Document:

Security Agreement dated as of August 14, 2008

 Exhibit 10.4 
 SECURITY AGREEMENT 
 THIS SECURITY
AGREEMENT (the “Agreement”) is made as of this 14th day of August, 2008, by CECO ENVIRONMENTAL CORP.
(“Debtor”) and its Subsidiaries (the Debtor and its Subsidiaries collectively, the “Pledging Parties”) for the benefit of ICARUS INVESTMENT CORP., an Ontario corporation (“Secured Party”).

 R E C I T A L S : 
 WHEREAS, Secured Party has agreed to make a loan (the “Loan”) to Debtor in the principal amount of Canadian $5,000,000; and 
 WHEREAS, the Loan is evidenced by a Subordinated Convertible Promissory Note in the principal amount of Canadian $5,000,000 (the “Note”) of even date herewith from Debtor to Secured Party; and

 WHEREAS, Secured Party requires, and the Pledging Parties are willing to grant, as security for the Loan, a security interest in all their
right, title and interest in and to the “Collateral” (as such term is defined in Paragraph 18 hereof), to secure the payment and performance by Debtor of the Liabilities (as defined below in Section 2), subject to the terms and
conditions hereinafter set forth. 
 NOW, THEREFORE, to secure the payment and performance of the Liabilities, each of the Pledged Parties
hereby agrees with Secured Party as follows: 
 1. Grant; Collateral. Each Pledging Party hereby assigns and pledges to Secured Party,
for collateral purposes, and grants to Secured Party a security interest in, all its right, title and interest in and to the Collateral (as defined in Section 18(b) hereof), subject to and in accordance with the terms and conditions set forth
in this Agreement and the Note. Capitalized terms used, but not defined herein, shall have the meanings ascribed to them in the Note. 
 2.
Liabilities. This Agreement, and the security interest herein granted to Secured Party, is given to secure all the following (the same being herein sometimes collectively referred to as the “Liabilities”): 
  

	 	(a)	the principal, interest and all other sums owed under the Note; 

  

	 	(b)	all amounts owed Secured Party under this Agreement including without limitation of all advances, costs or expenses paid or incurred by the Secured Party, to protect any or all of
the Collateral, perform any obligation of the Pledging Parties hereunder, or to sell the Collateral.; 

  

	 	(c)	any and all costs of enforcement and collection of the Note and the enforcement of this Agreement, including without limitations reasonable attorneys’ fees; and

  

	 	(d)	interest on all of the foregoing at the rate specified in the Note. 

 The parties agree that Liabilities do not include (i) the obligations of the Company under that
certain Registration Rights Agreement between the Company and Secured Party dated the date hereof, (ii) any amounts under the Note that are converted to common stock under the Note, and (iii) any equity or equity related rights (including
obligations pertaining to any conversion rights) under the Note. 
 3. Representations and Warranties. Each Pledging Party hereby
represents and warrants to, and covenants with, Secured Party that: 
  

	 	(a)	Each Pledging Party is the absolute and exclusive owner of its respective Collateral other than leased Collateral, and except for the security interest herein granted to Secured
Party and to Senior Lender (as defined in Section 17), has not made and shall not make any sale, assignment, pledge, hypothecation or other transfer of the Collateral, or any portion thereof other than in the ordinary course of business and
except as permitted by the Senior Lender Credit Agreement (as defined in the Subordination Agreement which is defined in Section 17), and shall forever warrant and defend Secured Party’s title and interest in and to the Collateral against
the claims and demands of all persons whomsoever, subject to the terms of the Subordination Agreement (as defined in Section 17); 

  

	 	(b)	Except for the security interest herein granted to Secured Party, to the Senior Lender and the other Permitted Liens (as defined in the Senior Lender Credit Agreement), the
Collateral is free and clear of all liens, charges, claims, encumbrances and security interests as of the date hereof; 

  

	 	(c)	The Pledging Parties will keep the Collateral, to the extent applicable, in good order, repair and condition and free and clear of all levies, attachments, liens, charges, claims,
encumbrances, security interests of every kind and nature, except for the assignment and security interests herein granted to Senior Lender, Secured Party and the other Permitted Liens (as defined in the Senior Lender Credit Agreement);

  

	 	(d)	No instruments of assignment and transfer or financing statements covering the Collateral, or any part thereof, have been executed by the Pledging Parties or are on file in any
public office, except for those in favor of Secured Party and Senior Lender and any other applicable Permitted Liens (as defined in the Senior Lender Credit Agreement), and the Pledging Parties will not execute, or file or cause to be filed in any
public office, any instruments of assignment and transfer or any financing statement or statements, affecting the Collateral, or any part thereof, except in favor of Secured Party or Senior Lender; 

  

	 	(e)	 Each Pledging Party will, at the request of Secured Party, execute or join with Secured Party in executing and, at Pledging Parties’ expense, file and refile
under the Uniform Commercial Code of the State in which such Pledging 

  

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Party is organized or incorporated (the “Code”), such financing statements and amendments thereto, continuation statements and other
documents in such states and in such offices as Secured Party may deem necessary or appropriate and wherever required or permitted by law in order to perfect and preserve Secured Party’s security interest in the Collateral, and each Pledging
Party hereby authorizes Secured Party to file any and all such financing statements, amendments thereto and continuation statements and other documents relative to all or any part of the Collateral without the signature of such Pledging Party where
permitted by law; 

  

	 	(f)	No Pledging Party shall use or permit the Collateral to be used in violation of any applicable law, ordinance, rule, regulation or requirement, now or hereafter in effect, of
governmental authorities or any policy or contract of insurance; 

  

	 	(g)	Each Pledging Party shall perform and comply with all policies of insurance, and the rules and requirements of underwriters’ and fire prevention agencies, and all laws,
ordinances, rules and regulations relating to, and shall promptly pay when due all license fees, registration fees, taxes, assessments and other charges which may be levied upon or assessed against, the ownership, operation, possession, maintenance,
use or method of use of the Collateral; 

  

	 	(h)	Secured Party or its representatives shall have the right to inspect, at each Pledging Party’s place of business, the Collateral, at any time and from time to time, at
reasonable times during normal business hours and upon reasonable notice to such Pledging Party; 

  

	 	(i)	Each Pledging Party shall, at such time or times as Secured Party may request and at such Pledging Party’s cost and expense, prepare list(s), in such form as shall be
reasonably satisfactory to Secured Party, certified by such Pledging Party describing in reasonable detail all Collateral of such Pledging Party subject to this Agreement; 

  

	 	(j)	Each Pledging Party shall promptly give written notice to Secured Party of any damage to or destruction of its Collateral, or any part thereof, by fire or other casualty, or by
condemnation or taking. No Pledging Party shall make, accept or consent to any settlement or agreement in respect of insurance or condemnation proceeds except as agreed in writing by Senior Lender, and if no such consent is required, by Secured
Party; and 

  

	 	(k)	None of the Collateral is in a damaged or destroyed condition by reason of fire or other casualty in excess of $500,000. 

  

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 4. Events of Default. Each Pledging Party hereby agrees that the occurrence or existence of any
one of the following events or conditions, as well as those events or conditions as defined in the Note as Events of Default shall constitute an Event of Default herein (referred to herein singularly as “Event of Default” and
collectively as “Events of Default”): 
  

	 	(a)	any material representation or warranty made by Debtor in the Note or by a Pledging Party in this Agreement shall be breached or violated, or prove to be false, misleading or
inaccurate, in any material respect which is not cured within 10 days following notice from Secured Party; 

  

	 	(b)	any attachment, seizure or levy shall be made upon the Collateral, in whole or in part which is not cured within 10 days following notice from Secured Party;

  

	 	(c)	a Pledging Party shall sell, assign or otherwise transfer, voluntarily or involuntarily, all or any part of the Collateral, except as expressly permitted herein which is not cured
within 10 days following notice from Secured Party; 

  

	 	(d)	Debtor shall fail to pay, perform and discharge the Liabilities, when and as due in accordance with the Note, and such failure shall continue uncured or uncorrected past the
applicable curative periods, if any; 

  

	 	(e)	except for the security interest granted to Secured Party herein and to the Senior Lender, any security interest, lien, charge or encumbrance against the Collateral other than valid
leases of property to a Pledging Party and any other Permitted Liens (as defined in the Senior Lender Credit Agreement), whether prior to, concurrent with or subsequent to the interest herein granted to Secured Party, shall accrue (other than to the
Senior Lender) which is not cured within 10 days following notice from Secured Party; 

  

	 	(f)	the failure by a Pledging Party to perform an obligation under, or the occurrence of any other default with respect to any provision of this Agreement other than as specifically
described in any other clause of this Section 4, and the continuation of such default for a period of ten (10) days after written notice thereof; 

  

	 	(g)	breach by a Pledging Party of any of the covenants, representations, warranties or other obligations hereunder which is not cured within 10 days following notice from Secured Party;
or 

  

	 	(h)	 the failure by Debtor to perform any obligation under, or the occurrence of any other default or event of default with respect to any provision of the Note (other
than as specifically described in any other clause of this Section 4), which is not cured within the time period provided therefor, if any. For purposes of the foregoing definition, with respect to any event or occurrence which constitutes an
Event of Default hereunder solely by reason of its 

  

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constituting a default under another document or instrument, to the extent (if any) that such other document or instrument provides a grace or cure period
with respect to such default, the same grace or cure period, and only such period, shall apply with respect thereto under this Agreement. 

 5. Remedies. Upon the occurrence or existence of any of the Events of Default, then at the option of Secured Party and without demand or notice to any Pledging Party (demand and notice as to any such Events of
Default being hereby expressly waived by each Pledging Party except as expressly provided in Paragraph 4 hereof), Secured Party shall, to the fullest extent permitted by law, be entitled, subject to the Subordination Agreement, to: 
 (a) appropriate and apply on the payment of the Liabilities (whether or not due and in any order of priority as may be selected by Secured
Party in its sole discretion), any and all accounts or monies held in possession of Secured Party for the benefit of a Pledging Party; 
 (b) enter upon a Pledging Party’s premises and take possession of the Collateral; 
 (c)
exercise in respect to the Collateral all the rights, powers and remedies available to Secured Party upon default under the Code then in effect, including the right to sell, publicly or privately, the Collateral, or any part thereof; and 

(d) exercise any and all other rights, powers and remedies as may be provided in the Note and such other rights and remedies as may be
provided at law or in equity. 
 If any notification of intended disposition of the Collateral is required by law, such notification, if
mailed shall be deemed reasonably and properly given if mailed at least ten (10) days before such disposition, full postage prepaid, sent by certified mail return receipt requested, addressed to a Pledging Party, at the address appearing on the
records of Secured Party. Upon any sale of all, or any part of, the Collateral by Secured Party hereunder (whether by virtue of the power of sale herein granted, pursuant to judicial process or otherwise), the receipt of Secured Party or the officer
making the sale shall be a sufficient discharge to the purchaser or purchasers of the Collateral so sold, and such purchaser or purchasers shall not be obligated to see to the application of any part of the purchase money paid over to Secured Party
or such officer or be answerable in any way for the misapplication or non-application thereof. 
 6. Application of Proceeds. All
proceeds of sale of any of the Collateral by Secured Party as herein provided shall be applied in any order of priority determined by Secured Party which is in accordance with the terms of the Note and the Subordination Agreement. 
 7. Incorporation of Note. It is expressly understood and agreed that all the terms, covenants, conditions, agreements, representations,
warranties, obligations and provisions contained in the Note are, by this reference, adopted and incorporated in this 

  

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Agreement to the same full extent and with the same binding force and effect as if all such terms, covenants, conditions, representations, warranties,
obligations and provisions thereof were herein stated in full, it being the express intent that the Note complement and supplement this Agreement to the extent necessary or required to protect, preserve and confirm the rights, powers and remedies of
Secured Party in respect of the Liabilities. 
 8. Secured Party’s Right to Cure. If a Pledging Party shall fail to do any act or
thing which such Pledging Party has covenanted to do hereunder, or any covenant, representation or warranty by a Pledging Party shall be breached or violated, Secured Party may, but shall not be obligated to, after the expiration of the applicable
curative or grace period, if any, except in the case of an emergency, do the same or cause it to be done, or remedy such breach or violation, and if, in connection therewith, Secured Party shall make any advances or expenditures of money for the
account of such Pledging Party, then there shall be added to the Liabilities the reasonable costs or expenses so paid or incurred by Secured Party, and any and all amounts paid or incurred by Secured Party in taking any such action shall be repaid
to Secured Party upon demand being made to such Pledging Party therefor and shall bear interest at the Default Rate, as defined in the Note from the date advanced or expended, to and including the date of repayment. 
 9. Waiver of Liability. Nothing herein contained shall be construed as constituting Secured Party a trustee or mortgagee in-possession. In the
exercise of the powers herein granted and assigned to Secured Party, no liability shall be asserted or enforced against Secured Party, all such liability being expressly waived and released by each Pledging Party and any person or persons claiming
by, through or under a Pledging Party. 
 10. Indemnity. Each Pledging Party shall and does hereby agree to indemnify, protect, save
and hold forever harmless Secured Party and its agents (collectively, “Secured Party’s Indemnitees”) from and against any and all liability, loss and damage, including court costs and reasonable attorneys’ fees and
expenses, which Secured Party’s Indemnitees, or any of them, may or might incur, suffer or sustain under or by reason of this Agreement and from and against any and all claims and demands whatsoever which may be asserted against Secured
Party’s Indemnitees, or any of them, by reason of any alleged or actual obligations or undertakings on Secured Party’s part to perform or discharge any of the terms, covenants and agreements contained in this Agreement. If any of Secured
Party’s Indemnitees shall incur any such liability, loss or damage or by reason of this Agreement, or in the defense of any claims or demands, or otherwise, the amount thereof, including court costs, and reasonable attorneys’ fees and
expenses, shall be secured hereby, and the Pledging Parties, jointly and severally, shall, upon demand, immediately reimburse Secured Party’s Indemnitees therefor, together with interest thereon at the Base Rate, from the date of demand until
reimbursement is made. 
 11. Inaction of Secured Party. Secured Party shall not, in any way, be responsible for failure to do any or
all of the things for which rights, interests, power or authority are herein granted and assigned to Secured Party, nor shall Secured Party be required to make an accounting for the benefit of the Pledging Parties, except for monies actually
received by Secured Party in accordance with the terms hereof, each Pledging Party hereby expressly waiving, and releasing Secured Party from any and all such responsibility, liability and requirements. 
  

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 12. Parity of Security. In the event of a default by Debtor under either of the Note or this
Agreement, Secured Party may realize upon the security given under the this Agreement singly, successively or cumulatively, at such time and in such order as Secured Party may, in its sole discretion, elect. 
 13. Foreclosure or Other Judgments. No judgment or decree which may be entered on any Liabilities shall operate to abrogate or lessen the effect
of this Agreement, but this Agreement shall continue in full force and effect until the full and final payment and discharge of any and all Liabilities, in whatever form the Liabilities may be, and of any and all costs and expenses incurred and
sustained by virtue of the authority herein contained have been fully paid from the proceeds of the Collateral, or until such time as this Agreement may be voluntarily released. This Agreement shall also remain in full force and effect during the
pendency of any foreclosure proceedings, both before and after sale, until the issuance of a deed pursuant to a foreclosure decree, unless the Liabilities are fully and finally paid and discharged. 
 14. No Waiver. No failure on the part of Secured Party to exercise, and no delay in exercising, any rights, powers, privileges, interests or
remedies hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such rights, powers, privileges, interests or remedies by Secured Party preclude any other or further exercise thereof or the exercise of any other
rights, powers, privileges, interests or remedies. All rights, powers and remedies hereunder are cumulative and not exclusive of any other rights, powers or remedies provided in the Note, this Agreement, or any of the Loan Documents, or at law or in
equity, and each and all such rights, powers and remedies provided in the Note or this Agreement, or at law or in equity, and each and all such rights, powers and remedies may be pursued or exercised single, successively or cumulatively, at such
time or times and in such order as Secured Party may, in its sole discretion, elect. 
 15. Release and Discharge. At the time when
all Liabilities and all obligations of Debtor hereunder have been fully and finally paid and performed, this Agreement shall terminate and be of no further force and effect. After such termination, if requested by a Pledging Party, Secured Party
shall execute and deliver to such Pledging Party for filing in each office in which any financing statement relative to its Collateral, or any part thereof, shall be filed, a termination statement under the Code and shall also execute and deliver to
such Pledging Party a release of any and all of the Collateral for the purpose of releasing Secured Party’s interest in the Collateral, all without recourse to or representation, warranty and covenant by Secured Party and at the cost and
expense of such Pledging Party. 
 16. Further Assurances. Each Pledging Party agrees to perform such further acts and things and to
execute and deliver to Secured Party such additional assignments, agreements, assurances, certificates, opinions and other documents and instruments as Secured Party may reasonably require or deem advisable to carry into effect the purposes of this
Agreement, or to better assure, perfect, protect, preserve and confirm unto Secured Party its rights, powers, privileges, interest and remedies under this Agreement provided such additional assignments, agreements, assurances, certificates, opinions
or other documents or instruments which are consistent with the terms hereof and of the other Loan Documents and do not impose additional liabilities or obligations on the Debtor. 
  

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 17. Subordination. This Agreement, and the security interests and other liens and rights granted
herein, are subordinate to a senior credit facility of Debtor and the Pledging Parties in favor of Fifth Third Bank (“Senior Lender”), as lender, pursuant to the terms of that certain Subordination Agreement dated the date hereof
between Secured Party and Senior Lender (the “Subordination Agreement”). 
 18. Definitions. For purposes of this
Section 18, capitalized terms used but not specifically defined in this Agreement shall have the meanings ascribed to them in the Code. As used herein, the following terms shall have the meanings set forth below: 
  

	 	(a)	“Accounts” shall mean and include: (i) any and all rights to the payment of money or other forms of consideration of any kind now or hereafter owing or to be
owing to the Debtor (whether classified under the UCC as Accounts, Chattel Paper, Electronic Chattel Paper, General Intangibles, or otherwise) including, but not limited to, accounts receivable, letters of credit and the right to receive payment
thereunder, chattel paper, tax refunds, insurance proceeds, contract rights, notes, drafts, instruments, documents, acceptances, and any other debts, obligations and liabilities in whatever form now or hereafter owing to the Debtor, all guarantees,
security and liens which secure payment of any of the foregoing, all the Debtor’s rights to goods, now owned or hereafter acquired by the Debtor, sold (delivered, undelivered, in transit or returned) which may be represented thereby; and
(ii) all proceeds of any of the foregoing. 

  

	 	(b)	“Collateral” shall mean all of each Pledging Party’s personal property, including, without limitation, Accounts, Instruments, Documents, contract rights,
General Intangibles, Chattel Paper, Inventory, Instruments, Equipment, Goods, Fixtures, Commercial Tort Claims, Investment Property, Letter-of-Credit Rights, Letters of Credit, leasehold improvements, accounts receivable, documents of title,
policies and certificates of insurance, all insurance proceeds, securities, cash, money, Deposit Accounts, Payment Intangibles, trademarks, trade names, patents, copyrights, applications for trademarks, patents and copyrights, and other intellectual
property rights, and all other tangible and intangible property owned by the Debtor, and books and records relating to the foregoing and all the products and proceeds of the foregoing. 

  

	 	(c)	“Subsidiaries” means CECO Group Inc., CECO Filters, Inc., New Busch Co., Inc., The Kirk & Blum Manufacturing Company, kbd/Technic, Inc., CECOAire, Inc.,
CECO Abatement Systems, Inc., H.M. White, Inc., Effox Inc., GMD Environmental Technologies, Inc., FM, LLC, CECO Mexico Holdings LLC, and Fisher-Klosterman, Inc. 

 19. Notices. Any and all notices given in connection with this Agreement shall be deemed adequately given only if given as set forth in the Note.

  

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 20. Miscellaneous. It is further understood and agreed that: 
  

	 	(a)	Time is of the essence with respect to each and every covenant, agreement and obligation of the Pledging Parties under this Agreement; 

  

	 	(b)	This Agreement, and all the terms, covenants agreements and conditions hereof, shall extend to, be binding upon and enforceable against each Pledging Party and its successors and
assigns, but the privileges and benefits herein accruing to each Pledging Party shall extend and inure only to such of its successors and assigns as may be permitted pursuant to this Agreement. All liabilities and obligations of Pledging Parties
hereunder are, and shall be, at all times, joint and several; 

  

	 	(c)	This Agreement, and all the terms, covenants, agreements and conditions hereof, shall extend to and inure to the benefit of Secured Party, its successors and assigns;

  

	 	(d)	The representations, warranties and covenants made by Pledging Parties under this Agreement are, and shall be deemed to be, of continuing force and effect until all the Liabilities
have been fully and finally paid and performed; 

  

	 	(e)	Each Pledging Party agrees jointly and severally to pay, on demand of Secured Party, all reasonable costs and expenses paid, sustained or incurred by Secured Party, including
without limitation, court costs and reasonable attorneys’ fees and expenses, in connection with the enforcement of this Agreement; 

  

	 	(f)	The singular shall include the plural, and the plural the singular, and pronouns of any gender shall include the other gender, wherever required by the context hereof;

  

	 	(g)	Except as otherwise specifically provided herein, Secured Party has the right, whenever its consent or approval is required hereunder, to withhold, or to refuse to grant, such
consent or approval, which right is exercisable by Secured Party in its absolute discretion; 

  

	 	(h)	The paragraph headings of this Agreement are for convenience only and are not intended to alter, limit or enlarge in any way the scope or meaning of the language hereof; and

  

	 	(i)	EACH PLEDGING PARTY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR ANY STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY. DEBTOR HEREBY EXPRESSLY ACKNOWLEDGES THIS WAIVER IS A MATERIAL, INDUCEMENT FOR SECURED PARTY TO ACCEPT THIS AGREEMENT AND TO MAKE THE LOAN
SECURED HEREBY AND BY THE OTHER LOAN DOCUMENTS. 

  

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 IN WITNESS WHEREOF, the Debtor has hereto set its hand and seal to this Agreement as of the date first above
written, pursuant to proper authority duly granted. 
  

							
	 PLEDGING PARTIES:
	 		 	CECO ENVIRONMENTAL CORP.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, CFO
			
		 		 	CECO GROUP INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, CFO
			
		 		 	CECO FILTERS, INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Secretary
			
		 		 	NEW BUSCH CO., INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Secretary
			
		 		 	THE KIRK & BLUM MANUFACTURING COMPANY
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Secretary
			
		 		 	kbd/TECHNIC, INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Secretary

							
		 		 	CECOAIRE, INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Secretary
			
		 		 	CECO ABATEMENT SYSTEMS, INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Secretary
			
		 		 	H.M. WHITE, INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Treasurer
			
		 		 	EFFOX INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Secretary
			
		 		 	GMD ENVIRONMENTAL TECHNOLOGIES, INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Treasurer
			
		 		 	FM, LLC
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Treasurer

							
		 		 	CECO MEXICO HOLDINGS LLC
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Treasurer
			
		 		 	FISHER-KLOSTERMAN, INC.
				
		 		 	By:	 	 /s/ Dennis W. Blazer

		 		 		 	Dennis W. Blazer, Secretary

							
	 SECURED PARTY:
	 		 	ICARUS INVESTMENT CORPORATION
				
		 		 	By:	 	 /s/ Phillip DeZwirek

				
		 		 	Its:	 	 /s/ PresidentRegistration Rights Agreement dated as of August 14, 2008

 Exhibit 10.5 
 REGISTRATION RIGHTS AGREEMENT 
 THIS REGISTRATION RIGHTS AGREEMENT (this
“Agreement”), dated as of August 14, 2008 (the “Effective Date”), is made by and between CECO ENVIRONMENTAL CORP. (the “Company”) and ICARUS INVESTMENT CORP., an Ontario
corporation (the “Shareholder”). 
 WHEREAS, pursuant to that certain Subordinated Convertible Promissory Note made by the
Company for the benefit of Shareholder dated the date hereof (the “Note”), the Shareholder has a right to convert the outstanding principal and/or interest into common stock of the Company (the “Convertible
Shares”); and 
 WHEREAS, as a condition to Shareholder lending the funds under the Note, the Company and the Shareholder have
entered into this Agreement to provide certain securities registration rights to the Shareholder. 
 NOW, THEREFORE, in consideration of the
premises, the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: 
 1. Definitions. As used in this Agreement: 
 “Affiliate” shall mean any entity controlling, controlled by or under common control with another entity. For the purposes of this definition, “control” shall have the meaning presently specified for that
word in Rule 405 promulgated by the SEC under the Securities Act. 
 “Company” shall have the meaning set forth in the
preamble hereto. 
 “Person” means an individual, a corporation, a partnership, a trust, a limited liability company, an
unincorporated organization or a governmental organization or any agency or political subdivision thereof. 
 “Public
Offering” shall mean a public offering of Convertible Shares pursuant to an effective Registration Statement. 
 “Prospectus” shall mean any prospectus that is a part of a Registration Statement, together with all amendments or supplements thereto. 
 “Registrable Stock” shall mean the shares of common stock issued or issuable upon conversion of the Note; provided, however, that Registrable Stock shall not be deemed to include (i) any shares
after such shares have been registered under the Securities Act and sold pursuant to a registration of such securities, (ii) any shares sold pursuant to any other exemption from registration under the Securities Act to a Person who is free to
resell such shares without registration under the Securities Act, or (iii) any shares that are sold in a transaction in which rights under this Agreement are not assigned. 
 “Registration Statement” shall mean any registration statement filed with the SEC in accordance with the Securities Act, together with
all amendments or supplements thereto. 

 “SEC” shall mean the United States Securities and Exchange Commission or any successor
to the functions of such agency. 
 “Securities Act” shall mean the Securities Act of 1933, as amended prior to or after the
date of this Agreement or any federal statute or statutes which shall be enacted to take the place of such act, together with all rules and regulations promulgated thereunder. 
 2. Legend on Convertible Shares. 
 (A)
A copy of this Agreement shall be filed with the Secretary of the Company and kept with the records of the Company. 
 (B) Each certificate
representing Convertible Shares acquired by any Shareholder pursuant to the Note shall bear legends substantially in the following forms: 
 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
JURISDICTION. THE SECURITIES MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND SUCH LAWS OR IN TRANSACTION OUTSIDE THE UNITED STATES NOT SUBJECT TO THE SECURITIES ACT. 
 (C) In the event that any such
Convertible Shares are transferred in a Public Offering, the Company shall promptly upon request, deliver a replacement certificate not containing the legend set forth in Section 2(B) in connection with such transfer. 
 (D) Upon the delivery to the Company of a legal opinion reasonably satisfactory to the Company to the effect that the legend set forth in
Section 2(B) is no longer required by the Securities Act and any applicable state securities law, the Company shall promptly upon request deliver a replacement certificate not containing the legend in exchange for the legended
certificate. 
 3. Piggyback Registration Rights. 
 (A) If at any time from the Effective Date and prior to 5 years after the Effective Date, the Company proposes to register shares of Common Stock under the Securities Act for distribution for its account pursuant to a
primary underwritten offering (other than a registration statement on Form S-8 or Form S-4 or any successor forms to such Forms) and the Company may register such offering on a form that would also permit the registration of the Registrable Stock,
the Company shall, each such time, promptly give the Shareholder written notice of such determination. Upon the written request of the Shareholder given within fifteen (15) days following such notice by the Company, subject to
Section 3(B), the Company shall use its reasonable best efforts to cause to be registered under the Act (and any related qualification or registration under blue sky laws) and included within any underwriting involved therein, all of the
Registrable Stock that the Shareholder has requested be registered. Such written request may specify all or 

  

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a part of the Shareholder’s Registrable Stock. The
Company shall have the right to terminate or withdraw any registration initiated by it under this Section 3 prior to the effectiveness of such registration whether or not the Shareholder has elected to include securities in such
registration. 
 (B) If lead underwriters of an underwritten primary registration advise the Company that, in their good faith judgment, the
number of securities requested to be included in such registration exceeds the number which can be sold in such offering without materially and adversely affecting the marketability of the offering, then the Company will include in the Registration
Statement relating to such registration (i) first, the securities the Company proposes to sell, and (ii) second, the Registrable Stock requested to be included in such registration by the Stockholder(s) and any other stockholders of the
Company (“Other Security Holders”) reduced on a pro rata basis, based on the amount of Convertible Shares owned by the requesting Stockholder(s) and, if applicable, the securities owned by each such Other Security Holders.

 4. Registration Procedures. 
 (A) In connection with any registration under Section 3 hereof, the Company covenants and agrees that it will: 
 (i)
furnish to the Shareholder such number of copies of such Registration Statement, each amendment and supplement thereto, the Prospectus included in the Registration Statement (including each preliminary Prospectus), and such other documents, as the
Shareholder may reasonably request in order to facilitate the public sale or other disposition of the securities owned by the Shareholder; 
 (ii) to the extent an exemption from registration or qualification does not exist, use reasonable best efforts to register or qualify the Convertible Shares covered by such Registration Statement under such other securities or blue sky laws
of such jurisdictions as the Shareholder shall reasonably request, and do any and all other acts and things which may be necessary under such securities or blue sky laws to enable the Shareholder to consummate the public sale or other disposition in
such jurisdiction of the Convertible Shares owned by the Shareholder covered by such Registration Statement; provided, however, that the Company shall not be required to (i) qualify to do business as a foreign corporation in any jurisdiction
wherein it would not otherwise be required to qualify but for this subparagraph or (ii) subject itself to general service of process or taxation in any such jurisdiction. 
 (iii) use its reasonable best efforts to cause all such Convertible Shares covered by such Registration Statement to be listed on each securities
exchange or national market system on which securities of the same class are then listed; 
 (iv) provide a transfer agent and registrar for
Registrable Stock not later than the effective date of such Registration Statement; and 
  

 3 

 (v) comply with all applicable rules and regulations of the SEC, and make available to its security
holders an earnings statement satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act) (i) commencing at the end of any fiscal quarter in
which Convertible Shares are sold to underwriters in an underwritten offering or (ii) if not sold to underwriters in such an offering, commencing on the first day of the first fiscal quarter of the Company after the effective date of a
Registration Statement, which earnings statement shall cover said 12-month period. 
 (B) The Stockholder agrees that, upon receipt of
written notice from the Company of a happening of any event or the existence of any facts that make any statement made in a Registration Statement or prospectus untrue in any material respect or that require the making of any changes in a
Registration Statement or prospectus so that it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances
under which they were made (in the case of any prospectus), not misleading, the Stockholders will forthwith discontinue disposition of such Convertible Shares covered by such Registration Statement until they are advised in writing by the Company
that the use of the applicable prospectus may be resumed, and have received copies of any additional or supplemental filings that are incorporated or deemed to be incorporated by reference in such prospectus, and, if so directed by the Company, such
Stockholders will deliver to the Company all copies of the prospectus covering such Convertible Shares current at the time of receipt of such notice. 
 (C) The Stockholder agrees that it will keep confidential any material non-public information concerning the Company or its securities that it obtains in connection with a Registration Statement, and that it will not
purchase or sell securities of the Company on the basis of any such information or communicate such information to any Person under circumstances in which it is reasonably foreseeable that such Person is likely to purchase or sell securities of the
Company on the basis of any such information; provided, however, nothing in this Section 4(C) shall prevent the Stockholder from disposing of Registrable Stock in the manner contemplated by this Agreement. 
 5. Stockholder Holdback. If the Company registers shares of Common Stock in connection with an underwritten public offering by the Company, the
Stockholder, if so required by the lead underwriters of such underwritten offering, agrees not to effect any public sale or distribution of any of the Convertible Shares, including any sale pursuant to Rule 144 promulgated under the Securities Act
(other than as a part of such underwritten public offering), without the consent of the Company or such lead underwriters during the period commencing on a date specified by the lead underwriters, such date not to exceed 10 days prior to the
effective date of such Registration Statement, and ending on the earlier of (i) 90 days after the pricing of such offering, unless the lead underwriters for such offering otherwise agree, and (ii) the abandonment of such offering.

 6. Information. Shareholder hereby agrees (a) to cooperate with the Company and to promptly provide such information and
assistance as the Company may reasonably request and as may be reasonably necessary to complete any Registration Statement or other required filing pursuant to this Agreement and (b) to the extent required by the Securities Act, to deliver or
cause delivery of the 

  

 4 

 
prospectus contained in any Registration Statement, and any amendment or supplement thereto, to any purchaser from such Stockholder of the Convertible Shares
covered by the Registration Statement. It shall be a condition precedent to the inclusion of the Registrable Stock of any Stockholders in a Registration Statement effected pursuant to this Agreement that such Stockholder shall execute such
indemnities, underwriting agreements, lockups and other documents as the Company or the managing underwriter shall reasonably request in order to satisfy the requirements applicable to such Registration Statement. 
 7. Expenses. The Company shall pay all costs (excluding fees and expenses of Shareholder(s)
’ counsel and any underwriting or selling commissions or transfer taxes with respect to the disposition, sale, or transfer of the Registrable
Stock), fees and expenses in connection with all Registration Statements filed pursuant to Section 3 hereof including, without limitation, the Company’s legal and accounting fees, printing expenses, blue sky fees and expenses.

 8. Indemnification. 
 (A) In the event of any Public Offering of any Registrable Stock under the Securities Act pursuant to this Agreement, the Company agrees, to the extent permitted by law, to indemnify and hold harmless each seller of Registrable Stock, and
each Affiliate of such seller, against any losses, claims, damages or liabilities (except as limited by Section 8(D)), joint or several, arising out of or based upon: 
 (i) any alleged untrue statement of any material fact contained, on the effective date thereof, in any Registration Statement under which
such Registrable Stock was registered under the Securities Act, any preliminary prospectus or final prospectus contained therein, or any summary prospectus contained therein, or any amendment or supplement thereto, or 
 (ii) any alleged omission to state in any such document a material fact required to be stated therein or necessary to make the statements
therein not misleading, 
 except insofar as any such loss, claim, damage or liability is: 
 (i) caused by or contained in any information furnished in writing to the Company by such seller or any such Affiliate expressly for use
in connection with such Registration Statement, or 
 (ii) caused by such seller’s failure to deliver a copy of the
Registration Statement or prospectus or any amendment or supplement thereto as required by the Securities Act or the rules or regulations thereunder, or 
 (iii) caused by the failure to discontinue (i) disposition of any Registrable Stock under a Registration Statement or (ii) use of a prospectus or preliminary prospectus or any amendment or supplement by such
seller after receipt of notice from the Company that it should no longer be used; or 
  

 5 

 (iv) arise out of or are based upon offers or sales effected by the Stockholder “by
means of” (as defined in Securities Act Rule 159A) a “free writing prospectus” (as defined in Securities Act Rule 405) that was not authorized in writing by the Company. 
 In connection with an underwritten offering, the Company will indemnify such underwriters, their officers and directors and each Person who controls
(within the meaning of the Securities Act) such underwriters to the same extent as provided above with respect to the sellers of Registrable Stock (and with the same exception with respect to information furnished or omitted by such underwriter or
controlling person thereof). The Company shall reimburse each Person indemnified pursuant to this Section 8(A) in connection with investigating or defending any loss, claim, damage, liability or action indemnified against. The
reimbursements required by this Section 8(A) shall be made by periodic payments during the course of the investigation or defense, as and when bills are received or expenses incurred. The indemnities provided pursuant to this
Section 8(A) shall remain in force and effect regardless of any investigation made by or on behalf of the indemnified party and shall survive transfer of Registrable Stock by a seller. 
 (B) In the event of any Public Offering of any Registrable Stock under the Securities Act pursuant to this Agreement, each Stockholder agrees to furnish
to the Company in writing such information and affidavits as the Company reasonably requests for use in connection with any Registration Statement or prospectus in connection with the registration or any amendment or supplement thereto or as may be
required by law for use in connection with any such Registration Statement or prospectus and all information required to be disclosed in order to make the information previously furnished to the Company by the Stockholder not materially misleading
or necessary to cause such Registration Statement not to omit a material fact with respect to the Stockholder in order to make the statements therein not misleading. 
 (C) To the extent permitted by law, and subject to the limitation set forth in the last sentence of this Section (C), each Stockholder which is a seller of Registrable Stock under a Registration Statement
pursuant to this Agreement agrees severally and not jointly to indemnify and hold harmless the Company, its directors, officers, employees and agents, each other seller of securities under such Registration Statement, each Affiliate of each such
other seller, and each Affiliate of the Company, against: 
 (i) any losses, claims, damages or liabilities (except as limited
by Section 8(D)), joint or several, arising out of or based upon: 
 (a) any alleged untrue statement of any
material fact contained, on the effective date thereof, in any Registration Statement under which such Registrable Stock was registered under the Securities Act, any preliminary prospectus or final prospectus contained therein, or any summary
prospectus contained therein, or any amendment or supplement thereto, or 
 (b) any alleged omission to state in any such
document a material fact required to be stated therein or necessary to make the statements therein not misleading, but only insofar as any such loss, claim, damage or liability is caused by or 

  

 6 

 
contained in any information furnished in writing to the Company by the indemnifying seller expressly for use in connection with (Y) such Registration
Statement or preliminary prospectus or any amendment or supplement thereto or (Z) a Public Offering; and 
 (ii) any
losses, claims, damages or liabilities, joint or several, arising out of or based upon: 
 (a) any failure by such seller to
deliver a copy of the Registration Statement or prospectus or any amendment or supplement thereto as required by the Securities Act or the rules or regulations thereunder, or 
 (b) any failure by such seller to stop using the Registration Statement or prospectus or any amendment or supplement thereto after receipt
of written notice from the Company to stop, or 
 (c) offers or sales effected by the Stockholder “by means of” (as
defined in Securities Act Rule 159A) a “free writing prospectus” (as defined in Securities Act Rule 405) that was not authorized in writing by the Company. 
 In connection with an underwritten offering, each seller will indemnify such underwriters, their officers and directors and each Person who controls (within the meaning of the Securities Act) such underwriters to the
same extent as provided above with respect to the Company and other sellers. Each seller shall reimburse each Person indemnified pursuant to this Section 8(C) in connection with investigating or defending any loss, claim, damage,
liability or action indemnified against. The reimbursements required by this Section 8(C) shall be made by periodic payments during the course of the investigation or defense, as and when bills are received or expenses incurred. The
indemnities provided pursuant to this Section 8(C) shall remain in force and effect regardless of any investigation made by or on behalf of the indemnified party and shall survive transfer of Registrable Stock by an indemnifying seller,
and transfer of other securities by any other indemnified seller. Notwithstanding any contrary provision of this Agreement, however, the liability under this Section 8 of each Stockholder which is a seller of Registrable Stock shall be
limited in the aggregate, to an amount not to exceed the amount of proceeds to the indemnifying seller from the sale of the Registrable Stock sold by the indemnifying seller, except in the case of fraud or willful misconduct. 
 (D) In the event the Company or any Stockholder receives a complaint, claim or other notice of any loss, claim or damage, liability or action, giving
rise to claim for indemnification under this Section 8, the Person claiming indemnification shall promptly notify the Person against whom indemnification is sought of such complaint, notice, claim or action, and such indemnifying Person
shall have the right to investigate and defend any such loss, claim, damage, liability or action. The Person claiming indemnification shall have the right to employ separate counsel in any such action and to participate in the defense thereof but
the fees and expenses of such counsel shall not be at the expense of the Person against whom indemnification is sought (unless the Person claiming indemnification reasonably believes (with written advice of counsel) that the ability of the counsel
defending such action to defend 

  

 7 

 
such Person’s interests therein is affected adversely and materially by a conflict of interest) and the indemnifying Person shall not be obligated to
indemnify any Person for any settlement of any claim or action effected without the indemnifying Person’s consent, which consent will not be unreasonably withheld. 
 9. Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement. 
 10. Descriptive Headings. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this
Agreement. 
 11. Notices. All requests, notices and other communications provided for hereunder shall be in writing and delivered by
hand or by first-class or certified mail postage prepaid, or by facsimile, to the following addresses, or such other addresses as shall be given by notice delivered hereunder, and shall be deemed to have been received on the day of personal delivery
or by facsimile or within three (3) business days after such mailing: 
 If to the Shareholder, to: 
 Icarus Investment Corp. 
 Yonge-Eglinton Centre 
 2300 Yonge Street, 
 P.O. Box 2408 
 Suite 1710 
 Toronto, ON 
 Canada, M4P 1E4 
 If to the
Company, to: 
 CECO Environmental Corp. 
 Attention: Dennis Blazer 
 3120 Forrer Street 
 Cincinnati, OH 45209 
 Fax no.: (513) 458-2644 
 or, as to the
Shareholder or the Company, to such other persons or at such other addresses as shall be furnished by any such party by like notice to the other parties. 
 12. Termination. All rights under this Agreement shall terminate as to any holder at such time as such holder is free to sell all shares of Registrable Stock held by such holder pursuant to Rule 144 under the
Securities Act free from any volume restrictions or manner of sale restrictions under Rule 144 or a comparable exemption from registration that enables the holder to sell all shares of Registrable Stock held by such holder without registration under
the Securities Act and without legal restriction as to the volume or to manner of sale or otherwise. 
  

 8 

 13. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original but all of which shall together constitute one and the same document. 
 14. Entire Agreement. This Agreement
constitutes the entire agreement by and among the parties hereto with respect to the subject matter hereof. 
 15. Amendments. This
Agreement may be amended, modified or supplemented only by a written instrument executed by the Company and the Shareholder; provided, however, that if any underwriter engaged by the Company in selling the Company’s securities pursuant to the
Company’s initial public offering requests an amendment to this Agreement, the parties agree to negotiate in good faith to reasonably modify this Agreement to accommodate such request. 
 16. Assignment of Registration Rights. The rights to cause the Company to register Registrable Securities pursuant to this Agreement may be
assigned only (a) by a Holder to an Affiliate or (b) to a party who acquires at least 500,000 shares of Registrable Stock (if the Note has not been converted, calculated by determining the number of shares of Common Stock into which the
holder of the Note can convert the outstanding amount of such Note, including interest and principal); provided, however, (i) the transferor shall, within ten (10) days after such transfer, furnish to the Company written
notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned and (ii) such transferee shall agree to become a party to and be subject to all restrictions set
forth in this Agreement. 
 17. Governing Law, Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio applicable to contracts made and to be performed in that state. EACH PARTY HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDINGS INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO
OR CONNECTED WITH THIS AGREEMENT WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. 
 [Signature page follows.] 
  

 9 

 IN WITNESS WHEREOF, each of the parties hereto has executed this Registration Rights Agreement as of the
day and year first written above. 
  

			
	 CECO ENVIRONMENTAL CORP.

		
	By:	 	 /s/ Dennis W. Blazer

	Name:	 	  

		 	Dennis W. Blazer
		 	Chief Financial Officer
	
	 ICARUS INVESTMENT CORP.

		
	By:	 	 /s/ Phillip DeZwirek

		
	Its:	 	 /s/ President

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