EXHIBIT 10.29
DISTRIBUTION AGREEMENT
THIS AGREEMENT is made and entered into on this 6th day of July, 1995, by
and between FSI International, Inc., a corporation organized and existing under
the laws of Minnesota, U.S.A., with its principal place of business at Chaska,
Minnesota (U.S.A.) (hereafter "Supplier") and Metron Semiconductors Europa B.V.,
a limited liability company organized and existing under the laws of The
Netherlands, with its principal place of business at Almere, The Netherlands
(hereafter "Distributor").
WHEREAS, Supplier designs, manufactures and sells products for use in the
semiconductor industry, which Products are more particularly described in
Exhibit A attached hereto (the "Products"), and wishes to expand its market for
the Products in the geographical areas set forth in Exhibit B attached hereto
(the "Territories");
WHEREAS, Distributor has served as Supplier's distributor under various
distribution agreements dating back to 1975.
WHEREAS, Distributor wishes to assign this Agreement to those of its
subsidiaries and affiliates in the respective Territories as more particularly
described in Exhibit B;
WHEREAS, Supplier wishes to appoint Distributor and Distributor wishes to
accept such appointment, as the independent, exclusive distributor of the
Products in the Territories on the terms and conditions set forth herein; and
NOW, THEREFORE, Supplier and Distributor agree as follows:
1. Appointment of Distributor, Terms of Product Sales.
___________________________________________________
1.1 Subject to all of the terms and conditions of this Agreement,
Supplier hereby appoints Distributor, and Distributor hereby accepts
such appointment, as the exclusive, independent distributor of the
Products in the Territories. Supplier may, however, sell Products to
third parties for use in the Territories on a representative basis,
provided that Supplier shall pay Distributor a commission with
respect to such Products determined by Supplier and based on services
performed by Distributor with respect to such Products. In certain
representative sales of Products, Supplier may allocate the
commission between Distributor and a third party, such allocation
determined by Supplier and based on an equitable basis and consistent
with past practice between Supplier and Distributor. Moreover,
Supplier shall not be prohibited from establishing a technical or
support offices or organizations in the Territories, provided that
such offices or organizations should not engage in sales of the
Products.
1.2 With the exception of Products sold to specific customers determined
on either a customer-by-customer or project-by-project basis, and as
agreed to by Supplier and Distributor, Supplier shall sell the
Products to Distributor at Supplier's current U.S. domestic sales
list prices, less Distributor's discount, as provided in Exhibit A.
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Supplier may change its sales list prices upon sixty (60) days'
advance written notice to Distributor.
1.3 Distributor shall have the right of first refusal to act as
distributor in the Territories and under the terms of this Agreement
for any modified, revised, up-dated or replacement products sold by
Supplier and related to the Products. Supplier shall notify
Distributor immediately of any such products.
1.4 Sales to the Distributor will be invoiced on an open account basis.
Sales invoices will be due for payment sixty (60) days after shipment
of the Products. A reasonable late payment penalty may be applied to
late payments for Products accepted by Distributor or Distributor's
customers, without prior written approval by Supplier. Such penalty
shall be equal to the lesser of the following interest rates in
effect on the date the payment was due: (i) two points plus the prime
interest rate as announced by Xxxxxx Trust and Savings Bank, and (ii)
three points plus the statutory default late payment interest rate
under the laws of the Netherlands applicable to distribution
agreements.
1.5 Supplier shall retain title to the Products and bear the risk of loss
until delivery to the carrier, F.O.B. Supplier's factory or
distribution center, at which time title shall pass and the risk of
loss shall be borne by Distributor (or Distributor's customers).
Provided, however, that beginning September 1, 1996, Supplier and
Distributor shall implement procedures to provide for Supplier to
retain title to the Products and bear the risk of loss until delivery
F.O.B. at Distributor's warehouse (or the place of acceptance by
Distributor's customer). In any event, Distributor (or Distributor's
customers) shall, directly or indirectly, bear the cost of any
customs duties, taxes, shipping and handling costs, and insurance
with respect to the shipment of the Products.
1.6 Notwithstanding the general rule provided in Section 1.5 above,
Supplier and Distributor may negotiate and arrange for certain sales
of Products pursuant to terms under which either: (i) Supplier shall
retain title to the Products and bear the risk of loss until
delivery, F.O.B. Distributor's warehouse (or the place of acceptance
by Distributor's customer), or (ii) Supplier shall retain title to
the Products and bear the risk of loss until delivery to the carrier,
F.O.B. Supplier's factory or distribution center.
2. Obligations and Covenants of Supplier.
______________________________________
2.1 Supplier will use its best efforts to comply with Distributor's
request for the means of shipping the Products as specified in
Distributor's orders and shall use its best efforts to notify
Distributor in the event that Supplier is unable to comply with such
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request. Supplier shall not send partial shipments of Distributor's
orders unless Distributor agrees in advance.
2.2 Absent extraordinary circumstances and subject to written agreement
by Supplier and Distributor (such agreement which shall not be
reasonably withheld), Supplier shall not sell the Products directly
to customers in the Territories and shall refer to Distributor in a
timely manner all orders and inquiries relating to the Products
originating from within or outside the Territories to the extent such
orders or inquiries relate to Products destined for use within the
Territories.
2.3 In negotiation or renegotiation of any agreement with any of its
other distributors, agents or employees subsequent to the date of
this Agreement, Supplier will insist upon a covenant that such other
distributor, agent or employee will not seek customers or establish a
branch or maintain any distribution outlet in the Territories.
2.4 Supplier will, from time to time, supply Distributor, at Supplier's
cost, with a reasonable quantity of promotional materials in the
English language, such as literature, catalogs and other advertising
materials relating to the Products. Such promotional materials shall
also be translated in the native language of the country to which the
Products are shipped if required by applicable law.
2.5 [Section 2.5 is left blank intentionally.]
2.6 Supplier will conduct technical seminars and provide training for
sales or services related to the Products for the benefit of
Distributor's employees. Each party shall be responsible for the
expenses (including the cost of transportation, meals and lodging)
incurred by its own employees attending such seminars or training.
2.7 Supplier will, from time to time, and at its own cost (including the
cost of salaries and lodging for Supplier's employees) participate in
international trade shows for promoting the Products in the
Territories pursuant to agreement by Supplier and Distributor.
2.8 Supplier will use its best efforts to assist Distributor to
facilitate any import processing by providing Distributor with all
required documents and information.
2.9 Supplier agrees to comply with all applicable export control laws and
regulations relating to the Products. Supplier will also use its
best efforts to provide information necessary for Distributor to
comply with all applicable export control laws and regulations
relating to the Products.
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2.10 Supplier's current, general warranty with respect to the Products is
set forth in Supplier's International System Warranty which is
attached hereto as Exhibit C and incorporated herein by reference.
Such warranty may be amended, supplemented or replaced by Supplier,
provided that Supplier provides Distributor with sixty (60) days'
prior written notice of such amended, supplemented or replacement
warranty.
2.11 Without Distributor's prior written consent, Supplier will not use,
reproduce, disclose or otherwise make available to any person, other
than Supplier's employees or agents who have a need to know such
information, any and all information, written or oral, which is
disclosed by Distributor to Supplier, identified as confidential
information and not generally available to the public. The term
"confidential information" shall not include information provided by
Distributor to Supplier exclusively for the purpose of soliciting
potential and actual sales of the Products. In addition, the term
"confidential information" shall not include any information that is
or becomes known to the public through no fault of Supplier.
2.12 Supplier shall accept for credit Distributor's inventory of spares or
equipment pursuant to the terms of Supplier's Inventory Return
Policy, a current copy of which is attached hereto as Exhibit D.
2.13 During the term of any warranty made by Supplier with respect to any
Product sold by Distributor, Supplier shall maintain an adequate
inventory of spare parts for such Product.
2.14 Upon delivery of each Product by Supplier to Distributor, Supplier
shall supply Distributor with adequate documentation to Distributor
for purposes of servicing and trouble-shooting such Product. Such
documentation shall comply with any applicable law. The cost of any
such manuals and documentation shall be included in the price of the
Product under Section 1.2 of this Agreement.
3. Obligations and Covenants of Distributor.
_________________________________________
3.1 Distributor will use its best efforts to market and sell the Products
in the Territories.
3.2 Except as otherwise required by law, Distributor will market and sell
the Products without removing or altering any labels, trade names,
trademarks, notices, labels, serial numbers or other identifying
marks, symbols or legends affixed to any of the Products or their
containers or packages.
3.3 Supplier shall not be liable under any warranty made by Distributor
with respect to any of the Products which exceed the warranties made
by Supplier which warranties are more particularly described in
Exhibit C attached hereto. Supplier may modify
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any warranties upon reasonable notice to Distributor, provided,
however, that such amended Warranties will not apply to Products sold
or Products which Distributor has entered into a contract to sell but
has not yet delivered.
3.4 Without Supplier's prior written consent, Distributor shall not use,
produce or disclose or otherwise make available to any person, other
than Distributor's employees or agents who have a need to know such
information for the performance of its obligations hereunder, any and
all information written or oral, which is disclosed by Supplier to
Distributor, identified as confidential information and not generally
available to the public. The term "confidential information" shall
not include information provided by Supplier to Distributor
exclusively for the purpose of soliciting potential and actual sales
of the Products. In addition, the term "confidential information"
shall not include any information that is or becomes known to the
public through no fault of Distributor.
3.5 Distributor shall furnish to Supplier, upon Supplier's reasonable
requests from time to time, reports including, but not limited to,
actual and forecast sales, market conditions and competitive
activity.
3.6 Distributor will, from time to time, and at its own cost (including
the cost of salaries and lodging for Distributor's employees),
participate in international trade shows for promoting the Products
in the Territories, pursuant to agreement by Supplier and
Distributor.
3.7 Distributor shall use its best efforts to service any Products during
any applicable warranty period. Distributor may contract with other
individuals or business entities to assist Distributor in installing
and servicing the Products, provided that such individuals or
business entities: (i) have adequate training to install and service
the Products, and (ii) agree in writing that they will not compete
with Supplier by selling any products or equipment in the Territories
during the term of this Agreement, to the extent that such products
or equipment are similar in function to any Products sold by
Supplier.
4. Term and Termination.
_____________________
4.1 Unless and until sooner terminated as provided for herein, this
Agreement shall continue for a term of three (3) years commencing on
July 1, 1995 and will be deemed automatically renewed thereafter for
one or more additional terms of two (2) years and on the same
conditions.
4.2 This Agreement may be terminated by either party upon providing the
other party with written notice of termination more than twelve (12)
months prior to expiration
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of the applicable term, i.e., more than twelve (12) months prior to
expiration of the initial three-year term or more than twelve (12)
months prior to expiration of an ensuing two-year extension.
4.3 In the event of a breach of any material provision of this Agreement,
this Agreement may be terminated upon ninety (90) days' written
notice given by the non-breaching party to the other party, which
notice shall specify the breach on which the termination is based,
provided, however, that in such event this Agreement shall continue
in full force and effect without regard to such notice if the other
party cures the breach specified in the notice within the said 90-day
period.
4.4 This Agreement will terminate immediately upon the occurrence of any
of the following events:
(a) All or any substantial part of the property of either party
shall be condemned, seized or otherwise appropriated, or the
custody or control of such property shall be assumed by any
person or agency acting or purporting to act under authority of
any government (de jure or de facto) or either party shall have
been prevented from exercising normal managerial control over
all or any substantial part of its property by any such person
or agency; or
(b) Either party shall (i) apply for or consent to the appointment
of a receiver, trustee or liquidator for its business or of all
or any substantial part of its assets, or (ii) be unable, or
admit in writing its inability, to pay its debts as they mature,
(iii) make a general assignment for the benefit of creditors,
(iv) be adjudicated a bankrupt or insolvent, or (v) file a
voluntary petition in bankruptcy or a petition or an answer
seeking reorganization or an arrangement with creditors or
seeking to take advantage of any insolvency law, or file an
answer admitting the material allegations of a petition filed
against either party in any bankruptcy, reorganization or
insolvency proceeding, or take corporate action for the purpose
of effecting any of the foregoing; or
(c) An order, judgment or decree shall be entered without the
application, approval or consent of the subject party by any
court of competent jurisdiction, approving a petition seeking
reorganization of the party or appointing a receiver, trustee or
liquidator of its business or of all or any substantial part of
its assets; or
(d) An order or notice shall be published by any government or
inter-government authority requiring the cessation of trading
activities with
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the subject party as a result of the violation of export
controls, safety or other regulatory laws.
4.5 Upon termination of this Agreement, Distributor shall no longer have
the right to serve as a distributor of the Products in the
Territories and shall not be entitled to any additional consideration
as a result of such termination. However, Distributor shall have the
right to continue selling in the Territories the Products which are
in Distributor's inventory at the time of termination of this
Agreement; such right, however, shall terminate six (6) months after
termination of this Agreement. Supplier shall accept all Products
returned by Distributor for full refund if Distributor so requests in
writing within twelve (12) months after termination of this
Agreement, such refund to be made at the prices for which the
Products were originally purchased by Distributor from Supplier,
provided that the returned Products are in good condition as approved
by Supplier, such approval by Supplier shall not be unreasonably
withheld or delayed.
4.6 Upon termination of this Agreement, Distributor shall cease to
represent itself as being a distributor of Supplier. Within sixty
(60) days after termination, Distributor will return to Supplier all
promotional materials for and samples and demonstration models of the
Products.
4.7 Notwithstanding termination of this Agreement upon notice as provided
in Section 4.2 of this Agreement, Supplier shall continue to provide
Products in conformity with and pursuant to the terms of this
Agreement during the remaining term of this Agreement. Further, in
the event of a termination notice, Distributor shall notify Supplier
by the termination date, of a list of all prospective customers
interested in the Products. If, within six (6) months after the
termination date, Supplier receives a purchase order from any of the
identified prospects, Supplier (i) shall promptly notify Distributor
of such purchase order and (ii) shall pay to Distributor a commission
equal to the Distributor's discount with respect to the Products
under such purchase order.
4.8 Notwithstanding termination of this Agreement, Distributor shall
continue to perform all warranty service during the term of any
applicable warranty period, whether such warranty expires before or
after the termination of this Agreement, with respect to any Products
sold by, on behalf of, or in cooperation with Distributor.
4.9 Upon the termination, expiration or non-renewal of this Agreement,
Supplier shall not be liable to Distributor for any compensation,
reimbursement or damages on account of the loss of prospective
profits from anticipated sales, or on account of any expenditures,
investments, losses or commitments in connection with the
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business or goodwill of Supplier, Distributor, or otherwise, provided that
Supplier has not breached any material provision of this Agreement, except as
expressly provided in Section 4.7 of this Agreement.
5. Indemnification.
________________
5.1 Distributor hereby agrees to indemnify and hold Supplier harmless
from and against any and all damages, liabilities, fines or
expenses incurred by Supplier as a result of Distributor's breach
of any provision hereof.
5.2 Supplier hereby agrees to indemnify and hold Distributor harmless
from and against any and all damages, liabilities, fines or
expenses incurred by Distributor as a result of Supplier's breach
of any provision hereof.
5.3 Supplier agrees to defend and hold Distributor harmless from and
against any and all damages, liabilities, fines or expenses
incurred by Distributor in connection with any claim or lawsuit
arising out of the design, manufacture, use, Supplier's warranty,
or defect ("gebrek") of any of the Products, provided that
Distributor has complied with its obligations hereunder and has
given prompt notice of the claim or lawsuit to Supplier together
with all information and documents relating to such a claim or
lawsuit. Distributor hereby agrees to assist Supplier in defending
such claim or lawsuit.
5.4 Supplier agrees to defend and hold Distributor harmless from and
against any and all damages, liabilities, fines or expenses
incurred by Distributor in connection with any claim or lawsuit
arising out of any infringement or alleged infringement of any
patent or other intellectual property rights of any person, firm or
company in the Territories, provided that Distributor has given
prompt notice of the claim or lawsuit to Supplier together with all
information and documents relating to such a claim or lawsuit.
Distributor hereby agrees to assist Supplier in defending such
claim or lawsuit.
5.5 The indemnification agreements as provided in this Section 5 shall
continue in full force and effect despite the expiration, recision,
or termination of this Agreement.
6. Relationship of the Parties.
____________________________
6.1 The relationship between Supplier and Distributor is that of seller
and buyer. Neither Distributor, nor any employee of Distributor,
shall be considered an employee or agent of Supplier for any
purpose. Unless otherwise expressly authorized in writing by the
other party hereto, neither party shall have the right or authority
to assume or create any responsibility, express or implied, on
behalf of or
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in the name of the other party hereto, or to bind the other party
in any manner whatsoever, or to accept payment from any person on
behalf of the other party.
6.2 Supplier hereby grants a license to Distributor permitting
Distributor to use Supplier's trademarks and trade names in
connection with the sale of Products. Distributor agrees to use
Supplier's trademarks and trade names only in connection with the
sale of any Products. This license shall terminate upon the
termination of this Agreement, at which time Distributor shall
cease to and shall not thereafter use, and shall not permit any of
its agents, employees or subsidiaries thereafter to use, for any
purpose whatsoever, any of Supplier's trademarks or trade names
other than for the purpose of selling Products in Distributor's
inventory as specifically provided in Section 4.5 of this
Agreement, or pursuant to any other written agreement between the
parties. Nothing in this Agreement shall be deemed to transfer to
or confer upon Distributor any right, title or interest in any
trademark or trade name owned by or used by Supplier.
6.3 During the term of this Agreement and for a period of six (6)
months after termination of this Agreement, (i) Supplier shall not,
without Distributor's prior written consent, solicit employees of
Distributor or any of its subsidiaries for employment with Supplier
or otherwise interfere with Distributor's relationship with its
employees, and (ii) Distributor shall not, without Supplier's prior
written consent, solicit employees of Supplier or any of its
subsidiaries for employment with Distributor or otherwise interfere
with Supplier's relationship with its employees. This Section shall
not restrict or prohibit (i) Supplier from hiring an employee of
Distributor or any of its subsidiaries, if such employee applies
for employment with Supplier by responding to an announcement of an
available employment position, and (ii) Distributor from hiring an
employee of Supplier or any of its subsidiaries, if such employee
applies for employment with Distributor by responding to an
announcement of an available employment position.
7. Assignment.
___________
7.1 Neither this Agreement nor any right, title, interest or obligation
hereunder may be assigned or otherwise transferred by either party
or their assignees, transferees or successors in interest without
the prior written consent of the other party. This Agreement shall
inure to the benefit of such assignees, transferees and other
successors in interest of the parties in the event of an assignment
or other transfer made consistent with the provisions of this
Agreement.
7.2 By its signature to the Agreement, Supplier consents to the
assignment of this Agreement to Distributor's affiliated companies
in the respective geographical areas set forth in Exhibit B
attached hereto.
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8. Force Majeure.
______________
Neither party shall be liable for any breach of this Agreement occasioned
by an act of God, labor disputes, unavailability of transportation, goods
or services, governmental restrictions or actions, change in the law, war
(declared or undeclared) or other hostilities, or by any other event, the
condition or cause of which is beyond the control of such party. In the
event of nonperformance or delay attributable to any such causes, the
period for performance of the applicable obligation hereunder will be
extended for a period equal to the period of delay. However, the party so
delayed shall use its best efforts, without obligation to expend
substantial amounts not otherwise required under this Agreement, to
circumvent or overcome the cause of the delay. In the event that any such
delay exceeds sixty (60) days, either party may at its option terminate
this Agreement effective immediately by giving written notice thereof to
the other party.
9. Notices
_______
Any notice required to be given hereunder shall be deemed to have been
effectively given only when delivered personally to an officer of the
applicable party, or when first sent by telefax and confirmed by registered
mail, addressed to the applicable party at its address set forth below, or
at such other address as such party my hereafter designate as the
appropriate address for the receipt of such notice:
To Supplier at: FSI International, Inc.
Attention: Benno Sand
000 Xxxx Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxx 00000
X.X.X.
To Distributor at: Metron Semiconductors Europa B.V.
c/o Metron Technology Corporation
Attention: Xxxxxx Xxxxx
000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000-0000
X.X.X.
With a copy to: Metron Semiconductors Europa B.V.
Attention: Xxx Xxxxxxx
XxxxxxxxxxXx 00
X-00000 Xxxxxxxx
Xxxxxxx
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10. Waiver.
_______
No waiver by either party of strict compliance with all terms and
conditions of this Agreement shall constitute a waiver of any subsequent
failure of the other party to comply strictly with each and every term and
condition hereof.
11. Complete Agreement.
___________________
This Agreement constitutes the entire agreement between the parties
relating to the subject matter contained herein and it supersedes and
terminates any and all prior agreements between them, including the
Distribution Agreements between Supplier and Distributor dated July 8 and
October 9, 1987, and the Distribution Agreement between Supplier and Metron
Semiconductors (Hong Kong) Ltd. dated July 1, 1987. If any provision, or
application hereof, of this Agreement is held unlawful or unenforceable in
any respect, such illegality or unenforceability shall not affect other
provisions or applications that can be given effect and this Agreement
shall be construed as if the unlawful or unenforceable provision or
application had not been contained herein. This Agreement may be amended or
otherwise modified only by a written document signed by authorized
representatives of the parties.
12. Counterparts.
_____________
This Agreement may be executed in two counterparts, each of which shall
be deemed an original, but both of which shall constitute but one
instrument.
13. Arbitration and Applicable Law.
_______________________________
13.1 Any dispute between the parties arising out of or in connection
with this Agreement that cannot be settled amicably between the
parties shall be finally resolved by arbitration. Arbitration
proceedings shall be conducted in Minneapolis, Minnesota pursuant
to the International Arbitration Rules of the American Arbitration
Association. In the event that either party makes a demand for
arbitration, the arbitrator shall be selected by mutual agreement
between the parties, or if the parties are unable to agree on an
arbitrator within twenty (20) days after a demand for arbitration
is made, the arbitrator shall be selected by the American
Arbitration Association. Disputes subject to arbitration hereunder
for claims in the aggregate amount of One Million (U.S.) Dollars
($1,000,000.00) shall be resolved by a panel of three independent
impartial arbitrators, one arbitrator selected by Supplier, one by
Distributor and the third by the other two arbitrators. Failure to
select an arbitrator within twenty (20) days of a demand for
arbitration shall be deemed a waiver of a right to select an
arbitrator and one will be selected by the American Arbitration
Association. All arbitrators shall be persons with skill and
experience in the
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industry. The costs of arbitration, but not the costs and
expenses of the parties, shall be shared equally by Supplier and
Distributor.
13.2 Either party shall have the right to review, prior to the
submission of its case to the arbitration panel, any and all
documents in the possession of the other party which relate to such
other party's performance under, or the conduct of its activities
in connection with, this Agreement.
13.3 The governing language of this Agreement shall be English. This
Agreement shall be interpreted and enforced in accordance with the
laws of the United States and the State of Minnesota, without
giving effect to choice of law principles. The United Nations
Convention on Contracts for the International Sale of Goods shall
not apply to this Agreement.
13.4 The agreement to arbitrate as provided in this Section 13 shall
continue in full force and effect despite the expiration, recision,
or termination of this Agreement. The parties knowingly and
voluntarily waive their rights to have their dispute tried and
adjudicated by a judge or jury.
THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
DISTRIBUTOR SUPPLIER
METRON SEMICONDUCTORS EUROPA B.V. FSI INTERNATIONAL, INC.
/s/ Xxx Xxxxxxx /s/ X. X. Xxxxxxxx
By____________________________ By____________________________
Xxx Xxxxxxx X. X. Xxxxxxxx
Its Executive Vice President Its Chief Executive Officer
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