Exclusive Distribution Agreement - Netherlands

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 Harris 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 ma ...