I can confirm that version 2 opens all version 1 files. When you install v2 it will convert any v1 files automatically when you next go to open that file.
The FAQ confirms this;
AxCrypt 1.x and 2.x are compatible in the sense that 2.x can open all files secured with 1.x. In addition to that, 2.x implements of lot of new rich features, while some functions of 1.x are deprecated. Files secured with AxCrypt 2.x are not possible to open with AxCrypt 1.x. You cannot have both AxCrypt 1.x and 2.x installed at the same time.
You say that you have a 10 character password. With advances in computing power this is no longer sufficient against a sophisticated adversary; aim for 14-16 characters, numbers, symbols and mixed case.
Obviously do not forget your old password until your old files have been re-encrypted. However when you install v2 I would strongly recommend creating a more secure password to give you better protection.
Your v1 files will then be re-encrypted in v2 format and secured with your new password (unless you ignore my advice and use your old password).
You can install v2 straight away. Import all your old files, enter your old password and you’re good to go.