Former spy chief Zdravko Mustac, 74, and ex-agent Josip Perkovic, 71, were found guilty of complicity in the murder of Stjepan Djurekovic who was opposed to Yugoslavia's communist regime, a Munich court ruled.
Both men were extradited from Croatia in 2014 in a case that had sparked a row between the European Union and its newest member.
"The court finds that the accused Zdravko M. had asked the accused Josip P. to plan and prepare for the murder of Stjepan Djurekovic," the court said in a statement.
Djurekovic was killed in a garage that was used as a print office in the Bavarian town of Wolfratshausen more than three decades ago.
He was shot multiple times and hit with a cleaver by three still unidentified people.
Prosecutors say the motive was to silence Djurekovic who had information about alleged illegal business dealings by the son of a leading Yugoslav politician.
A Croatian man has already been sentenced to life imprisonment in the case in 2008.
The extradition process of the two accused had strained ties between the EU and Zagreb.
Three days before joining the EU on July 1, 2013, Croatia changed a key law, making it impossible to extradite persons wanted for crimes committed before August 2002.
The move soured ties with the bloc and Zagreb finally amended the law.