Exhibit 10.9**THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT AND WAIVER**     THIS THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT AND WAIVER (this “Amendment”),dated March 15, 2007, is entered into among COMMERCE ENERGY, INC., a California corporation(“Borrower”), COMMERCE ENERGY GROUP, INC., a Delaware corporation (“Parent”),WACHOVIA CAPITAL FINANCE CORPORATION (WESTERN), a California corporation, as Agent and Lender(“Agent”), and THE CIT GROUP/BUSINESS CREDIT, INC., a New York corporation, as co-Lender(“Co-Lender”).**RECITALS**     A. Borrower, Parent and Agent have previously entered into that certain Loan and SecurityAgreement dated June 8, 2006 (the “Loan Agreement”) as amended by the First Amendment toLoan and Security Agreement and Waiver dated September 20, 2006 (the “First Amendment”) andthe Second Amendment to Loan and Security Agreement and Waiver dated October 26, 2006 (the“Second Amendment”), pursuant to which Agent and Co-Lender, as assignee of a portion ofAgent’s original rights and obligations under the Loan Agreement, have made certain loans andfinancial accommodations available to Borrower. Terms used herein without definition shall havethe meanings ascribed to them in the Loan Agreement.     B. The following Events of Default have occurred and are continuing under the Loan Agreement:(i) Parent and its Subsidiaries failed to maintain a Fixed Charge Coverage Ratio of not less than1.1 to one for the period of nine (9) consecutive months ended November 30, 2006, as required bySection 9.17 of the Loan Agreement (as amended by the Second Amendment); and (ii) during the periodfrom January 25, 2007 through January 31, 2007 (inclusive), Borrowers failed to maintain ExcessAvailability of not less than $5,000,000 as required by Section 9.17.1 of the Loan Agreement (asadded by the Second Amendment). The foregoing Events of Default will collectively be referred toherein as the “Known Existing Defaults”.     C. Borrower has requested that Agent and Co-Lender waive the Known Existing Defaults and amendthe Loan Agreement on the terms and conditions set forth herein.     D. Borrower and Parent are entering into this Amendment with the understanding and agreementthat, except as specifically provided herein, none of Agent’s and Co-Lender’s rights or remedies asset forth in the Loan Agreement is being waived or modified by the terms of this Amendment.**AGREEMENT**     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained,and for other good and valuable consideration, the receipt and sufficiency of which are herebyacknowledged, the parties hereby agree as follows:
 

 
     1. Amendment to Loan Agreement. Section 9.17.1 of the Loan Agreement (as added by theSecond Amendment) is hereby amended and restated to read in its entirety as follows:“9.17.1 Excess Availability. Borrowers shall, at all times during each ofthe periods set forth below, maintain Excess Availability of not less than theamount set forth opposite such period:   Periods Amounts2/1/07 through 7/31/07 $5,000,000On and after 8/1/07 $10,000,000”     2. Consents.          (a) Sale/Leaseback Transaction. Borrower now desires to enter into a sale/leasebacktransaction for certain Equipment with a value of approximately $1,000,000 (the“Sale/Leaseback”), which would be prohibited by Section 9.7(b) of the Loan Agreement (theBorrower having already sold assets during the current fiscal year with a value of approximately$900,000, which when added to the value of the Equipment in the Sale/Leaseback, would exceed themaximum aggregate sum permitted in clause (vi) of Section 9.7(b) of the Loan Agreement). Agent andCo-Lender hereby consent to the Sale/Leaseback and agree that the Sale/Leaseback will notconstitute a Default or Event of Default under the Loan Agreement.          (b) Bond Indemnity. Parent now desires to enter into an Agreement of Indemnity infavor of International Fidelity Insurance Company (“Surety”), in the form previouslysupplied to Agent, with respect to a certain bond to be issued by Surety in the amount of $300,000(the “Indemnity Agreement”) and to grant Surety a security interest in the personalproperty and fixtures of Parent as provided in the Indemnity Agreement, which would be prohibitedby Sections 9.8 and 9.9 of the Loan Agreement. Agent and Co-Lender hereby consent to the IndemnityAgreement (including such security interest) and agree that the Indemnity Agreement (including suchsecurity interest) will not constitute a Default or Event of Default under the Loan Agreement,provided that Surety duly executes and delivers a subordination agreement in form andsubstance satisfactory to Agent with respect to such security interest.          (c) Limitations on Consents. The foregoing consents shall apply only to theSale/Leaseback and the Indemnity Agreement as specifically described above, and in all otherrespects, Agent and Co-Lender reserve and preserve their rights to require the strict compliance byBorrower and Parent with Sections 9.7, 9.8, and 9.9 of the Loan Agreement and all of the otherterms and provisions of the Financing Agreements.     3. Waiver of Known Existing Defaults. Each of Agent and Co-Lender hereby waives theKnown Existing Defaults and waives enforcement of its rights against Borrower and Parent arisingfrom the Known Existing Defaults; provided, however, nothing herein shall be deemeda waiver with respect to any failure of Borrower or Parent to comply fully with Section 9.17 of theLoan Agreement as to periods ending after November 30, 2007 and Section 9.17.1 of the LoanAgreement as modified by this Amendment. Subject to this Amendment becoming
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effective as set forth in Section 4 below, this waiver shall be deemed effective, as to eachKnown Existing Default, on the date of the first occurrence of such Known Existing Default. Thiswaiver shall be effective only for the specific defaults comprising the Known Existing Defaults,and in no event shall this waiver be deemed to be a waiver of enforcement of Agent’s or Co-Lender’srights with respect to any other Defaults or Events of Default now existing or hereafter arising.Nothing contained in this Amendment nor any communications between Borrower or Parent and Agent orCo-Lender shall be a waiver of any rights or remedies Agent or Co-Lender has or may have againstBorrower or Parent, except as specifically provided herein. Except as specifically providedherein, Agent and Co-Lender hereby reserve and preserve all of their rights and remedies againstBorrower and Parent under the Loan Agreement and the other Financing Agreements.     4. Effectiveness of this Amendment. The effectiveness of this Amendment, and thewaivers provided herein, are conditioned upon the occurrence of each of the following:          (a) Amendment. Agent shall have received this Amendment, fully executed in asufficient number of counterparts for distribution to all parties.          (b) Amendment Fee. Agent shall have received an amendment fee in the amount ofThirty-Five Thousand Dollars ($35,000) for the benefit of Agent and Co-Lender based upon theirrespective Pro Rata Shares, which fee is fully earned as of and due and payable on the date hereof.          (c) Representations and Warranties. The representations and warranties set forthherein and in the Loan Agreement shall be true and correct.          (d) Other Required Documentation. All other documents and legal matters in connectionwith the transactions contemplated by this Amendment shall have been delivered or executed orrecorded and shall be in form and substance satisfactory to Agent.     5. Representations and Warranties. Each of Borrower and Parent represents andwarrants as follows:          (a) Authority. Such party has the requisite corporate power and authority to executeand deliver this Amendment, and to perform its obligations hereunder and under the FinancingAgreements (as amended or modified hereby) to which it is a party. The execution, delivery andperformance by such party of this Amendment have been duly approved by all necessary corporateaction and no other corporate proceedings are necessary to consummate such transactions.          (b) Enforceability. This Amendment has been duly executed and delivered such party.This Amendment and each Financing Agreement (as amended or modified hereby) is the legal, valid andbinding obligation of such party, enforceable against such party in accordance with its terms, andis in full force and effect.          (c) Representations and Warranties. The representations and warranties contained ineach Financing Agreement (other than any such representations or warranties that,
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 by their terms, are specifically made as of a date other than the date hereof) are correct onand as of the date hereof as though made on and as of the date hereof.          (d) Due Execution. The execution, delivery and performance of this Amendment arewithin the power of such party, have been duly authorized by all necessary corporate action, havereceived all necessary governmental approval, if any, and do not contravene any law or any materialcontractual restrictions binding on such party.          (e) No Default. After giving effect to the waivers contained in this Amendment, noevent has occurred and is continuing that constitutes a Default or Event of Default.     6. Governing Law. The validity, interpretation and enforcement of this Amendment andany dispute arising out of the relationship between the parties hereto, whether in contract, tort,equity or otherwise, shall be governed by the internal laws of the State of California butexcluding any principles of conflicts of law or other rule of law that would cause the applicationof the law of any jurisdiction other than the laws of the State of California.     7. Counterparts. This Amendment may be executed in any number of counterparts, eachof which shall be an original, but all of which taken together shall constitute one and the sameagreement. Delivery of an executed counterpart of this Amendment by telefacsimile or otherelectronic method of transmission shall have the same force and effect as the delivery of anoriginal executed counterpart of this Amendment. Any party delivering an executed counterpart ofthis Amendment by telefacsimile or other electronic method of transmission shall also deliver anoriginal executed counterpart, but the failure to do so shall not affect the validity,enforceability or binding effect of this Amendment.     8. Reference to and Effect on the Financing Agreements.          (a) Upon and after the effectiveness of this Amendment, each reference in the Loan Agreementto “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Loan Agreement,and each reference in the other Financing Agreements to “the Loan Agreement”, “thereof” or words oflike import referring to the Loan Agreement, shall mean and be a reference to the Loan Agreement asmodified and amended hereby.          (b) Except as specifically amended above, the Loan Agreement and all other FinancingAgreements, are and shall continue to be in full force and effect and are hereby in all respectsratified and confirmed and shall constitute the legal, valid, binding and enforceable obligationsof Borrower or Parent (as applicable) to Agent and Co-Lender.          (c) The execution, delivery and effectiveness of this Amendment shall not, except as expresslyprovided herein, operate as a waiver of any right, power or remedy of Agent or Co-Lender under anyof the Financing Agreements, nor constitute a waiver of any provision of any of the FinancingAgreements.          (d) To the extent that any terms and conditions in any of the Financing Agreements shallcontradict or be in conflict with any terms or conditions of the Loan Agreement, after givingeffect to this Amendment, such terms and conditions are hereby deemed
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 modified or amended accordingly to reflect the terms and conditions of the Loan Agreement asmodified or amended hereby.     9. Estoppel. To induce Agent and Co-Lender to enter into this Amendment and tocontinue to make advances to Borrower under the Loan Agreement, Borrower hereby acknowledges andagrees that, as of the date hereof, there exists no right of offset, defense, counterclaim orobjection in favor of Borrower as against Agent or Co-Lender with respect to the Obligations.     10. Integration. This Amendment, together with the other Financing Agreements(including the First Amendment), incorporates all negotiations of the parties hereto with respectto the subject matter hereof and is the final expression and agreement of the parties hereto withrespect to the subject matter hereof.     11. Severability. In case any provision in this Amendment shall be invalid, illegalor unenforceable, such provision shall be severable from the remainder of this Amendment and thevalidity, legality and enforceability of the remaining provisions shall not in any way be affectedor impaired thereby.     12. Submission of Amendment. The submission of this Amendment to the parties or theiragents or attorneys for review or signature does not constitute a commitment by Agent or Co-Lenderto waive any of their rights and remedies under the Financing Agreements, and this Amendment shallhave no binding force or effect until all of the conditions to the effectiveness of this Amendmenthave been satisfied as set forth herein.
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     IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first abovewritten.      COMMERCE ENERGY, INC.,