The ZIP file became an ’empty’ file with minimum KBs. It was like a new .zip file with no content. I just noticed that I did not mention the software used to manage the ZIP files: I use 7-Zip, and I am not sure that this is an AxCrypt issue.
I was able to recover all my files from backup and I am not able to reproduce the issue. Although I find it interesting that some files, unencrypted, were found in AxCrypt temp directories. I cannot recall the exact situation that created these unencrypted files.