Exhibit 10.1
                

 

 
 
 
FIRST AMENDMENT
 
to

ASSET PURCHASE AGREEMENT
among
KADANT COMPOSITES LLC,
KADANT INC.,
LDI COMPOSITES CO.
and
LIBERTY DIVERSIFIED INDUSTRIES, INC.
dated as of
October 10, 2006

      
         
    

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FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT

This First Amendment to Asset Purchase Agreement is made and entered into as of
October 10, 2006, among KADANT COMPOSITES LLC, a Delaware limited liability
company (“Seller”), KADANT INC., a Delaware corporation (“Kadant”), LDI
COMPOSITES CO., a Minnesota corporation (“Buyer”), and LIBERTY DIVERSIFIED
INDUSTRIES, INC., a Minnesota corporation, and parent corporation of Buyer
(“Buyer Parent”).  Capitalized terms used herein and not otherwise defined shall
have the meaning ascribed to them in the Agreement (defined below).

WHEREAS, effective October 21, 2005, the parties entered into that certain Asset
Purchase Agreement (the “Agreement”) pursuant to which Seller sold to Buyer all
of the tangible and intangible assets of Seller other than the Excluded Assets
(as defined therein), and Buyer purchased the same on the terms set forth
therein.

WHEREAS, the parties wish to amend certain of the provisions, covenants and
obligations under the Agreement in accordance with the terms and conditions of
this Amendment;

NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set
forth, the parties hereto agree as follows:

1.           Amendment to Section 10 of Agreement.  Section 10(a) of the
Agreement is hereby to provide the following additional provision:

“(iv)           During Buyer's Administration Period, warranty claimants
were sent notices (the “Warranty Notices”) that their claims would be remedied
(the remedy specified in the Warranty Notices being referred to as the “Approved
Warranty Claims”) but such Approved Warranty Claims were not remedied before the
Warranty Fund was fully committed.  Seller agrees to honor and pay up to an
additional amount of $1,500,000 (the “Additional Funds”) for Approved Warranty
Claims as specified in the Warranty Notices.  At such time as the Additional
Funds have been exhausted, Seller agrees to honor and pay for Warranty Claims in
accordance with applicable warranty obligations as provided in section 10(a)
(iii) of the Agreement.

2.           Amendment to Section 12 of Agreement.  Section 12(f) of the
Agreement shall be amended by replacing the second sentence thereof with the
following: “No Indemnifying Party shall be liable for any Loss, to the extent
that the aggregate of all such Losses for which Indemnified Parties have
received indemnification exceed $8,914,000.”

3.           Release.  In further consideration of the Seller’s obligation to
pay Additional Funds, as set forth in Section 1 above, Buyer and Buyer Parent
hereby release and forever discharge each of Seller and Kadant, their respective
agents, employees, affiliated entities, directors, officers, successors and
assigns of and from all demands, actions, causes of action, suits, damages and
any and all claims, demands and liabilities whatsoever of every name and nature,
both in law and in equity, which against the other, each now has or ever had and
more especially on account of, from or relating to, Warranty Claims and  product
problems related to premature degradation or crumbling of the product and
excessive contraction of the product; provided, however, that this release shall
not effect the obligation of Seller and Kadant to defend Buyer and Buyer Parent
from any Third Party Claim related to Warranty Claims subject to the limitations
set forth in Section 12(f) of the Agreement, as amended by this Amendment.

4.           Survival of Remaining Provisions.  Except as set forth above all of
the other terms, provisions and conditions set forth in the Agreement shall
remain in full force and legal effect as if the terms of the Amendment had been
originally included in the Agreement.

      
        
      
      
             
    

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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year
first above written.
 
KADANT COMPOSITES LLC

By:           Kadant GranTek Inc., its sole member

 

  By:  /s/ Jonathan W. Painter___________
Name:      Jonathan W. Painter
Title:        Chairman

KADANT INC.

By:           /s/ Sandra L.
Lambert                                                                         
                Name:      Sandra L. Lambert
Title:         VP & General Counsel

LDI COMPOSITES CO.

By:           /s/ Stephen Richardson            
               Name:      Stephen Richardson
Title:         VP & CFO

LIBERTY DIVERSIFIED INDUSTRIES, INC.

By:           /s/ Stephen Richardson            
               Name:      Stephen Richardson
Title:         VP & CFO

      
                  Signature Page to First Amendment to Asset Purchase Agreement