RELEASE AGREEMENT
This
Release Agreement is entered into this 16th day of
April 2008 by and among Commerce Energy, Inc., a
California corporation (“ Commerce
”), Tenaska Power Services Co., a Nebraska corporation
(“ Tenaska
”) and Wachovia Capital Finance Corporation (Western)
(“ Wachovia
”) as agent for the lenders party to that certain Loan
and Security Agreement dated June 8, 2006 as amended (the
“ Loan
Agreement ”) with respect to the following
facts:
A. Pursuant
to the Loan Agreement, Wachovia is providing various credit
facilities to Commerce secured by the personal property of
Commerce;
B. Tenaska
is supplying energy to Commerce, and to secure its obligations
and liabilities to Tenaska in connection therewith, Commerce
granted Tenaska a security interest in certain personal
property as described in the Security Agreement dated
August 1, 2005 as amended (the “ Security
Agreement ”); and
C. The
parties hereto now desire that pursuant to the Loan Agreement,
Wachovia arrange for the issuance by Wachovia Bank, National
Association of a standby letter of credit for the original
face amount of $7,000,000 in favor of Tenaska (as beneficiary)
and in the form of Exhibit A
attached hereto and incorporated herein by reference (the
“ LC
”), as well as $3,000,000 collateral in the form of cash
wired to Tenaska, both in substitution of the collateral
provided under the Security Agreement.
NOW
THEREFORE, Tenaska hereby agrees that
one (1) business day after receipt by Tenaska of the
original LC signed by duly authorized representatives of
Wachovia Bank, National Association and cash and in
consideration thereof: (a) Tenaska shall be
deemed to have released and terminated and shall have released
and terminated any and all of its security interests in the
assets and property of Commerce, including without limitation
the collateral provided under the Security Agreement;
(b) Commerce and Wachovia together with their agents
shall be authorized to file UCC termination statements for any
and all UCC financing statements naming Commerce as debtor and
Tenaska as secured party, including without limitation those
filed with the California Secretary of State on July 15,
2005 as filing number 05-7034378774 and on August 5, 2005
as filing number 05-7036775585;
(c) one (1) business day after receipt by
Tenaska of the original LC signed by duly authorized
representatives of Wachovia Bank, National Association,
Tenaska shall deliver to U.S. Bank National Association a
written instrument releasing and terminating any and all of
its rights, remedies and interests with respect to deposit
account number [*] and post office lockbox number 644010,
Cincinnati, Ohio 45264-4010; and (d)
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