Commerce Energy Sells Texas Retail Electric Business for $14.8 Million

  
    
  
  
    
      Commerce Energy Group, Inc. (AMEX:EGR) said today that its principal 
      operating subsidiary, Commerce Energy, Inc., sold all of its retail 
      electric service contracts in Texas to Ambit Energy, LP (Ambit), for an 
      estimated $14.8 million. The purchase price includes $8.5 million in 
      cash received on closing, a second payment of $2.7 million, reduced by 
      customer deposits and adjusted for final customer count, to be received 
      on or before November 24, 2008 and deferred payments over a 24-month 
      period estimated to be $3.6 million.
    
    
      “This is a significant, positive step in both 
      paying down debt as well as strengthening the core platform of the 
      company,” said Commerce chief operating 
      officer, Michael Fallquist. “We found a buyer 
      in Ambit that shares our commitment to great technology, products and 
      customer service. Ambit has agreed to preserve the terms and conditions 
      of the customer contracts and this transaction will be seamless to all 
      our customers.”
    
    
      Commerce chief executive officer, Gregory L. Craig, remarked, “We 
      have achieved another critical milestone in the now eight month old 
      turnaround process. We are pleased to have completed a successful asset 
      sale against the backdrop of a global credit and financial crisis and 
      believe that this sale will better position Commerce operationally, 
      financially, and strategically to achieve our future objectives.”
    
    
      Commerce will retain its business providing retail electric power and 
      natural gas in other markets in which it currently operates. In 
      connection with the sale, Commerce also entered into amendments to its 
      debt agreements, which, among other things, allow additional support of 
      up to $6.0 million from AP Finance, LLC, remove the requirement to have 
      a refinancing term sheet by October 30, 2008 and decrease the revolving 
      loan limit and letter of credit limit under the credit facility.
    
    
      Commerce was represented by Affiliated Energy Group (AEG) in connection 
      with the transaction.
    
    
      About Ambit Energy
    
    
      Ambit Energy, L.P. is a retail energy provider based in Dallas, Texas. 
      Ambit currently provides electricity and natural gas service to retail 
      customers in Texas, New York and Illinois. Additional information on 
      Ambit Energy can be found at ambitenergy.com.
    
    
      About Commerce Energy Group
    
    
      Commerce Energy Group is a leading independent U.S. electricity and 
      natural gas marketing company. Its principal operating subsidiary, 
      Commerce Energy, Inc., is licensed by the Federal Energy Regulatory 
      Commission and by state regulatory agencies as an unregulated retail 
      marketer of natural gas and electricity and serves homeowners, 
      commercial and industrial consumers and institutional customers. For 
      more information, visit www.CommerceEnergy.com.
    
    
      Forward-Looking Statements
    
    
      Except for historical information contained in this release, statements 
      in this release may constitute forward-looking statements regarding the 
      company’s assumptions, projections, 
      expectations, targets, intentions or beliefs about future events. Words 
      or phrases such as “anticipates,” 
      “believes,” “estimates,” 
      “expects,” “intends,” 
      “plans,” “predicts,” 
      “projects,” “targets,” 
      “will likely result,” 
      “will continue,” “may,” 
      “could” or similar 
      expressions identify forward-looking statements. Forward-looking 
      statements are not guarantees of future performance and involve risks 
      and uncertainties which could cause actual results or outcomes to differ 
      materially from those expressed. Commerce Energy Group, Inc. cautions 
      that while such statements in this news release, whether express or 
      implied, are made in good faith and the company believes such statements 
      are based on reasonable assumptions, including without limitation, 
      management’s examination of historical 
      operating trends, data contained in records, and other data available 
      from third parties, the company cannot assure that its projections will 
      be achieved. In addition to other factors and matters discussed from 
      time to time in our filings with the U.S. Securities and Exchange 
      Commission (SEC), some important factors that could cause actual results 
      or outcomes for Commerce Energy Group, Inc. or its subsidiaries to 
      differ materially from those discussed in forward-looking statements 
      include: the ability to secure a longer term credit facility by 
      year-end, the success and effectiveness of the company’s 
      new management plans and strategies; higher than anticipated attrition 
      of company personnel, the volatility of the energy markets; higher than 
      expected attrition of, and/or unforeseen operating difficulties relating 
      to, customer accounts, competition, operating hazards, uninsured risks, 
      failure of performance by suppliers and transmitters, changes in general 
      economic conditions, seasonal weather or force majeure events that 
      adversely affect electricity or natural gas supply or infrastructure, 
      decisions by our energy suppliers requiring us to post additional 
      collateral for our energy purchases, uncertainties in the capital 
      markets should the company seek to raise additional equity or debt; 
      uncertainties relating to federal and state proceedings regarding the 
      2000-2001 California energy crisis; accounts receivable collection 
      issues caused by unfavorable changes in regulations or economic trends, 
      increased or unexpected competition, adverse state or federal 
      legislation or regulation, or adverse determinations by regulators, 
      including failure to obtain regulatory approvals. Any forward-looking 
      statement speaks only as of the date on which such statement is made, 
      and, except as required by law, the company undertakes no obligation to 
      update any forward-looking statement to reflect events or circumstances 
      after the date on which such statement is made or to reflect the 
      occurrence of unanticipated events. New factors emerge from time to 
      time, and it is not possible for management to predict all such factors.