I assume you’re referring to an Photopaint image?
You need to load the unlocked file into Photopaint and use the ‘Save As’ or ‘Convert’ feature.
AxCrypt only encrypts the file – you can’t use AxCrypt to change the original extension.
Go back into the software which created the .APX and use that software to convert it into a different format. You can then use AxCrypt to encrypt the new file.