Document:

Exhibit 10.13 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THIS NOTE MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE UNDER SAID ACT AND ANY
APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO INCENTRA SOLUTIONS, INC. THAT SUCH REGISTRATION IS NOT
REQUIRED.

SECURED TERM NOTE

          FOR
VALUE RECEIVED, INCENTRA SOLUTIONS, INC., a Nevada Corporation (the “Company”), promises to pay to CALLIOPE
CAPITAL CORPORATION, 874 Walker Road, Suite C, Dover, DE 19904, Fax:
914-949-9618 (the “Holder”) or its
registered assigns or successors in interest, the sum of Twelve Million Dollars
($12,000,000), together with any accrued and unpaid interest hereon, on July
31, 2010 (the “Maturity Date”) if
not sooner paid.

          Capitalized
terms used herein without definition shall have the meanings ascribed to such
terms in that certain Securities Purchase Agreement dated as of the date hereof
by and between the Company and the Holder (as amended, modified and/or
supplemented from time to time, the “Purchase
Agreement”). 

          The
following terms shall apply to this Note:

ARTICLE I

CONTRACT RATE AND AMORTIZATION

          1.1
Contract Rate. Subject to Sections 2.2 and 3.9, interest payable on the
outstanding principal amount of this Note (the “Principal Amount”) shall accrue at a rate per annum equal to
the “prime rate” published in The Wall Street Journal from time to time
(the “Prime Rate”), plus two
percent (2.0%) (the “Contract Rate”).
The Contract Rate shall be increased or decreased as the case may be for each
increase or decrease in the Prime Rate in an amount equal to such increase or
decrease in the Prime Rate; each change to be effective as of the day of the
change in the Prime Rate. The Contract Rate shall not at any time be less than
ten percent (10.0%). Interest shall be (i) calculated on the basis of a 360 day
year, and (ii) payable monthly, in arrears, commencing on August 1, 2007, on
the first business day of each consecutive calendar month thereafter through
and including the Maturity Date, and on the Maturity Date, whether by
acceleration or otherwise. 

          1.2
Contract Rate Payments. The Contract Rate shall be calculated on the
last business day of each calendar month hereafter (other than for increases or
decreases in the Prime Rate which shall be calculated and become effective in
accordance with the terms of Section 1.1) until the Maturity Date.

          1.3
Principal Payments. Amortizing payments of the aggregate principal
amount outstanding under this Note at any time (the “Principal Amount”) shall be made in cash by the Company on
February 1, 2008 and on the first business day of each succeeding month

thereafter
through and including the Maturity Date (each, an “Amortization Date”). Commencing on the first Amortization
Date, the Company shall make monthly payments to the Holder on each
Amortization Date, each such payment in the amount of $285,714.28 together with
any accrued and unpaid interest on such portion of the Principal Amount plus
any and all other unpaid amounts which are then owing under this Note, the
Purchase Agreement and/or any other Related Agreement (collectively, the “Monthly Amount”). Any outstanding Principal
Amount together with any accrued and unpaid interest and any and all other
unpaid amounts which are then owing by the Company to the Holder under this
Note, the Purchase Agreement and/or any other Related Agreement shall be due
and payable on the Maturity Date.

          1.4
Optional Prepayment. The Company may prepay this Note at any time, in
whole or in part, without penalty or premium.

ARTICLE II

EVENTS OF DEFAULT

          2.1
Events of Default. The occurrence of any of the following events set
forth in this Section 2.1 shall constitute an event of default (“Event of Default”) hereunder:

               (a)
Failure to Pay. The Company fails to pay when due any installment of
principal, interest or other fees hereon in accordance herewith, or the Company
fails to pay any of the obligations of the Company or any of its Subsidiaries
under the Purchase Agreement or any Related Agreement when due, and, in any
such case, such failure shall continue for a period of five (5) days following
the date upon which any such payment was due.

               (b)
Breach of Covenant. The Company or any of its Subsidiaries breaches any
covenant or any other term or condition of this Note in any material respect
and such breach, if subject to cure, continues for a period of fifteen (15)
days after the occurrence thereof.

               (c)
Breach of Representations and Warranties. Any representation, warranty
or statement made or furnished by the Company or any of its Subsidiaries in this
Note, the Purchase Agreement or any other Related Agreement shall at any time
be false or misleading in any material respect on the date as of which made or
deemed made.

               (d)
Default Under Other Agreements. The occurrence of any default (or
similar term) in the observance or performance of any other agreement or
condition relating to any indebtedness or contingent obligation of the Company
or any of its Subsidiaries (including, without limitation, the indebtedness
evidenced by (i) the Security Agreement dated as of February 6, 2006, by and
among the Company, certain subsidiaries of the Company and Laurus Master Fund,
Ltd. (“Laurus”) (as amended, modified or supplemented from time to time, the
“2006 Security Agreement”) and/or any Ancillary Agreement referred to in the
2006 Security Agreement and/or (ii) that certain 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 “2004 Securities Purchase
Agreement”) and/or any Related Agreement referred to in

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the 2004
Securities Purchase Agreement, as amended, modified or supplemented from time
to time) and/or (iii) that certain Securities Purchase Agreement, dated as of
March 31, 2006, by and between the Company and Laurus (as amended, modified or
supplemented from time to time, the “2006 Securities Purchase Agreement”)
and/or any Related Agreement referred to in the 2006 Securities Purchase
Agreement, as amended, modified or supplemented from time to time), in each
case, beyond the period of grace (if any), the effect of which default is to
cause, or permit the holder or holders of such indebtedness or beneficiary or
beneficiaries of such contingent obligation to cause, such indebtedness to become
due prior to its stated maturity or such contingent obligation to become
payable; 

               (e)
Bankruptcy. The Company or any of its Subsidiaries shall (i) apply
for, consent to or suffer to exist the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself or of all
or a substantial part of its property, (ii) make a general assignment for
the benefit of creditors, (iii) commence a voluntary case under the federal
bankruptcy laws (as now or hereafter in effect), (iv) be adjudicated a bankrupt
or insolvent, (v) file a petition seeking to take advantage of any other law
providing for the relief of debtors, (vi) acquiesce to, without challenge
within ten (10) days of the filing thereof, or failure to have dismissed,
within thirty (30) days, any petition filed against it in any involuntary case
under such bankruptcy laws, or (vii) take any action for the purpose of
effecting any of the foregoing;

               (f)
Judgments. Attachments or levies in excess of $250,000 in the aggregate
are made upon the Company or any of its Subsidiary’s assets or a judgment is
rendered against the Company’s property involving a liability of more than
$250,000 which shall not have been vacated, discharged, stayed or bonded within
ninety (90) days from the entry thereof;

               (g)
Insolvency. The Company or any of its Subsidiaries shall admit in
writing its inability, or be generally unable, to pay its debts as they become
due or cease operations of its present business;

               (h)
Change of Control. A Change of Control (as defined below) shall occur
with respect to the Company, unless Holder shall have expressly consented to
such Change of Control in writing. A “Change of Control” shall mean any event
or circumstance as a result of which (i) any “Person” or “group” (as such terms
are defined in Sections 13(d) and 14(d) of the Exchange Act, as in effect on
the date hereof), other than the Holder, is or becomes the “beneficial owner”
(as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or
indirectly, of 35% or more on a fully diluted basis of the then outstanding
voting equity interest of the Company (other than a “Person” or “group” that
beneficially owns 35% or more of such outstanding voting equity interests of
the Company on the date hereof), (ii) the Board of Directors of the Company
shall cease to consist of a majority of the Company’s board of directors on the
date hereof (or directors appointed by a majority of the board of directors in
effect immediately prior to such appointment) or (iii) the Company or any of
its Subsidiaries merges or consolidates with, or sells all or substantially all
of its assets to, any other person or entity;

               (i)
Indictment; Proceedings. The indictment or threatened indictment of the
Company or any of its Subsidiaries or any executive officer of the Company or
any of its 

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Subsidiaries under any criminal statute, or commencement or
threatened commencement of criminal or civil proceeding against the Company or
any of its Subsidiaries or any executive officer of the Company or any of its
Subsidiaries pursuant to which statute or proceeding penalties or remedies
sought or available include forfeiture of any of the property of the Company or
any of its Subsidiaries;

               (j)
The Purchase Agreement and Related Agreements. (i) An Event of Default
shall occur under and as defined in the Purchase Agreement or any Related
Agreement, (ii) the Company or any of its Subsidiaries shall breach any term or
provision of the Purchase Agreement or any other Related Agreement in any
material respect and such breach, if capable of cure, continues unremedied for
a period of fifteen (15) days after the occurrence thereof, (iii) the Company
or any of its Subsidiaries
attempts to terminate, challenges the validity of, or its liability under, the
Purchase Agreement or any Related Agreement, (iv) any proceeding shall be
brought to challenge the validity, binding effect of the Purchase Agreement or
any Related Agreement or (v) the Purchase Agreement or any Related Agreement
ceases to be a valid, binding and enforceable obligation of the Company or any
of its Subsidiaries (to the extent such persons or entities are a party
thereto);

               (k)
Stop Trade. An SEC stop trade order or Principal Market trading
suspension of the Common Stock shall be in effect for five (5) consecutive days
or five (5) days during a period of ten (10) consecutive days, excluding in all
cases a suspension of all trading on a Principal Market, provided that the
Company shall not have been able to cure such trading suspension within thirty
(30) days of the notice thereof or list the Common Stock on another Principal
Market within sixty (60) days of such notice; or

          2.2
Default Interest. Following the occurrence and during the continuance of
an Event of Default, the Company shall pay additional interest on this Note in
an amount equal to one and one half percent (1.5%) per month, and all
outstanding obligations under this Note, the Purchase Agreement and each other
Related Agreement, including unpaid interest, shall continue to accrue interest
at such additional interest rate from the date of such Event of Default until
the date such Event of Default is cured or waived.

          2.3
Default Payment. Following the occurrence and during the continuance of
an Event of Default, the Holder, at its option, may demand repayment in full of
all obligations and liabilities owing by Company to the Holder under this Note,
the Purchase Agreement and/or any other Related Agreement and/or may elect, in
addition to all rights and remedies of the Holder under the Purchase Agreement
and the other Related Agreements and all obligations and liabilities of the
Company under the Purchase Agreement and the other Related Agreements, to
require the Company to make a Default Payment (“Default Payment”). The Default Payment shall be 125% of the
outstanding principal amount of the Note, plus accrued but unpaid interest, all
other fees then remaining unpaid, and all other amounts payable hereunder. The
Default Payment shall be applied first to any fees due and payable to the
Holder pursuant to this Note, the Purchase Agreement, and/or the other Related
Agreements, then to accrued and unpaid interest due on this Note and then to
the outstanding principal balance of this Note. The Default Payment shall be
due and payable immediately on the date that the Holder has exercised its
rights pursuant to this Section 4.3.

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ARTICLE III

MISCELLANEOUS

          3.1
Cumulative Remedies. The remedies under this Note shall be cumulative.

          3.2
Failure or Indulgence Not Waiver. No failure or delay on the part of the
Holder hereof in the exercise of any power, right or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such power, right or privilege preclude other or further exercise thereof or of
any other right, power or privilege. All rights and remedies existing hereunder
are cumulative to, and not exclusive of, any rights or remedies otherwise
available.

          3.3
Notices. Any notice herein required or permitted to be given shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to
the party notified, (b) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next
business day, (c) five days after having been sent by registered or certified
mail, return receipt requested, postage prepaid, or (d) one day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the
Company at the address provided in the Purchase Agreement executed in
connection herewith, and to the Holder at the address provided in the Purchase
Agreement for such Holder, with a copy to John E. Tucker, Esq., 825 Third
Avenue, 14th Floor, New York, New York 10022, facsimile number (212)
541-4434, or at such other address as the Company or the Holder may designate
by ten days advance written notice to the other parties hereto. 

          3.4
Amendment Provision. The term “Note” and all references thereto, as used
throughout this instrument, shall mean this instrument as originally executed,
or if later amended or supplemented, then as so amended or supplemented, and
any successor instrument as such successor instrument may be amended or
supplemented.

          3.5
Assignability. This Note shall be binding upon the Company and its
successors and assigns, and shall inure to the benefit of the Holder and its
successors and assigns, and may be assigned by the Holder in accordance with
the requirements of the Purchase Agreement. The Company may not assign any of
its obligations under this Note without the prior written consent of the
Holder, any such purported assignment without such consent being null and void.

          3.6
Cost of Collection. In case of any Event of Default under this Note, the
Company shall pay the Holder reasonable costs of collection, including reasonable
attorneys’ fees.

          3.7
Governing Law, Jurisdiction and Waiver of Jury Trial.

               (a)
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW.

5

               (b)
THE COMPANY HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED
IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION
TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE COMPANY, ON THE ONE
HAND, AND THE HOLDER, ON THE OTHER HAND, PERTAINING TO THIS NOTE OR ANY OF THE
OTHER RELATED AGREEMENTS OR TO ANY MATTER ARISING OUT OF OR RELATED TO THIS
NOTE OR ANY OF THE RELATED AGREEMENTS; PROVIDED, THAT THE COMPANY
ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT
LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW YORK; AND FURTHER
PROVIDED, THAT NOTHING IN THIS NOTE SHALL BE DEEMED OR OPERATE TO
PRECLUDE THE HOLDER FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY
OTHER JURISDICTION TO COLLECT THE OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR
ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT
ORDER IN FAVOR OF THE HOLDER. THE COMPANY EXPRESSLY SUBMITS AND CONSENTS IN
ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT,
AND THE COMPANY HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK
OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. THE
COMPANY HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER
PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO THE COMPANY AT THE ADDRESS SET FORTH IN THE PURCHASE
AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER
OF THE COMPANY’S ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE
U.S. MAILS, PROPER POSTAGE PREPAID.

               (c)
THE COMPANY DESIRES THAT ITS DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF
THE JUDICIAL SYSTEM AND OF ARBITRATION, THE COMPANY HERETO WAIVES ALL RIGHTS TO
TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY
DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE HOLDER AND
THE COMPANY ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS NOTE, ANY OTHER RELATED
AGREEMENT OR THE TRANSACTIONS RELATED HERETO OR THERETO.

          3.8
Severability. In the event that any provision of this Note is invalid or
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of this Note.

          3.9
Maximum Payments. Nothing contained herein shall be deemed to establish
or require the payment of a rate of interest or other charges in excess of the
maximum

6

permitted by
applicable law. In the event that the rate of interest required to be paid or
other charges hereunder exceed the maximum rate permitted by such law, any
payments in excess of such maximum rate shall be credited against amounts owed
by the Company to the Holder and thus refunded to the Company.

          3.10
Security Interest and Guarantee. The Holder has been granted a security
interest (i) in certain assets of the Company and its Subsidiaries as more
fully described in the Master Security Agreement and (ii) in the equity
interests of the Company’s Subsidiaries pursuant to the Stock Pledge Agreement.
The obligations of the Company under this Note are guaranteed by certain
Subsidiaries of the Company pursuant to the Subsidiary Guarantee.

          3.11
Construction. Each party acknowledges that its legal counsel
participated in the preparation of this Note and, therefore, stipulates that
the rule of construction that ambiguities are to be resolved against the
drafting party shall not be applied in the interpretation of this Note to favor
any party against the other.

          5.13
Registered Obligation. This Note is intended to be a registered
obligation within the meaning of Treasury Regulation Section 1.871-14(c)(1)(i)
and the Company (or its agent) shall register this Note (and thereafter shall
maintain such registration) as to both principal and any stated interest.
Notwithstanding any document, instrument or agreement relating to this Note to
the contrary, transfer of this Note (or the right to any payments of principal
or stated interest thereunder) may only be effected by (i) surrender of this
Note and either the reissuance by the Company of this Note to the new holder or
the issuance by the Company of a new instrument to the new holder, or (ii)
transfer through a book entry system maintained by the Company (or its agent),
within the meaning of Treasury Regulation Section 1.871-14(c)(1)(i)(B).

[Balance
of page intentionally left blank; signature page follows]

7

6

          IN WITNESS WHEREOF, the Company has caused
this Secured Term Note to be signed in its name effective as of this 31st
day of July, 2007.

	
 

	
 

	
 

	
 

	
INCENTRA SOLUTIONS, INC.

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	

	
 

	
     Name: Matthew G. Richman

	
 

	
     Title:
 Senior Vice President, Chief Corporate Development Officer & Treasurer

	
 

	
 

	
 

	
WITNESS:

	
 

	
 

	
 

	

8Exhibit 10.14 

	
 

	
 

	
 

	
THIS WARRANT
 AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
 NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
 STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON STOCK ISSUABLE UPON EXERCISE
 OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN
 THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT UNDER
 SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
 REASONABLY SATISFACTORY TO INCENTRA SOLUTIONS, INC. THAT SUCH REGISTRATION IS
 NOT REQUIRED.

Right to Purchase up to 3,750,000 Shares of
Common Stock of

Incentra Solutions, Inc.

(subject to adjustment as provided herein)

COMMON
STOCK PURCHASE WARRANT

	
 

	
 

	
 

	
No. ____________________________

	
 

	
Issue Date: July 31, 2007 

          INCENTRA
SOLUTIONS, INC., a corporation organized under the laws of the State of Nevada
(“ICNS”), hereby certifies that, for value received, CALLIOPE CAPITAL
CORPORATION, or assigns (the “Holder”), is entitled, subject to the terms set
forth below, to purchase from the Company (as defined herein) from and after
the Issue Date of this Warrant and at any time or from time to time before 5:00
p.m., New York time, through the close of business July 31, 2027 (the “Expiration
Date”), up to 3,750,000 fully paid and nonassessable shares of Common Stock (as
hereinafter defined), at the applicable Exercise Price (as defined below) per
share. The number and character of such
shares of Common Stock and the applicable Exercise Price per share are subject
to adjustment as provided herein.

          As
used herein the following terms, unless the context otherwise requires, have
the following respective meanings:

	
 

	
 

	
 

	
          (a) The term
 “Company” shall include ICNS and any corporation which shall succeed, or
 assume the obligations of, ICNS hereunder. 

	
 

	
 

	
 

	
          (b) The term
 “Common Stock” includes (i) the Company’s Common Stock, par value $0.001 per
 share; and (ii) any other securities into which or for which the Common Stock
 may be converted or exchanged pursuant to a plan of recapitalization,
 reorganization, merger, sale of assets or otherwise.

	
 

	
 

	
 

	
          (c) The term
 “Note” means that certain Secured Term Note issued by the Company as of the
 date hereof to the Holder in the original principal amount of twelve million
 dollars ($12,000,000).

	
 

	
 

	
 

	
 

	
          (d) The term
 “Other Securities” refers to any stock (other than Common Stock) and other
 securities of the Company or any other person (corporate or otherwise) which
 the Holder of this Warrant at any time shall be entitled to receive, or shall
 have received, on the exercise of the Warrant, in lieu of or in addition to
 Common Stock, or which at any time shall be issuable or shall have been
 issued in exchange for or in replacement of Common Stock or Other Securities
 pursuant to Section 4 or otherwise.

	
 

	
 

	
 

	
 

	
 

	
(e) The
 “Exercise Price” applicable under this Warrant shall be $0. 01. 

1. Exercise
of Warrant.

	
 

	
 

	
 

	
 

	
1.1

	
Number of
 Shares Issuable upon Exercise. From and after the
 date hereof, the Holder shall be entitled to receive, upon exercise of this
 Warrant in whole or in part, by delivery of an original or fax copy of an
 exercise notice in the form attached hereto as Exhibit A (the “Exercise
 Notice”) up to 3,750,000 shares of Common Stock of the Company, subject to
 adjustment pursuant to Section 4.

	
 

	
 

	
 

	
 

	
1.2

	
Fair Market
 Value. For purposes hereof, the “Fair Market Value”
 of a share of Common Stock as of a particular date (the “Determination Date”)
 shall mean:

	
 

	
 

	
 

	
          (a) If the
 Company’s Common Stock is traded on the American Stock Exchange or another
 national exchange or is quoted on the National or Capital Market of The
 Nasdaq Stock Market, Inc. (“Nasdaq”), then the closing or last sale price,
 respectively, reported for the last business day immediately preceding the
 Determination Date.

	
 

	
 

	
 

	
          (b) If the
 Company’s Common Stock is not traded on the American Stock Exchange or
 another national exchange or on the Nasdaq but is traded on the National
 Association of Securities Dealers, Inc. Over-the-Counter Bulletin Board, then
 the mean of the average of the closing bid and asked prices reported for the
 last business day immediately preceding the Determination Date.

	
 

	
 

	
 

	
          (c) Except
 as provided in clause (d) below, if the Company’s Common Stock is not
 publicly traded, then as the Holder and the Company agree or in the absence
 of agreement by arbitration in accordance with the rules then in effect of
 the American Arbitration Association, before a single arbitrator to be chosen
 from a panel of persons qualified by education and training to pass on the
 matter to be decided.

	
 

	
 

	
 

	
          (d) If the
 Determination Date is the date of a liquidation, dissolution or winding up,
 or any event deemed to be a liquidation, dissolution or winding up pursuant
 to the Company’s charter, then all amounts to be payable per share to holders
 of the Common Stock pursuant to the charter in the event of such liquidation,
 dissolution or winding up, plus all other amounts to be payable per share in
 respect of the Common Stock in liquidation under the charter, assuming for
 the purposes of this clause (d) that all of the shares of Common Stock then
 issuable upon exercise of the Warrant are outstanding at the Determination
 Date.

2

	
 

	
 

	
 

	
 

	
1.3

	
Company
 Acknowledgment. The Company will, at the time of the
 exercise of this Warrant, upon the request of the Holder hereof, acknowledge
 in writing its continuing obligation to afford to such Holder any rights to
 which such Holder shall continue to be entitled after such exercise in
 accordance with the provisions of this Warrant. If the Holder shall fail to
 make any such request, such failure shall not affect the continuing
 obligation of the Company to afford to such Holder any such rights.

	
 

	
 

	
 

	
 

	
1.4

	
Trustee for
 Warrant Holders. In the event that a bank or trust
 company shall have been appointed as trustee for the Holder of this Warrant
 pursuant to Subsection 3.2, such bank or trust company shall have all the
 powers and duties of a Warrant agent (as hereinafter described) and shall
 accept, in its own name for the account of the Company or such successor
 person as may be entitled thereto, all amounts otherwise payable to the
 Company or such successor, as the case may be, on exercise of this Warrant
 pursuant to this Section 1.

2. Procedure
for Exercise.

	
 

	
 

	
 

	
 

	
2.1

	
Delivery of
 Stock Certificates, Etc., on Exercise. The Company
 agrees that the shares of Common Stock purchased upon exercise of this
 Warrant shall be deemed to be issued to the Holder as the record owner of
 such shares as of the close of business on the date on which this Warrant
 shall have been surrendered and payment made for such shares in accordance
 herewith. As soon as practicable
 after the exercise of this Warrant in full or in part, and in any event
 within three (3) business days thereafter, the Company at its expense
 (including the payment by it of any applicable issue taxes) will cause to be
 issued in the name of and delivered to the Holder, or as such Holder (upon
 payment by such Holder of any applicable transfer taxes) may direct in
 compliance with applicable securities laws, a certificate or certificates for
 the number of duly and validly issued, fully paid and nonassessable shares of
 Common Stock (or Other Securities) to which such Holder shall be entitled on
 such exercise, plus, in lieu of any fractional share to which such Holder
 would otherwise be entitled, cash equal to such fraction multiplied by the
 then Fair Market Value of one full share, together with any other stock or
 other securities and property (including cash, where applicable) to which
 such Holder is entitled upon such exercise pursuant to Section 1 or
 otherwise.

	
 

	
 

	
 

	
 

	
2.2

	
Exercise.
 (a) Payment may be made either (i) in cash or by certified or official bank
 check payable to the order of the Company equal to the applicable aggregate
 Exercise Price, (ii) by delivery of this Warrant, or shares of Common Stock
 and/or Common Stock receivable upon exercise of this Warrant in accordance
 with Section (b) below, or (iii) by a combination of any of the foregoing
 methods, for the number of Common Shares specified in such Exercise Notice
 (as such exercise number shall be adjusted to reflect any adjustment in the
 total number of shares of Common Stock issuable to the Holder per the terms
 of this Warrant); provided, however, that if at the time of delivery of an Exercise
 Notice the shares of Common Stock to be issued upon payment of the Exercise
 Price have been 

3

	
 

	
 

	
 

	
 

	
 

	
registered
 under the Securities Act of 1933, as amended (the “Securities Act”), and are
 covered by an effective registration statement under the Securities Act,
 payment of the Exercise Price may only be made pursuant to clause (i) above
 and may not be made pursuant to clause (ii) or (iii) above. Upon receipt by
 the Company of an Exercise Notice and proper payment of the aggregate
 Exercise Price, the Holder shall thereupon be entitled to receive the number
 of duly authorized, validly issued, fully-paid and non-assessable shares of
 Common Stock (or Other Securities) determined as provided herein.

          (b)
Notwithstanding any provisions herein to the contrary, if the Fair Market Value
of one share of Common Stock is greater than the Exercise Price (at the date of
calculation as set forth below), in lieu of exercising this Warrant for cash,
the Holder may elect to receive shares equal to the value (as determined below)
of this Warrant (or the portion thereof being exercised) by surrender of this
Warrant at the principal office of the Company together with the properly
endorsed Exercise Notice, in which event the Company shall issue to the Holder
a number of shares of Common Stock computed using the following formula: 

	
 

	
 

	
 

	
 

	
 

	
X=Y

	
 

	
(A-B)

	
 

	
 

	
 

	

	
 

	
 

	
 

	
A

	
 

	
 

	
 

	
 

	
 

	
Where X =

	
 

	
the number
 of shares of Common Stock to be issued to the Holder

	
 

	
 

	
 

	
 

	
 

	
Y =

	
 

	
the number
 of shares of Common Stock purchasable under this Warrant or, if only a
 portion of this Warrant is being exercised, the portion of this Warrant being
 exercised (at the date of such calculation)

	
 

	
 

	
 

	
 

	
 

	
A =

	
 

	
the Fair
 Market Value of one share of the Company’s Common Stock (at the date of such
 calculation)

	
 

	
 

	
 

	
 

	
 

	
B =

	
 

	
the Exercise
 Price (as adjusted to the date of such calculation)

3. Effect
of Reorganization, Etc.; Adjustment of Exercise Price.

	
 

	
 

	
 

	
 

	
3.1

	
Reorganization,
 Consolidation, Merger, Etc. In case at any time or
 from time to time, the Company shall (a) effect a reorganization, (b)
 consolidate with or merge into any other person, or (c) transfer all or
 substantially all of its properties or assets to any other person under any
 plan or arrangement contemplating the dissolution of the Company, then, in each
 such case, as a condition to the consummation of such a transaction, proper
 and adequate provision shall be made by the Company whereby the Holder of
 this Warrant, on the exercise hereof as provided in Section 1 at any time
 after the consummation of such reorganization, consolidation or merger or the
 effective date of such dissolution, as the case may be, shall receive, in
 lieu of the Common Stock (or Other Securities) issuable on such exercise
 prior to such consummation or such effective date, the stock and other
 securities and property (including cash) to which such Holder would have been
 entitled upon such consummation or in connection with such dissolution, as

4

	
 

	
 

	
 

	
 

	
 

	
the case may
 be, if such Holder had so exercised this Warrant, immediately prior thereto,
 all subject to further adjustment thereafter as provided in Section 4.

	
 

	
 

	
 

	
 

	
3.2

	
Dissolution.
 In the event of any dissolution of the Company following the transfer of all
 or substantially all of its properties or assets, the Company, concurrently
 with any distributions made to holders of its Common Stock, shall at its
 expense deliver or cause to be delivered to the Holder the stock and other
 securities and property (including cash, where applicable) receivable by the
 Holder of this Warrant pursuant to Section 3.1, or, if the Holder shall so
 instruct the Company, to a bank or trust company specified by the Holder and
 having its principal office in New York, NY as trustee for the Holder of this
 Warrant (the “Trustee”).

	
 

	
 

	
 

	
 

	
3.3

	
Continuation
 of Terms. Upon any reorganization, consolidation,
 merger or transfer (and any dissolution following any transfer) referred to
 in this Section 3, this Warrant shall continue in full force and effect and
 the terms hereof shall be applicable to the shares of stock and other
 securities and property receivable on the exercise of this Warrant after the
 consummation of such reorganization, consolidation or merger or the effective
 date of dissolution following any such transfer, as the case may be, and
 shall be binding upon the issuer of any such stock or other securities,
 including, in the case of any such transfer, the person acquiring all or
 substantially all of the properties or assets of the Company, whether or not
 such person shall have expressly assumed the terms of this Warrant as
 provided in Section 4. In the event
 this Warrant does not continue in full force and effect after the
 consummation of the transactions described in this Section 3, then the
 Company’s securities and property (including cash, where applicable) receivable
 by the Holders of the Warrant will be delivered to Holder or the Trustee as
 contemplated by Section 3.2.

4. Extraordinary
Events Regarding Common Stock. In the event that the Company shall (a)
issue additional shares of the 

Common Stock as a dividend
or other distribution on outstanding Common Stock or any preferred stock issued
by the Company, (b) subdivide its outstanding shares of Common Stock, or (c)
combine its outstanding shares of the Common Stock into a smaller number of
shares of the Common Stock (each of the preceding clauses (a) through (c),
inclusive, an “Event”), then, in each such event, the number of shares of Common Stock that the Holder shall
thereafter, on the exercise hereof as provided in Section 1, be entitled to
receive shall be increased or decreased to a number determined by multiplying
the number of shares of Common Stock that would, immediately prior to such
Event, be issuable upon the exercise of this Warrant by a fraction of which (a)
the numerator is the number of issued and outstanding shares of Common Stock
immediately after such Event, and (b) the denominator is the number of issued
and outstanding shares of Common Stock immediately prior to such Event.

5. Certificate
as to Adjustments. In each case of any adjustment or readjustment in the
shares of Common Stock (or  

Other Securities) issuable on
the exercise of this Warrant, the Company at its expense will promptly cause
its Chief Financial Officer or other appropriate designee to compute such
adjustment or readjustment in accordance with the

5

terms of this
Warrant and prepare a certificate setting forth such adjustment or readjustment
and showing in detail the facts upon which such adjustment or readjustment is
based, including a statement of (a) the consideration received or receivable by
the Company for any additional shares of Common Stock (or Other Securities)
issued or sold or deemed to have been issued or sold, (b) the number of shares
of Common Stock (or Other Securities) outstanding or deemed to be outstanding,
and (c) the Exercise Price and the number of shares of Common Stock to be
received upon exercise of this Warrant, in effect immediately prior to such
adjustment or readjustment and as adjusted or readjusted as provided in this
Warrant. The Company will forthwith mail a copy of each such certificate to the
Holder of this Warrant and any Warrant agent of the Company (appointed pursuant
to Section 11 hereof).

6. Reservation
of Stock, Etc., Issuable on Exercise of Warrant. The Company will at all
times reserve and keep available,  

solely for issuance and
delivery on the exercise of this Warrant, shares of Common Stock (or Other
Securities) from time to time issuable on the exercise of this Warrant.

7. Assignment;
Exchange of Warrant. Subject to compliance with applicable securities laws,
this Warrant, and the rights 

evidenced hereby, may be
transferred by any registered holder hereof (a “Transferor”) in whole or in
part. On the surrender for exchange of
this Warrant, with the Transferor’s endorsement in the form of Exhibit B
attached hereto (the “Transferor Endorsement Form”) and together with evidence
reasonably satisfactory to the Company demonstrating compliance with applicable
securities laws, which shall include, without limitation, the provision of a
legal opinion from the Transferor’s counsel that such transfer is exempt from
the registration requirements of applicable securities laws, and with payment
by the Transferor of any applicable transfer taxes, will issue and deliver to
or on the order of the Transferor thereof a new Warrant of like tenor, in the
name of the Transferor and/or the transferee(s) specified in such Transferor
Endorsement Form (each a “Transferee”), calling in the aggregate on the face or
faces thereof for the number of shares of Common Stock called for on the face
or faces of the Warrant so surrendered by the Transferor.

8. Replacement
of Warrant. On receipt of evidence reasonably satisfactory to the Company
of the loss, theft, destruction  

or mutilation of this
Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of this Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.

9. Registration
Rights. The Holder of this Warrant has been granted certain registration
rights by the Company. These 

registration  rights are set
forth in the Registration Rights Agreement dated as of July 31, 2007 entered
into by the Company and the initial Holder of this Warrant, as amended,
modified or supplemented from time to time.

10. Maximum
Exercise. Notwithstanding anything herein to the contrary, in no event
shall the Holder be entitled to  

exercise any portion of
this Warrant in excess of that portion of this Warrant upon exercise of which
the sum of (1) the number of shares of Common Stock

6

beneficially
owned by the Holder and its Affiliates (other than shares of Common Stock which
may be deemed beneficially owned through the ownership of the unexercised
portion of the Warrant or the unexercised or unconverted portion of any other
security of the Holder subject to a limitation on conversion analogous to the
limitations contained herein) and (2) the number of shares of Common Stock
issuable upon the exercise of the portion of this Warrant with respect to which
the determination of this proviso is being made, would result in beneficial
ownership by the Holder and its Affiliates of any amount greater than 9.99% of
the then outstanding shares of Common Stock (whether or not, at the time of
such exercise, the Holder and its Affiliates beneficially own more than 9.99%
of the then outstanding shares of Common Stock). As used herein, the term “Affiliate” means any person or entity
that, directly or indirectly through one or more intermediaries, controls or is
controlled by or is under common control with a person or entity, as such terms
are used in and construed under Rule 144 under the Securities Act. For purposes of the second preceding
sentence, beneficial ownership shall be determined in accordance with Section
13(d) of the Securities Exchange Act of 1934, as amended, and Regulations 13D-G
thereunder, except as otherwise provided in clause (1) of such sentence. For any reason at any time, upon written or
oral request of the Holder, the Company shall within one (1) business day
confirm orally and in writing to the Holder the number of shares of Common
Stock outstanding as of any given date.
The limitations set forth herein (x) shall automatically become null and
void following notice to the Company upon the occurrence and during the
continuance of an Event of Default (as defined in the Note) and (y) may be
waived by the Holder upon provision of no less than sixty-one (61) days prior
written notice to the Company; provided, however, that, such written notice of
waiver shall only be effective if delivered at a time when no indebtedness
(including, without limitation, principal, interest, fees and charges) of the
Company of which the Holder or any of its Affiliates was, at any time, the
owner, directly or indirectly is outstanding. 

11. Restriction.
Notwithstanding anything to the contrary contained herein, the Holder hereby
agrees that during the  

period on and after the
Issue Date and prior to the date that is the one year anniversary of the Issue
Date, it shall not sell any Common Stock acquired upon exercise of this
Warrant. After the one year anniversary
of the Issue Date, the Holder hereby agrees not to sell on any trading day such
number of shares of Common Stock acquired upon exercise of this Warrant that is
in excess of twenty-five percent (25%) of the aggregate dollar trading volume
of the Common Stock for the twenty-two (22) day trading period (the “Period”)
immediately preceding each such sale by Holder; provided, however, that the
volume of the day of any sale up to, but not including, the volume as to any
sale by Holder and any volume thereafter, shall be included in any Period. Notwithstanding anything contained herein to
the contrary, the foregoing restrictions (a) shall not be applicable and shall
have no further force or effect following the occurrence and during the
continuance of an Event of Default under and as defined in the Securities
Purchase Agreement dated as of the date hereof by and among the Company and
Laurus (as amended, restated modified and/or supplemented from time to time)
and (b) shall not apply to transfers in a private transaction including,
without limitation, as a bona fide gift or gifts, provided that the transferee
thereof agrees to be bound in writing by the restrictions set forth herein. 

7

12. Warrant
Agent. The Company may, by written notice to the Holder of this Warrant,
appoint an agent for the purpose  

of issuing  Common Stock
(or Other Securities) on the exercise of this Warrant pursuant to Section 1,
exchanging this Warrant pursuant to Section 7, and replacing this Warrant
pursuant to Section 8, or any of the foregoing, and thereafter any such
issuance, exchange or replacement, as the case may be, shall be made at such
office by such agent.

13. Transfer
on the Company’s Books. Until this Warrant is transferred on the books of
the Company, the Company may 

treat the registered
Holder hereof as the absolute owner hereof for all purposes, notwithstanding
any notice to the contrary.

14. Notices,
Etc. All notices and other communications from the Company to the Holder of
this Warrant shall be mailed  

by first class registered or
certified mail, postage prepaid, at such address as may have been furnished to
the Company in writing by such Holder or, until any such Holder furnishes to
the Company an address, then to, and at the address of, the last Holder of this
Warrant who has so furnished an address to the Company.

15. Miscellaneous.
This Warrant and any term hereof may be changed, waived, discharged or
terminated only by an 

instrument in writing signed
by the party against which enforcement of such change, waiver, discharge or
termination is sought. This Warrant shall be governed by and construed in
accordance with the laws of State of New York without regard to principles of
conflicts of laws. Any action brought
concerning the transactions contemplated by this Warrant shall be brought only
in the state courts of New York or in the federal courts located in the state
of New York; provided, however, that the Holder may choose to waive this
provision and bring an action outside the State of New York. The individuals executing this Warrant on
behalf of the Company agree to submit to the jurisdiction of such courts and
waive trial by jury. In the event that
any provision of this Warrant is invalid or unenforceable under any applicable
statute or rule of law, then such provision shall be deemed inoperative to the
extent that it may conflict therewith and shall be deemed modified to conform
with such statute or rule of law. Any
such provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of this
Warrant. The headings in this Warrant
are for purposes of reference only, and shall not limit or otherwise affect any
of the terms hereof. The invalidity or
unenforceability of any provision hereof shall in no way affect the validity or
enforceability of any other provision hereof.
The Company acknowledges that legal counsel participated in the
preparation of this Warrant and, therefore, stipulates that the rule of
construction that ambiguities are to be resolved against the drafting party
shall not be applied in the interpretation of this Warrant to favor any party
against the other party.

[BALANCE OF PAGE INTENTIONALLY LEFT BLANK;

SIGNATURE PAGE FOLLOWS.]

8

          IN
WITNESS WHEREOF, the Company has executed this Warrant as of the date first
written above.

	
 

	
 

	
 

	
 

	
 

	
 

	
INCENTRA
 SOLUTIONS, INC.

	
 

	
WITNESS:

	
 

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
 

	

	
 

	
 

	
Name:

	
Matthew G. Richman

	
 

	
 

	
Title:

	
Senior Vice President, Chief Corporate Development Officer &
 Treasurer

	

	
 

	
 

	
 

9

EXHIBIT A

FORM OF SUBSCRIPTION
(To Be Signed Only On Exercise Of Warrant) 

	
 

	
 

	
TO:

	
INCENTRA
 SOLUTIONS, INC.

	
 

	
1140 Pearl
 Street

	
 

	
Boulder, CO
 80302

	
 

	
Attention:
 Chief Financial Officer

          The
undersigned, pursuant to the provisions set forth in the attached Warrant (No.____),
hereby irrevocably elects to purchase (check applicable box):

	
 

	
 

	
________

	
________
 shares of the Common Stock covered by such Warrant; or 

	
 

	
 

	
________

	
the maximum
 number of shares of Common Stock covered by such Warrant pursuant to the
 cashless exercise procedure set forth in Section 2.

          The
undersigned herewith makes payment of the full Exercise Price for such shares
at the price per share provided for in such Warrant, which is $___________.
Such payment takes the form of (check applicable box or boxes):

	
 

	
 

	
________

	
$__________
 in lawful money of the United States; and/or 

	
 

	
 

	
________

	
the
 cancellation of such portion of the attached Warrant as is exercisable for a
 total of _______ shares of Common Stock (using a Fair Market Value of $_______
 per share for purposes of this calculation); and/or 

	
 

	
 

	
________

	
the
 cancellation of such number of shares of Common Stock as is necessary, in
 accordance with the formula set forth in Section 2.2, to exercise this
 Warrant with respect to the maximum number of shares of Common Stock
 purchasable pursuant to the cashless exercise procedure set forth in Section
 2. 

          The
undersigned requests that the certificates for such shares be issued in the
name of, and delivered to ______________________________________ whose address is ___________________________________________________________________________.

          The
undersigned represents and Warrants that all offers and sales by the
undersigned of the securities issuable upon exercise of the within Warrant
shall be made pursuant to registration of the Common Stock under the Securities
Act of 1933, as amended (the “Securities Act”) or pursuant to an exemption from
registration under the Securities Act.

	
 

	
 

	
 

	
 

	
Dated:

	
 

	
 

	
 

	
 

	

	
 

	

	
 

	
 

	
 

	
(Signature must conform to name of holder as specified on the face of
 the Warrant)

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Address:

	
 

	
 

	
 

	
 

	
 

	

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

A-1

EXHIBIT B

FORM OF TRANSFEROR ENDORSEMENT
(To Be Signed Only On Transfer Of Warrant) 

          For
value received, the undersigned hereby sells, assigns, and transfers unto the
person(s) named below under the heading “Transferees” the right represented by
the within Warrant to purchase the percentage and number of shares of Common
Stock of INCENTRA SOLUTIONS, INC. into which the within Warrant relates
specified under the headings “Percentage Transferred” and “Number Transferred,”
respectively, opposite the name(s) of such person(s) and appoints each such
person Attorney to transfer its respective right on the books of INCENTRA
SOLUTIONS, INC. with full power of substitution in the premises. 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Transferees  

	
   

	
Address  

	
   

	
Percentage

Transferred  

	
   

	
Number

Transferred  

	

	
 

	

	
 

	

	
 

	

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	

	
 

	

	
 

	

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	

	
 

	

	
 

	

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	

	
 

	

	
 

	

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	

	
 

	

	
 

	

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Dated:

	
 

	
 

	
 

	
 

	

	
 

	

	
 

	
 

	
 

	
(Signature
 must conform to name of holder as specified on the

	
 

	
 

	
 

	
face of the
 Warrant)

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Address:

	
 

	
 

	
 

	
 

	
 

	

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
SIGNED IN
 THE PRESENCE OF:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	
 

	
 

	
(Name)

	
ACCEPTED AND
 AGREED:

	
 

	
 

	
[TRANSFEREE]

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	
 

	
(Name)

	
 

	
 

	
 

	
 

	
 

	
 

B-1

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