AXS ONE INC
EX-10.7: PARTICIPATION RIGHTS WAIVER AND JOINDER
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<TYPE>EX-10.7
<SEQUENCE>8
<FILENAME>y00461exv10w7.htm
<DESCRIPTION>EX-10.7: PARTICIPATION RIGHTS WAIVER AND JOINDER
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<TITLE>EX-10.7</TITLE>
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<DIV align="right" style="font-size: 10pt; margin-top: 12pt"><B>Exhibit&nbsp;10.7</B>
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<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><U><B>AXS-ONE, INC.</B></U>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>Waiver and Termination of Participation Rights;<BR>
Joinder to New Participation Rights</B>

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">1.&nbsp;<U>Background</U>. The undersigned, being holders (the &#147;<I>Holders</I>&#148;) of Series&nbsp;A 6% Secured
Convertible Promissory Notes, Series&nbsp;B 6% Secured Convertible Promissory Notes, Series&nbsp;C 6%
Convertible Promissory Notes and/or Series&nbsp;D 6% Convertible Promissory Notes and Common Stock
Purchase Warrants (the &#147;<I>Securities</I>&#148;) of AXS-One, Inc., a Delaware corporation (the &#147;<I>Company</I>&#148;), have
certain rights of participation (&#147;<I>Participation Rights</I>&#148;) pursuant to Section&nbsp;4.7 of the Convertible
Note and Warrant Purchase Agreement, dated as of July&nbsp;24, 2008 (the &#147;<I>July&nbsp;2008 Agreement</I>&#148;), among
the Company and the Holders, pursuant to which each Holder has a right to purchase its respective
<I>pro rata </I>share (based on the ratio that the aggregate amount of Securities purchased by it pursuant
to the Convertible Note and Warrant Purchase Agreement, dated as of May&nbsp;29, 2007 (the &#147;<I>May&nbsp;2007
Agreement</I>&#148;), the Convertible Note and Warrant Purchase Agreement, dated as of November&nbsp;13, 2007
(the &#147;<I>November&nbsp;2007 Agreement</I>&#148;), and/or the July&nbsp;2008 Agreement bears to the aggregate amount of
Securities purchased by all such Holders pursuant to the May&nbsp;2007 Agreement, the November&nbsp;2007
Agreement, and/or the July&nbsp;2008 Agreement) of an aggregate of thirty percent (30%) of the
securities being offered by the Company in any future equity financing (including debt with an
equity component) (a &#147;<I>Future Offering</I>&#148;) during the period beginning on the Closing Date (as defined
in the July&nbsp;2008 Agreement) and ending two (2)&nbsp;years after the date of the July&nbsp;2008 Agreement.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">2.&nbsp;<U>Waiver and Termination of Participation Rights</U>. The Company now desires to conduct a
new round of financing, in which it will offer for sale and issue its Series&nbsp;E 6% Secured
Convertible Promissory Notes and Common Stock Purchase Warrants (the &#147;<I>New Securities</I>&#148;), pursuant to
a Convertible Note and Warrant Purchase Agreement dated as of October&nbsp;30, 2008, among the Company
and each party set forth therein as a purchaser (the &#147;<I>New Agreement</I>&#148;). The Holders hereby
acknowledge that they have received and reviewed the New Agreement, and do hereby (i)&nbsp;waive their
Participation Rights held pursuant to Section&nbsp;4.7 of the July&nbsp;2008 Agreement and (ii)&nbsp;agree that
upon execution of the New Agreement by the parties thereto that all of their Participation Rights
held pursuant to the July&nbsp;2008 Agreement will terminate and be of no further force and effect.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">3.&nbsp;<U>Joinder to New Participation Rights</U>. Each Holder hereby agrees, pursuant to Section&nbsp;4.7
of the New Agreement to join, become party to and be bound by Section&nbsp;4.7 of the New Agreement
regarding Rights of Participation and the Miscellaneous provisions of Article&nbsp;VI of the New
Agreement, effective upon execution of the New Agreement by the parties thereto.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">4.&nbsp;<U>Execution in Counterparts</U>. This agreement may be executed in two or more counterparts,
each of which shall be deemed an original but which together shall constitute one and the same
instrument. The executed signature pages hereto may be delivered by facsimile or other means of
electronic image transmission, such a copy of any signature page hereto shall have the same force
and effect as an original thereof.
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><I>&#091;signature page follows&#093;</I>
</DIV>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
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<DIV align="left" style="font-size: 10pt; margin-top: 6pt">IN WITNESS WHEREOF, the undersigned have executed this Waiver and Termination of Participation
Rights and Joinder to New Participation Rights as of this 30<SUP style="font-size: 85%; vertical-align: text-top">th</SUP> day of October&nbsp;2008.
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>BlueLine Capital Partners, LP</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Timothy P. Bacci
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD align="left">Timothy P. Bacci&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD align="left">Managing Partner&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>BlueLine Capital Partners II, LP</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Timothy P. Bacci
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD align="left">Timothy P. Bacci&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD align="left">Managing Partner&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Jurika Family Trust U/A 3/17/1989</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ William K. Jurika
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD align="left">William K. Jurika&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD align="left">Trustee&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Aston Assets, S.A.</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Alejandro Gonzalez
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD align="left">Alejandro Gonzalez&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD align="left">Legal Representative&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>BlueLine Capital Partners III, LP</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ Timothy P. Bacci
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD align="left">Timothy P. Bacci&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD align="left">Managing Partner&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
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<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">                                           /s/ Daniel H. Burch
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Daniel H. Burch</B>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">                                   /s/ Harold D. Copperman
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Harold D. Copperman</B>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">                                           /s/ Robert J. Migliorino
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Robert J. Migliorino</B>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
</TABLE>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="49%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="19%">&nbsp;</TD>
    <TD width="19%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Sirius Trust</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left" nowrap>/s/ N. Mifsud &nbsp;  /s/ M. Garcia
&nbsp;</TD>
    <TD style="border-bottom: 1px solid #000000" align="left" nowrap>/s/ L. Spencer &nbsp; /s/ P. Palmiero&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD align="left">N. Mifsud / M. Garcia             </TD>
    <TD>L. Spencer/P. Palmiero&nbsp;&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD align="left">Primafides (Suisse) SA             &nbsp;</TD>
    <TD>Earl Trust AG
</TD><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">&nbsp;&nbsp;</TD>
    <TD align="left">Directors&nbsp;</TD>
</TR>
</TABLE>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">        /s/ Philip L. Rugani
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Philip L. Rugani</B>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000" align="left">        /s/ William P. Lyons
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>William P. Lyons</B>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
</TABLE>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt">&#091;AXS-One, Inc. Waiver and Termination of Participation Rights<BR>
and Joinder to New Participation Rights&#093;
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
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