NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, (I) THE OBLIGATIONS EVIDENCED
BY THIS THIRD AMENDED AND RESTATED REPLACEMENT PROMISSORY NOTE ARE SUBORDINATED
TO THE PRIOR PAYMENT IN FULL OF THE SENIOR OBLIGATIONS (AS DEFINED IN THE
SUBORDINATION AGREEMENT HEREINAFTER REFERRED TO) PURSUANT TO, AND TO THE EXTENT
PROVIDED IN THE SUBORDINATION AGREEMENT, DATED AS OF DECEMBER 29, 2005 (AS
AMENDED, RESTATED, SUPPLEMENTED OR MODIFIED FROM TIME TO TIME, THE
"SUBORDINATION AGREEMENT") IN FAVOR OF FIFTH THIRD BANK (TOGETHER WITH ITS
SUCCESSORS AND ASSIGNS, AND THE OTHER HOLDERS, IF ANY, OF THE SENIOR OBLIGATIONS
IDENTIFIED THEREIN, THE "SENIOR LENDER") AND (II) THE RIGHTS OF THE HOLDER OF
THIS NOTE HEREUNDER ARE SUBJECT TO THE LIMITATIONS AND PROVISIONS OF THE
SUBORDINATION AGREEMENT. IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THE
SUBORDINATION AGREEMENT AND THE TERMS OF THIS THIRD AMENDED AND RESTATED
REPLACEMENT PROMISSORY NOTE, THE TERMS OF THE SUBORDINATION AGREEMENT SHALL
GOVERN.
CECO Environmental Corp.
FOURTH AMENDED AND RESTATED REPLACEMENT PROMISSORY NOTE
$1,200,000
March 26, 2007
WHEREAS, Can-Med Technology, Inc. d/b/a Green Diamond Oil Corp., an Ontario
corporation ("Green Diamond") has prior to this date advanced sums to CECO
Environmental Corp. (the "Company") as evidenced by a Third Amended and Restated
Replacement Promissory Note dated December 28, 2006 (the "Prior Note"), which
Prior Note shall be cancelled and replaced by this Fourth Amended and Restated
Replacement Promissory Note (the "Note").
WHEREAS, Green Diamond has agreed to amend and restate the Prior Note and
replace the Prior Note with this Note to extend the maturity date and increase
the interest rate under the Prior Note.
FOR VALUE RECEIVED, the undersigned, CECO Environmental Corp. (the
"Company"), a Delaware corporation, hereby promises to pay to the order of Green
Diamond Oil Corp. or registered assigns ("Holder"), the principal sum of ONE
MILLION TWO HUNDRED THOUSAND AND NO/100 ($1,200,000.00) on the Maturity Date, as
defined in Section 1 below. This Note is subordinate to certain bank financing
of the Company further described herein and to a series of promissory notes in
the original principal amount of $5,000,000 originally issued on December 2,
1999 and subsequently amended and restated (the "December 1999 Notes"). The
principal amount of the December 1999 Notes has been increased in connection
with an amendment and restatement.
112527v1
1. Maturity. This Note shall be due and payable upon the earlier to occur
of the following events (the "Maturity Date"): (i) January 31, 2010 or (ii) the
closing (any such closing referred to as the "Closing") of a Sale Transaction.
For purposes of this Note, a Sale Transaction shall mean (i) a merger,
consolidation, corporate reorganization, or sale of shares of stock of the
Company as a result of which there is a change in control and/or the
shareholders of the Company on the date hereof ("Current Shareholders") own 50%
or less of the outstanding shares of the Company on a fully-diluted basis
immediately after the transaction and, including as outstanding for purposes of
such calculation, any warrants, options or other