EXHIBIT 10.4

EXECUTION VERSION

FORBEARANCE AGREEMENT

This FORBEARANCE AGREEMENT (this “Agreement”) is entered into as of March 26,
2012 by and among Comverge, Inc., a Delaware corporation, (“Comverge”),
Alternative Energy Resources, Inc., a Delaware corporation (“AER”), Enerwise
Global Technologies, Inc., a Delaware corporation (“Enerwise”), Comverge Giants,
LLC, a Delaware limited liability company (“Giants”), Public Energy Solutions,
LLC, a New Jersey limited liability company (“PES”), Public Energy Solutions NY,
LLC, a Delaware limited liability company (“PESNY”), and Clean Power Markets,
Inc., a Pennsylvania corporation (“CPM”; and together with Comverge, AER,
Enerwise, Giants, PES and PESNY, each an “Issuer” and individually,
collectively, jointly and severally, the “Issuers”), the Purchasers (as defined
below) party thereto and Peak Holding Corp. (“Peak”), as Note Agent (as defined
below).

W I T N E S S E T H:

WHEREAS, the Issuers, the below-defined Purchasers and below-defined Note Agent
entered into that certain Note Purchase and Security Agreement dated as of the
date hereof (as the same has been amended, restated, supplemented or otherwise
modified from time to time, including pursuant to this Agreement, the “NPA”), by
and among the Issuers, the purchasers whose names appear on Annex A thereto
(each a “Purchaser” and, collectively, the “Purchasers”), and Peak, in its
capacity as agent for itself and the Purchasers (in such capacity and together
with any successor or replacement agent, the “Note Agent”);

WHEREAS, Events of Default are currently in existence under Section 8.6 of the
NPA as a result of (a) the “Existing Events of Default” as defined in the Senior
Forbearance Agreement as in effect on the date hereof, and (b) the “Existing
Events of Default” as defined in the Grace Bay Forbearance Agreement as in
effect on the date hereof (all such Events of Default mentioned in clauses
(a) and (b) of this paragraph, the “Existing Event of Default”);

WHEREAS, the Issuers have requested that, during the Forbearance Period, Note
Agent and the Purchasers forbear from exercising the rights and remedies they
may possess under the NPA and the other Note Documents as a result of the
Existing Events of Default and any Non-Material Future Defaults; and

WHEREAS, Note Agent and the Purchasers are willing to forbear from exercising
their rights and remedies as a result of any Non-Material Future Defaults during
the Forbearance Period, on the terms and subject to the conditions set forth
herein.

NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which hereby are acknowledged, the parties hereto
agree as follows:

1. Defined Terms. Capitalized terms used but not defined herein, including in
the preamble and recitals above, shall have the meanings ascribed to such terms
in the NPA. As used herein, the following terms shall have the respective
meanings given to them below:

(a) “Acquisition Agreement” means that certain Agreement and Plan of Merger
dated as of the date of this Agreement by and among Comverge, Peak Holding Corp.
and Peak Merger Corp.

 

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(b) “Additional Prepayment Amount” means either (A) in the event that the
Superior Proposal is with the entity set forth on Schedule A hereto (“Company
X”), the Prepayment Premium, and (B) in the event that the Superior Proposal is
not with Company X, the greater of (i) the Prepayment Premium that would be
applicable to the Obligations and (ii) the amount by which the Converted Share
Value exceeds the value of the Obligations (assuming no conversion of such
Obligations).

(c) “Applicable Termination Date” means the earliest to occur of (1) in the
event of a termination of the Acquisition Agreement pursuant to any of
Section 9.1(a), Section 9.1(b)(i), Section 9.1(b)(ii), Section 9.1(d)(i)(B) (if
such Company Adverse Recommendation Change is not made in connection with a
Superior Proposal, as such terms are defined in the Acquisition Agreement),
Section 9.1(d)(i)(C), Section 9.1(d)(ii) or Section 9.2 thereof, the date of
such termination, (2) in the event of a termination of the Acquisition Agreement
pursuant to any of Section 9.1(c)(i), Section 9.1(c)(iii), Section 9.1(d)(i)(A)
or Section 9.1(d)(i)(B) (if such Company Adverse Recommendation Change is made
in connection with a Superior Proposal) thereof, the earlier of (x) the date
that is 45 days following the date of such termination and (y) the consummation
of the Superior Proposal (pursuant to and as defined in the Acquisition
Agreement) in connection with which the Acquisition Agreement was terminated and
(3) in the event of a termination of the Acquisition Agreement pursuant to any
of Section 9.1(c)(ii), or Section 9.1(d)(iii), the later of (x) the date that is
30 days following the date of such termination or (y) the date that is 40 days
following the date of this Agreement.

(d) “Convertible Shares” means the number of shares of Common Stock obtained by
converting all of the Obligations into Common Stock (without giving effect to
any limitation on the amount of Obligations that may be converted) at the Common
Conversion Price, as adjusted pursuant to Section 2.2(g) of the NPA.

(e) “Converted Share Value” means the offer price per share of Common Stock at
which the tender offer contemplated by a Superior Proposal is successfully
consummated multiplied by the number of Convertible Shares.

(f) “Forbearance Period” shall have the meaning set forth in Section 3(b)
hereof.

(g) “Forbearance Termination Date” means the earlier to occur of (i) the
Applicable Termination Date and (ii) the date on which the forbearance
effectuated by Section 3(b) of this Agreement shall cease due to the occurrence
of any of the events described in Section 4 hereof.

(h) “Material Default” means the occurrence of any of the following events:

(a) an Event of Default occurs that would reasonably be expected to result in a
Material Adverse Change;

 

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(b) any Event of Default arising under or caused by Sections 8.1, 8.4, 8.5,
8.6(b) (solely with respect to the SVB Loan Documents), 8.7, 8.10 and 8.12 of
the NPA; and

(c) any Event of Default arising with respect to any material failure to comply
with Sections 6.2(a)(i), (ii) and (iii), 6.2(c), 6.7, 6.9, 6.13, 6.15(b), 7.1,
7.4, 7.5, 7.9, 7.11, and 7.12 of the NPA (it being agreed that transactions
pursuant to the Acquisition Agreement, including actions taken in accordance
with the Acquisition Agreement in connection with a Superior Proposal (as
defined in the Acquisition Agreement) shall not constitute a “Material Default”
as long as Issuers comply with Section 2 of this Agreement.

For the avoidance of doubt, no Material Default shall be deemed to exist
(i) with respect to an Event of Default under Section 8.6 of the NPA arising
(a) from a default under the Grace Bay Loan Documents that does not constitute a
“Material Default” as long as the forbearance pursuant to the Grace Bay
Forbearance Agreement (as in effect on the date hereof) has not been terminated
or otherwise ceased to be in effect, (b) from a default under the Senior Debt
Documents that does not constitute a “Material Default” as long as the
forbearance pursuant to the Senior Forbearance Agreement (as in effect on the
date hereof) has not been terminated or otherwise ceased to be in effect, and
(ii) from a default under (a) Section 6.15 of the NPA (other than a default
under Section 6.15(b) of the NPA) or (b) Section 7 hereof (other than
Section 7(a) hereof).

(i) “Material Adverse Change” is (a) a material impairment in the perfection,
priority or enforceability of Note Agent’s Lien in the Collateral (taken as a
whole) or in the value of such Collateral (taken as a whole); (b) a material
adverse change in the business, operations or financial condition of the Note
Parties and their Subsidiaries, taken as a whole; (c) an event of default in the
payment of any interest or principal on the Loans; (d) a material impairment in
the Issuers’ ability to make any payment of Obligations; or (e) any warranty,
representation or statement made or delivered by the Issuers to Note Agent or
any Purchaser, now or in the future, shall be untrue or misleading in any
material respect with respect to the Collateral (taken as a whole), the
perfection, priority or enforceability of Note Agent’s Lien in the Collateral
(taken as a whole) or the financial statements delivered by the Issuers to Note
Agent, when made or deemed to be made.

(j) “Maturity Date” has the meaning set forth in the NPA.

(k) “Non-Material Future Default” means any Default or Event of Default that is
not a Material Default that occurs on or after the date hereof but prior to the
Forbearance Termination Date.

2. Consent; Mandatory Prepayment; Optional Prepayment.

(a) Subject to the terms and conditions set forth herein, and notwithstanding
anything to the contrary in the NPA and the other Note Documents, Note Agent and
the Purchasers hereby irrevocably consents to the transactions set forth in the
Acquisition Agreement (as defined

 

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below) and any Superior Proposal (pursuant to and as defined in the Acquisition
Agreement), so long as all of the Obligations, but excluding contingent
indemnification obligations under the NPA for which no claim has been asserted,
are paid in full within two (2) business days of the time of the consummation of
the transaction contemplated by the Superior Proposal in accordance with
Section 2.3(c) or Section 2.3(d) of the NPA, as applicable.

(b) Notwithstanding anything to the contrary in the NPA and the other Note
Documents, if the Acquisition Agreement is terminated either (i) by Comverge
pursuant to Section 9.1(c)(i) or Section 9.1(c)(iii) of the Acquisition
Agreement or (ii) by Peak pursuant to Section 9.1(d)(i)(A) or
Section 9.1(d)(i)(B) (if such Company Adverse Recommendation Change is made in
connection with a Superior Proposal, as such terms are defined in the
Acquisition Agreement) of the Acquisition Agreement, then, within two
(2) business days after the consummation of the tender offer contemplated by the
Superior Proposal (pursuant to and as defined in the Acquisition Agreement), at
the election of Peak (which election shall be made within 1 business day of the
consummation of the tender offer contemplated by the Superior Proposal), the
Issuers shall (i) prepay all of the Obligations, but excluding the Prepayment
Premium and contingent indemnification obligations under the NPA for which no
claim has been asserted, and (ii) pay the Additional Prepayment Amount, to Peak.

(c) Notwithstanding anything to the contrary in the NPA and the other Note
Documents, if the Acquisition Agreement is terminated either (i) by Comverge
pursuant to Section 9.1(c)(i) or Section 9.1(c)(iii) of the Acquisition
Agreement or (ii) by Peak pursuant to Section 9.1(d)(i)(A) or
Section 9.1(d)(i)(B) (if such Company Adverse Recommendation Change is made in
connection with a Superior Proposal, as such terms are defined in the
Acquisition Agreement) of the Acquisition Agreement, then, within two
(2) business days after the consummation of the tender offer contemplated by the
Superior Proposal (pursuant to and as defined in the Acquisition Agreement), at
the election of the Issuers (which election shall be made within 1 business day
of the consummation of the tender offer contemplated by the Superior Proposal),
the Issuers shall (i) prepay all of the Obligations, but excluding the
Prepayment Premium and contingent indemnification obligations under the NPA for
which no claim has been asserted, and (ii) pay the Additional Prepayment Amount,
to Peak.

3. Forbearance in Respect of Non-Material Future Defaults.

(a) Acknowledgment of Existing Debt. Neither Note Agent nor any Purchaser has
waived, presently intend to waive, and may ever waive any Event of Default and
nothing contained herein or in the transactions contemplated hereby shall be
deemed to constitute any such waiver or to establish a custom or course of
dealing. Each Issuer acknowledges and agrees that, as of the date hereof the
outstanding principal balance of the Loan is $12,000,000.

(b) Forbearance. In reliance upon the representations, warranties and covenants
of the Issuers contained in this Agreement, and subject to the terms,
conditions, modifications and amendments set forth in this Agreement and any
documents or instruments executed in connection herewith, Note Agent and the
Purchasers, subject to the provisions of Section 3(c) below, agree to forbear,
during the period (the “Forbearance Period”) commencing on the date hereof and
ending on the Forbearance Termination Date, from exercising its rights and
remedies under the NPA and other Note Documents or applicable law in respect of
or arising out of the

 

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Existing Events of Default, Non-Material Future Defaults, and its Amortization
Right (with respect to such Amortization Rights, as long as the forbearance
pursuant to the Grace Bay Forbearance Agreement has not been terminated or
otherwise ceased to be in effect). Upon the termination of the Forbearance
Period, the agreement of Note Agent and the Purchasers to forbear pursuant to
this Section 3(b) shall automatically and without further action terminate and
be of no force and effect, it being expressly agreed that the effect of such
termination will be to permit Note Agent and the Purchasers to exercise all
rights and remedies in respect of any Events of Default and its Amortization
Right immediately in accordance with the NPA and other Note Documents or
applicable law.

(c) No Forbearance. Notwithstanding anything to the contrary contained in
Section 3(b):

(i) The Existing Events of Default and each Non-Material Future Default, upon
the occurrence thereof, shall constitute an Event of Default under the NPA and
each other Note Document for the purpose of determining whether or not certain
actions or in-actions may be taken or otherwise acquiesced to by or on behalf of
any Issuer, as set forth therein. Accordingly, any actions or in-actions taken
or omitted by any Issuer in violation of any provision governing whether such
action or in-action may or may not be taken or omitted while any Event of
Default exists will constitute additional Events of Default under the NPA and
the other Note Documents, as well as a breach of the terms of this Agreement.

(ii) Peak’s Amortization Rights shall continue to exist regardless of any action
or in-actions taken or otherwise acquiesced to by or on behalf of any Issuer.
The forbearance provided under Section 3(b) shall in no way be considered a
course of dealing or a right of the Issuers to any forbearance or waiver of
Peak’s right to exercise its Amortization Right following the termination or
other cessation of the Grace Bay Forbearance Agreement.

(iii) The forbearance set forth in Section 3(b) on the part of Note Agent and
the Purchasers shall not, and shall not be deemed to, relieve in any manner any
Issuer from complying with all limitations, restrictions, prohibitions or
requirements that would otherwise be effective or applicable under the NPA or
any other Note Documents (including all limitations, restrictions, prohibitions
or requirements that extend to subsidiaries not party to the NPA) during the
term of this Agreement, or otherwise during the continuance of any Default or
Event of Default.

4. Automatic Termination of Forbearance Period. The agreement of Note Agent and
the Purchasers to forbear pursuant to Section 3(b) of this Agreement shall
automatically terminate, without notice or any other further act or instrument
being required, upon the occurrence of any of the following:

(a) if any Issuer makes or pursues a claim pursuant to a judicial process
against Note Agent, any Purchaser or any of its Affiliates in respect of matters
arising under the Note Documents;

(b) the existence of any Material Default, other than the Existing Events of
Default;

 

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(c) a Issuer material breach of any agreement or covenant contained in this
Agreement (it being acknowledged that breaches of Sections 5 and 7(a) of this
Agreement beyond any applicable grace period provided therein shall be deemed to
be material);

(d) any representation or warranty made by any Issuer in Section 8(g) of this
Agreement shall prove to be false or misleading as of the date when made;

(e) the forbearance by SVB under that certain Senior Forbearance Agreement (as
defined below) shall have terminated for any reason or otherwise ceases to be in
full force and effect;

(f) SVB (or any agent or representative of SVB) takes any action or remedy with
respect to any default or event of default that occurs under the SVB Loan
Documents (including, without limitation, acceleration of the maturity of the
Indebtedness under the SVB Loan Documents); and

(g) the forbearance by Grace Bay Holdings II, LLC under that certain Forbearance
Agreement by and among Issuers and Grace Bay Holdings II, LLC dated as of the
date hereof (the “Grace Bay Forbearance Agreement”) shall have terminated for
any reason or otherwise ceases to be in full force and effect.

5. Certain Agreements. From the date hereof and at all times thereafter, the
Issuers shall deliver on every other Wednesday (or if Wednesday is not a
Business Day, on the next succeeding Business Day) (i) a rolling 13 week cash
flow, reflecting actual results from the prior week period compared to (A) the
immediately preceding rolling 13 week cash flow delivered to Note Agent and
(B) the annual forecast delivered pursuant to Section 6.2(e) and (ii) the
projected results for the subsequent 13 week period, together with management’s
discussion of any variance from the prior cash flow or the annual forecast. A
breach (which shall continue to exist for a period of two (2) Business Days
after the occurrence of such breach) by any Issuer of any of the foregoing
provisions of this Section 5 shall constitute an Event of Default under the NPA.

6. Conditions Precedent. The effectiveness of this Agreement is subject to the
following conditions precedent:

(a) the execution and delivery of this Agreement by Note Agent, each Purchaser
and each Issuer and this Agreement shall be in full force and effect;

(b) all representations and warranties made by the Issuers in Section 8 below
being true and correct in all material respects as of the date hereof;

(c) the Acquisition Agreement shall have been duly executed by the parties
thereto, and such Acquisition Agreement shall be in full force and effect; and

(d) Issuers shall have delivered to Note Agent a copy, certified by an
authorized officer of Comverge as true, correct and complete, of the
fully-executed Forbearance Agreement and Sixth Amendment with respect to the SVB
Loan Documents, by and among the Issuers, SVB and the other parties thereto,
such agreement shall be in full force and effect and shall be in form and
substance reasonably acceptable to Note Agent and the Purchasers (the “Senior
Forbearance Agreement”).

 

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7. Post-Closing Covenant. The Issuers shall comply with the following covenants
(it being understood and agreed that the failure to comply with such covenants
by the due date set forth below shall be an Event of Default under the NPA):

(a) On or prior to 10 days after the date of this Agreement, Issuers shall
deliver to Note Agent Comverge’s board of director’s approved financial plan
(the “Forecast”) for the 2012 fiscal year in order to set the financial
covenants in Sections 6.7(a) and (b) to the NPA for the 2012 fiscal year;

(b) On or prior to 30 days after the date of this Agreement (or such later date
as Note Agent may agree in its sole discretion), Note Agent shall receive
evidence satisfactory to Note Agent that the Indebtedness related to that
certain UCC-1 financing statement filed with the Delaware Department of State on
January 10, 2007 with the initial filing number of 2007 0136019 by General
Electric Capital Corporation against Comverge has been paid in full and a UCC-3
termination statement has been filed with respect to such UCC-1 financing
statement and all other Liens with respect to such Indebtedness have been
released in a manner satisfactory to Note Agent;

(c) Issuers shall pay, or reimburse Note Agent and the Purchasers for, all
reasonable out-of-pocket costs and expenses incurred by Note Agent and the
Purchasers in connection with this Agreement, including, without limitation, the
preparation, negotiation and execution of this Agreement (including reasonable
attorney’s fees of counsel to Note Agent and the Purchasers) within five
(5) days after receipt of an invoice.

8. Representations and Warranties. Each Issuer hereby represents and warrants to
Note Agent and the Purchasers as follows:

(a) each Issuer is a corporation or limited liability company, as applicable,
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation, as applicable;

(b) each Issuer has the power and authority to execute and deliver this
Agreement and to perform its obligations under this Agreement;

(c) the execution, delivery and performance by each Issuer of this Agreement and
the performance by such Issuer of each other Note Document to which it is a
party (i) are within its corporate, limited liability company or other entity
powers, (ii) have been duly authorized by all necessary action, (iii) are not in
contravention of any law, rule, or regulation applicable to it, or any order,
judgment, decree, writ, injunction, or award of any arbitrator, court, or
Governmental Authority, or of the terms of its Operating Documents, or of any
contract or undertaking to which it is a party or by which any of its properties
may be bound or affected, (iv) do not and will not result in or require the
creation of any Lien (other than Permitted Liens) upon or with respect to any of
its properties, (v) do not and will not result in any default, noncompliance,
suspension, revocation, impairment, forfeiture or nonrenewal of any permit,
license, authorization or approval material to its operations or any of its
properties, and (vi) do not and will not require

 

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any approval of such Issuer’s interestholders or any approval or consent of any
Person under any material contractual obligation of such Issuer, other than
consents or approvals that have been obtained and that are still in force and
effect

(d) no authorization or approval or other action by, and no notice to or filing
with, any Governmental Body is required in connection with the due execution,
delivery and performance by such Issuer of this Agreement or any other Note
Document to which it is or will be a party or any other Note Document to which
it is or will be a party, other than filings with the SEC.

(e) this Agreement constitutes the legal, valid and binding obligation of each
Issuer, enforceable against each Issuer in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, or similar
laws affecting the enforcement of creditor’s rights generally or by equitable
principles relating to enforceability;

(f) no injunction, writ, restraining order, or other order of any nature
prohibiting, directly or indirectly, the consummation of the transactions
contemplated herein has been issued and remains in force by any Governmental
Authority against any Issuer;

(g) no Material Default exists or is continuing;

(h) this Agreement has been entered into without force or duress, of the free
will of any Issuer. Each Issuer’s decision to enter into this Agreement is a
fully informed decision and such Issuer is aware of all legal and other
ramifications of such decision;

(i) (i) the Issuers have thoroughly read and reviewed the terms and provisions
of this Agreement in its full and final form and are familiar with the same,
(ii) the terms and provisions contained herein are clearly understood by the
Issuers and have been fully and unconditionally consented to by the Issuers,
(iii) the Issuers have had full benefit and advice of counsel of their own
selection, or the opportunity to obtain the benefit and advice of counsel of
their own selection, in regard to understanding the terms, meaning and effect of
this Agreement and (iv) this Agreement has been entered into by the Issuers
freely, voluntarily, and with full knowledge, and (v) in executing this
Agreement, each Issuer is relying on no representations, either written or oral,
express or implied, made to such Issuer by any other party hereto or any other
Person. Each Issuer acknowledges that Note Agent’s and the Purchasers’
agreements set forth in this Agreement are adequate and sufficient consideration
for the agreements of the Issuers set forth in this Agreement; and

(j) the representations and warranties contained in the NPA are true and
correct, in all material respects, as of the date hereof, except to the extent
that such representations and warranties relate expressly to an earlier date, in
which case they are true and correct in all material respect as of such earlier
date.

9. No Waiver. Except as amended or modified pursuant to this Agreement, (i) Note
Agent and the Purchasers reserves all rights, privileges and remedies under the
Note Documents and (ii) the NPA and other Note Documents remain unmodified and
in full force and effect. All references in the Note Documents to the NPA shall
be deemed to be references to the NPA as amended hereby.

 

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10. Counterparts. This Agreement may be executed by one or more of the parties
to this Agreement in any number of separate counterparts, each of which when so
executed, shall be deemed an original and all said counterparts when taken
together shall be deemed to constitute but one and the same instrument. Any
facsimiled or photocopied signatures hereto, or signatures delivered by email
(in .pdf format) shall be deemed original signatures hereto, all of which shall
be equally valid.

11. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of each Issuer and its respective successors and assigns and Note
Agent and the Purchasers and its successors and assigns; provided, however, no
Issuer shall assign any of its rights or obligations under this Agreement and
any such prohibited assignment shall be absolutely void ab initio.

12. Further Assurance. Each Issuer hereby agrees to execute and deliver or cause
to be executed and delivered, from time to time, as and when reasonably
requested by Note Agent and the Purchasers, all such documents, instruments and
agreements and to take or cause to be taken such further or other action as Note
Agent and the Purchasers may reasonably deem necessary or desirable in order to
carry out the intent and purposes of this Agreement, the NPA and the other Note
Documents.

13. GOVERNING LAW; JURISDICTION; VENUE; MUTUAL JURY TRIAL WAIVER. THE PROVISIONS
IN THE NPA WITH RESPECT TO GOVERNING LAW, JURISDICTION, VENUE AND MUTUAL WAIVER
OF JURY TRIAL ARE APPLICABLE TO THIS AGREEMENT AS IF FULLY SET FORTH HEREIN.

14. Severability. Wherever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
such law, such provision shall be ineffective to the extent of such prohibition
or invalidity without invalidating the remainder of such provision or the
remaining provisions of this Agreement.

15. Reaffirmation. Each Issuer as debtor, grantor, pledgor, guarantor, assignor,
or in any other similar capacity in which such Issuer grants Liens or security
interests in its property or otherwise acts as accommodation party or guarantor,
as the case may be, hereby (a) ratifies and reaffirms all of its payment and
performance obligations, contingent or otherwise, under each of the Note
Documents to which it is a party (after giving effect hereto) and (b) to the
extent such Issuer granted Liens on or security interests in any of its property
pursuant to any such Note Document as security for or otherwise guaranteed the
Obligations and/or its obligations under or with respect to the Note Documents,
ratifies and reaffirms such guarantee and grant of security interests and Liens
and confirms and agrees that such security interests and Liens hereafter secure
all of the Obligations as amended hereby. Each of the Issuers hereby consents to
this Agreement and acknowledges that each of the Note Documents remains in full
force and effect and is hereby ratified and reaffirmed. The execution of this
Agreement shall not operate as a waiver of any right, power or remedy of Note
Agent and the Purchasers, constitute a waiver of any provision of any of the
Note Documents or serve to effect a novation of the Obligations.

 

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16. Ratification of Liability; Acknowledgment of Rights; Release of Claims.

(a) Each Issuer hereby ratifies and confirms its respective liabilities,
obligations and agreements under the NPA and the other Note Documents and the
Liens and security interests created thereby, and acknowledges that: (i) it has
no defenses, claims or set-offs to the enforcement by Note Agent or any
Purchaser of such liabilities, obligations and agreements; (ii) Note Agent and
the Purchasers have fully performed all undertakings owed to such Issuer as of
the date hereof and (iii) except to the limited extent of consents of Note Agent
and the Purchasers contained in this Agreement, neither Note Agent nor any
Purchaser waives, diminishes or limits any term or condition contained in the
NPA or in any of the other Note Documents.

(b) Effective on the date hereof, each Issuer, for itself and on behalf of its
successors, assigns, and officers, directors, employees, agents and attorneys,
and any Person acting for or on behalf of, or claiming through it, hereby
waives, releases, remises and forever discharges Note Agent, each Purchaser,
each of their respective affiliates, and each of their respective successors in
title, past, present and future officers, directors, employees, limited
partners, general partners, investors, attorneys, assigns, subsidiaries,
shareholders, trustees, agents and other professionals and all other Persons and
entities to whom Note Agent or any Purchaser would be liable if such Persons or
entities were found to be liable to such Issuer (each a “Releasee” and
collectively, the “Releasees”), from any and all past, present and future
claims, suits, liens, lawsuits, adverse consequences, amounts paid in
settlement, debts, deficiencies, diminution in value, disbursements, demands,
obligations, liabilities, causes of action, damages, losses, costs and expenses
of any kind or character, whether based in equity, law, contract, tort, implied
or express warranty, strict liability, criminal or civil statute or common law
(each a “Claim” and collectively, the “Claims”), whether known or unknown, fixed
or contingent, direct, indirect, or derivative, asserted or unasserted, matured
or unmatured, foreseen or unforseen, past or present, liquidated or
unliquidated, suspected or unsuspected, which such Issuer ever had from the
beginning of the world, now has, or might hereafter have against any such
Releasee which relates, directly or indirectly to the NPA, any other Note
Document, in each case, for any acts or omissions occurring on or prior to the
date of this Agreement of any such Releasee with respect to the NPA or any other
Note Document, or to the lender-Issuer relationship evidenced by the Note
Documents, except for the duties and obligations set forth in this Agreement. As
to each and every Claim released hereunder, each Issuer hereby represents that
it has received the advice of legal counsel with regard to the releases
contained herein, and having been so advised, specifically waives the benefit of
the provisions of Section 1542 of the Civil Code of California which provides as
follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH A CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM, MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.”

As to each and every Claim released hereunder, each Issuer also waives the
benefit of each other similar provision of applicable federal or state law
(including, without limitation, the laws of the state of California), if any,
pertaining to general releases after having been advised by its legal counsel
with respect thereto.

 

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Each Issuer acknowledges that it may hereafter discover facts different from or
in addition to those now known or believed to be true with respect to such
Claims and agrees that this instrument shall be and remain effective in all
respects notwithstanding any such differences or additional facts. This release
shall be and remain in full force and effect notwithstanding the discovery by
each Issuer after the date hereof (i) of any new or additional Claim against any
Releasee, (ii) of any new or additional facts in any way relating to this
release, (iii) that any fact relied upon by it was incorrect, or (iv) that any
representation or warranty made by any Releasee was untrue or that any Releasee
concealed any fact, circumstance or claim relevant to such Issuer’s execution of
this release. Each Issuer understands, acknowledges and agrees that the release
set forth above may be pleaded as a full and complete defense and may be used as
a basis for an injunction against any action, suit or other proceeding which may
be instituted, prosecuted or attempted in breach of the provisions of such
release.

(c) Each Issuer, for itself and on behalf of its successors, assigns, and
officers, directors, employees, agents and attorneys, and any Person acting for
or on behalf of, or claiming through it, hereby absolutely, unconditionally and
irrevocably, covenants and agrees with and in favor of each Releasee above that
(i) none of the provisions of the above release shall be construed as or
constitute an admission of any liability on the part of any Releasee; (ii) it
will not sue (at law, in equity, in any regulatory proceeding or otherwise) any
Releasee on the basis of any Claim released, remised and discharged by such
Person pursuant to this Section 16; and (iii) any attempt to assert a Claim
barred by the provisions of this Section 16 shall subject it to the provisions
of applicable law setting forth the remedies for the bringing of groundless,
frivolous or baseless claims or causes of action. Each Issuer further agrees
that it shall not dispute the validity or enforceability of the NPA or any of
the other Note Documents or any of its obligations thereunder, or the validity,
priority, enforceability or the extent of Note Agent’s Lien on any item of
Collateral under the NPA or the other Note Documents. If any Issuer or any of
its respective successors, assigns, or officers, directors, employees, agents or
attorneys, or any Person acting for or on behalf of, or claiming through it
violate the foregoing covenant, such Person, for itself and its successors,
assigns and legal representatives, agrees to pay, in addition to such other
damages as any Releasee may sustain as a result of such violation, all
attorneys’ fees and costs incurred by such Releasee as a result of such
violation. In agreeing to the foregoing release, each Issuer expressly disclaims
any reliance on any representations or warranties, acts or omissions by any of
the Releasees and hereby agrees and acknowledges that the validity and
effectiveness of the above release do not depend in any way on any such
representations or warranties, acts or omissions or the accuracy, completeness
or validity thereof.

(d) The provisions of this Section 16 shall survive the termination of this
Agreement and the other Note Documents and the payment in full of the
Obligations.

(e) Issuer acknowledges that the foregoing release is a material inducement to
the decision of Note Agent and each Purchaser to enter into this Agreement.

17. No Disregard of Note Documents. Each Issuer acknowledges that the parties
hereto have not entered into a mutual disregard of the terms and provisions of
the NPA or the

 

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other Note Documents, or engaged in any course of dealing in variance with the
terms and provisions of the NPA or the other Note Documents, within the meaning
of any applicable law of the State of California or otherwise.

18. Issuers Remain in Control. Each Issuer acknowledges that it remains in
control of its business and affairs and determines the business plan, for, and
employment, management and operating directions and decisions for its business
and affairs.

19. Submission of Agreement. The submission of this Agreement to the parties or
their agents or attorneys for review or signature does not constitute a
commitment by Note Agent or any Purchaser to forbear from exercising any of
their rights and remedies under the Note Documents, and this Agreement shall
have no binding force or effect until all of the conditions to the effectiveness
of this Agreement have been satisfied as set forth herein.

20. Note Document. This Agreement constitutes a Note Document. Any breach by any
Issuer of any material term, provision, covenant, agreement, representation or
warranty set forth in this Agreement shall constitute an immediate Event of
Default under the NPA.

21. Legend. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS EVIDENCED HEREBY ARE
SUBORDINATE IN THE MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN AMENDED
AND RESTATED SUBORDINATION AGREEMENT (THE “INTERCREDITOR AGREEMENT”) DATED AS OF
MARCH 26, 2012 BY AND AMONG SILICON VALLEY BANK, GRACE BAY HOLDINGS II, LLC AND
PEAK HOLDING CORP., AS NOTE AGENT, TO THE INDEBTEDNESS (INCLUDING INTEREST) OWED
BY THE ISSUERS AND THE GUARANTORS.

[Remainder of page intentionally left blank; signature pages follow]

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth above.

 

ISSUERS:

COMVERGE, INC.,

a Delaware corporation

By:  

/s/ David Mathieson

  Name:   David Mathieson   Title:   Executive Vice President and Chief
Financial Officer

ENERWISE GLOBAL TECHNOLOGIES, INC.,

a Delaware corporation

By:  

/s/ David Mathieson

  Name:   David Mathieson   Title:   Vice President

COMVERGE GIANTS, LLC,

a Delaware limited liability company

By:  

/s/ David Mathieson

  Name:   David Mathieson   Title:   Vice President

PUBLIC ENERGY SOLUTIONS, LLC,

a New Jersey limited liability company

By:  

/s/ David Mathieson

  Name:   David Mathieson   Title:   Vice President

PUBLIC ENERGY SOLUTIONS NY, LLC,

a Delaware limited liability company

By:  

/s/ David Mathieson

  Name:   David Mathieson   Title:   Vice President

[SIGNATURE PAGE TO FORBEARANCE AGREEMENT]

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CLEAN POWER MARKETS, INC., a Pennsylvania corporation By:  

/s/ David Mathieson

  Name:   David Mathieson   Title:   Vice President

ALTERNATIVE ENERGY RESOURCES, INC.,

a Delaware corporation

By:  

/s/ David Mathieson

  Name:   David Mathieson   Title:   Vice President

[SIGNATURE PAGE TO FORBEARANCE AGREEMENT]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth above.

 

PEAK HOLDINGS CORP.,

as Note Agent and sole Purchaser

By:  

/s/ Joseph D. Zulli

  Name:   Joseph D. Zulli   Title:   Treasurer

[SIGNATURE PAGE TO FORBEARANCE AGREEMENT]