<PAGE>

                                                                   Exhibit 10.21

                        SETTLEMENT AGREEMENT AND RELEASE

         This Settlement Agreement and Release (hereinafter this "AGREEMENT") is
made and entered  into as of this 29th day of  December,  2000,  by and among Nx
Networks, Inc. (formerly Netrix Corporation), a Delaware corporation ("NX"), and
Jonathan  A. Sachs and Robert C. Lind  (collectively  referred  to herein as the
"AETHERWORKS SHAREHOLDERS" and individually as an "AETHERWORKS Shareholder").

                                    RECITALS

         WHEREAS, Netrix Corporation,  AetherWorks  Corporation  ("AETHERWORKS")
and Nx1  Acquisition  Corp.  entered into an Agreement  and Plan of Merger dated
December 31, 1999 (the "MERGER AGREEMENT");

         WHEREAS,  pursuant to the Merger Agreement,  all issued and outstanding
shares of  AetherWorks  common  stock and all issued and  outstanding  shares of
AetherWorks  Series B common  stock  were  converted  into the right to  receive
2,301,436 shares of Nx common stock (the "MERGER CONSIDERATION");

         WHEREAS,  pursuant  to  Section  1.9  and  Article  IV  of  the  Merger
Agreement,  Nx was to establish an escrow account by depositing  fifteen percent
(15%) of the Merger Consideration into escrow (the "ESCROW SHARES");

         WHEREAS,  Jonathan A. Sachs and Robert C. Lind own approximately 33% of
the Merger Consideration;

         WHEREAS,  pursuant to the Merger Agreement, all outstanding options and
warrants of AetherWorks were converted into the right to receive 867,687 options
and  warrants of Nx common stock (the  "AETHERWORKS  OPTIONS AND  Warrants")  in
addition to which  AetherWorks  employees and agents received a further grant of
1,000,000  options to acquire Nx common stock (the  "1,000,000 NX OPTIONS") (the
"AETHERWORKS  OPTIONS AND  WARRANTS"  together  with the  "1,000,000 NX OPTIONS"
shall be collectively referred to herein as the "NX OPTIONS AND WARRANTS");

         WHEREAS,  pursuant to Section 1.14 of the Merger Agreement,  the Merger
Consideration  and options and  warrants  were subject to an  adjustment  in the
event  that the  average  closing  sales  price of Nx  common  stock  for the 15
consecutive  trading day period ending on October 31, 2000 (the "AVERAGE Price")
was not at least $22.50 per share;

         WHEREAS, pursuant to the terms of the Merger Agreement, the AetherWorks
Shareholders  are now due and owing an additional  4,777,973 shares of Nx Common
Stock ("MERGER CONSIDERATION  ADJUSTMENT SHARES") and an additional 1,967,563 Nx
Options and Warrants ("MERGER CONSIDERATION  ADJUSTMENT  OPTIONS/WARRANTS") (the
"MERGER CONSIDERATION ADJUSTMENT SHARES" together with the "MERGER CONSIDERATION
ADJUSTMENT  OPTIONS/WARRANTS"  shall be  collectively  referred to herein as the
"MERGER ADJUSTMENT");


<PAGE>

         WHEREAS,   Nx  and  AetherWorks  entered  into  a  Registration  Rights
Agreement dated as of December 31, 1999, (the  "REGISTRATION  RIGHTS Agreement")
in favor of the  AetherWorks  Shareholders  as an inducement to  AetherWorks  to
enter into the Merger Agreement;

         WHEREAS, Nx and the AetherWorks Shareholders wish to resolve and settle
any  and all  disputes  between  them  with  respect  to the  Merger  Agreement,
including,  any and all  disputes  related  to the Merger  Consideration  or the
Merger Adjustment.

         NOW, THEREFORE, for and in consideration of the following terms, mutual
agreements, covenants and conditions, the parties agree as follows:

         1. No later than December 29, 2000, Nx shall prepare and forward to its
transfer agent, with all required instructions and permissions for distribution,
all AetherWorks stock certificates in its possession for processing and transfer
to the AetherWorks  Shareholders of the number of shares of Merger Consideration
enumerated  on the  Adjusted  Share  Ledger  attached  hereto as  EXHIBIT A (the
"LEDGER").  Nx shall  forward on or before  January  3, 2001 to all  Aetherworks
Shareholders  the Nx  certificates  already in its possession  representing  the
Merger  Consideration.  No later  than  January 5, 2001,  Nx shall  prepare  and
forward a check payable to each AetherWorks Shareholder who would otherwise have
been entitled to a fraction of a share of Nx common stock (after aggregating all
fractional  shares  of Nx  common  stock  to be  received  by  such  AetherWorks
Shareholder   for  fractional   shares  of  Merger   Consideration   and  Merger
Consideration Adjustment Shares) as enumerated in the column entitled "Cash Due"
on the Ledger and who has tendered  his or her  AetherWorks  stock  certificate.
Upon execution of this Agreement,  Nx shall release its rights to an escrow fund
and/or escrow agreement pursuant to Article IV of the Merger Agreement and shall
cause the release of any Escrow Shares in its  possession or which may hereafter
come into its possession to the  AetherWorks  Shareholders  as enumerated on the
Ledger.  Any stock certificates  relating to shares of the Merger  Consideration
delivered  to Nx  after  the date of this  Agreement,  shall  be  processed  and
forwarded  to Nx's  transfer  agent no later  than two (2)  business  days  from
receipt of such  certificates.  Nx shall provide to the AetherWorks  Shareholder
(or the AetherWorks Shareholder representative),  within one (1) business day of
receiving  such  certificate,   a  reasonably  detailed  list  of  any  and  all
documentation  known to Nx to be  required  by it and/or the  transfer  agent to
release the certificates and Nx shall provide to the AetherWorks Shareholder (or
the  AetherWorks  Shareholder)  representative  any subsequent  request from the
transfer agent for any such  documents  within one (1) business day of receiving
such request  from the transfer  agent.  Such stock  certificates  shall then be
delivered  to  the  AetherWorks  Shareholder  (or  the  AetherWorks  Shareholder
representative)  within two (2) business days of receiving  such request and all
supporting documentation. Nx shall incur a penalty in the amount of ten thousand


                                  -2-
<PAGE>


dollars  ($10,000)  per each  business day of delay which occurs beyond the time
limits  outlined  above.  Such penalty shall be paid directly to the AetherWorks
Shareholder entitled to the stock certificates at issue.

         2. As soon as practicable, but in no event later than January 16, 2001,
Nx shall file with the United States  Securities  and Exchange  Commission  (the
"SEC")  a  registration  statement  on Form  S-3  (or an  appropriate  form  for
registration  available  to Nx),  registering  the  resale  of both  the  Merger
Consideration and the Merger Consideration  Adjustment Shares and any Nx Options
and Warrants and Merger Consideration Adjustment  Options/Warrants which are not
issued  pursuant to Nx' stock option plans (the "RESALE  PROSPECTUS").  Nx shall
use its  commercially  reasonable  best  efforts to have the  Resale  Prospectus
declared effective by the SEC as soon as possible. Prior to filing with the SEC,
the Resale Prospectus shall be provided,  within a commercially reasonable time,
but in no event later than  January  10,  2001,  to counsel for the  AetherWorks
Shareholders  for their review and approval.  Such review and approval shall not
unreasonably delay the filing of the Resale Prospectus. Nx shall incur a penalty
to the AetherWorks  Shareholders in the amount of ten thousand dollars ($10,000)
per each  business  day after  January 16,  2001 in which the Resale  Prospectus
referenced above is not filed, except to the extent such delay in filing results
from the  failure of counsel  for the  AetherWorks  Shareholders  to approve the
Resale  Prospectus  on or  before  January  14,  2001,  so  long  as the  Resale
Prospectus  was  provided to said  counsel by Nx on or before  January 10, 2001.
Such penalty shall be paid  directly to the  AetherWorks  Shareholders  on a pro
rata basis (percentage of Merger Consideration owned).

         3. As soon as practicable, but in no event later than January 16, 2001,
Nx shall file a registration on Form S-8 or update one or more previously  filed
Forms S-8 with the SEC (the  "FORM  S-8") to  register  the  shares of Nx common
stock issuable upon exercise of the Nx Options and Warrants as enumerated on the
Ledger,  and to register the additional  shares of Nx common stock issuable upon
exercise of the Merger Consideration  Adjustment  Options/Warrants as enumerated
on the  Ledger,  in each case to the  extent the same are issued or to be issued
under the Nx stock option plans. As soon as  practicable,  but in no event later
than January 16, 2001,  Nx shall also provide  revised  stock option and warrant
grant  agreements  (the  "OPTION/WARRANT  GRANT  AGREEMENTS") to the AetherWorks
Shareholders  which  reflect the repriced Nx Options and Warrants and the Merger
Consideration  Adjustment  Options/Warrants  to be  granted  to the  AetherWorks
Shareholders.  Prior to filing  the Form S-8 with the SEC,  the Form S-8 and the
Option/Warrant  Grant  Agreements  shall  be  provided,  within  a  commercially
reasonable time, but in no event later than January 10, 2001, to counsel for the
AetherWorks  Shareholders  for their  review and  approval.  Counsel  review and
approval shall not unreasonably delay the filing of the Form S-8. Nx shall incur
a penalty to the AetherWorks  Shareholders in the amount of ten thousand dollars
($10,000) per each business day after January 16, 2001 in which the updated Form
S-8 referenced  above is not filed and the  Option/Warrant  Grant Agreements are
not provided to the  AetherWorks  Shareholders,  except to the extent such delay
results  from or the  failure of counsel  for the  AetherWorks  Shareholders  to
approve the Form S-8 and  Option/Warrant  Grant  Agreements on or before January
14,  2001,  so long as the Form S-8 and  Option/Warrant  Grant  Agreements  were
provided to said counsel by Nx on or before January 10, 2001. Such penalty shall

                                      -3-
<PAGE>


be paid directly to the AetherWorks Shareholders on a pro rata basis (percentage
of Nx Options and Warrants owned.)

         4. Nx shall  prepare  and file the  documents  necessary  to  conduct a
special  meeting of its  shareholders  (the  "SPECIAL  MEETING")  to approve the
additional  shares,  options,  and warrants to be issued in connection  with the
Merger  Adjustment,  and  to  the  extent  necessary  for  any  increase  in the
authorized number of shares required to issue such additional  shares,  options,
or warrants under Nx's option plans.  Such documents  shall include,  but not be
limited to, the filing of a preliminary  and  definitive  proxy  statement  (the
"SPECIAL  MEETING  DOCUMENTS")  with the  SEC.  Nx  shall  use its  commercially
reasonable  best  efforts  to enable the SEC to  complete  the  Special  Meeting
Documents  review,  if any,  within a time period  necessary to legally call and
conduct the Special  Meeting.  The Special meeting shall take place on or before
March 15,  2001.  Prior to filing with the SEC,  all Special  Meeting  Documents
shall be provided,  within a commercially reasonable time, but in no event later
than five (5) business  days prior to the  anticipated  filing date, of which Nx
will give written notice, to counsel for the Aetherworks  Shareholders for their
review and approval.  Likewise,  all SEC comments and Nx responses to same shall
be provided to said counsel for review.  Counsel  review and approval  shall not
unreasonably delay the filing of the Special Meeting Documents. Nx shall incur a
penalty to the AetherWorks  Shareholders  in the amount of ten thousand  dollars
($10,000)  per each  business  day  after  March 15,  2001 in which the  Special
Meeting is not held, except to the extent such delay results from the failure of
counsel  for  the  AetherWorks  Shareholders  to  approve  the  Special  Meeting
Documents within five (5) business days of receiving them. Such penalty shall be
paid directly to the AetherWorks Shareholders on a pro rata basis (percentage of
Merger Consideration owned).

         5. Upon the shareholder approval referenced in paragraph 4, AetherWorks
Shareholders  shall receive the  additional  shares,  options,  and warrants due
pursuant  to the  Merger  Adjustment  as  listed  on the  Ledger  on the  day of
shareholder approval. Draft Option/Warrant Grant Agreements representing shares,
options,  and warrants  pursuant to the Merger  Adjustment  as enumerated on the
Ledger  shall be  prepared  and  available  for  inspection  by counsel  for the
AetherWorks  Shareholders  no  later  than  March  1,  2000.  In  the  event  Nx
shareholders do not approve the additional shares,  options,  and warrants to be
issued in connection with the Merger Adjustment,  AetherWorks Shareholders shall
receive  the amount of Merger  Consideration  Adjustment  permitted  pursuant to
NASDAQ Rule 4350 (such amount shall be confirmed in writing to Nx by the NASD on
or before March 15,  2001),  with the  remainder of the Merger  Adjustment to be
paid  in  cash  equivalent  according  to the  following  calculations:  For the
AetherWorks  Shareholders entitled to Merger Consideration  Adjustment Shares as
enumerated on the Ledger,  a cash equivalent  equal to the product of the number
of Merger  Consideration  Adjustment Shares to which each individual is entitled
and (i) the  Average  Price per each share  ($2.93 per  share),  or (ii) the per
share price for the  average of five (5)  trading  days ending on the day of the
Special Meeting, whichever is greater. For the AetherWorks Shareholders entitled
to Merger Consideration Adjustment Options/Warrants as enumerated on the Ledger,
a cash  equivalent  equal to the  product of the number of Merger  Consideration
Adjustment  Options/Warrants  to  which  each  individual  is  entitled  and the
difference  between (i) the Average  Price per each share ($2.93 per share),  or

                                      -4-
<PAGE>


(ii) the per share price for the average of five (5) trading  days ending on the
day of the Special  Meeting,  and the exercise price as enumerated on the Ledger
for each of the Merger Consideration  Adjustment  Options/Warrants to which such
AetherWorks Shareholder is so entitled,  whichever is greater.  Failure to issue
the Merger Adjustment,  and/or cash, and/or the Option/Warrant  Grant Agreements
as stipulated in this paragraph 5 to the  AetherWorks  Shareholders  within five
(5))  business  days after the Special  Meeting  will result in a penalty in the
amount of ten thousand  dollars  ($10,000) per each business day from such date.
Such penalty shall be paid  directly to the  AetherWorks  Shareholders  on a pro
rata basis (percentage of Merger Consideration owned).

         6.  Nx  shall  comply  with  and  perform  its  obligations  due to the
AetherWorks   Shareholders   pursuant  to  the  terms  and   provisions  of  the
Registration  Rights  Agreement,  except  to  the  extent  the  same  have  been
superceded by the terms of this Agreement.

         7. The Nx Options and Warrants for each AetherWorks  Shareholder  shall
have a  revised  exercise  price  set to their  corresponding  entry or  entries
enumerated on the Ledger. All Merger Consideration  Adjustment  Options/Warrants
for each AetherWorks  Shareholder to be issued pursuant to the Merger Adjustment
shall  have an  exercise  price  set to their  corresponding  entry  or  entries
enumerated on the Ledger. The AetherWorks  Options and Warrants shall be amended
to the extent  necessary  to continue to be fully valid,  completely  vested and
exercisable  through  a  termination  date to occur on the later of (i) June 30,
2001,  (ii) the close of business  on the  three-month  anniversary  date of the
AetherWorks  shareholders termination of employment or other affiliation with Nx
(unless a separate  agreement has been made  broadening or reducing any of these
periods or rights),  or (iii) the original exercise period stated in the initial
option  or  warrant  grant  agreement  (subject  to any  termination  provisions
provided  therein,  but further subject to the  AetherWorks  board of directors'
actions in regard to these matters in February of 2000). The  modifications  and
amendments  contemplated  in this  paragraph  7  shall  be  memorialized  in the
Option/Warrant  Grant Agreements to be provided to the AetherWorks  Shareholders
pursuant to paragraph 3 above and shall  comply  entirely  with the  AetherWorks
Board of Directors' actions in regard to these matters in February of 2000.

         8. Upon the request of an AetherWorks Shareholder, and if in accordance
with  applicable  securities  laws, Nx shall provide an opinion from its counsel
that supports the removal of any restrictive  legends from Nx stock certificates
issued in connection with the Merger Consideration,  the Nx Options and Warrants
or the  Merger  Adjustment.  Nx shall  provide to the  AetherWorks  Shareholder,
within one (1) business day of such opinion request,  a detailed list of any and
all required  supporting  documentation.  Nx shall  undertake  its  commercially
reasonable  efforts to cause such  opinion to be  delivered  to the  AetherWorks
Shareholder  (or the  AetherWorks  Shareholder  representative)  within five (5)
business days of receiving such request and all supporting documentation.

         9. Nx shall establish a mechanism for  facilitating the exercise of the
Nx Options and Warrants  and Merger  Consideration  Adjustment  Options/Warrants
which  facility  shall  include,  but not be  limited  to,  the  ability  of the
AetherWorks  Shareholders  to directly  communicate  with the transfer agent (or
appropriate  exchange  agent).  Nx shall provide to the AetherWorks  Shareholder
within one (1) business day of such exercise request, a reasonably detailed list

                                      -5-
<PAGE>


of any and all required  supporting  documentation  known to Nx. If the transfer
agent  requests  additional  information,  Nx shall  forward such request to the
AetherWorks  Shareholder  within one (1) business day of receiving  the request.
Stock  certificates  representing  the shares of Nx common stock  issuable  upon
exercise of the Nx Options and Warrants and/or Merger  Consideration  Adjustment
Options/Warrants  shall be  delivered  to the  AetherWorks  Shareholder  (or the
AetherWorks  Shareholder   representative)  within  two  (2)  business  days  of
receiving such request and all required supporting documentation.

         10. Nx shall pay on or before  February 15, 2001,  or within 15 days of
presentation  of each  invoice,  whichever  is later,  the fees and  expenses of
counsel to the AetherWorks Shareholders, not to exceed $50,000 in the aggregate,
in  connection  with  all  work  related  to  the  rights  and  remedies  of the
AetherWorks  Shareholders pursuant to the Merger Agreement,  the negotiation and
drafting of this Agreement, and the rights and remedies contemplated herein.

         11.  This  Agreement  is  made  as a  compromise  between  Nx  and  the
AetherWorks  Shareholders  for the complete and final  settlement of all claims,
differences and any causes of action with respect to the Merger  Agreement.  The
parties to this Agreement agree and acknowledge that this Agreement shall not be
construed  as an  admission  by any  party  of  any  liability,  wrongdoing,  or
responsibility on their part or on the part of their  predecessors,  successors,
assigns, agents, heirs, parents, subsidiaries,  affiliates, officers, directors,
or employees. Indeed, the parties expressly deny any such liability,  wrongdoing
or responsibility.

         12.  The  AetherWorks   Shareholders,   for  their  heirs,  successors,
subrogors,  grantors and assigns, hereby release,  remise, and forever discharge
Nx, and all of its employees, agents,  representatives,  directors,  successors,
parents,  subsidiaries,  affiliates, and assigns of and from any and all claims,
debts,  demands,  rights,  and causes of actions of whatsoever  kind and nature,
arising  from and by  reason  of any and all  known,  foreseen,  and  unforeseen
consequences,  which the  AetherWorks  Shareholders  have or may have against Nx
arising  from and by reason of anything  whatsoever  from the  beginning  of the
world until the date of this  Agreement,  including,  but not limited to,  every
liability,  right,  claim,  debt,  or cause of action  asserted in or in any way
arising from the Merger Agreement,  the responsibility for which has been and is
expressly denied by Nx. This release expressly excludes any release or waiver by
the AetherWorks  Shareholders of any liability,  right, claim, debt, or cause of
action  against  Nx for  breach  of any of the terms of this  Agreement,  or any
employment agreement with an AetherWorks Shareholder.

         13. Nx hereby releases, remises, and forever discharges the AetherWorks
Shareholders of and from any and all claims, debts, demands,  rights, and causes
of action of whatsoever  kind and nature,  arising from and by reason of any and
all  known,  foreseen,  and  unforeseen  consequences,  which Nx has or may have
against  the  AetherWorks  Shareholders  arising  from and by reason of anything
whatsoever  from the  beginning  of the world until the date of this  Agreement,
including, but not limited to, (i) every liability, right, claim, debt, or cause
of  action  asserted  in or in  any  way  arising  from  the  Merger  Agreement,
(including without limitation Section 1.7(h) ("Stockholder Escrow"), Section 1.9
and Article IV of the Merger Agreement), and (ii) every liability, right, claim,

                                      -6-
<PAGE>


debt, or cause of action  asserted in or in any way arising from the AetherWorks
Shareholders  activities  as  individuals,   or  as  board  members,   officers,
consultants, agents, or employees of AetherWorks Corporation or Nx.

Notwithstanding  the above,  the releases set forth in this Section 13 shall not
affect any rights or obligations of Nx or any AetherWorks  Shareholder  pursuant
to any employment related agreement between them, any violation of any published
corporate  policy of Nx provided to Nx employees  related to the  protection  of
confidential information, and any amended and restated agreements between Nx and
Jonathan Sachs dated April 7, 2000,  and amended of even date herewith,  or this
Agreement.

         14. The parties  agree and assure each  another that they will take any
and all actions that may be necessary to carry out their obligations  hereunder.
The parties  agree to execute all  documents  necessary  to fulfill the terms of
this  Agreement,  and shall  comply  with all  reasonable  requests  to  provide
information and/or documents to comply with this Agreement and the terms hereof.

         15.  The  parties  hereby  expressly  acknowledge  that  the  foregoing
represents the sole and total consideration for this Agreement and that no other
promises or  representations  have been made other than as expressed herein, and
that in executing this Agreement,  the parties have not relied on any promise or
representation  other than as expressed  herein.  The parties further state that
they have read all of this  Agreement and have had it explained to them by their
attorneys  and that  they  fully  understand  all of the  terms  used and  their
significance.  This Agreement has been signed  voluntarily  and on the advice of
counsel.

         16. This  Agreement  constitutes  the entire  agreement of the parties.
There is no other agreement,  written or oral, expressed or implied, between the
parties  concerning  the  resolution  of the matters set forth herein except for
this  Agreement.  This  Agreement  may be modified  only by a written  agreement
signed by all parties  concerned in any  restatement or amendment.  The terms of
this Agreement are contractual and not merely a recital.

         17. This Agreement  shall be deemed to be executed in the  Commonwealth
of  Virginia  and subject to and  construed  in  accordance  with the law of the
Commonwealth of Virginia.  It shall be binding upon the parties and all of their
predecessors,   successors,   assigns,  agents,  heirs,  parents,  subsidiaries,
affiliates, officers, directors, or employees.

         18. This Agreement may be executed in any number of  counterparts  each
of which  shall be  deemed to be an  original,  all of which  together  shall be
deemed one and the same instrument.  This Agreement may be executed by facsimile
signatures.  In addition to the AetherWorks  Shareholders  identified  above, Nx
agrees that any  individual or entity as identified in the Ledger,  may become a
party  to this  Agreement,  within  60 days of the  date of this  Agreement,  by
executing  and  delivering  an  addendum  counterpart  signature  page  to  this
Agreement and shall be deemed an "AetherWorks  Shareholder" hereunder;  provided
that such new  signatory  shall not be entitled to the benefit of any  provision
providing  for penalty  payments  from Nx  relating to the period  prior to such
signatory  becoming  a party to this  Agreement.  Any  individual  or  entity as
identified  in the Ledger who  declines to endorse  this  Agreement  will not be

                                      -7-
<PAGE>


considered a third party  beneficiary  hereto and will not be entitled to any of
the benefits of this Agreement.

      19. Any provision of this Agreement which is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be deemed severable from the
remainder of this Agreement, and the remaining provisions contained in this
Agreement shall be construed to preserve to the maximum permissible extent the
intent and purpose of this Agreement. Any such prohibition or unenforceability
in any jurisdiction shall not invalidate or render unenforceable such provision
in any other jurisdiction.

                        [SIGNATURES FOLLOW ON NEXT PAGE]

                                      -8-
<PAGE>





      IN WITNESS WHEREOF, this Agreement is hereby executed to be effective as
of the date first above written.

                                    NX NETWORKS, INC.


                                    _______________________________________
                                    Jay Schifferli
                                    President and Chief Executive Officer



                                    AETHERWORKS SHAREHOLDERS:


                                    _______________________________________
                                    Jonathan A. Sachs




                                    _______________________________________
                                    Robert C. Lind



                                      -9-
<PAGE>



                         ADDENDUM TO SIGNATURE PAGE FOR

                       ADDITIONAL AETHERWORKS SHAREHOLDERS

      The party below acknowledges and agrees to be bound by the terms and
conditions set forth in this Settlement Agreement and Release as of the date set
forth next to such party's signature.

Date:______________________         _____________________________________



                                      -10-