Additionally, the Company announced that on October 30, 2008, it completed a $1.1 million convertible note financing led by BlueLine Partners and William Jurika and including several AXS-One board and management team members. The notes, which are secured by substantially all the assets of the Company, mature on May 29, 2009, bear interest at the rate of 6 percent per year and are convertible into AXS-One common stock at a $1.00 conversion price. The Company also issued warrants to the investors to purchase an aggregate of 3,300,000 shares of common stock at an exercise price of $0.01. If all of the warrants are exercised and the entire principal amount of the notes is converted into shares of common stock, the average purchase price of such shares issued pursuant to this financing will be $0.26 per share. Proceeds of these notes will be used to strengthen the Company's balance sheet and working capital position.

    Highlights for the third quarter include:

    -- 15 deals worldwide, including contracts with eight new customers.
    -- The Company's first contract for Dynamic Data Migrator, AXS-One's
       patent-pending data migration product announced in June 2008. The
       contract is with an existing AXS-One financial services customer who is
       planning to migrate from Lotus Notes to Microsoft Exchange.
    -- The Company's largest win to date for Sun JMS archiving at one of the
       world's largest conglomerates. The initial order, closed through
       AXS-One channel partner Sun Microsystems, is for 20,000 users in Asia.
    -- A competitive replacement win with one of the largest banks in Europe.
       The bank will implement AXS-One's Lotus Notes archiving, instant
       messaging archiving, retention management and case management modules.
       The AXS-One Compliance Platform has been selected to support the bank's
       MiFID compliance requirements as well as their broad regulatory
       compliance needs, mailbox management, retention management and
       e-discovery.
    -- A competitive replacement win with the world's largest post-trade
       financial services company. The bank will implement AXS-One for Lotus
       Notes mail archiving for broad regulatory compliance needs, mailbox
       management, retention management and e-discovery.
    -- A leader in the entertainment distribution industry selected AXS-One
       after a recommendation from the customer's outside counsel to address
       e-discovery requirements.
    -- A number of existing customers worldwide expanded their use of the
       AXS-One Compliance Platform, adding additional users, record types
       and/or functionality.

Bill Lyons, Chairman & CEO of AXS-One, commented, "These results represent a continued positive trend of progress across all aspects of our business and convey accelerating demand for our solutions. In particular, our new Dynamic Data Migrator product continues to gain momentum in the industry while the ongoing series of competitive wins prove the appeal of our products, our platform and industry vision. We have made great progress in developing and enhancing our sales channel for this innovative solution and believe it will become an expanding contributor to our financial results in the coming quarters."

For the first nine months of 2008, total revenues were $11.0 million, an increase of 26% compared with total revenues of $8.7 million for the first nine months of 2007. License revenue was $4.1 million, up 44% from the $2.8 million in license revenue for the first nine months last year. Total operating expenses were $16.1 million for the first nine months of 2008, a decrease of 17% from $19.4 million in the prior year. The operating loss narrowed to $5.2 million for the first nine months of 2008, down from an operating loss of $10.7 million in the first nine months of last year. The net loss for the first nine months of 2008 was $6.7 million, or $(0.18) per diluted share compared to a net loss of $10.9 million, or $(0.31) per diluted share for the comparable prior-year period.

"The progress year-to-date demonstrates that we have successfully turned the corner in our development," Mr. Lyons continued. "Our Records Compliance Management platform revenue has been increasing as our work in building a global sales channel is finally paying dividends. We are seeing progress in each market vertical despite the challenging economic environment. We also successfully leveraged the archiving expertise built into our platform to create our new data migration tool and this unique solution has opened new doors for AXS-One and broadened our growth opportunities. We are well-positioned to cross-sell this portfolio of solutions through our robust global sales channel in the coming quarters."

Conference call information

Management will conduct a conference call to discuss these results at 5 p.m. Eastern time on October 30, 2008. Interested parties can participate in the call by dialing 706-645-0399 with the conference ID #70822556 or can access the webcast at http://www.axsone.com/investors_events.shtml. Interested parties should access the webcast approximately 10-15 minutes before the scheduled start time. The webcast will be archived for 7 days following the call. Interested parties may submit questions prior to the conference call by e-mail to IR@axsone.com.

About AXS-One Inc.

AXS-One Inc. (OTCBB: AXSO) is a leading provider of high performance Records Compliance Management software. The AXS-One Compliance Platform enables organizations to implement secure, scalable and enforceable policies that address records management for corporate governance, legal discovery and industry regulations such as SEC17a-4, NASD 3010, Sarbanes-Oxley, HIPAA, The Patriot Act and Gramm-Leach Bliley. AXS-One's award-winning technology has been critically acclaimed as best of class and delivers digital archiving, business process management, electronic document delivery and integrated records disposition and discovery for e-mail, instant messaging, images, SAP and other corporate records. Founded in 1978, and headquartered in Rutherford, NJ, AXS-One has offices worldwide including in the United States, Australia, Singapore and the United Kingdom. For further information, visit the AXS-One website at http://www.axsone.com

AXS-One, the AXS-One logo, "Access Tomorrow Today," and AXSPoint are registered trademarks of, and AXS-One Compliance Platform, AXS-One Central, AXS-One Retention Manager, AXS-One Rapid-AXS, AXS-Link for Desktop, AXS-Link for SAP, AXS-Link for Lotus Notes, AXS-Link for Microsoft Exchange, AXS-One Data Archive Translator, AXS-Link for File System Archiving, AXS-Link for .PST Management, AXS-One Supervision, AXS-One Case Management, "The Records Compliance Management Company" and AXS-Link are trademarks of, AXS-One Inc., in the U.S. All other company and product names are trademarks or registered trademarks of their respective companies.

Special Note Regarding Forward-Looking Statements: A number of statements contained in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the applicable statements. These risks and uncertainties include, but are not limited to: our ability to improve financial and sales performance; risks relating to liquidity; the impact of the economic downturn on customer buying decisions, potential vulnerability to technological obsolescence; the risks that our current and future products may contain errors or defects that would be difficult and costly to detect and correct; potential difficulties in managing growth; dependence on key personnel; the possible impact of competitive products and pricing; and other risks described in more detail in AXS-One's most current Form 10-K and other subsequent Securities and Exchange Commission filings.

     Company Contact:                        IR Contact:
     Joseph Dwyer                            Jeff Stanlis
     AXS-One Inc.                            Hayden Communications
     jdwyer@axsone.com                       jeff@haydenir.com
     (201) 935-3400                          (602) 476-1821

                               -Tables Follow-



                        AXS-ONE INC. AND SUBSIDIARIES
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                                (In thousands)

                                                  September 30,   December 31,
                                                      2008           2007
                   ASSETS                          (unaudited)
    Current assets:
      Cash and cash equivalents                      $1,157         $3,362
      Accounts receivable, net of allowance
       for doubtful accounts                          2,619          2,208
      Prepaid expenses and other current assets         641            838
          Total current assets                        4,417          6,408

    Equipment and leasehold improvements, net of
     accumulated depreciation                           172            253
    Other assets                                        237            283
    Total assets                                     $4,826         $6,944


            LIABILITIES AND STOCKHOLDERS' DEFICIT
    Current liabilities:
      Bank debt                                        $949             $-
      Convertible debt, net of discount               9,717              -
      Accounts payable and accrued expenses           4,116          4,934
      Deferred revenue                                3,296          3,233
          Total current liabilities                  18,078          8,167

      Long-term convertible debt, net of discount         -          7,037
      Long-term deferred revenue                        197            120
      Other long-term liabilities                         -            212
          Total long-term liabilities                   197          7,369

    Stockholders' deficit                           (13,449)        (8,592)
    Total liabilities and stockholders' deficit      $4,826         $6,944

The financial information included in this document is intended only as summary provided for your convenience, and should be read in conjunction with the complete consolidated financial statements of the Company (including the Notes thereto, which set forth important information) contained in its Reports on Form 10-K and 10-Q filed and to be filed by the Company with the U.S. Securities and Exchange Commission (SEC). Such reports are available on the public EDGAR electronic filing system maintained by the SEC.

                        AXS-ONE INC. AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                    (In thousands, except per share data)
                                 (Unaudited)

                                      Three Months Ended    Nine Months Ended
                                         September 30,         September 30,
                                       2008        2007     2008         2007
    Revenues:
      License fees                   $1,556        $544   $4,099       $2,845
      Services                        2,120       1,950    6,872        5,861
        Total revenues                3,676       2,494   10,971        8,706

    Operating expenses:
      Cost of license fees               85         126      271          371
      Cost of services                1,008       1,381    3,367        4,212
      Sales and marketing             1,720       2,047    5,200        6,106
      Research and development        1,322       2,200    4,254        5,380
      General and administrative        840       1,038    3,037        3,299
        Total operating expenses      4,975       6,792   16,129       19,368
    Operating loss                   (1,299)     (4,298)  (5,158)     (10,662)
    Other income (expense):
      Interest income                     5          46       25          160
      Interest expense                 (684)       (203)  (1,632)        (323)
      Other income (expense), net       (31)        (82)     (21)         (30)
        Total other income (expense),
         net                           (710)       (239)  (1,628)        (193)
    Loss before income taxes         (2,009)     (4,537)  (6,786)     (10,855)
    Income tax provision/(benefit)        1          39      (46)          39
    Net loss                        $(2,010)    $(4,576) $(6,740)    $(10,894)

    Basic & diluted net loss per
     common share:                   $(0.05)     $(0.13)  $(0.18)      $(0.31)

    Weighted average basic & diluted
     common shares outstanding       38,352      35,038   38,034       34,885

The unaudited financial information included in this document is intended only as summary provided for your convenience, and should be read in conjunction with the complete consolidated financial statements of the Company (including the Notes thereto, which set forth important information) contained in its Reports on Form 10-K and 10-Q filed and to be filed by the Company with the U.S. Securities and Exchange Commission (SEC). Such reports are available on the public EDGAR electronic filing system maintained by the SEC.

SOURCE AXS-One Inc.

http://www.axsone.com

In conjunction with the enhancements, AXS-One earlier announced strategic partnerships with the industry's two leading application migration specialists, CASAHL Technology and Unify Corp. CASAHL is a leading provider of middleware products for integrating or migrating Lotus Notes applications to the Microsoft platform (SharePoint, InfoPath, Groove, Exchange, and SQL Server). Unify is a global provider of application modernization solutions. Together, they represent an end-to-end solution for Lotus Notes Application Migration with a proven methodology for rapid adoption. The combined AXS-One, CASAHL and Unify partnership will provide customers with a single solution, best-of-breed approach that addresses requirements for e-mail, calendars, contacts and applications, as well as effective co-existence with the Lotus Domino environment.

"Today's announcement, as well as the partnerships established between AXS-One, CASAHL and Unify are an important example of how the Microsoft partner community is coming together to support customers by providing a complete solution that enables rapid deployment and adoption of the Microsoft platform without disruption," said Jim Bernardo, Director of Microsoft's Enterprise and Partner Group.

Michael Osterman, principal analyst at Osterman Research, added, "Migrating from one messaging server platform to another is difficult, time-consuming and often results in data loss and conversion problems, Dynamic Data Migrator provides a number of advantages because data does not have to be migrated en masse for groups of users at once. If an organization opts to migrate from Notes to Exchange, Dynamic Data Migrator will convert Notes e-mails to the Exchange platform, but retain an original copy of each Notes e-mail in the archive, which more fully satisfies e-discovery, regulatory and related requirements. For organizations that are considering a migration, AXS-One's tool is an important one to consider."

Since its market rollout in June 2008, DDM has provided a revolutionary approach to e-mail migration for organizations migrating from Lotus Notes to Microsoft Exchange. DDM provides continuous access to Notes e-mail directly from the user's Outlook client, delivering a zero-conversion alternative to conventional data conversion processes. Message fidelity is assured, delivering a solution that provides reduced risk, lower costs and shorter timelines. The addition of calendar and contact migration leverages DDM's highly differentiated approach to e-mail conversion and co-existence, with a flexible, policy-based approach to migration that ensures rapid deployment with assured data fidelity, reduced Exchange infrastructure costs and minimized co-existence risks.

"For customers who have decided to migrate from Notes to Exchange, AXS-One can now provide the industry's most comprehensive rapid deployment solution," said Bill Lyons, CEO of AXS-One. "The enhancements we have announced today, combined with our strategic partnerships with CASAHL and Unify, offer organizations a highly differentiated migration solution. In these difficult economic times, providing a solution that can significantly reduce cost, lower risk, improve the end-user experience and accelerate the timeline to completion is just what customers having been asking for."

About AXS-One Inc.

AXS-One (OTC Bulletin Board: AXSO) is a leading provider of high performance Records Compliance Management software solutions. The AXS-One Compliance Platform enables organizations to implement secure, scalable and enforceable policies that address records management for corporate governance, legal discovery and industry regulations such as SEC17a-4, NASD 3010, Sarbanes-Oxley, HIPAA, The Patriot Act and Gramm-Leach-Bliley. AXS-One's award-winning technology has been critically acclaimed as best of class and delivers digital archiving, business process management, electronic document delivery and integrated records disposition and discovery for e-mail, instant messaging, images, SAP and other corporate records. Founded in 1979, and headquartered in Rutherford, N.J., AXS-One has offices worldwide including the United States, Australia, Singapore and the United Kingdom. For further information, visit the AXS-One Web site at http://www.axsone.com.

AXS-One, the AXS-One logo, "Access Tomorrow Today," and AXSPoint are registered trademarks of, and AXS-One Compliance Platform, AXS-One Central, AXS-One Retention Manager, AXS-One Rapid-AXS, AXS-Link for Desktop, AXS-Link for SAP, AXS-Link for Lotus Notes, AXS-Link for Microsoft Exchange, Dynamic Data Migrator, AXS-One Data Archive Translator, AXS-Link for File System Archiving, AXS-Link for .PST Management, AXS-One Supervision, AXS-One Case Management, "The Records Compliance Management Company" and AXS-Link are trademarks of, AXS-One Inc., in the U.S. All other company and product names are trademarks or registered trademarks of their respective companies.

    AXS-One Contact:
    Peter Moore
    GlobalFluency
    646-652-5205
    pmoore@globalfluency.com

SOURCE AXS-One

http://www.axsone.com

"Our partnership with AXS-One broadens our Composer suite and heightens DDM value -- enabling our customers to rapidly and efficiently transition from Notes to Microsoft with little disruption," said Kevin Kane, vice president and general manager of Composer Solutions, Unify. "The delivery of a comprehensive migration solution accelerates our customers' ability to sunset Lotus Notes and rapidly adopt the Microsoft platform."

Bill Lyons, CEO of AXS-One added, "Dynamic Data Migrator has a dramatic impact on the cost and time it takes organizations to transition from Notes to Microsoft Exchange. By partnering with Unify, we have extended the value of our highly differentiated approach and can provide the Microsoft field, partner and customer community with a comprehensive platform migration strategy."

"This partnership between Unify and AXS-One is a great example of how the Microsoft partner community is coming together to support customers by providing a complete solution that enables rapid deployment and adoption of the Microsoft platform without disruption," said Jim Bernardo, Director of Microsoft's Enterprise and Partner Group. "Unify and AXS-One are key technology partners for the migration of custom business process Lotus Notes applications and e-mail to the Microsoft platform."

Introduced in June 2008, AXS-One's Dynamic Data Migrator (DDM) provides a revolutionary new approach to e-mail server migration. DDM provides continuous access to Notes e-mail directly from the user's Outlook client, delivering a zero-conversion alternative to conventional data conversion processes. Message fidelity is assured, delivering a solution that provides reduced risk, costs and timelines.

Unify's Composer for Lotus Notes is an application migration solution that decomposes data from Lotus Notes and re-assembles it into .NET and SharePoint environments. Composer incorporates standard methodologies, rich migration technologies and professional services to deliver new Web services-based applications that seamlessly integrate into the Microsoft Office suite. Composer uniquely migrates the LotusScript, providing customers with a complete solution for quickly and easily migrating even the most complex custom Lotus Notes application frameworks. The validity of Composer is best depicted by referenceable customers who have deployed the migrated applications to their production Microsoft platform -- and turned off their Lotus Domino servers.

About AXS-One

AXS-One Inc. (OTCBB : AXSO) is a leading provider of scalable, high performance Records Compliance Management solutions. The AXS-One Compliance Platform enables organizations to implement secure, scalable and enforceable policies that address records management for corporate governance, legal discovery and industry regulations such as SEC17a-4, NASD 3010, Sarbanes-Oxley, HIPAA, The Patriot Act and Gramm-Leach Bliley. Founded in 1978, and headquartered in Rutherford, NJ, AXS-One has offices worldwide including in the United States, Australia, Hong Kong, Singapore, United Kingdom and South Africa. For further information, visit the AXS-One web site at http://www.axsone.com.

About Unify

Unify is a global provider of application modernization solutions. The company has a rich heritage of delivering enterprise software and services for modernizing and maximizing the performance of applications and data while providing significant and measurable return on investment for customers. Unify's market leading technologies help organizations drive business optimization, improve collaboration, increase customer service and reduce costs. Unify is headquartered in Roseville, Calif. with offices in London, Munich, Paris, and Sydney. Visit http://www.unify.com or e-mail info@unify.com.

AXS-One, the AXS-One logo, "Access Tomorrow Today," and AXSPoint are registered trademarks of, and AXS-One Compliance Platform, AXS-One Central, AXS-One Retention Manager, AXS-One Rapid-AXS, AXS-Link for Desktop, AXS-Link for SAP, AXS-Link for Lotus Notes, AXS-Link for Microsoft Exchange, AXS-One Data Archive Translator, AXS-Link for File System Archiving, AXS-Link for .PST Management, AXS-One Supervision, AXS-One Case Management, "The Records Compliance Management Company" and AXS-Link are trademarks of AXS-One Inc., in the U.S. All other company and product names are trademarks or registered trademarks of their respective companies.

     AXS-One Contact:
     Peter Moore
     GlobalFluency
     646-652-5205
     pmoore@globalfluency.com

     Unify Corp. Contact:
     Deb Thornton
     Unify Corp.
     916-218-4779
     deb@unify.com

SOURCE AXS-One

http://www.axsone.com

Expected next investor conference call information:
Conference Call Date: 10/30/2008
Conference Call Time: 5:00 PM
Conference Call URL: http://phx.corporate-ir.net/phoenix.zhtml?c=118604&dc=&p=irol-Guestbook&UniqueId=2006680&EventId=2006680&mp=IROL-EventDetails&rdu=&mpdp=EventId~2006680!WebCastId~809889!StreamId~1211037&pp=IROL-BasicWebCast&ppdp=EventId~2006680!WebCastId~809889!StreamId~1211037&pph=339&ppw=270&upv=&econf&ee=