Exhibit 10.7


                       WAIVER AND SUBORDINATION AGREEMENT

         This Waiver and Subordination Agreement ("Waiver"), dated as of March
23, 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 or about March 24, 2005, the Company will acquire PWI
Technologies, Inc., a Washington corporation ("PWI"); and,

         WHEREAS, the Company shall hold PWI as a wholly owned subsidiary; and

         WHEREAS, Wells Fargo Bank, National Association ("WFB") is providing
funding for the acquisition and a continuing credit facility for PWI after the
acquisition and is requiring a security interest in certain assets of PWI;

         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 PWI.

         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 PWI Technologies,
                       Inc., a Washington 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


                                       1
<PAGE>

              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 23 day of March, 2005.

                                        INCENTRA SOLUTIONS, INC.


                                         By: /s/ Thomas P. Sweeney III
                                             -----------------------------------
                                         Name: Thomas P. Sweeney III
                                         Title: Chief Executive Officer


                                         LAURUS MASTER FUND, LTD.


                                         By: /s/ David Grin
                                             -----------------------------------
                                         Name: David Grin
                                         Title: Director




                                       2