WAIVER AND SUBORDINATION AGREEMENT
This Waiver and Subordination Agreement ("Waiver"), dated as of
February 18, 2005, is entered into by and between INCENTRA SOLUTIONS, INC., a
Nevada corporation (the "Company") and LAURUS MASTER FUND, LTD., a Cayman
Islands company ("Laurus"), for the purpose of amending or waiving certain terms
of (i) the Securities Purchase Agreement, dated as of May 13, 2004, by and
between the Company and Laurus (as amended, modified or supplemented from time
to time, the "SPA") and (ii) the Master Security Agreement, dated as of May 13,
2004, by and between the Company and Laurus (as amended, modified or
supplemented from time to time, the "MSA"). Capitalized terms used herein
without definition shall have the meaning ascribed to such terms in the SPA or
MSA, as applicable.
WHEREAS, on February 14, 2005, the Company created Incentra Merger
Corp., a Delaware corporation ("Merger Corp"), with and into which Star
Solutions of Delaware, Inc., a Delaware corporation shall be merged; and,
WHEREAS Merger Corp shall be the surviving corporation in such merger,
continuing to do business under the name of Star Solutions of Delaware, Inc.;
and
WHEREAS, Xxxxx Fargo Bank, National Association ("WFB") is providing
funding for the merger and a continuing credit facility for Merger Corp after
the merger and is requiring a security interest in certain assets of Merger
Corp;
NOW, THEREFORE, in consideration of the above, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Laurus hereby waives the provisions of Section 6.12(e)(ii) of
the SPA as to Merger Corp.
2. Laurus hereby subordinates to WFB the rights of Laurus in and
to the following:
Accounts receivable and other rights to payments,
general intangibles, equipment and inventory of Star
Solutions of Delaware, Inc., a Delaware corporation
and wholly owned subsidiary of Incentra Solutions,
Inc.
3. Each waiver and amendment set forth herein shall be effective
as of the date hereof following the execution and delivery of
same by each of the Company and Laurus.
4. Except as specifically set forth in this Waiver and Amendment
Agreement, or as previously amended, modified or supplemented,
there are no other amendments to the Loan Documents, and all
of the other
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forms, terms and provisions of the Loan Documents remain in
full force and effect.
5. This Waiver and Amendment Agreement shall be binding upon the
parties hereto and their respective successors and permitted
assigns and shall inure to the benefit of and be enforceable
by each of the parties hereto and its successors and permitted
assigns.
6. This Waiver and Amendment Agreement shall be construed and
enforced in accordance with and governed by the laws of the
State of New York.
7. This Waiver and Amendment Agreement may be executed in any
number of counterparts, each of which shall be an original,
but all of which shall constitute one instrument.
IN WITNESS WHEREOF, each of the Company and Laurus has caused this
Waiver and Amendment Agreement to be signed in its name effective as of
this 18th day of February, 2005.
INCENTRA SOLUTIONS, INC.
By: /s/Xxxxxx X. Xxxxxxx III
---------------------------
Name: Xxxxxx X. Xxxxxxx III
Title: Chief Executive Officer
LAURUS MASTER FUND, LTD.
By: /s/Xxxxx Grin
---------------------------
Name: Xxxxx Grin
Title: Director
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