<SUBMISSION>
<ACCESSION-NUMBER>0001157523-08-008451
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20081023
<ITEMS>2.04
<ITEMS>8.01
<ITEMS>9.01
<FILING-DATE>20081028
<DATE-OF-FILING-DATE-CHANGE>20081028
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>AFP IMAGING CORP
<CIK>0000319126
<ASSIGNED-SIC>3861
<IRS-NUMBER>132956272
<STATE-OF-INCORPORATION>NY
<FISCAL-YEAR-END>1210
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>000-10832
<FILM-NUMBER>081144973
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>250 CLEARBROOK RD
<CITY>ELMSFORD
<STATE>NY
<ZIP>10523
<PHONE>9145926100
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>250 CLEARBROOK RD
<CITY>ELMSFORD
<STATE>NY
<ZIP>10523
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>AUTOMATIC FILM PROCESSOR CORP
<DATE-CHANGED>19821122
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>a5815827.htm
<DESCRIPTION>AFP IMAGING CORPORATION 8-K
<TEXT>
<html>
  <head>
    <title></title>
<!--Copyright 2008 Business Wire, a Berkshire Hathaway company.-->
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  <body style="font-size: 8pt; font-family: Times New Roman">
    <p style="text-align: center">

    </p>
    <p style="text-align: center">
      <font style="font-family: Times New Roman; font-size: 11pt"><b>UNITED
      STATES</b></font><b><font style="font-family: Times New Roman; font-size: 11pt"><br style="font-size: 11pt; font-family: Times New Roman"></font><font style="font-family: Times New Roman; font-size: 11pt">SECURITIES
      AND EXCHANGE COMMISSION</font></b><br><font style="font-family: Times New Roman; font-size: 11pt"><b>Washington,
      D.C. 20549</b></font><br><br><font style="font-family: Times New Roman; font-size: 14pt"><b>FORM
      8-K</b></font><br><br><font style="font-family: Times New Roman; font-size: 11pt"><b>CURRENT
      REPORT</b></font><br><font style="font-family: Times New Roman; font-size: 11pt"><b>
      Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</b></font><br><br><font style="font-family: Times New Roman; font-size: 10pt">Date
      of Report (Date of earliest event reported): October 23, 2008</font><br><br><font style="font-family: Times New Roman; font-size: 16pt"><b>AFP&#160;Imaging
      Corporation</b></font><br><font style="font-family: Times New Roman; font-size: 10pt">(Exact
      name of registrant as specified in its charter)</font><br><br>
    </p>
    <div style="text-align:left">
    <table style="margin-bottom: 10.0px; font-size: 8pt; font-family: Times New Roman; width: 100%" cellspacing="0">
      <tr>
        <td style="text-align: center; padding-left: 0.0px; width: 33%" valign="bottom">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt"><b>New
            York</b></font>
          </p>
        </td>
        <td style="text-align: center; white-space: nowrap; padding-right: 0.0px; padding-left: 0.0px; width: 34%" valign="bottom">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt"><b>0-10832</b></font>
          </p>
        </td>
        <td style="text-align: center; white-space: nowrap; padding-right: 0.0px; padding-left: 0.0px; width: 33%" valign="bottom">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt"><b>13-2956272</b></font>
          </p>
        </td>
      </tr>
      <tr>
        <td style="text-align: center; padding-left: 0.0px; width: 33%" valign="bottom">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">(State
            or other jurisdiction</font>
          </p>
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">of
            incorporation)</font>
          </p>
        </td>
        <td style="text-align: center; padding-left: 0.0px; width: 34%" valign="bottom">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">(Commission</font>
          </p>
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">File
            Number)</font>
          </p>
        </td>
        <td style="text-align: center; padding-left: 0.0px; width: 33%" valign="bottom">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">(IRS
            Employer</font>
          </p>
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">Identification
            No.)</font>
          </p>
        </td>
      </tr>
    </table>
    </div>
    <div style="text-align:center">
    <table style="margin-left:auto;margin-right:auto; margin-bottom: 10.0px; font-size: 8pt; font-family: Times New Roman; width: 100%" cellspacing="0">
      <tr>
        <td style="text-align: center; padding-left: 0.0px; width: 50%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt"><b>250
            Clearbrook Road</b></font><font style="font-family: Times New Roman; font-size: 10pt"><br style="font-size: 10pt; font-family: Times New Roman"></font><font style="font-family: Times New Roman; font-size: 10pt"><b>Elmsford,
            New York</b></font>
          </p>
        </td>
        <td style="width: 20%">
          &#160;
        </td>
        <td style="text-align: center; white-space: nowrap; padding-right: 0.0px; padding-left: 0.0px; width: 30%" valign="bottom">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt"><b>10523</b></font>
          </p>
        </td>
      </tr>
      <tr>
        <td style="text-align: center; padding-left: 0.0px; width: 50%" valign="bottom">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">(Address
            of principal executive offices)</font>
          </p>
        </td>
        <td style="width: 20%">

        </td>
        <td style="text-align: center; padding-left: 0.0px; width: 30%" valign="bottom">
          <font style="font-family: Times New Roman; font-size: 10pt">(Zip
          Code)</font>
        </td>
      </tr>
    </table>
    </div>
    <p style="text-align: center">
      <font style="font-family: Times New Roman; font-size: 11pt"><b>Registrant&#8217;s
      telephone number, including area code: (914) 592-6100</b></font><br>
    </p>
    <p style="text-align: center">
      <font style="font-family: Times New Roman; font-size: 11pt"><b>Not
      Applicable</b></font><br><font style="font-family: Times New Roman; font-size: 10pt">(Former
      name or former address, if changed since last report)</font><br>
    </p>
    <p>
      <font style="font-family: Times New Roman; font-size: 10pt">Check the
      appropriate box below if the Form 8-K filing is intended to
      simultaneously satisfy the filing obligation of the registrant under any
      of the following provisions:</font>
    </p>
    <p>
      <font style="font-family: Arial Unicode MS; font-size: 10pt">&#8414;</font>
      <font style="font-family: Times New Roman; font-size: 10pt">Written
      communications pursuant to Rule 425 under the Securities Act (17 CFR
      230.425)</font>
    </p>
    <p>
      <font style="font-family: Arial Unicode MS; font-size: 10pt">&#8414;</font>
      <font style="font-family: Times New Roman; font-size: 10pt">Soliciting
      material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
      240.14a-12)</font>
    </p>
    <p>
      <font style="font-family: Arial Unicode MS; font-size: 10pt">&#8414;</font>
      <font style="font-family: Times New Roman; font-size: 10pt">Pre-commencement
      communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
      240.14d-2(b))</font>
    </p>
    <p>
      <font style="font-family: Arial Unicode MS; font-size: 10pt">&#8414;</font>
      <font style="font-family: Times New Roman; font-size: 10pt">Pre-commencement
      communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
      240.13e-4(c))</font>
    </p>
    <div style="text-indent: 0pt; margin-bottom: 10pt; margin-left: 0pt; width: 100%; margin-right: 0pt">
      <div>
        <div style="text-align: left">

        </div>
      </div>
      <div style="page-break-after: always">
        <div style="text-align: center">

        </div>
        <div style="text-align: center">
          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
    <p>

    </p>
    <div style="text-align:left">
    <table style="margin-bottom: 10.0px; font-size: 10pt; font-family: Times New Roman; width: 100%" cellspacing="0">
      <tr>
        <td style="text-align: left; padding-left: 0.0px; width: 10%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <b>Item 2.04.</b>
          </p>
        </td>
        <td style="text-align: left; padding-left: 0.0px; width: 90%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <b>Triggering Events That Accelerate or Increase a Direct
            Financial Obligation or an Obligation under an Off-Balance Sheet
            Arrangement.</b>
          </p>
        </td>
      </tr>
    </table>
    </div>
    <p>

    </p>
    <p style="text-align: justify">
      <font style="font-size: 10pt"><b>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</b></font><font style="font-size: 10pt">On
      October 23, 2008, the Registrant was informed that ComVest Capital, LLC
      (&#8220;ComVest&#8221;) would be delivering to the Registrant a notice of default
      and acceleration in connection with the Revolving Credit and Term Loan
      Agreement (the &#8220;Loan Agreement&#8221;) entered into by and between the
      Registrant and ComVest in April 2007.&#160;&#160; As previously disclosed,
      pursuant to the Loan Agreement, ComVest agreed to lend to the Registrant
      an aggregate of up to $8 million in the form of a $5 million term loan
      and a $3 million revolving loan facility (&#8220;Revolver&#8221;).&#160;&#160;The Registrant&#8217;s
      aggregate outstanding advances under the Revolver presently exceed the
      maximum revolving credit commitment permissible under the Loan Agreement
      as a direct result of additional borrowings made by the Registrant under
      the Revolver to pay the term loan principal and interest charges and
      revolver interest charges for August and September 2008.</font>
    </p>
    <p style="text-align: justify">
      <font style="font-size: 10pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;As a result of the
      aforementioned default, upon receipt of the default notice, all
      obligations of the Registrant owed to ComVest shall immediately become
      due and payable, which obligations presently aggregate
      $6,938,623.&#160;&#160;Further, the Registrant will be obligated to comply with
      the terms of a collateral security agreement by and between the
      Registrant and ComVest, which provides for certain obligations of the
      Registrant in the event of a default, including an obligation of the
      Registrant to immediately commence depositing cash receipts and/or other
      proceeds of the collateral into a collateral deposit account controlled
      by ComVest for the purpose of securing the Registrant&#8217;s obligations
      under the Loan Agreement.</font>
    </p>
    <p style="text-align: justify">

    </p>
    <div style="text-align:left">
    <table style="margin-bottom: 10.0px; font-size: 10pt; font-family: Times New Roman; width: 100%" cellspacing="0">
      <tr>
        <td style="text-align: left; padding-left: 0.0px; width: 10%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <b>Item 8.01</b>
          </p>
        </td>
        <td style="text-align: left; padding-left: 0.0px; width: 90%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <b>Other Events.</b>
          </p>
        </td>
      </tr>
    </table>
    </div>
    <p style="text-align: justify">

    </p>
    <p style="text-align: justify">
      <font style="font-size: 10pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;The Registrant is presently
      meeting with investment bankers for the purpose of engaging a banker to
      assist the Registrant in seeking out a domestic or foreign strategic
      partner and negotiating a transaction in order to best serve the
      long-term goal of the Registrant to successfully maintain the
      Registrant&#8217;s operations and exploit its business opportunity and market
      share in the future.</font>
    </p>
    <p style="text-align: justify">
      <font style="font-size: 10pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;The press release in respect
      thereof is annexed to this Form 8-K.</font>
    </p>
    <p>

    </p>
    <div style="text-align:left">
    <table style="margin-bottom: 10.0px; font-size: 10pt; font-family: Times New Roman; width: 100%" cellspacing="0">
      <tr>
        <td style="text-align: left; padding-left: 0.0px; width: 10%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <b>Item 9.01.</b>
          </p>
        </td>
        <td style="text-align: left; padding-left: 0.0px; width: 90%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <b>Financial Statements and Exhibits.</b>
          </p>
        </td>
      </tr>
    </table>
    </div>
    <p>

    </p>
    <p style="text-align: left">
      <font style="font-size: 10pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-size: 10pt">(c)
      Exhibits</font>
    </p>
    <p style="text-align: left">
      <font style="font-size: 10pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><u><font style="font-size: 10pt">Exhibit
      No.</font></u><font style="font-size: 10pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><u><font style="font-size: 10pt">Description</font></u>
    </p>
    <p style="white-space: nowrap">
      <font style="font-size: 10pt">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;99.1&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Press
      Release issued by AFP Imaging Corporation on October 28, 2008.</font>
    </p>
    <p>

    </p>
    <div style="text-indent: 0pt; margin-bottom: 10pt; margin-left: 0pt; width: 100%; margin-right: 0pt">
      <div>
        <div style="text-align: left">

        </div>
      </div>
      <div style="page-break-after: always">
        <div style="text-align: center">

        </div>
        <div style="text-align: center">
          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
    <p>

    </p>
    <p style="text-align: center">
      <font style="font-family: Times New Roman; font-size: 10pt"><b>SIGNATURES</b></font>
    </p>
    <p style="text-indent: 30.0px">
      <font style="font-family: Times New Roman; font-size: 10pt">Pursuant to
      the requirements of the Securities Exchange Act of 1934, the registrant
      has duly caused this report to be signed on its behalf by the
      undersigned hereunto duly authorized.</font>
    </p>
    <div style="text-align:left">
    <table style="margin-bottom: 10.0px; font-size: 8pt; font-family: Times New Roman; width: 100%" cellspacing="0">
      <tr>
        <td style="width: 5%">

        </td>
        <td style="width: 45%">

        </td>
        <td style="text-align: left; padding-left: 0.0px" colspan="3" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt"><b>AFP
            IMAGING CORPORATION</b></font>
          </p>
        </td>
      </tr>
      <tr>
        <td style="width: 5%">

        </td>
        <td style="width: 45%">

        </td>
        <td style="text-align: left; padding-left: 0.0px" colspan="3" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">(Registrant)</font>
          </p>
        </td>
      </tr>
      <tr>
        <td style="width: 5%">

        </td>
        <td style="width: 45%">

        </td>
        <td colspan="3">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="width: 5%">

        </td>
        <td style="width: 45%">

        </td>
        <td colspan="3">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="width: 5%">

        </td>
        <td style="width: 45%">

        </td>
        <td colspan="3">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-bottom: 2.0px; padding-left: 0.0px; width: 5%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">Date:</font>
          </p>
        </td>
        <td style="text-align: left; padding-bottom: 2.0px; padding-left: 0.0px; width: 45%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">October
            28, 2008</font>
          </p>
        </td>
        <td style="text-align: left; padding-bottom: 2.0px; padding-left: 0.0px; width: 7%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">By:</font>
          </p>
        </td>
        <td style="text-align: left; padding-left: 0.0px; width: 7%; border-bottom: solid black 1.0pt" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            &#160;
          </p>
        </td>
        <td style="text-align: left; padding-left: 0.0px; width: 36%; border-bottom: solid black 1.0pt" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">/s/
            Elise Nissen</font>
          </p>
        </td>
      </tr>
      <tr>
        <td style="width: 5%">

        </td>
        <td style="width: 45%">

        </td>
        <td style="width: 7%">

        </td>
        <td style="text-align: left; padding-left: 0.0px; width: 7%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            &#160;
          </p>
        </td>
        <td style="text-align: left; padding-left: 0.0px; width: 36%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">Elise
            Nissen</font>
          </p>
        </td>
      </tr>
      <tr>
        <td style="width: 5%">

        </td>
        <td style="width: 45%">

        </td>
        <td style="width: 7%">

        </td>
        <td style="width: 7%">

        </td>
        <td style="text-align: left; padding-left: 0.0px; width: 36%" valign="top">
          <p style="margin-top: 0px; margin-bottom: 0px">
            <font style="font-family: Times New Roman; font-size: 10pt">Chief
            Financial Officer</font>
          </p>
        </td>
      </tr>
    </table>
    </div>
    <p>

    </p>
  </body>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>a5815827ex99_1.htm
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
<html>
  <head>
    <title></title>
<!--Copyright 2008 Business Wire, a Berkshire Hathaway company.-->
<!--All rights reserved www.businesswire.com-->
  </head>
  <body style="font-size: 8pt; font-family: Times New Roman">
    <p style="text-align: right">
      <b>Exhibit 99.1</b>
    </p>
    <p style="text-align: center">
      <u><font style="font-family: Times New Roman; font-size: 12pt"><b>AFP
      Imaging to Explore Strategic Alternatives and Reports Results for Fiscal
      Year Ending June 30, 2008</b></font></u>
    </p>
    <p>
      ELMSFORD, N.Y.--(BUSINESS WIRE)--October 28, 2008--This week marks the 30<sup>th</sup>
      anniversary of AFP (AFPC:OB) as a world class provider of state-of-art
      imaging equipment for Dental, Veterinary and Medical professionals.
    </p>
    <p>
      The Company&#8217;s strategic involvement and acquisition, 2 years ago, of<b>
      QR</b> in Italy gave AFP Imaging the unique opportunity to leverage and
      maximize its cutting edge, x-ray imaging technology that is fast
      becoming the global standard of care in the Dental, ENT and Veterinary
      markets. In addition, it brought AFP to the number one position
      globally, outside North America, (#2 in North America) in clinical and
      historical product leadership in low dose, 3D Cranial (Dental and ENT) <b>Cone
      Beam CT</b> Radiology.
    </p>
    <p>
      A substantial installed base, of over 700<b> NEWTOM</b> 3D CBCT
      Scanners, have been sold worldwide, and NEWTOM has garnered the support
      of numerous clinical luminaries throughout the Dental and ENT
      profession. AFP Imaging&#8217;s acquisition and investment has been further
      enhanced over the past years by significant, continued product
      innovation in hardware and software development. Additional large
      financial investments in people and facilities include launching a new
      market leading, large format <b>NEWTOM VG</b>, a vertical configuration.
      AFP has also capitalized on a fast growing market opportunity for our
      unique van based <b>NEWTOM VG Flex</b> &#8220;mobile scanner&#8221; solution. We
      also expect to launch new applications and equipment configurations for
      Veterinary and Human extremities in the near future.
    </p>
    <p>
      In addition to our existing global dealer network, we have made
      significant financial investments in developing a totally new AFP direct
      sales and technical support organization in the US. This new direct
      field force has allowed us to begin to gain traction against our
      competitors. We have already achieved dominant market share in many of
      the over 35 key countries outside the United States where NEWTOM is
      present. AFP is now properly positioned to focus and apply additional
      new marketing resources to accelerate penetration in North America.
    </p>
    <p>
      Last week, the Company attended the American Dental Association (ADA)
      meeting that was held in San Antonio, Texas, where our Mobile 3D Imaging
      Van was featured. Our NewTom VG and VGFlex (CBCT) scanner was well
      received in a live demonstration of three dimensional imaging at this
      major exhibition. AFP&#8217;s CBCT scanners are well known as state of the art
      imagers for dental implant planning, oral surgery and orthodontics as
      well as for other diagnostic applications such as ENT. Six
      manufacturers, including AFP participated in this unique &#8220;live x-ray
      forum.&#8221; It was the second clinical conference where AFP has performed in
      live patient examinations and continuing educational lectures for
      dentists and other specialists. The Company believes that the
      demonstration of on-site diagnostic cases was an exceptional opportunity
      to show the superior quality and flexibility of our NEWTOM CBCT scanner
      in comparison to others. Our expert luminary lectures and the live
      imaging demonstrations are the key to building sales leads and revenues
      in a very difficult economic environment. Similar sales efforts were
      highlighted by the Company in Europe and in China during October.
    </p>
    <p>
      In addition, the Company continues to find significant growth
      opportunities with its established brand of &#8220;EVA&#8221; digital dental sensors
      through its dedicated and comprehensive global network of distributors.
      The Company also continues to leverage its &#8220;EVA&#8221; technology and brand
      throughout North America, Europe and other territories with its unique
      and distinct leadership position in the field of veterinary dental
      imaging solutions.
    </p>
    <p>
      The Company recently filed its Form 10K with the SEC for the fiscal year
      ending June 30, 2008. Sales were $34.3 million, an increase of 19% in
      fiscal 2008 compared to $ 28.7 million for fiscal 2007. As reported in
      the Form 10K, while the Company is working to expand our worldwide
      installed base it has experienced ongoing operational losses and
      negative cash flow during the past fiscal year. The Company has
      instituted numerous cost cutting measures to reduce its cash
      requirements. Furthermore, beginning in July, 2008, the Company has been
      adversely impacted by the acceleration in the deterioration of credit
      availability causing a decline in financeable sales for the Company&#8217;s
      products. Practitioners such as dentists, oral surgeons, imaging
      centers, veterinarians and others, who must finance their own capital
      equipment purchases, have recently hesitated to commit to lease,
      purchase or invest in high tech products. Typically, these buyers are
      dependent on leasing, banking or other credit arrangements in order for
      them to afford sophisticated equipment.&#160;The uncertainty, reluctance or
      simple inability for the buyer to pay cash or finance equipment has
      resulted in the reduction of our current cash flow, especially during
      the first three and a half months of the new fiscal year.
    </p>
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    <p>
      The Company presently believes that AFP&#8217;s current long term financing,
      as well as our foreign lines of credit, may not be sufficient to provide
      the required working capital to leverage its full potential and maximize
      all of the investments made to date. The Board of Directors has
      therefore decided that the Company should immediately retain an
      investment banker to explore all strategic alternatives including
      additional investment capital, a merger with or acquisition by another
      entity, in order to improve shareholder value. A Banker will be selected
      shortly.
    </p>
    <p>
      All these above actions, to be taken now by the Company will allow AFP,
      its customers, employees, proprietary and exciting products to grow more
      securely and predictably in a very different and difficult financial
      world. We must immediately seek and add sufficient working capital,
      necessary additional resources, and allow us to achieve &#8216;critical mass&#8217;
      as part of a much larger entity to bring AFP and its excellent imaging
      solutions to the next level, This will provide a more secure future for
      all AFP&#8217;s constituents.
    </p>
    <p>
      For further information, you are encouraged to review AFP Imaging&#8217;s
      filings with the Securities and Exchange Commission, including our
      Annual Report on Form 10K for the fiscal year ending June 30, 2008.
    </p>
    <p>
      <i>The remarks contained in this press release and presented elsewhere
      by management from time to time contain forward-looking statements,
      which involve risks and uncertainties, including statements regarding
      the Company&#8217;s plans, objectives, expectations and intentions.</i> <i>The
      Company&#8217;s actual results may differ significantly from the results
      discussed in this press release or in other forward-looking statements
      presented by management.</i> <i>Among the factors that could cause
      actual results to differ materially include the failure of revenue on
      new products to develop as estimated, regulatory delays, loss of
      existing customers, the Company&#8217;s continuing default in its senior
      secured facility,</i> <i>the Company&#8217;s inability to meet increasing
      demand for its new products, general downward trends in the Company&#8217;s
      industry and other risks as described in the Company&#8217;s filings with the
      Securities and Exchange Commission.</i> <i>The Company expressly
      disclaims any obligation or undertaking to release publicly any updates
      or revisions to any such statements to reflect any change in the
      Company&#8217;s expectation or any change in events, conditions or
      circumstances on which such statement is based.</i>
    </p>
    <p>

    </p>
    <p>
      CONTACT:<br>AFP Imaging Corporation<br>David Vozick, 914-592-6100
    </p>
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