The Company has agreed to pay FKI consideration in the amount of approximately $16.0 million, which includes $15.0 million in cash and that number of shares of the Company's common stock worth approximately $1.0 million (based on the average closing price of the Company's common stock on the Nasdaq Global Market for the sixty trading days immediately preceding the closing date of the Asset Purchase). The total consideration paid excludes transaction costs and is subject to certain post-closing adjustments.

The consideration for the Asset Purchase also includes a three year earn-out payment, which is payable in unregistered shares of the Company's common stock. The earn-out payment is not to exceed in the aggregate shares worth approximately $3.5 million (the "Earn-out Cap")(based on the average closing price of the Company's common stock on the Nasdaq Global Market for the sixty trading days immediately preceding the closing date of the Asset Purchase). The number of shares earned is based on 50% of the amount by which annual fiscal year gross profits of the purchased operations of FKI exceeds $8,800,000 for the fiscal year ended December 31, 2008, $17,600,000 for the fiscal year ended December 31, 2009, and $26,400,000 for the fiscal year ended December 31, 2010; provided that the amount of share issued is subject to the Earn-out Cap. The buyer will receive certain registration rights in connection with both the shares issued at closing and in connection with the earn-out.

The parties to the APA have made customary representations, warranties and covenants therein. The assertions embodied in those representations and warranties were made for purposes of the APA and are subject to qualifications and limitations agreed by the respective parties in connection with negotiating the terms of the APA. In addition, certain representations and warranties made as of a specified date may be subject to a contractual standard of materiality different from what might be viewed as material to stockholders, or may have been used for the purpose of allocating risk between the respective parties rather than establishing matters as facts.

This report contains statements about the future, sometimes referred to as "forward--looking" statements. Forward-looking statements are typically identified by the use of the words "believe," "may," "should," "expect," "anticipate," "estimate," "project," "propose,""plan," "intend" and similar words and expressions. Forward-looking statements are subject to risks and uncertainties outside CECO's control. Actual events or results may differ materially from the forward-looking statements. For a discussion of additional contingencies and uncertainties to which information respecting future events is subject, see CECO's other SEC reports.