exv10w34



 



Exhibit 10.34


SECOND AMENDMENT TO TRANSITION AGREEMENT



          This AMENDMENT (the “Amendment”) is made as of this 28th day of February,
2003 to that certain Transition Agreement dated as of October 9, 20023 and as
amended by the First Amendment thereto (as amended, the “Transition Agreement”)
by and between FSI INTERNATIONAL, INC. (“FSI”), a corporation organized and
existing under the laws of the state of Minnesota, and METRON TECHNOLOGY N.V.,
a company organized as a Naamloze Vennootschap under the laws of the
Netherlands (“Metron”).



          In consideration of the actions contemplated by the Transition Agreement
and in consideration of the mutual agreements set forth herein, the parties
hereby agree that the Transition Agreement shall be amended as set forth below.




	 	1.	 	Interpretation.



          Terms used herein with an initial capital letter but not otherwise defined
herein shall have the meanings assigned to such terms in the Transition
Agreement. All references to sections, exhibits or schedules herein shall be
to sections, exhibits or schedules of the Transition Agreement.




	 	2.	 	Delayed Assignment of Metron Shares upon Closing.



          Notwithstanding anything to the contrary in the Transition Agreement, in
the event that the Metron Shares Value exceeds the FSI Closing Date Payment
determined in accordance with Section 2.4 and, as a result, no cash payment by
FSI is required to be made on the Closing Date in respect of the FSI Closing
Date Payment, Metron and FSI agree that FSI may defer payment of the FSI
Closing Date Payment on the Closing Date and retain all of the Metron Shares,
including all certificates representing such shares, until the final Purchase
Price is determined in accordance with Section 2.5. If, upon determination of
the final Purchase Price in accordance with Section 2.5 (which determination
shall be made taking into account FSI’s deferral of payment of the FSI Closing
Date Payment pursuant to the preceding sentence), FSI is required to make a
payment to Metron under the terms of Section 2.5, FSI shall make a portion of
such payment, in an amount up to the Metron Shares Value, by the assignment of
the number of Metron Shares representing the amount of the payment to be made
by FSI. In the event that the Metron Shares Value exceeds the amount of such
required payment by FSI, the number of Metron Shares shall be reduced to a
number representing the amount of such payment. FSI shall not at any time
prior to the determination and payment of the final Purchase Price sell,
convey, assign or otherwise transfer any of the Metron Shares.




	 	3.	 	Delayed Closing of Distribution Business in Italy.



          (a)     Notwithstanding anything to the contrary in the Transition Agreement
and notwithstanding the Closing of the transactions contemplated by the
Transition Agreement to occur on February 28, 2003 or such other date as may be
agreed by Metron and FSI, Metron and FSI agree that the transfer of the
Distribution Business in Italy contemplated to be transferred at the Closing
shall occur as promptly as practicable following on March 31, 2003, subject to
the satisfaction by Metron and FSI of all requirements to provide notice to,
and if applicable consult with, the internal union representatives (works
councils) of Metron Technology S.r.L. with respect to the Metron Transferred
Employees in Italy and the external unions representing such employees (such
requirements, the “Italian Labor Law Condition”) and such other applicable
conditions to Closing referred to in Section 3(c) below.



          (b)     During the period from the date of the Closing of the transfer of the
Distribution Business outside of Italy and the closing of the transfer of the
Distribution Business in Italy, the Transition Period shall continue with
respect to the Distribution Business in Italy and all obligations of Metron and
FSI under the Transition Agreement that are applicable during the Transition
Period with respect to the Distribution Business shall continue to apply with
respect to the Distribution Business in Italy until the closing of the transfer
of the Distribution Business in Italy.



          (c)     Metron and FSI agree that the obligation of the parties to close the
transfer of the Distribution Business in Italy is subject to the satisfaction
of all conditions to Closing, including the Italian Labor Law Condition, to the
extent such conditions are applicable to the transfer of the Distribution
Business in Italy had such transfer occurred on the date of the Closing of the
transfer of the Distribution Business outside of Italy. Metron and FSI agree
to use commercially reasonable efforts to satisfy the Italian Labor Law
Condition and such other conditions, to the extent practicable, on a prompt and
timely basis.







 




           (d)     Metron and FSI agree that the Distribution Business in Italy shall not
be taken into account in determining the Estimated Purchase Price and any FSI
Closing Date Payment or Metron Closing Date Payment under Section 2.4. In the
event that the transfer of the Distribution Business in Italy has occurred
prior to time periods for determination of the final Purchase Price in
accordance with Section 2.5(a), the Distribution Business in Italy shall be
taken into account in determining the final Purchase Price and any payments to
be made by FSI or Metron pursuant to Section 2.5. In the event that the
transfer of the Distribution Business in Italy has not occurred prior to time
periods for determination of the final Purchase Price in accordance with
Section 2.5(a), Metron and FSI shall agree on the manner in which the Purchase
Price, as it relates to the Distribution Business in Italy, shall be paid.




	 	4.	 	Korean Closing Matters.



          Notwithstanding Section 2.7 of the Transition Agreement and the transfer
of the Distribution Business in Korea as part of the Closing on the date
hereof, Metron and FSI agree that after determination the final Purchase Price
in accordance with Article II of the Transition Agreement, the amount of the
final Purchase Price attributable to the Distribution Business in Korea (i)
shall deducted from the final Purchase Price payable in accordance with Section
2.5 and (ii) shall be paid by the FSI Purchasing Affiliate to the Metron
Selling Affiliate located in Korea under the Business Transfer Agreement
entered into between such FSI Purchasing Affiliate and such Metron Selling
Affiliate.




	 	5.	 	Purchase Orders for Spare Parts not Transferred or Assumed.



          (a)     Notwithstanding anything to the contrary in the Transition Agreement,
including without limitation Section 4.3 of the Transition Agreement, Metron
and FSI agree that no purchase orders for Spare Parts outstanding as of the
Closing Date will be transferred by Metron or any Metron Selling Affiliate to,
or assumed by, FSI or any FSI Purchasing Affiliate. Metron and the Metron
Selling Affiliates shall continue to take purchase orders for Spare Parts after
the Closing Date up to and including April 15, 2003 in accordance with the
terms and conditions of the Distribution Agreements and such other terms and
conditions as are set forth in Exhibit A hereto. Metron shall (i) remain
obligated under all such purchase orders for Spare Parts outstanding as of the
Closing Date and all Purchase Orders for Spare Parts entered into by Metron and
the Metron Selling Affiliates between the Closing Date and April 15, 2003 and
(ii) fulfill all such purchase orders in accordance with their terms, subject
to terms and conditions of the Distribution Agreements and the terms and
conditions as are set forth in Exhibit A hereto. FSI and the FSI Purchasing
Affiliates shall have no responsibility with respect to such purchase orders
for Spare Parts, including any responsibility for payment of the Spare Parts
Commission under Section 4.3(c), except as set forth the Distribution
Agreements and the terms and conditions set forth in Exhibit A hereto.



          (b)     Notwithstanding Section 2.8 of the Transition Agreement, Metron and
FSI agree that the terms of the Distribution Agreements, to the extent
applicable, shall continue in full force and effect (subject to such other
terms as are set forth in Exhibit A hereto) with respect to the purchase orders
for Spare Parts outstanding as of the Closing Date and all Purchase Orders for
Spare Parts entered into by Metron and the Metron Selling Affiliates between
the Closing Date and April 15, 2003.



          (c)     Commencing on April 16, 2003, FSI and the FSI Purchasing Affiliates
shall be responsible for accepting new purchase orders for Spare Parts (and
invoicing customers, distributing Spare Parts to customers and servicing
customers with respect to such new Spare Parts purchase orders); provided,
however, that foregoing shall exclude purchase orders for the sale of Spare
Parts in Israel that are subject to the Israel Distribution Agreement.




	 	6.	 	Value Added Taxes; Indirect Taxes.



          (a)     In connection with the Closing of the transfer of the Distribution
Business by Metron and the applicable Metron Selling Affiliates to the
applicable FSI Purchasing Affiliates and the determination of the Estimated
Purchase Price, FSI and Metron have not included any value added taxes (“VAT”)
in such determination on the basis, among other reasons, that the transfer of
the Distribution Business is exempt from VAT as such transfer constitutes the
transfer of the Distribution Business as a going concern. However, in the
event that FSI and Metron determine as part of determining the final Purchase
Price pursuant to Section 2.5 of the Transition Agreement that VAT is
applicable to the transfer of selected assets in any country, (i) Metron shall
cause the relevant Metron Selling Affiliate to issue an invoice to the relevant
FSI Purchasing Affiliate for the amount of such VAT in accordance with
applicable law so as to enable the FSI Purchasing Affiliate to claim a VAT
credit and (ii) the amount of such VAT shall be added to the final Purchase
Price. In the event that Metron and FSI determine for any country that no
amount of VAT is owed in connection with the transfer of the Distribution
Business and it is later determined by







 





taxing authorities in any country that additional amounts of VAT is are owed,
FSI agrees that it shall be responsible for the payment of such VAT.


          [(b)     In the event that there are any indirect taxes (such as stamp duty
and registration taxes) relating to the transfer of the Distribution Business
in any country that as a matter of law or custom in such country are to be paid
by a buyer of a business or assets, FSI agrees that it shall be responsible for
the payment of such taxes.] [To be confirmed]




	 	7.	 	Waiver of Delivery of Employee Benefits Schedule.



          FSI hereby waives (i) the requirements in Section 6.1 and Section 9.1(j)
of the Transition Agreement that Metron provide a schedule as of Closing
listing all Employee Benefits to which each Transferred Employee is entitled
and (ii) any right to indemnification under Section 12.1(ii) of the Transition
Agreement relating solely to the failure to deliver such schedule; provided
however, that the foregoing shall not constitute a waiver of or relieve (x)
Metron of its obligations in respect of employees provided for in the
Transition Agreement, including in Section 6.2 (except for Section 6.2(d)
insofar as it relates to items to be delivered in respect of Employee Benefits
plans or arrangements to be disclosed in an update to the schedule required to
be delivered in accordance with Section 9.1(j)) or (y) FSI of its obligations
in respect of Transferred Employees provided for in the Transition Agreement,
including in Section 6.3.




	 	8.	 	Continued Force and Effect of Transition Agreement.



          Except as expressly modified by the terms of this Amendment, the terms and
conditions of the Transition Agreement and its respective exhibits and
schedules shall remain in full force and effect.



          IN WITNESS WHEREOF, each party has executed this Amendment by its duly
authorized officers as of the day and year first above written.




	 	 	 	 	 	 	 
	FSI INTERNATIONAL, INC.	 	METRON TECHNOLOGY N.V. 
	 	 	 	 	 	 	 
	By:	 	
/s/ Pat Hollister



	 	By:
	 	/s/ Ed Segal



	Name:	 	
Pat Hollister 

	 	Name:
	 	Ed Segal

	Title:	 	
Chief Financial Officer
	 	Title:
	 	Chief Executive Officer









 



Exhibit A


Additional Terms and Conditions

for

Spare Part Purchase Orders not Transferred



          1.     All orders placed on FSI will be at 25% discount. There will be no
reduction in discount for rush shipments as Metron will have no inventory.



          2.     All shipments from the United States to be via the DHL European or Asia
Hub. Shipping costs from DHL to the customers to be at the cost of FSI. All
purchase orders for Spare Parts placed by Metron to FSI will be shipped DDP to
the relevant Metron Warehouse or customer site stated on the Metron purchase
order.



          3.     Certain procedures:




	 	 	 	 	 
	 	 	
(a)
	 	FSI shall inform DHL to release stock against Metron purchase
orders.
	 	 	 	 	 
	 	 	
(b)
	 	Brian Mercer will serve as the Metron contact for processing the
purchase orders.
	 	 	 	 	 
	 	 	
(c)
	 	Robert Wendt will serve as the FSI contact for processing the
purchase orders.