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                                                                     Exhibit 4.2

                           CERTIFICATE OF DESIGNATIONS
                                      OF
                                PREFERRED STOCK
                                       OF
                                NX NETWORKS, INC.

                                TO BE DESIGNATED
                   SERIES B 8% CONVERTIBLE PREFERRED STOCK

                                ----------------

                        PURSUANT TO SECTION 151(G) OF THE
             GENERAL CORPORATION LAW OF THE STATE OF DELAWARE

                                ----------------

      The  undersigned DO HEREBY CERTIFY that the following  resolution was duly
adopted by the Board of Directors of Nx Networks,  Inc., a Delaware  corporation
(the "Corporation"),  at a meeting duly convened and held, at which a quorum was
present and acting throughout:

      "RESOLVED,  that  pursuant  to the  authority  conferred  on the  Board of
   Directors of the Corporation (the "Board of Directors") by the  Corporation's
   Certificate of  Incorporation,  the issuance of a series of preferred  stock,
   $.05 par value per share, of the  Corporation  which shall consist of 333,334
   shares of  preferred  stock be, and the same hereby is,  authorized;  and the
   Chief  Executive  Officer  and  Secretary  or  Assistant   Secretary  of  the
   Corporation  be, and they hereby are,  authorized and directed to execute and
   file with the Secretary of State of the State of Delaware the  Certificate of
   Designations of Preferred Stock of the Corporation  fixing the  designations,
   powers,  preferences  and  rights  of the  shares  of  such  series,  and the
   qualifications,  limitations  or  restrictions  thereof  (in  addition to the
   designations,   powers,  preferences  and  rights,  and  the  qualifications,
   limitations  or  restrictions  thereof,  set  forth  in  the  Certificate  of
   Incorporation which may be applicable to the Corporation's  preferred stock),
   as follows:

      1. NUMBER OF SHARES;  DESIGNATION.  A total of 333,334 shares of preferred
   stock, par value $.05 per share, of the Corporation are hereby  designated as
   Series B 8%  Convertible  Preferred  Stock  (the  "Series").  The  number  of
   authorized  shares of the Series may be reduced by the Board of  Directors by
   the  filing  of a  certificate  pursuant  to the  provisions  of the  General
   Corporation  Law of the  State  of  Delaware  (the  "GCL")  stating  that the
   reduction has been so authorized.

      2. RANK.  The Series  shall,  with  respect to payment of  dividends,
   redemption   payments  and  rights  upon  liquidation,   dissolution  or
   winding up of the affairs of the Corporation, rank:

      (i)senior and prior to the Common Stock,  par value $.05 per share, of the
         Corporation  (the  "Common  Stock"),   and  any  additional  series  of
         preferred  stock  which may in the future be issued by the  Corporation
         and are designated in the amendment to the Certificate of Incorporation
         or  the  certificate  of  designations   establishing  such  additional
         preferred  stock as  ranking  junior to the shares of the  Series.  Any
         shares of the  Corporation's  capital  stock  which  are  junior to the
         shares of the Series  with  respect to the  payment  of  dividends  are
         hereinafter  referred  to as "Junior  Dividend  Shares"  and any shares
         which  are  junior  to  the  shares  of  the  Series  with  respect  to
         redemption, payment and rights upon liquidation, dissolution or winding
         up of the affairs of the  Corporation  are  hereinafter  referred to as
         "Junior Liquidation Shares."

      (ii) PARRI PASSU with any additional  series of preferred  stock which may
         in the future be issued by the  Corporation  and are  designated in the
         amendment to the  Certificate of  Incorporation  or the  certificate of
         designations  establishing  such additional  preferred stock as ranking
         equal to the shares of the Series or which do not state they are Junior
         Dividend  Shares or Senior  Dividend  Shares (as  defined  below).  Any
         shares of the Corporation's capital stock which are equal to the shares
         of the Series with respect to the payment of dividends are  hereinafter
         referred to as "Parity  Dividend Shares" and any shares which are equal
         to the shares of the Series  with  respect to  redemption,  payment and
         rights upon  liquidation,  dissolution  or winding up of the affairs of
         the  Corporation  are  hereinafter  referred to as "Parity  Liquidation
         Shares."

      (iii) Junior to any additional  series of preferred stock which may in the
         future be issued by the Corporation and are designated in the amendment
         to the Certificate of  Incorporation or the certificate of designations
         establishing  such additional  preferred stock as ranking senior to the
         shares of the Series.  Any shares of the  Corporation's  capital  stock
         which  are  senior to the  shares of the  Series  with  respect  to the
         payment of dividends are  hereinafter  referred to as "Senior  Dividend
         Shares"  and any  shares  which are  senior to the shares of the Series
         with  respect  to  redemption,  payment  and rights  upon  liquidation,
         dissolution  or  winding  up of  the  affairs  of the  Corporation  are
         hereinafter referred to as "Senior Liquidation Shares."

   The Corporation may not issue additional  shares of preferred stock which are
   not (a) Junior Stock (as defined in paragraph  3(a) below) or (b) both Parity
   Liquidation  Shares and Parity  Dividend  Shares  without  the consent of the
   holders of a majority of the outstanding shares of the Series.

      3. DIVIDENDS. (a) The dividend rate on shares of the Series shall be $0.60
   per share per annum,  subject to  adjustment  as provided in paragraph  3(d).
   Dividends  on  shares  of the  Series  shall be fully  cumulative,  accruing,
   without  interest,  from the date of original  issuance of the Series through
   the date of  redemption  or  conversion  thereof,  and  shall be  payable  in
   arrears,  when,  as and if  declared by the Board of  Directors  out of funds
   legally available for the payment of dividends,  on May 31 and November 30 of
   each  year,  commencing  May 31,  2001,  except  that  if such  date is not a
   business  day then the  dividend  shall be payable  on the first  immediately
   succeeding  business day (as used herein,  the term "business day" shall mean

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   any day except a Saturday,  Sunday or day on which banking  institutions  are
   legally  authorized  to close in Herndon,  Virginia)  (each such period being
   hereinafter  referred to as a "Dividend Period").  Dividends shall be payable
   in cash or Common Stock, at the discretion of the  Corporation.  The means of
   payment (cash or Common  Stock) of each  dividend  shall be designated by the
   Board of  Directors  at the time it fixes  the  record  date for  determining
   holders of shares of the Series  entitled to receive such  dividend  payment.
   Each dividend  shall be paid to the holders of record of shares of the Series
   as they appear on the stock  register of the  Corporation on the record date,
   not less than 10 nor more than 60 days preceding the payment date thereof, as
   shall be fixed by the Board of  Directors.  If any dividend is  designated as
   being  payable  in  Common  Stock,  the  amount  of  Common  Stock  issued in
   satisfaction  of such dividend  shall be determined by dividing the amount of
   the dividend  payable with respect to each share of the Series by the Current
   Market  Price (as defined in Section 10) for the Common Stock as of the close
   of business on the business day the Board of Directors  fixes the record date
   for  determining  the holders  entitled to receive such  dividend.  Dividends
   payable for each Dividend  Period shall be computed on the basis of a 360-day
   year of twelve  30-day  months and rounded to the nearest cent. No fractional
   share of Common Stock shall be issued with  respect to any  dividend  paid in
   Common  Stock.  The  aggregate  number of shares  issuable  to each holder of
   shares of the Series will be calculated,  and in lieu of issuing a fractional
   share the Corporation  shall pay the cash value of such  fractional  share as
   determined  by  reference  to the Current  Market  Price used for purposes of
   calculating  the  number  of  shares  of  Common  Stock to be  issued in such
   dividend. Dividends on account of arrearages for any past Dividend Period may
   be declared and paid at any time,  without  reference to any regular dividend
   payment  date,  to  holders  of record on such date,  not  exceeding  45 days
   preceding the payment date thereof, as may be fixed by the Board of Directors
   of  the  Corporation.  Dividends  shall  accrue  regardless  of  whether  the
   Corporation has earnings,  whether there are funds legally available therefor
   and  whether  declared.  No  interest  shall be payable  with  respect to any
   dividend  payment  that may be in  arrears.  Holders  of Shares of the Series
   called for  redemption  between the close of  business on a dividend  payment
   record date and the close of business on the  corresponding  dividend payment
   date shall,  in lieu of receiving such dividend on the dividend  payment date
   fixed  therefor,  receive  such  dividend  payment  on  the  date  fixed  for
   redemption  together with all other accrued and unpaid  dividends to the date
   fixed for  redemption.  The  holders of shares of the Series  shall be not be
   entitled to any dividends other than the cash dividends  provided for in this
   paragraph 3.

      (b) No  dividends,  except as described in the next  succeeding  sentence,
   shall be  declared  or paid or set apart for  payment on any Parity  Dividend
   Shares  for  any  period  unless  full  cumulative  dividends  have  been  or
   contemporaneously are declared and paid or declared and set aside for payment
   for all accrued  dividends with respect to the Series through the most recent
   Dividend  Period ending on or prior to the date of payment,  or setting apart
   for  payment,  of such  dividends  on such  Parity  Dividend  Shares.  Unless
   dividends  accrued  and  payable  but  unpaid on shares of the Series and any
   Parity  Dividend Shares at the time  outstanding  have been paid in full, all
   dividends  declared  by the  Corporation  upon shares of the Series or Parity
   Dividend  Shares  shall be declared PRO RATA with respect to all such shares,

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   so that the amounts of any dividends declared on shares of the Series and the
   Parity  Dividend  Shares shall in all cases bear to each other the same ratio
   that,  at the time of the  declaration,  all accrued but unpaid  dividends on
   shares of the Series and the other Parity Dividend Shares, respectively, bear
   to each other.

      (c) If at any time the  Corporation has failed to (x) pay or set apart for
   payment all accrued  dividends  on any shares of the Series  through the then
   most recent  Dividend  Period and (y) set apart for payment an amount in cash
   equal to the  scheduled  dividend  payments for each of the next two Dividend
   Periods,  the Corporation  shall not, and shall not permit any corporation or
   other entity directly or indirectly controlled by the Corporation to:

         (i)declare  or pay or set  aside  for  payment  any  dividend  or other
            distribution  on or with  respect  to the  Junior  Dividend  Shares,
            whether in cash,  securities,  obligations or otherwise  (other than
            dividends or  distributions  paid in shares of capital  stock of the
            Corporation  ranking  junior to shares of the Series  both as to the
            payment of dividends and as to rights in liquidation, dissolution or
            winding up of the affairs of the Corporation  ("Junior  Stock"),  or
            options,  warrants or rights to subscribe for or purchase  shares of
            Junior Stock); or

         (ii) redeem,  purchase or  otherwise  acquire,  or pay into,  set apart
            money or make  available for a sinking or other  analogous  fund for
            the redemption,  purchase or other acquisition of, any shares of the
            Series  (unless  all of the shares of the  Series  are  concurrently
            redeemed),  Parity Dividend  Shares,  Parity  Liquidation  Shares or
            Shares of Junior Stock for any  consideration  (except by conversion
            into or exchange for Junior Stock),

   unless,  in each such  case,  all  dividends  accrued on shares of the Series
   through the most recent  Dividend  Period and on any Parity  Dividend  Shares
   have been or contemporaneously are declared and paid in full.

      (c) Any reference to  "distribution"  contained in this  paragraph 3 shall
   not be  deemed  to  include  any  distribution  made in  connection  with any
   liquidation,  dissolution or winding up of the Corporation, whether voluntary
   or involuntary.

      (d) If the  Corporation  has not filed an amendment to its  Certificate of
   Incorporation  on or before March 31, 2001,  which amendment  provides for an
   increase in the number of  authorized  shares of Common Stock from 55 million
   shares to at least 65 million  shares,  then the  dividend  rate  provided in
   paragraph  3(a) will be  adjusted.  The  adjustment  will be to increase  the
   dividend rate by 1% per annum (or, if less, the maximum  permitted by law) on
   April 1, 2001 and on the first day of each calendar  month  thereafter  until
   the amendment is filed.  Upon filing,  the dividend rate will return to $0.60
   per share of the Series per annum,  but such change will not affect dividends
   accrued  during the period  between  April 1, 2001 and the date the amendment
   was filed.

      4.  LIQUIDATION.  (a) The  liquidation  value  per  share of shares of the
   Series, in case of the voluntary or involuntary  liquidation,  dissolution or
   winding-up of the affairs of the Corporation,  shall be $7.50 per share, plus

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   an amount  equal to the cash value of dividends  accrued and unpaid  thereon,
   whether or not  declared,  to the payment date (such  aggregate  amount being
   hereinafter referred to as the "Liquidation Amount").

      (b) In the event of any voluntary or involuntary liquidation,  dissolution
   or  winding-up  of the  Corporation,  the holders of shares of the Series (i)
   shall not be entitled to receive the liquidation  value of the shares held by
   them until the liquidation value of all Senior  Liquidation Shares shall have
   been paid in full and (ii) shall be entitled to receive the liquidation value
   of such  shares  held  by them in  preference  to and in  priority  over  any
   distributions upon the Junior Liquidation Shares. Upon payment in full of the
   liquidation  value to which the holders of shares of the Series are entitled,
   the  holders  of shares of the Series  will not be  entitled  to any  further
   participation in any distribution of assets by the Corporation. If the assets
   of the Corporation  are not sufficient to pay in full the  liquidation  value
   payable to the  holders of shares of the  Series  and the  liquidation  value
   payable to the holders of any Parity  Liquidation  Shares, the holders of all
   such shares shall share ratably in such  distribution of assets in accordance
   with the amounts that would be payable on the  distribution if the amounts to
   which  the  holders  of  shares  of the  Series  and the  holders  of  Parity
   Liquidation Shares are entitled were paid in full.

      (c) Neither a consolidation  or merger of the Corporation with or into any
   other entity,  nor a merger of any other entity with or into the Corporation,
   nor a sale or  transfer  of all or any part of the  Corporation's  assets for
   cash or  securities  or other  property  shall be  considered a  liquidation,
   dissolution  or  winding-up  of the  Corporation  within the  meaning of this
   paragraph 4.

      (d) Written  notice of any  liquidation,  dissolution or winding up of the
   Corporation,  stating the payment  date or dates when and the place or places
   where the amounts distributable in such circumstances shall be payable, shall
   be given by first class mail, postage prepaid, not less than 30 days prior to
   any payment  date stated  therein,  to the holders of record of shares of the
   Series at their respective addresses as the same shall appear on the books of
   the transfer agent with respect to the Series.

      5. OPTIONAL REDEMPTION. (a) Shares of the Series will be redeemable at the
   option of the Corporation,  in whole or in part, from and after the time that
   (x) the Shares are convertible  into Common Stock pursuant to paragraph 7(a),
   and (y) the  Current  Market  Price for the  Common  Stock for a period of 10
   consecutive trading days equals or exceeds $5.00 per share and (z) the Common
   Stock  underlying  the  Shares  can be sold  by the  holder  thereof  without
   restriction on resale. The redemption price will be payable in cash and equal
   to $21.00 per share,  together with an amount equal to the dividends  accrued
   and unpaid  thereon,  whether or not declared,  to the  redemption  date. The
   aggregate  payment to each holder of shares of the Series to be redeemed will
   be rounded to the nearest cent.  Notwithstanding  the foregoing,  if the date
   fixed for  redemption  occurs after a record date for a dividend and prior to
   the  corresponding  payment date, such dividend shall be paid, on the payment
   date and the amount payable with respect to each share of the Series redeemed
   shall not include the amount of the dividend to be so paid.

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      (b) Not less than 30 nor more than 60 days prior to the date fixed for any
   redemption of shares of the Series  pursuant to this paragraph 5, a notice of
   redemption  shall be mailed by first class  mail,  postage  prepaid,  to each
   holder of shares of the Series to be redeemed at such  holder's  last address
   as it appears on the books of the transfer agent for the Series.  Such notice
   shall state:  (i) that the Corporation has elected to redeem all or a portion
   of the shares of the Series, as specified in such notice, (ii) the redemption
   price, (iii) the redemption date, (iv) that, unless the Corporation  defaults
   in the payment of the redemption  price,  all shares of the Series called for
   redemption  shall cease to accrue  dividends  after the  redemption  date and
   shall cease to be outstanding  after such date and (v) any other  information
   required by applicable  law to be included  therein and any other  procedures
   that a holder of shares of the  Series  must  follow to receive  payment  for
   their redeemed  shares.  Neither failure to mail such notice,  nor any defect
   therein or in the mailing thereof,  to any particular holder shall affect the
   sufficiency of the notice or the validity of the  proceedings  for redemption
   with  respect to any other  holder.  Any notice  mailed in the manner  herein
   provided  shall be  conclusively  presumed to have been duly given whether or
   not the holder  receives the notice.  On or after the redemption  date,  each
   holder of shares of the Series to be redeemed  shall  present  and  surrender
   such holder's  certificate or certificates for such shares to the Corporation
   at the place designated in the redemption notice and thereupon the redemption
   price of the shares shall be paid to or on the order of the person whose name
   appears on such  certificate or certificates  as the owner thereof,  and each
   surrendered  certificate shall be canceled.  In case less than all the shares
   represented by any such certificate are redeemed,  a new certificate shall be
   issued to the holder representing the unredeemed shares of the Series.

      (c) If a notice of redemption  has been given pursuant to this paragraph 5
   and if, on or before the date fixed for  redemption,  the funds necessary for
   such redemption  shall have been set aside by the  Corporation,  separate and
   apart from its other funds,  in trust for the PRO RATA benefit of the holders
   of the shares of the Series so called for redemption,  then,  notwithstanding
   that  any  certificates  for  such  shares  have  not  been  surrendered  for
   cancellation,  on the redemption  date dividends shall cease to accrue on the
   shares of the  Series to be  redeemed,  and at the close of  business  on the
   redemption  date the  holders of such shares  shall cease to be  stockholders
   with respect to those shares, shall have no interest in or claims against the
   Corporation  by virtue  thereof and shall have no voting or other rights with
   respect  thereto,  except the right to receive the moneys  payable  upon such
   redemption,  without interest thereon,  upon surrender (and  endorsement,  if
   required by the Corporation) of their certificates,  and the shares evidenced
   thereby shall no longer be outstanding.  Subject to applicable  escheat laws,
   any moneys so set aside by the  Corporation  and  unclaimed at the end of two
   years from the redemption date shall revert to the  Corporation,  after which
   reversion the holders of such shares so called for redemption shall look only
   to the  Corporation  for the payment of the  redemption  price.  Any interest
   accrued on funds so deposited shall be paid to the  Corporation  from time to
   time.

      (d) If a notice of redemption has been given pursuant to this paragraph 5,
   and any holder of shares of the Series shall,  prior to the close of business
   on the date fixed for  redemption,  give  written  notice to the  Corporation
   pursuant to paragraph 7 below of the  conversion  of any or all of the shares
   to be redeemed  held by the  holder,  then such  redemption  shall not become

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   effective as to such shares to be converted and such conversion  shall become
   effective as provided in paragraph 7 below,  whereupon any funds deposited by
   the  Corporation,  or on its behalf,  with a payment agent or segregated  and
   held in trust by the  Corporation  for the  redemption  of such shares  shall
   (subject to any right of the holder of such  shares to receive  the  dividend
   payable  thereon as provided  in  paragraph  7 below)  immediately  upon such
   conversion  be returned to the  Corporation  or, if then held in trust by the
   Corporation, shall be discharged from the trust.

      (e) In every case of redemption of less than all of the outstanding shares
   of the Series  pursuant to this  paragraph 5, the shares to be redeemed shall
   be  selected  PRO  RATA or by lot or in such  other  manner  as the  Board of
   Directors may  determine,  as may be prescribed by resolution of the Board of
   Directors  of the  Corporation,  provided  that only  whole  shares  shall be
   selected for redemption. Notwithstanding the foregoing, the Corporation shall
   not redeem any of the shares of the Series at any time outstanding  until all
   dividends  accrued  and  in  arrears  upon  all  shares  of the  Series  then
   outstanding shall have been paid for all past dividend periods.

      6. MANDATORY  REDEMPTION.  The shares of the  Series are not  subject
   to mandatory redemption or sinking fund requirements.

      7.  CONVERSION.  (a)  Holders of shares of the Series will have the right,
   exercisable  at any  time  after  (x) an  amendment  to  the  Certificate  of
   Incorporation  of the Corporation is filed with the Secretary of State of the
   State of Delaware which  increases the number of authorized  shares of Common
   Stock from 55 million  shares to at least 65 million  shares and (y) prior to
   redemption of such shares (as described in paragraph 5), to convert shares of
   the Series into shares of Common Stock  (calculated as to each  conversion to
   the nearest 1/100th of a share) at the conversion price of $0.75,  subject to
   adjustment as described below (the "Conversion  Price"). The number of shares
   of Common  Stock into which  each  share of the Series  shall be  convertible
   shall be determined by dividing $7.50, subject to proportional  adjustment to
   reflect  any  split or  consolidation  of the  Common  Stock or any  dividend
   payable  on the  Common  Stock in  additional  shares  of Common  Stock  (the
   "Conversion  Amount"), by the Conversion Price then in effect. In the case of
   shares of the Series called for redemption,  conversion rights will expire at
   the close of business on the business day next preceding the redemption date.
   Upon  conversion  of shares of the Series,  the  Corporation  will pay to the
   holder of the converted  shares an amount equal to the dividends  accrued but
   unpaid thereon  through the date the notice of conversion is delivered to the
   Corporation.  Such  payment  shall be made in cash,  or at the  option of the
   Corporation, in Common Stock valued at the Current Market Price of the Common
   Stock on the date the notice of conversion  is delivered to the  Corporation.
   Notwithstanding the foregoing, holders of record of shares of the Series on a
   record  date  fixed for the  payment of a dividend  on such  shares  shall be
   entitled to receive the dividend notwithstanding the conversion of the shares
   prior  to the  dividend  payment  date.  A  share  of the  Series  may not be
   converted in part.

      (b) In order to exercise the conversion right, the holder of each share of
   the Series to be converted shall surrender the certificate  representing such
   share,  duly  endorsed  or assigned to the  Corporation  or in blank,  at the
   office of the Corporation in Herndon,  Virginia (or such other address as the

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   Corporation  may designate) and shall give written notice to the  Corporation
   in the form set forth on the reverse of the stock certificates for the shares
   of the Series that such holder  elects to convert the shares  represented  by
   such certificate or a portion thereof.  Such notice shall also state the name
   or names (with  address) in which the  certificate  or  certificates  for the
   shares of Common Stock which shall be issuable upon such conversion  shall be
   issued,  and shall be accompanied by funds in an amount sufficient to pay any
   transfer or similar tax required by the  provisions of paragraph  7(e) below.
   Each share  surrendered for conversion  shall,  unless the shares issuable on
   conversion  are to be issued in the same name as the name in which such share
   of the  Series is  registered,  be duly  endorsed  by, or be  accompanied  by
   instruments of transfer (in each case, in form reasonably satisfactory to the
   Corporation),  duly executed by the holder or such  holder's duly  authorized
   attorney-in-fact.

      (c) As promptly as  practicable  after the surrender of  certificates  for
   shares of the Series for conversion and the receipt of such notice and funds,
   if any, as aforesaid,  the Corporation  shall issue and shall deliver to such
   holder,  or on such holder's written order, a certificate or certificates for
   the number of shares of Common Stock  issuable  upon the  conversion  of such
   shares of the Series in accordance  with the  provisions of this paragraph 7,
   and a check or cash in respect  of any  fractional  interest  in respect of a
   share of Common Stock arising upon such conversion,  as provided in paragraph
   7(d) below. Each conversion with respect to any shares of the Series shall be
   deemed to have been  effected  immediately  prior to the close of business on
   the date on which the  certificates  for shares of the Series shall have been
   surrendered  (accompanied  by the funds,  if any,  required by paragraph 7(e)
   below) and such notice and  assignment,  if any,  shall have been received by
   the Corporation as aforesaid,  and the person or persons  entitled to receive
   the  Common  Stock  issuable  upon such  conversion  shall be deemed  for all
   purposes to be the record  holder or holders of such  Common  Stock upon that
   date.

      (d) No fractional shares of Common Stock or scrip representing  fractional
   shares shall be issued upon conversion of shares of the Series.  If more than
   one share of the Series shall be  surrendered  for  conversion at one time by
   the same  holder,  the number of full shares of Common  Stock  issuable  upon
   conversion  thereof shall be computed on the basis of the aggregate number of
   shares of the  Series so  surrendered.  Instead  of any  fractional  share of
   Common Stock otherwise  issuable upon conversion of any shares of the Series,
   the Corporation shall pay a cash adjustment in respect to such fraction in an
   amount equal to the same  fraction of the Current  Market Price of the Common
   Stock at the close of business on the day of conversion.

      (e) If a holder converts shares of the Series,  the Corporation  shall pay
   any and all  documentary,  stamp or similar  issue or transfer tax payable in
   respect  of the issue or  delivery  of the shares of the Series (or any other
   securities  issued on account thereof  pursuant  hereto) or Common Stock upon
   the conversion;  PROVIDED,  HOWEVER, the Corporation shall not be required to
   pay any such tax that may be payable  because any such shares are issued in a
   name other than the name of the holder.

      (f)  From  and  after  the  date  an  amendment  to  the   Certificate  of
   Incorporation  of the Corporation is filed with the Secretary of State of the
   State of Delaware which  increases the number of authorized  shares of Common

                                      -8-
<PAGE>

   Stock from 55 million shares to at least 65 million  shares,  the Corporation
   shall reserve out of its authorized  but unissued  Common Stock or its Common
   Stock  held in  treasury  sufficient  shares  of Common  Stock to permit  the
   conversion of all of the  outstanding  shares of the Series.  The Corporation
   shall from time to time, in accordance with the GCL,  increase the authorized
   amount of its Common Stock if at any time the authorized amount of its Common
   Stock remaining  unissued shall not be sufficient to permit the conversion of
   all  shares of the  Series at the time  outstanding.  If any shares of Common
   Stock  required to be reserved for issuance upon  conversion of shares of the
   Series hereunder  require  registration  with or approval of any governmental
   authority under any federal or state law before the shares may be issued upon
   conversion,  the  Corporation  shall in good  faith and as  expeditiously  as
   possible  endeavor to cause the shares to be so registered  or approved.  All
   shares of Common Stock  delivered upon conversion of the shares of the Series
   will, upon delivery,  be duly  authorized and validly issued,  fully paid and
   nonassessable,  free from all taxes,  liens and charges  with  respect to the
   issue thereof.

      (g) The Conversion  Price shall be subject to adjustment from time to time
   as follows:

         (i)In the event that the  Corporation  shall (A) pay a dividend or make
            a  distribution,  in shares of Common Stock, on any class of Capital
            Stock of the Corporation or any subsidiary  which is not directly or
            indirectly  wholly owned by the Corporation,  (B) split or subdivide
            its outstanding  Common Stock into a greater number of shares or (C)
            combine  its  outstanding  Common  Stock  into a  smaller  number of
            shares,  then in each  such  case the  Conversion  Price  in  effect
            immediately  prior  thereto  shall be adjusted so that the holder of
            each share of the Series thereafter surrendered for conversion shall
            be  entitled  to receive  the number of shares of Common  Stock that
            such holder would have owned or have been  entitled to receive after
            the occurrence of any of the events  described  above had such share
            of the Series been converted  immediately prior to the occurrence of
            such event.  An adjustment  made pursuant to this paragraph  7(g)(i)
            shall become  effective  immediately  after the close of business on
            the record date in the case of a dividend or distribution (except as
            provided  in  paragraph  7(k)  below)  and  shall  become  effective
            immediately after the close of business on the effective date in the
            case of such subdivision,  split or combination, as the case may be.
            Any shares of Common Stock  issuable in payment of a dividend  shall
            be  deemed  to have been  issued  immediately  prior to the close of
            business  on the  record  date for such  dividend  for  purposes  of
            calculating  the number of outstanding  shares of Common Stock under
            clauses (ii) and (iii) below.

         (ii) In the  event  that  the  Corporation  shall  commit  to  issue or
            distribute  Common  Stock  or issue  rights,  warrants,  options  or
            convertible or exchangeable  securities entitling the holder thereof
            to subscribe  for or  purchase,  convert into or exchange for Common
            Stock,  in any such case at a price per share less than the  Current
            Market  Price  per  share  on the  earliest  of  (i)  the  date  the
            Corporation  shall enter into a firm  contract for such  issuance or
            distribution,   (ii)  the  record  date  for  the  determination  of

                                      -9-
<PAGE>

            stockholders entitled to receive any such rights, warrants,  options
            or convertible or exchangeable securities,  if applicable,  or (iii)
            the date of actual issuance or distribution of any such Common Stock
            or  rights,   warrants,   options  or  convertible  or  exchangeable
            securities  (provided  that the  issuance  of Common  Stock upon the
            exercise of rights, warrants, options or convertible or exchangeable
            securities  will not cause an adjustment in the Conversion  Price if
            no such adjustment  would have been required at the time such right,
            warrant, option or convertible or exchangeable security was issued),
            then  the  Conversion  Price  in  effect  immediately  prior to such
            earliest date shall be adjusted so that the  Conversion  Price shall
            equal the price  determined by multiplying  the Conversion  Price in
            effect immediately prior to such earliest date by the fraction:

            (x)whose  numerator  shall be the  number of shares of Common  Stock
               outstanding  on such  date plus the  number  of shares  which the
               aggregate offering price of the total number of shares so offered
               would  purchase at such Current  Market Price (such amount,  with
               respect to any such rights,  warrants,  options or convertible or
               exchangeable  securities,  determined  by  multiplying  the total
               number of shares  subject  thereto by the exercise  price of such
               rights,   warrants,   options  or  convertible  or   exchangeable
               securities  and  dividing  the product so obtained by the Current
               Market Price), and

            (y)whose  denominator  shall be the number of shares of Common Stock
               outstanding on such date plus the number of additional  shares of
               Common  Stock to be  issued or  distributed  or  receivable  upon
               exercise of any such right,  warrant,  option or  convertible  or
               exchangeable security.

            Such adjustment shall be made successively  whenever any such Common
            Stock,  rights,  warrants,  options or convertible  or  exchangeable
            securities are issued or  distributed.  In  determining  whether any
            rights,  warrants or options entitle the holders to subscribe for or
            purchase  shares of Common  Stock at less than such  Current  Market
            Price, and in determining the aggregate  offering price of shares of
            Common  Stock so issued or  distributed,  there  shall be taken into
            account  any  consideration  received  by the  Corporation  for such
            Common  Stock,   rights,   warrants,   options,  or  convertible  or
            exchangeable securities,  the value of such consideration,  if other
            than  cash,  to be  determined  by the  Board  of  Directors,  whose
            determination  shall be  conclusive  and  described in a certificate
            filed with the records of corporate  proceedings of the Corporation.
            If  any  right,  warrant,  option  or  convertible  or  exchangeable
            security to purchase or acquire Common Stock,  the issuance of which
            resulted in an adjustment in the  Conversion  Price pursuant to this
            subsection (b) shall expire and shall not have been  exercised,  the
            Conversion   Price  shall   immediately   upon  such  expiration  be
            recomputed to the  Conversion  Price which would have been in effect
            had the adjustment of the Conversion Price made upon the issuance of
            such right, warrant,  option or convertible or exchangeable security

                                      -10-
<PAGE>

            been made on the basis of  offering  for  subscription,  purchase or
            issuance,  as the case may be,  only of that  number  of  shares  of
            Common Stock actually  purchased or issued upon the actual  exercise
            of such  right,  warrant,  option  or  convertible  or  exchangeable
            securities.

         (iii) No adjustment in the  Conversion  Price shall be required  unless
            the adjustment  would require an increase or decrease of at least 1%
            in the Conversion Price then in effect; PROVIDED,  HOWEVER, that any
            adjustments  that  by  reason  of  this  paragraph  7(g)(i)  are not
            required to be made shall be carried  forward and taken into account
            in any subsequent adjustment.  All calculations under this paragraph
            7(g)(i)  shall be made to the nearest  cent or nearest  1/100th of a
            share.

         (iv)  Notwithstanding  anything  to the  contrary  set  forth  in  this
            paragraph 7(g), no adjustment  shall be made to the Conversion Price
            upon (A) the  issuance  of shares of Common  Stock  pursuant  to any
            compensation or incentive plan for officers, directors, employees or
            consultants of the  Corporation  which plan has been approved by the
            Compensation  Committee of the Board of Directors (or if there is no
            such committee  then serving,  by the majority vote of the Directors
            then serving who are not employees or officers of the Corporation, a
            5% or greater stockholder of the Corporation or an officer, employee
            or Affiliate or Associate  (as defined in paragraph 10 below) of any
            such 5% or greater  stockholder)  (unless the exercise price thereof
            is changed  after the date hereof  other than solely by operation of
            the  anti-dilution   provisions   thereof  or  by  the  Compensation
            Committee of the Board of Directors or, if applicable,  the Board of
            Directors  and,  if  required  by  law,  the   stockholders  of  the
            Corporation  as provided in this clause  (A)),  (B) the  issuance of
            shares  to  the  former  owners  of   AetherWorks   Corporation   in
            furtherance of the acquisition  agreement dated December 31, 1999 by
            and  among  AetherWorks  Corporation,  Nx  Networks,  Inc.  and  Nx1
            Acquisition  Corp.  or (C) the  issuance  of Common  Stock  upon the
            conversion or exercise of the options or warrants of the Corporation
            outstanding on December 15, 2000,  unless the conversion or exercise
            price thereof is changed after  December 15, 2000 (other than solely
            by operation of the anti-dilution provisions thereof).

         (v)The  Corporation  from time to time may reduce the Conversion  Price
            by any amount for any period of time in the  discretion of the Board
            of Directors. A voluntary reduction of the Conversion Price does not
            change  or adjust  the  conversion  price  otherwise  in effect  for
            purposes of this paragraph 7(g).

         (vii) In the event that, at any time as a result of an adjustment  made
            pursuant to paragraph 7(g)(i) through 7(g)(iii) above, the holder of
            any share of the Series thereafter  surrendered for conversion shall
            become entitled to receive any shares of the Corporation  other than
            shares of the  Common  Stock,  thereafter  the  number of such other
            shares so  receivable  upon  conversion  of any share of the  Series
            shall be subject to adjustment  from time to time in a manner and on
            terms as nearly  equivalent as practicable  to the  provisions  with
            respect to the Common Stock contained in paragraphs  7(g)(i) through

                                      -11-
<PAGE>

            7(g)(vi) above, and the other provisions of this paragraph 7(g)(vii)
            with  respect to the Common  Stock  shall apply on like terms to any
            such other shares.

      (h) In case of any  reclassification  of the Common Stock (other than in a
   transaction to which paragraph  7(g)(i)  applies),  any  consolidation of the
   Corporation  with, or merger of the Corporation  into, any other entity,  any
   merger of another entity into the Corporation  (other than a merger that does
   not result in any reclassification,  conversion,  exchange or cancellation of
   outstanding shares of Common Stock of the Corporation),  any sale or transfer
   of  all  or  substantially  all  of the  assets  of  the  Corporation  or any
   compulsory share exchange,  pursuant to which share exchange the Common Stock
   is  converted  into other  securities,  cash or other  property,  then lawful
   provision shall be made as part of the terms of such transaction  whereby the
   holder of each  share of the  Series  then  outstanding  shall have the right
   thereafter,  during the period  such share shall be  convertible,  to convert
   such  share  only  into the kind and  amount  of  securities,  cash and other
   property receivable upon the reclassification,  consolidation,  merger, sale,
   transfer  or share  exchange  by a holder  of the  number of shares of Common
   Stock of the  Corporation  into which a share of the  Series  might have been
   converted immediately prior to the reclassification,  consolidation,  merger,
   sale,  transfer or share  exchange  assuming that such holder of Common Stock
   failed to exercise  rights of  election,  if any, as to the kind or amount of
   securities,  cash or other  property  receivable  upon  consummation  of such
   transaction  subject  to  adjustment  as  provided  in  paragraph  7(g) above
   following the date of consummation of such transaction. As a condition to any
   such  transaction,  the Corporation or the person formed by the consolidation
   or resulting  from the merger or which acquires such assets or which acquires
   the  Corporation's  shares,  as the case may be, shall make provisions in its
   certificate or articles of  incorporation  or other  constituent  document to
   establish such right.  The certificate or articles of  incorporation or other
   constituent   document  shall  provide  for  adjustments  which,  for  events
   subsequent  to  the  effective  date  of  the   certificate  or  articles  of
   incorporation or other constituent document, shall be as nearly equivalent as
   may be practicable to the  adjustments  provided for in this paragraph 7. The
   provisions  of this  paragraph  7(h)  shall  similarly  apply  to  successive
   reclassifications,   consolidations,   mergers,  sales,  transfers  or  share
   exchanges.

      (i)   If:

         (i)the  Corporation   shall  take  any  action  which  would
            require an  adjustment  in the  Conversion  Price  pursuant  to
            Section 7(g); or

         (ii) the Corporation shall authorize the granting to the holders of its
            Common Stock  generally  of rights or warrants to  subscribe  for or
            purchase any shares of any class or any other rights or warrants; or

                                      -12-
<PAGE>

         (iii) there shall be any reclassification or change of the Common Stock
            (other than a subdivision or combination of its  outstanding  Common
            Stock or a change  in par  value)  or any  consolidation,  merger or
            statutory share exchange to which the Corporation is a party and for
            which approval of any  stockholders  of the Corporation is required,
            or the sale or transfer of all or substantially all of the assets of
            the Corporation; or

         (iv)there shall be a voluntary  or  involuntary  dissolution,
            liquidation or winding up of the Corporation;

   then, the Corporation shall cause to be filed with the transfer agent for the
   Series and shall cause to be mailed to the holders of shares of the Series at
   their  addresses as shown on the books of the transfer  agent for the Series,
   as promptly as possible,  but at least 30 days prior to the  applicable  date
   hereinafter  specified, a notice stating (A) the date on which a record is to
   be taken for the purpose of such dividend, distribution or granting of rights
   or  warrants,  or, if a record  is not to be taken,  the date as of which the
   holders  of  Common  Stock  of  record  to  be  entitled  to  such  dividend,
   distribution  or rights or warrants are to be  determined  or (B) the date on
   which such reclassification,  change, consolidation,  merger, statutory share
   exchange, sale, transfer, dissolution,  liquidation or winding up is expected
   to become  effective or occur,  and the date as of which it is expected  that
   holders of Common Stock of record shall be entitled to exchange  their shares
   of Common  Stock  for  securities  or other  property  deliverable  upon such
   reclassification,  change,  consolidation,  merger, statutory share exchange,
   sale, transfer, dissolution,  liquidation or winding up. Failure to give such
   notice or any defect therein shall not affect the legality or validity of the
   proceedings described in this paragraph 7(i).

      (j)  Whenever the  Conversion  Price is adjusted as herein  provided,  the
   Corporation  shall  promptly  file with the  transfer  agent for the Series a
   certificate  of an officer of the  Corporation  setting forth the  Conversion
   Price after the adjustment  and setting forth a brief  statement of the facts
   requiring such adjustment and a computation  thereof.  The Corporation  shall
   promptly cause a notice of the adjusted Conversion Price to be mailed to each
   registered holder of shares of the Series.

      (k) In any case in which paragraph 7(g) provides that an adjustment  shall
   become  effective  immediately  after a record date for an event and the date
   fixed for such adjustment pursuant to paragraph 7(g) occurs after such record
   date but before the occurrence of such event, the Corporation may defer until
   the actual  occurrence  of such event (i) issuing to the holder of any shares
   of the Series  converted  after such record date and before the occurrence of
   such  event  the  additional  shares  of  Common  Stock  issuable  upon  such
   conversion by reason of the adjustment  required by such event over and above
   the Common Stock issuable upon such  conversion  before giving effect to such
   adjustment  and (ii)  paying to such holder any amount in cash in lieu of any
   fraction pursuant to paragraph 7(d).

      (l) In case the  Corporation  shall take any action  affecting  the Common
   Stock, other than actions described in this paragraph 7, which in the opinion
   of the Board of Directors would  materially  adversely  affect the conversion

                                      -13-
<PAGE>

   right of the holders of the shares of the Series, the Conversion Price may be
   adjusted, to the extent permitted by law, in such manner, if any, and at such
   time,  as the  Board  of  Directors  may  determine  to be  equitable  in the
   circumstances;  PROVIDED,  HOWEVER,  that in no  event  shall  the  Board  of
   Directors be required to take any such action.

     (m) The Corporation will endeavor to list the shares of Common Stock
     required to be delivered upon conversion of shares of the Series, prior to
     delivery, upon each national securities exchange, the Nasdaq Stock Market
     or any similar system of automated dissemination of securities prices, if
     any, upon which the Common Stock is listed at the time of delivery.

     (n) In the event the Corporation has not filed an amendment to its
     Certificate of Incorporation increasing its authorized number of shares of
     Common Stock from 55 million shares to at least 65 million shares on or
     before September 30, 2001, then the Corporation will conduct a repurchase
     offer to redeem the shares of the Series. The repurchase price will equal
     the Liquidation Amount plus an amount equal to 110% of the difference
     between the Conversion Price then in effect and the Current Market Price of
     the Common Stock on the date the offer commences. The repurchase offer will
     be held open by the Corporation for at least 30 days.

      8.  STATUS  OF  SHARES.  All  shares  of the  Series  that are at any time
   redeemed or converted  pursuant to  paragraph 5 above,  and all shares of the
   Series that are otherwise  reacquired  by the  Corporation  and  subsequently
   canceled by the Board of Directors,  shall have the status of authorized  but
   unissued shares of preferred stock, without designation as to series, subject
   to  reissuance  by the Board of  Directors as shares of any one or more other
   series.

      9. VOTING RIGHTS.  Except as otherwise  required by law, holders of shares
   of the Series shall have no vote with respect to any matter  submitted to the
   stockholders of the  Corporation for vote or consent.  In connection with any
   right to vote or give consent  provided by law,  each holder of shares of the
   Series will have one vote for each share held.

       10.  CERTAIN   DEFINITIONS.   As  used  in  this  Certificate,   the
   following terms shall have the following respective meanings:

      "AFFILIATE"  of any  specified  person means any other person  directly or
   indirectly  controlling  or controlled  by or under common  control with such
   specified person.  For purposes of this definition,  "control" when used with
   respect to any person means the power to direct the  management  and policies
   of such person,  directly or  indirectly,  whether  through the  ownership of
   voting securities or otherwise;  and the term  "controlling" and "controlled"
   having meanings correlative to the foregoing.

                                      -14-
<PAGE>

       An  "ASSOCIATE" of a person means (A) any  corporation  or  organization,
   other than the Corporation or any subsidiary of the Corporation, of which the
   person is an officer or partner or is, directly or indirectly, the beneficial
   owner of 10% or more of any  class of  equity  securities;  (B) any  trust or
   estate in which the person has a  substantial  beneficial  interest  or as to
   which the person serves as trustee or in a similar  fiduciary  capacity;  and
   (C) any relative or spouse of the person, or any relative of the spouse,  who
   has the same home as the person or who is a director or officer of the person
   or any of its parents or subsidiaries.

      "CAPITAL  STOCK"  of any  person  or  entity  means  any and  all  shares,
   interests,  rights to purchase,  warrants,  options,  participations or other
   equivalents  of or interests  in the common stock or preferred  stock of such
   person or entity, including,  without limitation,  partnership and membership
   interests.

      "CURRENT MARKET PRICE" means, when used with respect to any security as of
   any date,  the last bid price regular way of such security as reported on the
   Nasdaq  National  Market for such date, or, if such security is not listed or
   admitted to trading on the Nasdaq National Market,  as reported on the Nasdaq
   SmallCap  Market  for such  date,  or, in case such  security  is listed on a
   national  securities exchange other than Nasdaq, the last sales price of such
   security on such date as reported for consolidated  transactions with respect
   to securities listed on the principal national  securities  exchange on which
   such  security is listed or  admitted to trading or, if such  security is not
   listed or  admitted  to trading on the Nasdaq  Stock  Market or any  national
   securities exchange, the average of the high bid and low asked prices of such
   security  on such date in the  over-the-counter  market,  as  reported by the
   National Association of Securities Dealers,  Inc. Automated Quotations System
   or such other  system  then in use or, if such  security is not quoted by any
   such  organization,  the average of the closing bid and asked  prices of such
   security as of such date furnished by a New York Stock  Exchange  member firm
   selected by the  Corporation,  or if such  security is not quoted by any such
   organization  and no such  New York  Stock  Exchange  member  firm is able to
   provide such prices, such price as is determined by the Independent Directors
   in good faith.

      "INDEPENDENT  DIRECTORS"  means  directors  that (i) are not 5% or greater
   stockholders of the Corporation or the designee of any such stockholder; (ii)
   are not officers or employees of the Corporation,  any of its subsidiaries or
   of a  stockholder  referred  to above in clause  (i);  (iii) are not  Related
   Persons; and (iv) do not have relationships that, in the opinion of the Board
   of Directors,  would interfere with their exercise of independent judgment in
   carrying out the responsibilities of the directors.

                                      -15-
<PAGE>

      "RELATED  PERSON" means an individual  related to an officer,  director or
   employee of the  Corporation  or any of its  Affiliates  which relation is by
   blood, marriage or adoption and not more remote than first cousin.

      IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly
   executed  on its  behalf  by its  undersigned  Chief  Executive  Officer  and
   attested to by its Assistant Secretary this 29th day of December, 2000.

                                    ___________________________________
                                    Jay R. Schifferli
                                    Chief Executive Officer

   ATTEST:

___________________________
      Peter J. Kendrick
      Assistant Secretary

                                      -16-<PAGE>

                                                                     Exhibit 4.3

THE WARRANTS  REPRESENTED BY THIS  CERTIFICATE  AND THE SHARES ISSUABLE UPON THE
SECURITIES  EVIDENCED BY THIS  CERTIFICATE  HAVE NOT BEEN  REGISTERED  UNDER THE
SECURITIES  ACT OF 1933 AND MAY NOT BE  TRANSFERRED  EXCEPT UPON DELIVERY TO THE
CORPORATION  OF AN OPINION OF COUNSEL  SATISFACTORY  IN FORM AND SUBSTANCE TO IT
THAT SUCH TRANSFER WILL NOT VIOLATE THE SECURITIES ACT OF 1933, AS AMENDED

       THE TRANSFER OF THIS WARRANT IS RESTRICTED AS DESCRIBED HEREIN.

                                Nx Networks, Inc.

             Warrant for the Purchase of Shares of Common Stock,
                          par value $0.05 per Share

No. ____                                                         66,667 Shares

            THIS CERTIFIES that, for value received, Richard Waye, whose address
is 12080 Kingsten Place, Reston, Virginia 20190 (the "Holder"), is entitled to
subscribe for and purchase from Nx Networks, Inc., a Delaware corporation (the
"Company"), upon the terms and conditions set forth herein, 66,667 shares of the
Company's Common Stock, par value $0.05 per share ("Common Stock"), at a price
of $0.90 per share (the "Exercise Price"). As used herein the term "this
Warrant" shall mean and include this Warrant and any Common Stock or Warrants
hereafter issued as a consequence of the exercise or transfer of this Warrant in
whole or in part.

            The number of shares of Common Stock issuable upon exercise of the
Warrants (the "Warrant Shares") and the Exercise Price may be adjusted from time
to time as hereinafter set forth. The Warrant Shares are entitled to the
benefits, and subject to the obligations, set forth in the Registration Rights
Agreement between the Company and the Holder dated concurrently herewith.

         1. EXERCISE PRICE AND EXERCISE PERIOD. This Warrant may be exercised at
any time or from time to time during the period commencing on the date an
amendment to the Certificate of Incorporation of the Company is filed with the
Secretary of State of the State of Delaware that increases the number of
authorized shares of Common Stock from 55 million shares to at least 65 million
shares (the "First Exercise Date") and ending at 5:00 P.M. Eastern time on
December 15, 2005 (the "Exercise Period").

         2. DELAY IN THE EXERCISE PERIOD. If the First Exercise Date does not
occur on or before March 31, 2001, the exercise price of the Warrants will be
reduced by 1% on that date and the last day of each calendar month until the
First Exercise Date occurs. If the First Exercise Date does not occur on or

<PAGE>

before September 30, 2001, the Company will redeem all of the Warrants for cash
at a redemption price equal to 110% of the difference between the Exercise Price
and the Current Market Price per share of Common Stock on September 30, 2001.
The Company will notify each Holder of such redemption by notice given within
five days after September 30, 2001, and such notice will set forth the
procedures a Holder must follow to obtain the redemption payment.

         3. PROCEDURE FOR EXERCISE; EFFECT OF EXERCISE.

         (a) CASH EXERCISE. This Warrant may be exercised, in whole or in part,
by the Holder during normal business hours on any business day during the
Exercise Period by (i) the presentation and surrender of this Warrant to the
Company at its principal office along with a duly executed Notice of Exercise
(in the form attached to this Agreement) specifying the number of Warrant Shares
to be purchased and (ii) delivery of payment to the Company of the Exercise
Price for the number of Warrant Shares specified in the Notice of Exercise by
cash, wire transfer of immediately available funds to a bank account specified
by the Company, or by certified or bank cashier's check.

         (b) CASHLESS EXERCISE. From and after the second anniversary of the
issuance of this Warrant, this Warrant may be exercised by the Holder through a
cashless exercise, as described in this Section 3(b). This Warrant may be
exercised, in whole or in part, by the Holder during normal business hours on
any business day after such second anniversary and during the Exercise Period by
the presentation and surrender of this Warrant to the Company at its principal
office along with a duly executed Notice of Exercise specifying the number of
Warrant Shares to be applied to such exercise. The number of Warrant Shares to
be delivered upon exercise of this Warrant pursuant to this Section 3(b) shall
equal the value of this Warrant (or the portion thereof being canceled) computed
as of the date of delivery of this Warrant to the Company using the following
formula:

            X =      Y(A-B)
                     ------
                        A

   Where:

               X =  the  number  of  shares  of  Common  Stock  to be  issued to
                    Holder under this Section 3(b);
               Y =  the number of Warrant Shares identified in the Notice of
                    Exercise as being applied to the subject exercise;

               A =  the Current Market Price on such date;
               B =  the Exercise Price on such date

For purposes of this Section 3(b), Current Market Price shall have the
definition provided in Section 7(g).

         (c) EFFECT OF Exercise. Upon receipt by the Company of this Warrant and
a Notice of Exercise, together with proper payment of the Exercise Price, as
provided in this Section 3, the Company agrees that such Warrant Shares shall be

                                      -2-
<PAGE>

deemed to be issued to the Holder as the record holder of such Warrant Shares as
of the close of business on the date on which this Warrant has been surrendered
and payment has been made for such Warrant Shares in accordance with this
Agreement and the Holder shall be deemed to be the holder of record of the
Warrant Shares, notwithstanding that the stock transfer books of the Company
shall then be closed or that certificates representing such Warrant Shares shall
not then be actually delivered to the Holder. A stock certificate or
certificates for the Warrant Shares specified in the Notice of Exercise shall be
delivered to the Holder as promptly as practicable, and in any event within
seven (7) business days, thereafter. The stock certificate(s) so delivered shall
be in any such denominations as may be reasonably specified by the Holder in the
Notice of Exercise. If this Warrant should be exercised in part only, the
Company shall, upon surrender of this Warrant for cancellation, execute and
deliver a new Warrant evidencing the right of the Holder to purchase the balance
of the Warrant Shares subject to purchase hereunder.

         4. REGISTRATION OF WARRANTS; TRANSFER OF WARRANTS. Any Warrants issued
upon the transfer or exercise in part of this Warrant shall be numbered and
shall be registered in a Warrant Register as they are issued. The Company shall
be entitled to treat the registered holder of any Warrant on the Warrant
Register as the owner in fact thereof for all purposes and shall not be bound to
recognize any equitable or other claim to or interest in such Warrant on the
part of any other person, and shall not be liable for any registration or
transfer of Warrants which are registered or to be registered in the name of a
fiduciary or the nominee of a fiduciary unless made with the actual knowledge
that a fiduciary or nominee is committing a breach of trust in requesting such
registration or transfer, or with the knowledge of such facts that its
participation therein amounts to bad faith. This Warrant shall be transferable
only on the books of the Company upon delivery thereof duly endorsed by the
Holder or by his duly authorized attorney or representative, or accompanied by
proper evidence of succession, assignment, or authority to transfer. In all
cases of transfer by an attorney, executor, administrator, guardian, or other
legal representative, duly authenticated evidence of his or its authority shall
be produced. Upon any registration of transfer, the Company shall deliver a new
Warrant or Warrants to the person entitled thereto. This Warrant may be
exchanged, at the option of the Holder thereof, for another Warrant, or other
Warrants of different denominations, of like tenor and representing in the
aggregate the right to purchase a like number of Warrant Shares, upon surrender
to the Company or its duly authorized agent.

         5. (a) RESTRICTIONS ON TRANSFER. The Holder, as of the date of issuance
hereof, represents to the Company that such Holder is acquiring the Warrants for
its own account for investment purposes and not with a view to the distribution
thereof or of the Warrant Shares. Notwithstanding any provisions contained in
this Warrant to the contrary, this Warrant and the related Warrant Shares shall
not be transferable except pursuant to the proviso contained in the following
sentence or upon the conditions specified in this Section 5, which conditions
are intended, among other things, to insure compliance with the provisions of
the Securities Act of 1933 (the "Securities Act") and applicable state law in
respect of the transfer of this Warrant or such Warrant Shares. The Holder by
acceptance of this Warrant, agrees that such Holder will not transfer this

                                      -3-
<PAGE>

Warrant or the related Warrant Shares prior to delivery to the Company of an
opinion of such Holder's counsel (as such opinion and such counsel are described
in Section 5(b) hereof) or until registration of such Warrant Shares under the
Securities Act has become effective or after a sale of such Warrant or Warrant
Shares has been consummated pursuant to Rule 144 or Rule 144A under the
Securities Act; PROVIDED, HOWEVER, that such holder may freely transfer this
Warrant or such Warrant Shares (without delivery to the Company or opinion of
Counsel) (w) to one of its nominees, affiliates or a nominee thereof, (x) to a
pension or profit-sharing fund established and maintained for its employees or
for the employees of any affiliate, (y) from a nominee to any of the
aforementioned persons as beneficial owner of this Warrant or such Warrant
Shares, or (z) to a qualified institutional buyer, so long as such transfer is
effected in compliance with Rule 144A under the Securities Act.

            (b) NOTICE OF INTENTION TO TRANSFER; OPINION OF COUNSEL. The Holder,
by its acceptance hereof, agrees that prior to any transfer of this Warrant or
of the related Warrant Shares (other than as permitted by Section 5(a) hereof or
pursuant to a registration under the Securities Act), the Holder will give
written notice to the Company of its intention to effect such transfer, together
with an opinion of such counsel for the Holder as shall be reasonably acceptable
to the Company, to the effect that the proposed transfer of this Warrant and/or
such Warrant Shares may be effected without registration under the Securities
Act. Upon delivery of such notice and opinion to the Company, the Holder shall
be entitled to transfer this Warrant and/or such Warrant Shares in accordance
with the intended method of disposition specified in the notice to the Company.

            (c) LEGEND. Each stock certificate representing Warrant Shares
issued upon exercise or exchange of this Warrant shall bear the following legend
unless the opinion of counsel referred to in Section 5(b) states such legend is
not required:

      "THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
      UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED EXCEPT UPON
      DELIVERY TO THE CORPORATION OF AN OPINION OF COUNSEL SATISFACTORY IN FORM
      AND SUBSTANCE TO IT THAT SUCH TRANSFER WILL NOT VIOLATE THE SECURITIES ACT
      OF 1933, AS AMENDED."

The Holder understands that the Company may place, and may instruct any transfer
agent or depository for the Warrant Shares to place, a stop transfer notation in
the securities records in respect of the Warrant Shares.

         6. RESERVATION OF SHARES. The Company shall at all times during the
Exercise Period reserve and keep available out of its authorized and unissued
Common Stock, solely for the purpose of providing for the exercise of the rights
to purchase all Warrant Shares granted pursuant to the Warrants, such number of
shares of Common Stock as shall, from time to time, be sufficient therefor. The
Company covenants that all shares of Common Stock issuable upon exercise of this
Warrant, upon receipt by the Company of the full Exercise Price therefor, and

                                      -4-
<PAGE>

all shares of Common Stock issuable upon conversion of this Warrant, shall be
validly issued, fully paid, non-assessable, and free of preemptive rights.

         7. EXERCISE PRICE ADJUSTMENTS.  In addition to the adjustment to the
Exercise Price contemplated by Section 2 hereof, the Exercise Price shall be
subject to adjustment from time to time as follows:

         a. (i) In the event that the Company shall (A) pay a dividend or make a
distribution, in shares of Common Stock on any class of capital stock of the
Company or any subsidiary which is not directly or indirectly wholly owned by
the Company, (B) split or subdivide its outstanding Common Stock into a greater
number of shares or (C) combine its outstanding Common Stock into a smaller
number of shares, then in each such case the Exercise Price in effect
immediately prior thereto shall be adjusted so that the Holder of a Warrant
thereafter surrendered for Exercise shall be entitled to receive the number of
shares of Common Stock that such Holder would have owned or have been entitled
to receive after the occurrence of any of the events described above had such
Warrant been exercised immediately prior to the occurrence of such event. An
adjustment made pursuant to this Section 7(a)(i) shall become effective
immediately after the close of business on the record date in the case of a
dividend or distribution (except as provided in Section 7(e) below) and shall
become effective immediately after the close of business on the effective date
in the case of such subdivision, split or combination, as the case may be. Any
shares of Common Stock issuable in payment of a dividend shall be deemed to have
been issued immediately prior to the close of business on the record date for
such dividend for purposes of calculating the number of outstanding shares of
Common Stock under clauses (ii) and (iii) below.

                 (ii) In the event that the Company shall commit to issue or
distribute Common Stock or issue rights, warrants, options or convertible or
exchangeable securities entitling the holder thereof to subscribe for or
purchase, convert into or exchange for Common Stock, in any such case at a price
per share less than the Current Market Price per share on the earliest of (i)
the date the Company shall enter into a firm contract for such issuance or
distribution, (ii) the record date for the determination of stockholders
entitled to receive any such rights, warrants, options or convertible or
exchangeable securities, if applicable, or (iii) the date of actual issuance or
distribution of any such Common Stock or rights, warrants, options or
convertible or exchangeable securities (provided that the issuance of Common
Stock upon the exercise of rights, warrants, options or convertible or
exchangeable securities will not cause an adjustment in the Exercise Price if no
such adjustment would have been required at the time such right, warrant, option
or convertible or exchangeable security was issued), then the Exercise Price in
effect immediately prior to such earliest date shall be adjusted so that the
Exercise Price shall equal the price determined by multiplying the Exercise
Price in effect immediately prior to such earliest date by the fraction:

         (x) whose numerator shall be the number of shares of Common Stock
         outstanding on such date plus the number of shares which the aggregate
         offering price of the total number of shares so offered would purchase
         at such Current Market Price (such amount, with respect to any such
         rights, warrants, options or convertible or exchangeable securities,
         determined by multiplying the total number of shares subject thereto by

                                      -5-
<PAGE>

         the exercise price of such rights, warrants, options or convertible or
         exchangeable securities and dividing the product so obtained by the
         Current Market Price), and

         (y) whose denominator shall be the number of shares of Common Stock
         outstanding on such date plus the number of additional shares of Common
         Stock to be issued or distributed or receivable upon exercise of any
         such right, warrant, option or convertible or exchangeable security.

Such adjustment shall be made successively whenever any such Common Stock,
rights, warrants, options or convertible or exchangeable securities are issued
or distributed. In determining whether any rights, warrants or options entitle
the holders to subscribe for or purchase shares of Common Stock at less than
such Current Market Price, and in determining the aggregate offering price of
shares of Common Stock so issued or distributed, there shall be taken into
account any consideration received by the Company for such Common Stock, rights,
warrants, options, or convertible or exchangeable securities, the value of such
consideration, if other than cash, to be determined by the Board of Directors,
whose determination shall be conclusive and described in a certificate filed
with the records of corporate proceedings of the Company. If any right, warrant,
option or convertible or exchangeable security to purchase or acquire Common
Stock, the issuance of which resulted in an adjustment in the Exercise Price
pursuant to this subsection (b) shall expire and shall not have been exercised,
the Exercise Price shall immediately upon such expiration be recomputed to the
Exercise Price which would have been in effect had the adjustment of the
Exercise Price made upon the issuance of such right, warrant, option or
convertible or exchangeable security been made on the basis of offering for
subscription, purchase or issuance, as the case may be, only of that number of
shares of Common Stock actually purchased or issued upon the actual exercise of
such right, warrant, option or convertible or exchangeable securities.

                 (iii) No adjustment in the Exercise Price shall be required
unless the adjustment would require an increase or decrease of at least 1% in
the Exercise Price then in effect; PROVIDED, HOWEVER, that any adjustments that
by reason of this Section 7(a) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Section 7(a) shall be made to the nearest cent or nearest 1/100th of
a share.

                 (iv) , no adjustment shall be made to the Exercise Price upon
(A) the issuance of shares of Common Stock pursuant to any compensation or
incentive plan for officers, directors, employees or consultants of the Company
which plan has been approved by the Compensation Committee of the Board of
Directors (or if there is no such committee then serving, by the majority vote
of the Directors then serving who are not employees or officers of the Company,
a 5% or greater stockholder of the Company or an officer or employee of any such
5% or greater stockholder) and, if required by law, the requisite vote of the

                                      -6-
<PAGE>

stockholders of the Company (unless the exercise price thereof is changed after
the date hereof other than solely by operation of the anti-dilution provisions
thereof or by the Compensation Committee of the Board of Directors or, if
applicable, the Board of Directors and, if required by law, the stockholders of
the Company as provided in this clause (A)) or (B) the issuance of Common Stock
upon the conversion or exercise of the options or warrants of the Company
outstanding on December 15, 2000, unless the conversion or exercise price
thereof is changed after December 15, 2000 (other than solely by operation of
the anti-dilution provisions thereof).

                 (v) In the event that, at any time as a result of an adjustment
made pursuant to Sections 7(a)(i) through 7(a)(iii) above, the Holder of any
Warrant thereafter surrendered for exercise shall become entitled to receive any
shares of the Company other than shares of the Common Stock, thereafter the
number of such other shares so receivable upon exercise of any such Warrant
shall be subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to the Common
Stock contained in Sections 7(a)(i) through 7(a)(iv) above, and the other
provisions of this Section 7(a) with respect to the Common Stock shall apply on
like terms to any such other shares.

         b. In case of any reclassification of the Common Stock (other than in a
transaction to which Section 7(a)(i) applies), any consolidation of the Company
with, or merger of the Company into, any other entity, any merger of another
entity into the Company (other than a merger that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of
Common Stock of the Company), any sale or transfer of all or substantially all
of the assets of the Company or any compulsory share exchange, pursuant to which
share exchange the Common Stock is converted into other securities, cash or
other property, then lawful provision shall be made as part of the terms of such
transaction whereby the Holder of a Warrant then outstanding shall have the
right thereafter, during the period such Warrant shall be exercisable, to
exercise such Warrant only for the kind and amount of securities, cash and other
property receivable upon the reclassification, consolidation, merger, sale,
transfer or share exchange by a holder of the number of shares of Common Stock
of the Company into which a Warrant might have been able to exercise for
immediately prior to the reclassification, consolidation, merger, sale, transfer
or share exchange assuming that such holder of Common Stock failed to exercise
rights of election, if any, as to the kind or amount of securities, cash or
other property receivable upon consummation of such transaction subject to
adjustment as provided in Section 7(a) above following the date of consummation
of such transaction. The provisions of this Section 7(b) shall similarly apply
to successive reclassifications, consolidations, mergers, sales, transfers or
share exchanges.

         c. If:

                 (i)  the Company shall take any action which would require
                 an adjustment in the Exercise Price pursuant to Section
                 7(a); or

                 (ii) the Company shall authorize the granting to the holders of
                 its Common Stock generally of rights or warrants to subscribe
                 for or purchase any shares of any class or any other rights or
                 warrants; or

                 (iii) there shall be any reclassification or change of the
                 Common Stock (other than a subdivision or combination of its
                 outstanding Common Stock or a change in par value) or any
                 consolidation, merger or statutory share exchange to which the
                 Company is a party and for which approval of any stockholders
                 of the Company is required, or the sale or transfer of all or
                 substantially all of the assets of the Company; or

                 (iv)  there shall be a voluntary or involuntary dissolution,
                 liquidation or winding up of the Company;

then, the Company shall cause to be mailed to each Holder at such Holder's
address as shown on the books of the transfer agent for the Warrants, as
promptly as possible, but at least 15 days prior to the applicable date
hereinafter specified, a notice stating (A) the date on which a record is to be
taken for the purpose of such dividend, distribution or granting of rights or
warrants, or, if a record is not to be taken, the date as of which the holders
of Common Stock of record to be entitled to such dividend, distribution or
rights or warrants are to be determined or (B) the date on which such
reclassification, change, consolidation, merger, statutory share exchange, sale,
transfer, dissolution, liquidation or winding up is expected to become effective
or occur, and the date as of which it is expected that holders of Common Stock
of record shall be entitled to exchange their shares of Common Stock for
securities or other property deliverable upon such reclassification, change,
consolidation, merger, statutory share exchange, sale, transfer, dissolution,
liquidation or winding up. Failure to give such notice or any defect therein
shall not affect the legality or validity of the proceedings described in this
Section 7(c).

         d. Whenever the Exercise Price is adjusted as herein provided, the
Company shall promptly mail to each Holder a notice setting forth the Exercise
Price after the adjustment and setting forth a brief statement of the facts
requiring such adjustment and a computation thereof. The Company shall promptly
cause a notice of the adjusted Exercise Price to be mailed to each Holder.

         e. In any case in which Section 7(a) provides that an adjustment shall
become effective immediately after a record date for an event and the date fixed
for such adjustment pursuant to Section 7(a) occurs after such record date but
before the occurrence of such event, the Company may defer until the actual
occurrence of such event (i) issuing to the Holder of any Warrants exercised
after such record date and before the occurrence of such event the additional
shares of Common Stock issuable upon such conversion by reason of the adjustment
required by such event over and above the Common Stock issuable upon such
exercise before giving effect to such adjustment and (ii) paying to such holder
any amount in cash in lieu of any fraction pursuant to Section 7(j).

                                      -8-
<PAGE>

         f. In case the Company shall take any action affecting the Common
Stock, other than actions described in this Section 7, which in the opinion of
the Board of Directors would materially adversely affect the exercise right of
the Holders, the Exercise Price may be adjusted, to the extent permitted by law,
in such manner, if any, and at such time, as the Board of Directors may
determine to be equitable in the circumstances; PROVIDED, HOWEVER, that in no
event shall the Board of Directors be required to take any such action.

         G. DEFINITION OF "CURRENT MARKET PRICE". For the purpose of any
computation under Section 3(b) or this Section 7, the Current Market Price per
share of Common Stock on any date shall be deemed to be the average of the daily
closing prices for the 30 consecutive trading days immediately preceding the
date in question. The closing price for each day shall be the last reported
sales price regular way or, in case no such reported sale takes place on such
day, the closing bid price regular way, in either case on the principal national
securities exchange (including, for purposes hereof, the NASDAQ National Market
System) on which the Common Stock is listed or admitted to trading or, if the
Common Stock is not listed or admitted to trading on any national securities
exchange, the highest reported bid price for the Common Stock as furnished by
the National Association of Securities Dealers, Inc. through NASDAQ or a similar
organization if NASDAQ is no longer reporting such information. If on any such
date the Common Stock is not listed or admitted to trading on any national
securities exchange and is not quoted by NASDAQ or any similar organization, the
fair value of a share of Common Stock on such date, as determined in good faith
by the board of directors of the Company, whose determination shall be
conclusive absent manifest error, shall be used.

         H. NO ADJUSTMENT IN CERTAIN CIRCUMSTANCES. No adjustment in the
Exercise Price shall be required if such adjustment is less than $.05; PROVIDED,
HOWEVER, that any adjustments which by reason of this Section 7 are not required
to be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 7 shall be made to the nearest
cent or to the nearest one-thousandth of a share, as the case may be.

         I. ADJUSTMENT TO WARRANT SHARES; CONTINUED VALIDITY OF WARRANT
AGREEMENT. Upon each adjustment of the Exercise Price as a result of the
calculations made in Sections 7(b), 7(c), or 7(d) hereof, this Warrant shall
thereafter evidence the right to purchase, at the adjusted Exercise Price, that
number of shares (calculated to the nearest thousandth) obtained by dividing (i)
the product obtained by multiplying the number of shares purchasable upon
exercise of this Warrant prior to adjustment of the number of shares by the
Exercise Price in effect prior to adjustment of the Exercise Price, by (ii) the
Exercise Price in effect after such adjustment of the Exercise Price.

         J. NO FRACTIONAL SHARES. The Company shall not be required to issue
fractions of shares of Common Stock or other capital stock of the Company upon
the exercise of this Warrant. If any fraction of a share would be issuable on
the exercise of this Warrant (or specified portions thereof), the Company shall

                                      -9-
<PAGE>

purchase such fraction for an amount in cash equal to the same fraction of the
Current Market Price of such share of Common Stock on the date of exercise of
this Warrant.

         8. TRANSFER TAXES. The issuance of any shares or other securities upon
the exercise of this Warrant, and the delivery of certificates or other
instruments representing such shares or other securities, shall be made without
charge to the Holder for any tax or other charge in respect of such issuance.
The Company shall not, however, be required to pay any tax which may be payable
in respect of any transfer involved in the issue and delivery of any certificate
in a name other than that of the Holder and the Company shall not be required to
issue or deliver any such certificate unless and until the person or persons
requesting the issue thereof shall have paid to the Company the amount of such
tax or shall have established to the satisfaction of the Company that such tax
has been paid.

         9. LOSS OR MUTILATION OF WARRANT AGREEMENT. Upon receipt of evidence
satisfactory to the Company of the loss, theft, destruction, or mutilation of
any Warrant (and upon surrender of any Warrant if mutilated), and upon
reimbursement of the Company's reasonable incidental expenses, the Company shall
execute and deliver to the Holder thereof a new Warrant of like date, tenor, and
denomination.

         10. NO RIGHTS AS A STOCKHOLDER. The Holder of any Warrant shall not
have, solely on account of such status, any rights of a stockholder of the
Company, either at law or in equity, or to any notice of meetings of
stockholders or of any other proceedings of the Company, except as provided in
this Warrant.

         11. GOVERNING LAW.  This Warrant shall be construed in accordance
with the laws of the State of Delaware applicable to contracts made and
performed within such State, without regard to principles of conflicts of law.

Dated: December 29, 2000
                                   Nx Networks, Inc.

                                   By:_________________________________
                                      Chief Executive Officer

                                      -10-
<PAGE>

FORM OF ASSIGNMENT

(To be executed by the registered holder if such holder desires to transfer the
attached Warrant.)

            FOR VALUE RECEIVED, hereby sells, assigns, and transfers unto
____________ a Warrant to purchase __________ shares of Common Stock, par
value $0.05] per share, of Nx Networks, Inc. (the "Company"), together with all
right, title, and interest therein, and does hereby irrevocably constitute and
appoint ____________ attorney to transfer such Warrant on the books of the
Company, with full power of substitution.

                                       Dated:_____________________

                                       By:_________________________
                                          Signature

      The signature on the foregoing Assignment must correspond to the name as
written upon the face of this Warrant in every particular, without alteration or
enlargement or any change whatsoever.

                                      -11-
<PAGE>

To:   Nx Networks, Inc.
      13595 Dulles Technology Drive
      Herndon, Virginia 20171
      Attention:  Chief Financial Officer

NOTICE OF EXERCISE

      The undersigned hereby exercises his or its rights to purchase _______
Warrant Shares covered by the within Warrant and tenders payment herewith in the
amount of $_________ in accordance with the terms thereof, and requests that
certificates for such securities be issued in the name of, and delivered to:

___________________________

___________________________

___________________________

(Print Name, Address and Social Security
or Tax Identification Number)

and, if such number of Warrant Shares shall not be all the Warrant Shares
covered by the within Warrant, that a new Warrant for the balance of the Warrant
Shares covered by the within Warrant be registered in the name of, and delivered
to, the undersigned at the address stated below.

                                       Dated:_________________________

                                       By:____________________________
                                          Print Name

                                       _______________________________
                                       Signature

Address:

___________________________

___________________________

___________________________

                                      -12-

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