        provision of applicable Netherlands or United States law or any
        agreement or other instrument binding upon the Issuer or any of its
        Significant Subsidiaries or any judgment, order or decree of any
        governmental body, agency or court having jurisdiction over the Issuer
        or any Significant Subsidiary, in each case with respect to this
        sub-clause (y), except for any contravention that would not affect the
        validity or enforceability of the Securities or the consummation of the
        transactions contemplated hereby or have a Material Adverse Effect; and
        no consent, approval, authorization or order of or qualification with
        any governmental body in the United States of America or The Netherlands
        or agency is required for the performance by the Issuer of its
        obligations under this Agreement, the Indenture or the Securities,
        except for the announcements and the statements required by section 3 of
        the Exemption Regulation pursuant to the Netherlands 1995 Act on the
        Supervision of the Securities Trade ("Wet toezicht effectenverkeer
        1995"), and except for the registration of the Securities under the
        Securities Act and except such as may be required by the securities or
        Blue Sky laws of the various states of the United States in connection
        with the offer and sale of the Securities.

                  (i) Since the date as of which information is given in the
        Registration Statement and the Prospectus, there has not occurred
        anything that would have a material adverse effect, or any development
        involving a prospective material adverse effect, on the general affairs,
        management, financial position, stockholders' equity or results of
        operations of the Issuer and its subsidiaries, taken as a whole, from
        that set forth in the Prospectus (exclusive of any amendments or
        supplements thereto effected subsequent to the date of the Distribution
        Agreement).

                  (j) Other than as set forth or contemplated in the Prospectus,
        there are no (i) legal or governmental proceedings pending or threatened
        in writing to which the Issuer or any of its subsidiaries is a party or
        to which any of the properties of the Issuer or any of its subsidiaries
        is subject which (x) would individually have a Material Adverse Effect
        or (y) in the judgment of the Issuer


                                      -4-
<PAGE>
        after reasonable investigation by the Issuer and its subsidiaries,
        would, in the aggregate, have a Material Adverse Effect; nor (ii) any
        contracts or other documents that are required to be described in the
        Registration Statement or Prospectus or to be filed as Exhibits to the
        Registration Statement that are not described or filed as required.

                  (k) The Issuer or one of its subsidiaries owns or possesses
        all patents, patent applications, trademarks, service marks, trade
        names, trade secrets, licenses and rights in any thereof which are
        necessary for the conduct of the business of the Issuer and its
        subsidiaries, taken as a whole, substantially in the manner in which it
        has been or is being conducted and, except as set forth in the
        Prospectus, there are no unresolved assertions that the Issuer or any of
        its subsidiaries has infringed the patent or trademark rights of others,
        other than assertions which, in the judgment of the Issuer, would not
        individually or in the aggregate be likely to have a Material Adverse
        Effect.

                  (l) No stamp or other issuance taxes or duties are payable by
        or on behalf of an Agent in The Netherlands in connection with the
        issuance of the Securities or the sale and delivery by an Agent of
        Securities, all in the manner contemplated in this Agreement.

                  (m) No authorization, approval or consent of any governmental
        authority or agency of or in The Netherlands is required to effect
        payments made by the Issuer within or outside The Netherlands in respect
        of the Securities.

                                      II.

                  (a) On the basis of the representations and warranties of the
        Issuer, and subject to the terms and conditions herein set forth, each
        of the Agents hereby severally and not jointly agrees, as agent of the
        Issuer, to use its reasonable best efforts to solicit and receive offers
        to purchase the Securities from the Issuer upon the terms and conditions
        set forth in the Prospectus as amended or supplemented from time to
        time. The Issuer reserves the right (i) to accept offers to purchase
        Securities, to solicit offers to purchase Securities and to sell
        Securities to or through one or more agents other than the Agents or to
        agree with another agent that such agent shall become an Agent
        hereunder, in each case, without obtaining the consent of the Agents,
        provided, however, that the Issuer will notify the Agents promptly
        following the issuance and sale of any Security issued and sold in
        respect of any offer so accepted and (ii) to sell, and solicit and
        accept offers to purchase, Securities directly on its own behalf; and,
        in the case of any such sale not resulting from a solicitation made by
        any Agent, no commission will be payable with respect to such sale.


                                      -5-
<PAGE>
               If any other agent is to be named as an Agent under this
        Agreement, such agent and the Issuer will execute an agreement
        substantially in the form of Annex III hereto, whereupon such agent
        shall become a party to this Agreement and shall be subject to the same
        obligations and receive the same benefits as an Agent would be subject
        to or would receive hereunder. If any other agent is to be appointed as
        Agent by the Issuer solely in connection with a particular issue of
        Securities, such agent and the Issuer will execute an agreement
        substantially in the form of Annex IV hereto.

               Procedural details relating to the issue and delivery of
        Securities, the solicitation of offers to purchase Securities and the
        payment in each case therefore shall be as set forth in the
        Administrative Procedures, attached hereto as Annex II, as they may be
        amended from time to time by written agreement between the Agents and
        the Issuer (the "Procedures"). The provisions of the Procedures shall
        apply to all transactions contemplated hereunder other than those made
        pursuant to a Terms Agreement. Each Agent and the Issuer agrees to
        perform the respective duties and obligations specifically provided to
        be performed by each of them in the Procedures. The Issuer will furnish
        to the Trustee a copy of the Procedures as from time to time in effect.

               The Issuer reserves the right, in its sole discretion, to
        instruct the Agents to suspend at any time, for any period of time or
        permanently, the solicitation of offers to purchase the Securities from
        the Issuer. As soon as practicable after receipt of notice from the
        Issuer, the Agents will suspend solicitation of offers to purchase
        Securities from the Issuer until such time as the Issuer has advised the
        Agents that such solicitation may be resumed. While such solicitation is
        suspended, the Issuer shall not be required to deliver any certificates,
        opinions or letters in accordance with Sections V(i), V(j) and V(k);
        provided, however, that if the Registration Statement or Prospectus is
        amended or supplemented during the period of suspension (other than by
        an amendment or supplement providing solely for a change in the interest
        rates, redemption provisions, amortization schedules or maturities
        offered on the Securities or for a change the Agents deem to be
        immaterial), no Agent shall be required to resume soliciting offers to
        purchase Securities until the Issuer has delivered such certificates,
        opinions and letters as such Agent may reasonably request.

               Unless otherwise agreed by the Issuer and the applicable Agent at
        the time of any sale of a Security by such Issuer through such Agent,
        the Issuer agrees to pay each Agent a commission (or grant an equivalent
        discount) at the time of settlement of any sale of a Security by the
        Issuer as a result of a solicitation made by such Agent, in an amount to
        be negotiated.

               Each Agent shall communicate to the Issuer, orally or in writing,
        each offer to purchase Securities received by such Agent as agent that
        in its judgment


                                      -6-
<PAGE>
        should be considered by the Issuer. The Issuer shall have the sole right
        to accept offers to purchase Securities and may reject any offer in
        whole or in part. Each Agent shall have the right to reject any offer to
        purchase Securities that it considers to be unacceptable, and any such
        rejection shall not be deemed a breach of its agreements contained
        herein.

                  (b) Each sale of Securities to any Agent as principal shall be
        made in accordance with the terms of this Agreement and (unless the
        Issuer and such Agent shall otherwise agree) a Terms Agreement which
        will provide for the sale of such Securities to, and the purchase
        thereof by, such Agent. A Terms Agreement may also specify certain
        provisions relating to the reoffering of such Securities by such Agent.
        The commitment of any Agent to purchase Securities as principal, whether
        pursuant to any Terms Agreement or otherwise, shall be deemed to have
        been made on the basis of the representations and warranties of the
        Issuer herein contained and shall be subject to the terms and conditions
        herein set forth. Each Terms Agreement shall specify the principal
        amount of Securities to be purchased by any Agent pursuant thereto, the
        price to be paid to the Issuer for such Securities, any provisions
        relating to rights of, and default by, underwriters acting together with
        such Agent in the reoffering of the Securities and the time and date and
        place of delivery of and payment for such Securities. Such Terms
        Agreement shall also specify requirements, if any, for opinions of
        counsel, accountants' letters and officers' certificates pursuant to
        Section VI hereof.

               For each sale of Securities to an Agent as principal that is not
        made pursuant to a Terms Agreement, the procedural details relating to
        the issue and delivery of such Securities and payment therefor shall be
        as set forth in the Procedures. For each such sale of Securities to an
        Agent as principal, the Issuer agrees to pay such Agent a commission (or
        grant an equivalent discount) as provided in Section II(a) hereof.
        Securities may also be sold by any Agent to or through dealers who may
        resell to investors. The Agents may pay all or part of their discount or
        commission to such dealers.

               Each time and date of delivery of and payment for Securities to
        be purchased by an Agent as principal, whether set forth in a Terms
        Agreement or in accordance with the Procedures, is referred to herein as
        a "Time of Delivery".

                  (c) The Issuer acknowledges that the obligations of the Agents
        under this Agreement are several and not joint.

                  (d) The documents required to be delivered pursuant to Section
        VI hereof on the Commencement Date (as defined below) shall be delivered
        to the Agents at the offices of Sullivan & Cromwell, 1 New Fetter Lane,
        London EC4A 1AN at 9:00 a.m., New York City time, on the date of this
        Agreement, which date


                                      -7-
<PAGE>
        and time of such delivery may be postponed by agreement among the Agents
        and the Issuer but in no event shall be later than the day prior to the
        date on which solicitation of offers to purchase Securities is commenced
        or on which any Terms Agreement is executed (such time and date being
        referred to herein as the "Commencement Date").

                                      III.

        Each Agent agrees, with respect to any Security denominated in a
currency other than U.S. dollars, as agent, directly or indirectly, not to
solicit offers to purchase, and as principal under any Terms Agreement or
otherwise, directly or indirectly, not to offer, sell or deliver, such Security
except as permitted by applicable law of the country issuing such currency.

                                      IV.

        Each Agent severally represents and agrees that (i) it has not offered
or sold and, prior to the expiry of the period of six months from the date of
issue of the Securities, will not offer or sell any such Securities to persons
in the United Kingdom except to persons whose ordinary activities involve them
in acquiring, holding, managing or disposing of investments (as principal or
agent) for the purposes of their businesses or otherwise in circumstances which
have not resulted and will not result in an offer to the public in the United
Kingdom within the meaning of the Public Offers of Securities Regulations 1995,
(ii) it has complied and will comply with all applicable provisions of the
Financial Services and Markets Act 2000 (the "FSMA") with respect to anything
done by it in relation to the Securities in, from or otherwise involving the
United Kingdom and (iii) it has only communicated or caused to be communicated
and will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of Section 21 of
the FSMA) received by it in connection with the issue and sale of such
Securities in circumstances in which Section 21(1) of the FSMA does not apply to
the Issuer.

        Each Agent further represents and agrees that from the date of issue of
the Securities or at any time thereafter, that

                  (a) it has not offered, transferred or sold and will not
        offer, transfer or sell any Securities:

                            (i) before a statement that the laws and regulations
                  referred to in (c) of this section are complied with, has been
                  submitted to the Netherlands Authority for the Financial
                  Markets; or

                            (ii) to persons who are established, domiciled or
                  have their residence in The Netherlands; and


                                      -8-
<PAGE>

                  (b) with respect to each offer of Securities, and each
        announcement and documents in respect thereof, made by it, it has stated
        and will state that the Securities are not and will not be offered to
        persons as referred to in (a)(ii) of this section; and

                  (c) with respect to each offer of Securities, and each
        announcement thereof, made by it, it has complied and will comply with
        the laws and regulations of any jurisdiction where persons to whom the
        offer is made are resident; and

        a statement that the laws and regulations referred to in (c) of this
section are complied with, has been and will be included in each announcement
made by it of any offer of Securities.



                                       V.

        The Issuer covenants and agrees with each Agent:

                  (a) (i) To make no amendment or supplement to the Registration
        Statement or the Prospectus after the date of any Terms Agreement or
        other agreement by an Agent to purchase Securities as principal and
        prior to the related Time of Delivery which shall have been reasonably
        disapproved by any Agent party to such Terms Agreement or otherwise
        purchasing as principal promptly after reasonable notice thereof; (ii)
        to prepare, with respect to any Securities to be sold through or to such
        Agent pursuant to this Agreement, a Pricing Supplement with respect to
        such Securities in a form previously approved by such Agent and to file
        such Pricing Supplement pursuant to and in accordance with Rule 424(b)
        under the Securities Act; (iii) to make no amendment or supplement to
        the Registration Statement or Prospectus (other than any Pricing
        Supplement), without having afforded each Agent a reasonable opportunity
        to review and comment thereon; provided, however, that the requirements
        in clauses (i) and (iii) of this Section V(a) shall not apply with
        respect to an amendment or supplement which relates to Securities sold
        through or to agents other than the Agents or contains no new
        information other than the terms of such Securities and the plan of
        distribution thereof; (iv) to file promptly all reports or information
        statements required to be filed by such Issuer or the Guarantor with the
        Commission pursuant to Section 13(a), 13(c), or 15(d) of the Exchange
        Act for so long as the delivery of a prospectus is required in
        connection with the offering or sale of the Securities, and during such
        same period to advise such Agent, promptly after the Issuer receives
        notice thereof, of the time when any amendment to the Registration
        Statement has been filed or has become effective or any supplement to
        the Prospectus or any amended Prospectus (other than any Pricing
        Supplement that relates to Securities not purchased through or by such
        Agent) has been filed with


                                      -9-
<PAGE>
        the Commission, of the issuance by the Commission of any stop order or
        of any order preventing or suspending the use of any prospectus relating
        to the Securities, of the suspension of the qualification of the
        Securities for offering or sale in any jurisdiction, of the initiation
        or threatening of any proceeding for any such purpose, or of any request
        by the Commission for the amendment or supplement of the Registration
        Statement or Prospectus or for additional information; and (v) in the
        event of the issuance of any such stop order or of any such order
        preventing or suspending the use of any such prospectus or suspending
        any such qualification, to use promptly its reasonable best efforts to
        obtain its withdrawal.

                  (b) Promptly from time to time to take such action as such
        Agent reasonably may request to qualify the Securities for offering and
        sale under the securities laws of such jurisdictions as such Agent may
        request and to comply with such laws so as to permit the continuance of
        sales and dealings therein for as long as may be necessary to complete
        the distribution or sale of the Securities, provided, however, that in
        connection therewith the Issuer shall not be required to qualify as a
        foreign corporation or to file a general consent to service of process
        in any jurisdiction.

                  (c) At the request of such Agent, to furnish such Agent with a
        copy of the Registration Statement and each amendment thereto, with a
        copy of the Prospectus and each amendment or supplement thereto, and
        additional copies of the Prospectus as each time amended or
        supplemented, other than any Pricing Supplement (except as provided in
        the Procedures), in the form in which it is filed with the Commission
        pursuant to Rule 424 under the Act, and with copies of the documents
        incorporated by reference therein, all in such quantities as such Agent
        may reasonably request; and if at any time any event shall have occurred
        as a result of which the Prospectus as then amended or supplemented
        would include an untrue statement of a material fact or omit to state
        any material fact necessary in order to make the statements therein, in
        the light of the circumstances under which they were made when such
        Prospectus is delivered, not misleading, or, if for any other reason it
        shall be necessary to amend or supplement the Prospectus or to file
        under the Exchange Act any document incorporated by reference in the
        Prospectus in order to comply with the Act, the Exchange Act or the
        Trust Indenture Act, to notify such Agent promptly and request such
        Agent to suspend solicitation of offers to purchase Securities from the
        Issuer (and, if so notified, such Agent shall cease such solicitations
        as soon as practicable, but in any event not later than one business day
        after notification); and if the Issuer shall decide to amend or
        supplement the Registration Statement or the Prospectus as then amended
        or supplemented, to so advise such Agent promptly and to prepare and to
        cause to be filed with the Commission an amendment or supplement to the
        Registration Statement or the Prospectus as then amended or supplemented
        that will correct such statement or omission or effect such compliance;
        provided,


                                      -10-
<PAGE>
        however, that if, at any time prior to the expiration of nine months
        after the Time of Delivery with respect to any Securities, such Agent
        continues to own Securities purchased from the Issuer by such Agent as
        principal, the Issuer shall promptly prepare and deliver to such Agent
        such an amendment or supplement that will correct such statement or
        omission; provided further, however, that if at any time nine months or
        more after the Time of Delivery with respect to any Securities, such
        Agent continues to own Securities purchased from the Issuer by such
        Agent as principal, the Issuer, upon such Agent's request but at the
        sole expense of such Agent, shall prepare and deliver to such Agent as
        many copies as such Agent shall request of such an amendment or
        supplement.

                  (d) To make generally available to its Security holders as
        soon as practicable, but in any event not later than eighteen months
        after the effective date of the Registration Statement an earning
        statement of the Issuer and its subsidiaries (which need not be audited)
        complying with Section 11(a) of the Act and the rules and regulations of
        the Commission thereunder (including, at the option of the Issuer, Rule
        158).

                  (e) For a period of three years after the completion of the
        sale of all the Securities, to deliver to such Agent as soon as they are
        available, copies of any reports and financial statements of the Issuer
        furnished to or filed with the Commission or any United States or The
        Netherlands or other European national securities exchange on which any
        class of securities of the Issuer is listed.

                  (f) That, from the date of any Terms Agreement with such Agent
        and continuing to and including the related Time of Delivery, not to
        offer, sell, contract to sell or otherwise dispose of in each case in
        the United States any debt securities of the Issuer or warrants to
        purchase debt securities of the Issuer substantially similar to the
        Securities, in each which mature more than one year after such Time of
        Delivery, without the Agents' prior written consent such consent not to
        be unreasonably withheld.

                  (g) That each acceptance by the Issuer of an offer to purchase
        Securities hereunder (including any purchase by such Agent as principal
        not pursuant to a Terms Agreement), and each execution and delivery by
        the Issuer of a Terms Agreement with such Agent, and each amendment or
        supplement of the Registration Statement or the Basic Prospectus by the
        Issuer, shall be deemed to be an affirmation to such Agent that the
        representations and warranties of the Issuer contained in or made
        pursuant to this Agreement are true and correct as of the date of such
        acceptance or of such Terms Agreement or of such amendment or
        supplement, as the case may be, as though made at and as of such date,
        and an undertaking that such representations and warranties will be true
        and correct as of the settlement date for the Securities relating to
        such acceptance or as of the Time of Delivery relating to such sale, as
        the case may be, as though made at and as of


                                      -11-
<PAGE>
        such date (except that such representations and warranties shall be
        deemed to relate to the Registration Statement and the Prospectus as
        amended or supplemented to each such date).

                  (h) That each time the Issuer sells Securities to such Agent
        as principal pursuant to a Terms Agreement and such Terms Agreement
        specifies the delivery of an opinion or opinions by counsel to the
        Agents, as a condition to the purchase of Securities pursuant to such
        Terms Agreement, the Issuer shall furnish to such counsel such papers
        and information as they may reasonably request to enable them to furnish
        to such Agent the opinion or opinions referred to in Section VI (c)
        hereof.

                  (i) That each time the Issuer's annual report on Form 20-F is
        filed and is incorporated by reference into the Prospectus and each time
        the Issuer sells Securities to such Agent as principal pursuant to a
        Terms Agreement and such Terms Agreement specifies the delivery of an
        opinion under this Section V(i) as a condition to the purchase of
        Securities pursuant to such Terms Agreement, the Issuer shall notify
        each Agent of such filing and furnish or cause to be furnished forthwith
        to such agent (but, in the case of the filing of the Issuer's annual
        report on Form 20-F, only if so requested in writing by [the Lead
        Agent]):

                  (x)   a written opinion of Netherlands legal advisor to the
                        Issuer, dated the date of such filing or the Time of
                        Delivery relating to such sale, as the case may be, in
                        form reasonably satisfactory to such Agent, to the
                        effect set forth in Section VI(b) hereof; provided,
                        however, that to the extent appropriate such opinion or
                        opinions may reconfirm matters set forth in a prior
                        opinion of Netherlands legal advisor delivered under
                        Section VI(b) or this Section V(i); and

                  (y)   a written opinion of Sullivan & Cromwell, United States
                        counsel for the Issuer, or other counsel for the Issuer
                        satisfactory to such Agent, dated the date of such
                        filing or Time of Delivery relating to such sale, as the
                        case may be, in form reasonably satisfactory to such
                        Agent, to the effect set forth in Section VI(a) hereof;
                        provided, however, that to the extent appropriate such
                        opinion or opinions may reconfirm matters set forth in a
                        prior opinion of United States counsel delivered under
                        Section VI(a) or this Section V(i); and

                  (j) That each time the Issuer's annual report on Form 20-F is
        filed and incorporated by reference into the prospectus and each time
        the Issuer sells Securities to such Agent as principal pursuant to a
        Terms Agreement and such Terms Agreement specifies the delivery of a
        letter under this Section V(j) as a condition to the purchase of
        Securities pursuant to such Terms Agreement, the


                                      -12-
<PAGE>
        Issuer shall notify each Agent of such filing and (but, in the case of
        the filing of the Issuer's annual report on Form 20-F, only if so
        requested in writing by [the Lead Agent]) shall cause the independent
        auditors who have audited the financial statements of the Issuer and its
        subsidiaries included in the Registration Statement and the Prospectus
        forthwith to furnish such Agent a letter, dated the date of such filing
        or Time of Delivery relating to such sale, as the case may be, in form
        reasonably satisfactory to such Agent, of the same tenor as the letter
        referred to in Section VI(d) hereof but modified to relate to the
        Registration Statement and the Prospectus as amended or supplemented to
        the date of such letter, with such changes as may be necessary to
        reflect changes in the financial statements and other information
        derived from the accounting records of the Issuer, to the extent such
        financial statements and other information are available as of a date
        not more than three business days prior to the date of such letter;
        provided, however, that, in the case of a letter furnished in connection
        with a sale of Securities to such Agent as principal, with respect to
        any financial information or other matter, such letter may reconfirm as
        true and correct at such date as though made at and as of such date,
        rather than repeat, statements with respect to such financial
        information or other matter made in the letter referred to in Section
        VI(e) hereof which was last furnished to such Agent.

                  (k) That each time the Issuer's annual report on Form 20-F is
        filed and each time the Issuer sells Securities to such Agent as
        principal and the applicable Terms Agreement specifies the delivery of a
        certificate under this Section V(k) as a condition to the purchase of
        Securities pursuant to such Terms Agreement (but, in the case of the
        filing of the Issuer's annual report on Form 20-F, only if so requested
        in writing by [the Lead Agent]), the Issuer shall furnish or cause to be
        furnished forthwith to such Agent a certificate or certificates, dated
        the date of such filing or Time of Delivery relating to such sale, as
        the case may be, in such form and executed by such officers of the
        Issuer as shall be reasonably satisfactory to such Agent, to the effect
        that the statements contained in the certificate or certificates
        referred to in Section VI(h) hereof which was last furnished to such
        Agent are true and correct in all material respects at such date as
        though made at and as of such date (except that such statements shall be
        deemed to relate to the Registration Statement and the Prospectus as
        amended and supplemented to such date) or, in lieu of such certificate
        or certificates, a certificate or certificates of the same tenor as the
        certificate or certificates referred to in said Section VI(i) but
        modified to relate to the Registration Statement and the Prospectus as
        amended and supplemented to such date; each such officer may certify to
        the best of his or her knowledge.

                  (l) To offer to any person who has agreed to purchase
        Securities as the result of an offer to purchase solicited by such Agent
        the right to refuse to purchase and pay for such Securities if, on the
        related settlement date fixed pursuant to the Procedures, any condition
        set forth in Section VI(e), (f), (g) or (i)


                                      -13-
<PAGE>
        hereof shall not have been satisfied (it being understood that the
        judgment of such person with respect to the impracticability or
        inadvisability of such purchase of Securities shall be substituted, for
        purposes of this Section V(l), for the respective judgment of an Agent
        with respect to certain matters referred to in such Sections VI(e) and
        (g), and that such Agent shall have no duty or obligation whatsoever to
        exercise the judgment permitted under such Section VI(e) and (g) on
        behalf of any such person).

                  (m) The Issuer covenants and agrees with each Agent that the
        Issuer will pay or cause to be paid the following: (i) the fees,
        disbursements and expenses of the Issuer's counsel and accountants in
        connection with the issuance of the Securities, the preparation,
        printing and filing of the Registration Statement, any Preliminary
        Prospectus, the Prospectus and any Pricing Supplements and all other
        amendments and supplements thereto, and the mailing and delivering of
        copies thereof to such Agent; (ii) the reasonable fees, direct
        disbursements and expenses of counsel for the Agents in connection with
        the establishment and updating of the program contemplated hereby, any
        opinions to be rendered by such counsel hereunder and the transactions
        contemplated hereunder; (iii) the cost of printing, preparing by word
        processor or reproducing any Terms Agreement, any Indenture, and any
        other documents in connection with the offering, purchase, sale and
        delivery of the Securities; (iv) all expenses in connection with the
        qualification of the Securities for offering and sale under state
        securities laws as provided in Section V(b) hereof, including fees and
        disbursements of counsel for the Agents in connection with such
        qualification and in connection with the Blue Sky and legal investment
        surveys; (v) any fees charged by securities rating services for rating
        the Securities; (vi) the cost of preparing the Securities (including any
        global Securities); and (vii) the reasonable fees and direct expenses of
        the Trustee and any agent of the Trustee and any transfer or paying
        agent of the Issuer and the reasonable fees and disbursements of counsel
        for the Trustee and any such agent in connection with the Indentures and
        the Securities. Except as provided in Sections VII and VIII hereof, each
        Agent shall pay all other expenses it incurs.

                                      VI.

        The obligation of any Agent, as agent of the Issuer, at any time
("Solicitation Time") to solicit offers to purchase the Securities and the
obligation of any Agent to purchase Securities as principal, pursuant to any
Terms Agreement or otherwise, shall in each case be subject, in such Agent's
discretion, to the condition that all representations and warranties and other
statements of the Issuer herein (and, in the case of an obligation of an Agent
under a Terms Agreement, in or incorporated in such Terms Agreement by
reference) are true and correct at and as of the Commencement Date and any
applicable date referred to in Section V(k) hereof that is prior to such
Solicitation Time or Time of Delivery, as the case may be, and at and as of such
Solicitation Time or Time of


                                      -14-
<PAGE>
Delivery, as the case may be, the condition that prior to such Solicitation Time
or Time of Delivery, as the case may be, the Issuer shall have performed in all
material respects all of their respective obligations hereunder theretofore to
be performed, and the following additional conditions:

                  (a) Sullivan & Cromwell, United States counsel for the Issuer,
        or other counsel for the Issuer satisfactory to such Agent, shall have
        furnished to such Agent their written opinion, dated the Commencement
        Date and each applicable date referred to in Section V(i) hereof that is
        on or prior to such Time of Delivery, in form and substance satisfactory
        to such Agent, to the effect that:

                        (i) assuming that the Indenture has been duly
                  authorized, executed and delivered by the Issuer insofar as
                  the laws of the Netherlands are concerned, the Indenture has
                  been duly qualified under the Trust Indenture Act of 1939 and
                  constitutes a valid and legally binding obligation of the
                  Issuer, enforceable in accordance with its terms, subject to
                  bankruptcy, insolvency, fraudulent transfer, reorganization,
                  moratorium and similar laws of general applicability relating
                  to or affecting creditors' rights and to general equity
                  principles;

                        (ii) any series of Securities established on or prior to
                  the date of such opinion has been duly authorized and
                  established in conformity with the Indenture, and, when the
                  terms of a particular Security and of its issuance and sale
                  have been duly authorized and established by all necessary
                  corporate action in conformity with the Indenture, and such
                  Security has been duly completed, executed, authenticated and
                  issued in accordance with the Indenture and delivered against
                  payment as contemplated by this Agreement, such Security will
                  constitute a valid and legally binding obligation of the
                  Issuer enforceable in accordance with its terms, subject to
                  bankruptcy, insolvency, fraudulent transfer, reorganization,
                  moratorium and similar laws of general applicability relating
                  to or affecting creditors' rights and to general equity
                  principles; in rendering such opinion at any time other than
                  pursuant to a Terms Agreement such counsel may assume that at
                  the time of issuance, sale and delivery of each particular
                  Security the authorization of the Securities will not have
                  been modified or rescinded and, with respect to each Security,
                  that such Security will conform to the respective forms of the
                  Securities examined by them (such latter assumption may be
                  made even if such opinion is rendered pursuant to a Terms
                  Agreement) and that the Trustee's certificate of
                  authentication of such Security will be manually signed by one
                  of the Trustee's authorized officers; such counsel may also
                  assume that at the time of the issuance, sale and delivery of
                  each particular Security there will not have occurred any
                  change in law affecting the validity, legally binding
                  character or enforceability of such Security and


                                      -15-
<PAGE>
                  that the issuance, sale and delivery of such Security, all of
                  the terms of such Security and the performance by the Issuer
                  of its obligations thereunder will comply with applicable law
                  and with each requirement or restriction imposed by any court
                  or governmental body having jurisdiction over the Issuer and
                  will not result in a default under or a breach of any
                  agreement or instrument then binding upon the Issuer;

                        (iii) assuming this Agreement and any applicable Terms
                  Agreement have been duly authorized, executed and delivered by
                  the Issuer insofar as the laws of The Netherlands are
                  concerned, this Agreement and any applicable Terms Agreement
                  have been duly executed and delivered by the Issuer;

                        (iv) the execution and delivery by the Issuer of the
                  Indenture and the Distribution Agreement do not, and the
                  completion, execution and issuance of each particular Security
                  in accordance with the Indenture and the sale by the Issuer of
                  such Security in accordance with this Agreement and any
                  applicable Terms Agreement and the performance by the Issuer
                  of its obligations under the Indenture, the Agreement and any
                  applicable Terms Agreement and the Securities will not violate
                  any Federal law of the United States or the law of the State
                  of New York applicable to the Issuer; provided, however, that,
                  with respect to this paragraph VI(a)(iv), such counsel need
                  express no opinion with respect to Federal or state securities
                  laws, other anti-fraud laws, fraudulent transfer laws and laws
                  that restrict transactions between United States persons and
                  citizens or residents of certain foreign countries or
                  specifically designated nationals and organizations; provided,
                  further, that insofar as performance by the Issuer of its
                  obligations under the Indenture, this Agreement, any
                  applicable Terms Agreement, and the Securities is concerned,
                  such counsel need express no opinion as to bankruptcy,
                  insolvency, reorganization, moratorium and similar laws of
                  general applicability relating to or affecting creditors'
                  rights;

        In rendering such opinion, such counsel may state that their opinion is
limited to the Federal laws of the United States and the laws of the State of
New York and such counsel may (i) note that, as to matters of Dutch law, the
Agents have received the opinion of Dutch counsel for the Issuer, rendered
pursuant to Section VI(b); (ii) assume that the Issuer has been duly
incorporated and is an existing company under the laws of The Netherlands, and
(iii) each Security issued by the Issuer will be duly executed and delivered in
accordance with the laws of The Netherlands.

        Such counsel may also state that, with your approval, they have relied
as to certain matters or information obtained from public officials, officers of
the Issuer and other sources believed by them to be responsible, and that they
have assumed that the


                                      -16-
<PAGE>
Indenture has been duly authorized, executed and delivered by the Trustee and
that the signatures on all documents examined by them are genuine, assumptions
which they have not independently verified.

        Such counsel shall also state that they have reviewed the Registration
Statement, the Basic Prospectus and the Prospectus Supplement and participated
in discussions with representatives of the Issuer its Dutch counsel,
representatives of the accountants for the Issuer and representatives of the
Agents and their United States counsel; and on the basis of the information that
they gained in the course of the performance of such services, considered in the
light of their understanding of the applicable law and the experience they have
gained through their practice in this field, such counsel shall confirm to the
Agents that each part of the Registration Statement, when such part became
effective, and the Basic Prospectus, as supplemented by the Prospectus
Supplement as of the date of the Prospectus Supplement, appeared on their face
to be appropriately responsive in all material respects to the requirements of
the Securities Act, the Trust Indenture Act of 1939 and the applicable rules and
regulations of the Commission thereunder; and nothing that has come to the
attention of such counsel has caused them to believe (x) that any part of the
Registration Statement, when such part became effective, contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading or
that the Basic Prospectus as supplemented by the Prospectus Supplement as of the
date of the Prospectus Supplement, contained any untrue statement of material
fact or omitted to state any material fact necessary in order to make the
statements therein, in the light of the circumstances in which they were made,
not misleading or (y) that, in the course of specified procedures performed by
them subsequent to the effective date of the Registration Statement, the Basic
Prospectus, as supplemented by a Prospectus Supplement, as of the date of such
opinion contained any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. Such
opinion may state (1) that such counsel do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement, Basic Prospectus or the Prospectus Supplement except for
those made under the captions "Description of Debt Securities" and "Taxation ---
The United States" in the Basic Prospectus and ["Description of Notes" and "Plan
of Distribution"] in the Prospectus Supplement insofar as they relate to the
provisions of documents therein described and (2) that they do not express any
opinion or belief as to the financial statements or other financial data or as
to any statement made by Dutch counsel to the Issuer with respect to the laws of
The Netherlands, contained in the Registration Statement, the Basic Prospectus
or any Prospectus Supplement, or documents incorporated by reference therein, or
as to the statement of the eligibility and qualification of the Trustee under
the Indentures under which the Securities are being issued.

                  (b) A.F. Verdam Esq., counsel for the Company, shall have
        furnished to such Agent his written opinion, dated the Commencement Date
        and each


                                      -17-
<PAGE>
        applicable date referred to in Section V(i)(B) hereof that is on or
        prior to such Time of Delivery, as the case may be, in form and
        substance satisfactory to such Agent, to the effect:

                      (i) the Issuer has been duly incorporated and is validly
               existing as a legal entity in the form of a limited liability
               company ("naamloze vennootschap") duly organized under the laws
               of The Netherlands, with corporate power and authority to perform
               its obligations under the Agreement;

                      (ii) the Agreement has been duly authorized by all
               internal corporate action of the Issuer and has been validly
               executed and delivered by the Issuer insofar as the laws of The
               Netherlands are concerned and constitutes valid and legally
               binding obligations of the Issuer enforceable against it in
               accordance with its terms under the laws of the Netherlands;

                      (iii) neither the execution of any of the Agreement, the
               Indenture or the Securities, nor the fulfilment of or compliance
               with their respective terms and provisions, by the Issuer will
               result in any violation of the provisions of the Articles of
               Association of the Issuer or any statute, rule or regulation in
               The Netherlands or to the best of such counsel's knowledge, any
               order applicable to the Issuer of any court or governmental
               agency or body in The Netherlands having jurisdiction over the
               Issuer or any other judgment, agreement or instrument to which
               the Issuer is a party or by which the Issuer or any of its
               property is bound, in each case except for breaches and
               violations which would not materially affect the validity of the
               Agreement, the Indenture or the Securities (as the case may be)
               or would not materially adversely affect the Issuer' ability to
               perform its obligations under any of these agreements;

                      (iv) no consent, approval, authorization, order,
               registration, filing or other recording or qualification of or
               with any court, governmental agency or body or other entity in
               The Netherlands, or any other legal formality under Dutch law is
               required to be obtained or made by the Issuer to enforce its
               rights under or to ensure the validity, effectiveness,
               enforceability or admissibility in evidence of the Agreement, the
               Indenture or the Securities or by reason of the execution of any
               of the Agreement, the Indenture or the Securities or the
               performance by the Issuer of its obligations under any of these
               agreements;

                      (v) to the best of such counsel's knowledge no consent,
               approval, authorization, order, registration, filing or otherwise
               recording or qualification of or with any court, governmental
               agency or body or other


                                      -18-
<PAGE>
               entity in The Netherlands, or any other legal formality under
               Dutch law, is currently required to be obtained or made by the
               Issuer to effect payments made by the Issuer within or outside
               The Netherlands in respect of the Securities within or outside
               The Netherlands upon redemption of the Securities, except for the
               Issuer's obligation to comply with notification and registration
               requirements of The Netherlands Central Bank (De Nederlandsche
               Bank N.V.) in connection with the issue of and all payments in
               respect of the Securities to or from non-residents of The
               Netherlands in accordance with the General Reporting Instructions
               2000 (Rapportage Voorschriften Buitenlands Betalingsverkeer 2000)
               issued by DNB pursuant to the External Financial Relations Act
               1994 (Wet Financiele Betrekkingen Buitenland 1994), although a
               failure to perform any of these formalities should not adversely
               affect the validity, effectiveness, enforceability or
               admissibility in evidence of the Agreement or the Securities or
               any payment made or to be made thereunder;

                      (vi) the choice of the laws of New York as the governing
               law of the Agreement is valid and binding on the Issuer, except
               that when applying New York law as the law expressed to be
               governing the Agreement, the competent court of the Netherlands,
               if any,

                      -     may give effect to mandatory rules of the law of any
                            other jurisdiction with which the situation has a
                            significant connection, if and insofar as, under the
                            laws of the latter jurisdiction, those rules must be
                            applied irrespective of the chosen law;

                      -     will apply the laws of the Netherlands in a
                            situation where they are mandatory irrespective of
                            the chosen law;

                      -     will apply the laws of the Netherlands in a
                            situation where they are mandatory irrespective of
                            the law otherwise applicable to the Agreement;

                      -     may refuse to apply New York law if such application
                            is manifestly incompatible with public policy of the
                            Netherlands;

                      (vii) the submission to the jurisdiction of the state
               courts in the State of New York, County of New York and the
               federal courts in the Southern District of New York by the Issuer
               contained in the Agreement are valid and binding on the Issuer
               and not subject to revocation and the appointment of (subject to
               the appointment of a successor pursuant to Article XIII hereof)
               Philips Electronics North America Corporation as authorized agent
               of the Issuer for the purposes described in Article XIII hereof
               has been duly authorized by the Issuer;


                                      -19-
<PAGE>
                      (viii) in the absence of an applicable convention
               providing for the reciprocal recognition and enforcement of
               judgments in civil and commercial matters between the Netherlands
               and the United States of America, a judgment rendered by a court
               in New York against the Issuer will not be recognized and
               enforced by the courts of the Netherlands; in order to obtain a
               judgment which is enforceable against the Issuer the claimant
               will have to file its claim against the Issuer with the competent
               Netherlands court, and in the course of these proceedings the
               claimant may submit the judgment rendered by the New York court;
               if the Netherlands court finds that the jurisdiction of the New
               York court has been based on grounds which are internationally
               acceptable and the proper legal procedures have been observed,
               the Netherlands court would, in principle, give binding effect to
               the final judgment which has been rendered in New York court,
               unless such judgment contravenes principles of Netherlands public
               policy;

                      (ix) to the best of such counsel's knowledge, there is no
               litigation or governmental proceedings pending or threatened in
               writing against or affecting the Issuer or any of its property,
               which litigation or governmental proceeding is reasonably
               expected to have a material adverse effect on the Issuer' ability
               to consummate the transactions contemplated under the Agreement
               or the validity of the Agreement; and

                      (x) no stamp, registration or other tax, charges or other
               costs are payable in The Netherlands in connection with or in
               relation to the execution, delivery or performance under the
               Agreement.

        In giving such opinion, such counsel may state that such opinion is
confined to and given on the basis of Dutch law as currently applied by the
Dutch courts and on the basis that it will be governed by and construed and have
effect in accordance with Dutch law.

        The opinion expressed shall be subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles, such as the principle of "reasonable and fairness" ("redelijkheid en
billiijkheid").

        Such opinion also may state that nothing therein is to be taken as
indicating that the remedy of an order for specific performance or the issue of
an injunction would be available in a Dutch court in respect of the obligations
arising under the Indenture, this Agreement or any applicable Terms Agreement in
that such remedies are available only at the discretion of the court and are not
usually granted where damages would be an adequate remedy.


                                      -20-
<PAGE>
        Also in giving such opinion, such counsel may rely upon the opinion or
opinions of counsel named in paragraph (a) of this Section VI as to matters of
New York and United States federal law.

                  (c) United States counsel to the Agents, shall have furnished
        to such Agent (i) such opinion or opinions, dated the Commencement Date,
        covering certain of the matters referred to in subparagraph (i), (ii),
        (iii), (iv), and the last paragraph of clause (a) of this Section VI,
        and (ii) if and to the extent requested by such Agent, with respect to
        each applicable date referred to in Section V(h) hereof that is on or
        prior to such Time of Delivery, as the case may be, an opinion or
        opinions, dated such applicable date, to the effect that such Agent may
        rely on the opinion or opinions which were last furnished to such Agent
        pursuant to this Section VI(c) to the same extent as though it or they
        were dated the date of such letter authorizing reliance (except that the
        statements in such last opinion or opinions shall be deemed to relate to
        the Registration Statement and the Prospectus as amended and
        supplemented to such date) or, in any case, in lieu of such an opinion
        or opinions, an opinion or opinions of the same tenor as the opinion or
        opinions referred to in clause (i) but modified to relate to the
        Registration Statement and the Prospectus as amended and supplemented to
        such date; and in each case such counsel shall have received such papers
        and information as they may reasonably request to enable them to pass
        upon such matters; in giving such opinion, such counsel may rely upon
        the opinion or opinions of counsel named in paragraph (b) of this
        Section VI as to matters of Dutch law.

                  (d) Mr. Theo P.M. Schmit of Philips Corporate Fiscal
        Department, internal tax counsel for the Issuer, dated the Commencement
        Date to the effect that the statements contained in the prospectus under
        the caption "Taxation - The Netherlands" insofar as they relate to
        matters of Netherlands tax law, are correct in all material respects. In
        rendering such opinion, such counsel may rely on the opinion of Sullivan
        & Cromwell as to matters of United States and New York law and
        certificates of officers of the Issuer and its subsidiaries as to
        matters of fact.

                  (e) On the Commencement Date and on each applicable date
        referred to in Section V(j) hereof that is on or prior to such
        Solicitation Time or Time of Delivery, as the case may be, the
        independent auditors who have audited the financial statements of the
        Issuer and its subsidiaries included in the Registration Statement and
        the Prospectus shall have furnished to such Agent a letter, dated the
        Commencement Date or such applicable date, as the case may be, in form
        and substance reasonably satisfactory to such Agent, containing
        statements and information of the type ordinarily included in
        accountants' "comfort letters" to agents or underwriters with respect to
        the financial statements and certain financial information contained in
        the Registration Statement and the Prospectus, both as amended or
        supplemented.


                                      -21-
<PAGE>
                  (f) There shall not have occurred any change, or any
        development involving a prospective change, in the condition, financial
        or otherwise, or in the earnings, business or operations, of the Issuer
        and its subsidiaries, taken as a whole, from that set forth in the
        Registration Statement and Prospectus, as amended or supplemented, that,
        in the reasonable judgment of each applicable Agent, is material and
        adverse and that makes it, in the reasonable judgment of such applicable
        Agent, after consultation with the Issuer, impracticable to market the
        Securities on the terms and in the manner contemplated in the Prospectus
        and Prospectus Supplement.

                  (g) There shall not have been any downgrading, nor shall any
        notice have been given of any intended or potential downgrading or of
        any review for a possible change that does not indicate the direction of
        the possible change, in the rating accorded any of the Issuer's
        securities by any "nationally recognized statistical rating
        organization" as such term is defined for purposes of Rule 436(g)(2)
        under the Securities Act.

                  (h) There shall not have occurred any of the following: (i)
        trading generally shall have been suspended or materially limited on or
        by, as the case may be, any of the Euronext Amsterdam N.V.'s stock
        market or the New York Stock Exchange, (ii) a general moratorium on
        commercial banking activities in Amsterdam or New York shall have been
        declared by Netherlands, United States Federal or New York State
        authorities, as the case may be, (iii) there shall have occurred any
        outbreak or escalation of hostilities that, in the good faith judgment
        of the applicable Agent, is material and adverse and (b) in the case of
        any of the events specified in clauses (a)(i) through (iii), such event,
        singly or together with any other such event, makes it, in the good
        faith judgment of an Agent, after consultation with the Issuer,
        impracticable to market the Securities on the terms and in the manner
        contemplated in the Prospectus).

                  (i) The Issuer shall have furnished or caused to be furnished
        to such Agent certificates of officers of the Issuer dated the
        Commencement Date and each applicable date referred to in Section V(k)
        hereof that is on or prior to such Time of Delivery, in such form and
        executed by such officers of the Issuer as shall be reasonably
        satisfactory to such Agent, as to the accuracy of the representations
        and warranties of the Issuer herein at and as of the Commencement Date
        or such applicable date, as the case may be, as to the performance in
        all material respects by the Issuer of all of its obligations hereunder
        to be performed at or prior to the Commencement Date or such applicable
        date, as the case may be, as to the matters set forth in subsection (f)
        and (g) of this Section VI, and as to such other matters as such Agent
        may reasonably request.

                  (j) The applicable Prospectus Supplement shall have been filed
        with


                                      -22-
<PAGE>
        the Commission pursuant to Rule 424 within the applicable time period
        prescribed for such filing by the rules and regulations under the
        Securities Act and no stop order suspending the effectiveness of the
        Registration Statement shall be in effect.

                                      VII.

        The Issuer agrees to indemnify and hold harmless each Agent and each
person, if any, who controls any Agent within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act, from and against any
and all direct losses, claims, damages and liabilities (including, without
limitation, any legal or other out-of-pocket expenses reasonably incurred in
connection with defending or investigating any such action or claim) caused by
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or the Prospectus (as amended or supplemented if the
Issuer shall have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to the
Agents furnished to the Issuer in writing by any Agent expressly for use
therein; provided, however, the foregoing indemnity with respect to any untrue
statement or omission or alleged untrue statement or omission made in a
preliminary prospectus shall not inure to the benefit of any Agent (or any
person controlling such Agent) from whom the person asserting any such direct
losses, liability, claim, damage or expense purchased any of the Securities that
are the subject thereof if such person was not sent or given a copy of the
Prospectus (or the Prospectus as amended or supplemented) (if the Issuer shall
have furnished any amendments or supplements thereto to the Agents), at or prior
to the written confirmation of the sale of such Securities to such person and
the untrue statement or omission or alleged untrue statement or omission made in
such preliminary prospectus was corrected in the Prospectus (or the Prospectus
as amended or supplemented). In no event shall the Issuer be liable for indirect
or consequential losses.

        Each Agent agrees, severally and not jointly, to indemnify and hold
harmless the Issuer, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Issuer within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act to the
same extent as the foregoing indemnity from the Issuer to each Agent, but only
with reference to information relating to such Agent furnished to the Issuer in
writing by such Agent expressly for use in the Registration Statement, any
preliminary prospectus, the Prospectus, or any amendment or supplement thereto.

        In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to


                                      -23-
<PAGE>
either of the two preceding paragraphs, such person (hereinafter called the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (hereinafter called the "indemnifying party") in writing
(or by facsimile and confirmed in writing) and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel, (ii) the
indemnifying party has failed within a reasonable time to retain counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both parties
by the same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party shall not,
in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all such indemnified parties, and that
all such fees and expenses shall be reimbursed as they are incurred. Such firm
shall be designated in writing by [Lead Agent] or, if [Lead Agent] is not an
indemnified party and is not reasonably likely to become an indemnified party,
by the Agents that are indemnified parties, in the case of parties indemnified
pursuant to the second preceding paragraph and by the Issuer in the case of
parties indemnified pursuant to the first preceding paragraph. The indemnifying
party shall not be liable for any settlement of any proceeding effected without
its written consent, but if settled with such consent or if there shall be a
final judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any direct loss or liability by reason of
such settlement or judgment. Notwithstanding the foregoing sentence, if at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the third sentence of this paragraph, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceedings.

        If the indemnification provided for in the first or second paragraph of
this Section VII is unavailable to an indemnified party or insufficient in
respect of any direct losses, claims,


                                      -24-
<PAGE>
damages or liabilities referred to therein, then each indemnifying party under
such paragraph, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Issuer, on the one
hand, and such Agent, on the other hand, from the offering of the Securities to
which such loss, claim, damage, liability or action in respect thereof relates
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Issuer, on the one hand, and of such Agent, on the other hand, in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Issuer, on the one hand, and such Agent, on
the other hand, shall be deemed to be in the same respective proportions as the
net proceeds from such offering (before deducting expenses) received by the
Issuer and the total discounts and commissions received by such Agent, in
respect thereof. The relative fault of the Issuer, on the one hand, and of such
Agent, on the other hand, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Issuer, on the one hand, or by such Agent, on the other hand,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.

        The Issuer and each Agent agree that it would not be just and equitable
if contribution pursuant to this Section VII were determined by pro rata
allocation (even if the Agents were treated as one entity for such purpose) or
by any other method or allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph shall
be deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section VII, no Agent shall be required to contribute any
amount in excess of the amount by which the total price at which the Securities
referred to in the preceding paragraph and purchased by it or through it were
sold exceeds the amount of any damages that such Agent has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Agents' respective obligations to contribute pursuant to
this Section VII are several in proportion to the respective principal amounts
of Securities purchased by them or through them to which such loss, claim,
damage, liability or action in respect thereof relates, and not joint. The
remedies provided for in this Section VII are not exclusive and shall not limit
any rights or remedies which may otherwise be available to any indemnified party
at law or in equity.


                                      -25-
<PAGE>
                                     VIII.

        Each Agent, in soliciting offers to purchase Securities from the Issuer
and in performing the other obligations of such Agent hereunder (other than in
respect of any purchase by an Agent as principal, pursuant to a Terms Agreement
or otherwise), is acting solely as agent for the Issuer and not as principal.
Each Agent will make reasonable efforts to assist the Issuer in obtaining
performance by each purchaser whose offer to purchase Securities from the Issuer
was solicited by such Agent and has been accepted by the Issuer, but such Agent
shall not have any liability to the Issuer in the event such purchase is not
consummated for any reason. If the Issuer shall default on its obligation to
deliver Securities to a purchaser whose offer it has accepted, the Issuer shall
(i) hold each Agent harmless against any direct loss, claim or damage arising
from or as a result of such default by the Issuer and (ii) notwithstanding such
default, pay to the Agent that solicited such offer any commission to which it
would be entitled in connection with such sale.

                                      IX.

        The respective indemnities, agreements, representations, warranties and
other statements of the Agents, the Issuer contained in this Agreement shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement or any applicable Terms Agreement, (ii) any investigation made
by or on behalf of any Agent or any person controlling any Agent or by or on
behalf of any of the Issuer, their respective officers or directors or any other
person controlling the Issuer and (iii) acceptance of and payment for any of the
Securities.

                                       X.

        The provisions of this Agreement authorizing the solicitation of offers
to purchase Securities from the Issuer may be suspended or terminated at any
time by the Issuer as to any Agent or by any Agent upon the giving of written
notice of such suspension or termination to such Agent or the Issuer, as the
case may be. In the event of such suspension or termination with respect to any
Agent, (x) this Agreement shall remain in full force and effect with respect to
any Agent as to which such suspension or termination has not occurred, (y) this
Agreement shall remain in full force and effect with respect to the rights and
obligations of any party which have previously accrued or which relate to
Securities which are already issued, agreed to be issued or the subject of a
pending offer at the time of such suspension or termination and (z) in any
event, this Agreement shall remain in full force and effect insofar as the
fourth paragraph of Section II(a) with respect to solicitations made prior to
such suspension or termination, Section V(e), Section V(m), Section VII, Section
VIII and Section IX are concerned.


                                      -26-
<PAGE>
                                      XI.

        Except as otherwise specifically provided herein or in the Procedures,
all statements, requests, notices and advices hereunder shall be in writing, or
by telephone if promptly confirmed in writing, and if to [Lead Agent] shall be
sufficient in all respects when delivered or sent by facsimile transmission or
registered mail to [ ], Attention: [ ] (telefax: 212-[ ]) with a copy to [ ],
Attention: [ ] (telefax: 212-[ ]); if to -, [ ], Attention: [ ] (telefax:
212-[]); and if to Koninklijke Philips Electronics N.V., Breitner Center,
Amstelplein 2, 1070 MX Amsterdam, The Netherlands., Attention: [ ] (telefax:
011-[ ]).

                                      XII.

        This Agreement and any Terms Agreement shall be binding upon, and inure
solely to the benefit of, the parties hereto or thereto, respectively, and to
the extent provided in Section VII and Section VIII hereof, the officers and
directors of the Issuer and any person who controls any Agent or the Issuer, and
their respective personal representatives, successors and assigns, and no other
person shall acquire or have any right under or by virtue of this Agreement or
any Terms Agreement. No purchaser of any of the Securities through or from any
Agent hereunder shall be deemed a successor or assign by reason merely of such
purchase.

                                     XIII.

        The Issuer has appointed Philips Electronics North America Corporation
(or any successor pursuant to this Article XIII) as its authorized agent (the
"Authorized Agent") upon which process may be served, to the attention of its
company secretary, in any action based on this Agreement that may be instituted
in any state or federal court in the City, County and State of New York by any
Agent or by any person controlling any Agent, and expressly accepts the
jurisdiction of any such court in respect of such action. Unless otherwise
agreed by the Agents and their counsel, such appointment shall be irrevocable
for a period of five years from and after the completion of sale of all the
Securities unless and until a successor Authorized Agent shall be appointed and
such successor shall accept such appointment for the remainder of such five year
period. The Issuer represents to each of the Agents that it has notified the
Authorized Agent of such designation and appointment and that Authorized Agent
has accepted the same in writing. The Issuer will take any and all action,
including the filing of any and all documents and instruments, that may be
necessary to continue such appointment or appointments in full force and effect
as aforesaid. Service of process upon the Authorized Agent and written notice of
such service to the Issuer (mailed or delivered as aforesaid) shall be deemed,
in every respect, effective service of process upon the Issuer. Notwithstanding
the foregoing, any action based on this Agreement may be instituted by any Agent
against the Issuer in any competent court in The Netherlands.


                                      -27-
<PAGE>
                                      XIV.

        Time shall be of the essence in this Agreement and any Terms Agreement.
As used herein, the term "business day" shall mean any day when the office of
the Commission in Washington, D.C. is open for business and when banking
institutions The Netherlands are open for business.

                                      XV.

        THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.

                                      XVI.

        This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

        If the foregoing is in accordance with your understanding, please sign
and return to us ten counterparts hereof, whereupon this letter and the
acceptance by each of you thereof shall constitute a binding agreement between
the Issuer and each of you in accordance with its terms.

                                            Very truly yours,

                                            KONINKLIJKE PHILIPS ELECTRONICS N.V.

                                            By__________________________________
                                               Name:
                                               Title:




The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.

[Lead Agent]


By__________________________________
    Name:
    Title:


                                      -28-
<PAGE>
[  ]

____________________________________
    Name:
    Title:


                                      -29-

</TEXT>
</DOCUMENT>
