AGREEMENT AND PLAN OF MERGER


                                  BY AND AMONG


                         IPC INFORMATION SYSTEMS, INC.,


                              IPC MERGER SUB, INC.


                                       AND


                               V BAND CORPORATION


                                 APRIL 14, 1999






<PAGE>
                                TABLE OF CONTENTS
         1.       Definitions       1

2.       Basic Transaction 5
         -----------------
                  (a)    The Merger                                           5
                  (b)    The Closing                                          6
                  (c)    Actions at the Closing                               6
                  (d)    Effect of Merger                                     6
                  (e)    Procedure for Payment                                7
                  (f)    Closing of Transfer Records                          7

         3.       Representations and Warranties of the Target                7
                  (a)    Organization, Qualification, and Corporate Power     8
                  (b)    Capitalization                                       8
                  (c)    Authorization of Transaction                         8
                  (d)    Noncontravention                                     8
                  (e)    Filings with the SEC                                 9
                  (f)    Title to Assets                                      9
                  (g)    Subsidiaries                                         9
                  (h)    Financial Statements                                 10
                  (i)    Events Subsequent to Most Recent Fiscal Quarter End  10
                  (j)    Undisclosed Liabilities                              10
                  (k)    Brokers' Fees                                        10
                  (l)    Legal Compliance                                     10
                  (m)    Tax Matters                                          11
                  (n)    Real Property                                        12
                  (o)    Intellectual Property                                13
                  (p)    Tangible Assets                                      14
                  (q)    Inventory                                            14
                  (r)    Contracts                                            14
                  (s)    Notes and Accounts Receivable                        15
                  (t)    Powers of Attorney                                   16
                  (u)    Insurance                                            16
                  (v)    Litigation                                           16
                  (w)    Product Warranty                                     16
                  (x)    Product Liability17
                  (y)    Employees                                            17
                  (z)    Employee Benefits17
                  (aa)   Environmental, Health, and Safety Matters            19
                  (bb)   Disclosure                                           19
         4.       Representations and Warranties of the Buyer and Merger Sub  19
<PAGE>
                  (a)    Organization                                         19
                  (b)    Authorization of Transaction                         19
                  (c)    Noncontravention                                     19
                  (d)    Brokers' Fees                                        20
                  (e)    Disclosure                                           20
                  (f)    Merger Sub.                                          20

         5.       Covenants                                                   20
                  (a)    General                                              20
                  (b)    Notices and Consents                                 20
                  (c)    Regulatory Matters and Approvals                     20
                  (d)    Operation of Business                                21
                  (e)    Full Access                                          22
                  (f)    Notice of Developments                               22
                  (g)    Exclusivity                                          22
                  (h)    Insurance and Indemnification                        23
                  (i)    Stock Options                                        23
                  (j)    National Bank of Canada                              24
                  (k)    Form 10-Q                                            24

6.       Conditions to Obligation to Close                                    24
                  (a)    Conditions to Obligation of the Buyer and Merger Sub 24
                  (b)    Conditions to Obligation of the Target               26

         7.       Termination                                                 27
                  (a)    Termination of Agreement                             27
                  (b)    Effect of Termination                                27
                  (c)    Termination Fee                                      28

8.       Miscellaneous                                                        28
                  (a)    Survival                                             28
                  (b)    Press Releases and Public Announcements              28
                  (c)    No Third-Party Beneficiaries                         28
                  (d)    Entire Agreement                                     28
                  (e)    Succession and Assignment                            28
                  (f)    Counterparts                                         28
                  (g)    Headings                                             28
                  (h)    Notices                                              29
                  (i)    Governing Law                                        30
                  (j)    Jurisdiction; Service of Process                     30
                  (l)    Severability                                         31
                  (m)    Expenses                                             31
                  (n)    Construction                                         31
                  (o)    Incorporation of Exhibits and Schedules              31
<PAGE>
Exhibit A--Delaware Certificate of Merger
Exhibit B--New York Certificate of Merger
Exhibit C--Form of Opinion of Counsel to the Target
Exhibit D--Form of Opinion of Counsel to the Buyer and Merger Sub
Disclosure Schedule--Exceptions to Representations and Warranties
<PAGE>
                          AGREEMENT AND PLAN OF MERGER

         Agreement  entered  into  as of  April  14,  1999,  by  and  among  IPC
Information Systems, Inc., a Delaware corporation (the "Buyer"), IPC Merger Sub,
Inc., a Delaware corporation and a wholly-owned Subsidiary of the Buyer ("Merger
Sub"), and V Band Corporation, a New York corporation (the "Target"). The Buyer,
the Merger  Sub,  and the  Target are  referred  to  collectively  herein as the
"Parties."

         This  Agreement  contemplates  a  transaction  in which the Buyer  will
acquire all of the assets of the Target for cash  through a merger of the Target
with and into Merger Sub.

         Concurrently with the execution and delivery of this Agreement,  and as
a  condition  and  inducement  to the  Buyer's  willingness  to enter  into this
Agreement,  Thomas E.  Feil  ("Mr.  Feil")  and the Buyer  have  entered  into a
Stockholder's  Agreement (the "Stockholder's  Agreement")  pursuant to which Mr.
Feil has agreed to vote all shares of Target common stock  beneficially owned by
him (not less than 1,430,472 shares) in favor of the Merger.

         Now,  therefore,  in  consideration  of the  premises  and  the  mutual
promises herein made, and in consideration of the  representations,  warranties,
and covenants herein contained, the Parties agree as follows:

         1.       Definitions.

         "Acquisition Proposal" has the meaning set forth in ss.5(q) below.

         "Acquisition Transaction" has the meaning set forth in ss.5(q) below.

         "Affiliate" has the meaning set forth in  Rule 12b-2 of the regulations
promulgated under the Securities Exchange Act.

         "Affiliated  Group"  means any  affiliated  group within the meaning of
Code ss.1504(a) or any similar group defined under a similar provision of state,
local or foreign law.

         "Business  Plan"  means the  documents  designated  as such by separate
agreement of the Parties.

         "Buyer" has the meaning set forth in the preface above.

         "Buyer-owned Share" means any Target Share that the Buyer or Merger Sub
owns beneficially.

         "Closing" has the meaning set forth in ss.2(b) below.
<PAGE>
         "Closing  Date" has the  meaning  set forth in ss.2(b)  below.  "COBRA"
means  the  requirements  of Part 6 of  Subtitle  B of Title I of ERISA and Code
ss.4980B.

         "Code" means the Internal Revenue Code of 1986, as amended.

         "Confidentiality  Agreement" means the agreement between the Target and
the Buyer dated September 11, 1998.

         "Confidential   Information"  means  any  information   concerning  the
businesses and affairs of the Target and its Subsidiaries other than information
that (i) was or becomes generally available to the public or (ii) was or becomes
generally available to the Buyer or Merger Sub on a non-confidential basis prior
to its disclosure to the Buyer, Merger Sub or their representatives.

         "Controlled Group" has the meaning set forth in Code ss.1563.

         "Credit  Facility"  means  the  revolving  loan and  letter  of  credit
facility  of the Target  made  pursuant  to the  credit  agreement  between  the
National Bank of Canada, New York Branch and the Target,  dated May 28, 1997, as
amended and the Loan Documents referred to therein.

         "Definitive  Proxy  Materials"  means the  definitive  proxy  materials
relating to the Special Meeting.

         "Delaware  Certificate  of Merger" has the meaning set forth in ss.2(c)
below.

         "Delaware General Corporation Law" means the General Corporation Law of
the State of Delaware, as amended.

         "Disclosure Schedule" has the meaning set forth in ss.3 below.

         "Dissenting  Share"  means  any  Target  Share  held of  record  by any
stockholder who or which has exercised his or its appraisal rights under the New
York Business Corporation Law.

         "Effective Time" has the meaning set forth in ss.2(d)(i) below.

         "Employee   Benefit   Plan"   means  any  (a)   nonqualified   deferred
compensation  or  retirement  plan  or   arrangement,   (b)  qualified   defined
contribution retirement plan or arrangement which is an Employee Pension Benefit
Plan, (c) qualified  defined benefit  retirement plan or arrangement which is an
Employee  Pension  Benefit  Plan  (including  any  Multiemployer  Plan),  or (d)
Employee  Welfare Benefit Plan or material  fringe benefit or other  retirement,
bonus, or incentive plan or program.

         "Employee  Pension  Benefit  Plan" has the  meaning  set forth in ERISA
ss.3(2).

         "Employee  Welfare  Benefit  Plan" has the  meaning  set forth in ERISA
ss.3(1).
<PAGE>
         "Environmental,   Health,  and  Safety  Requirements"  shall  mean  all
federal,  state, local and foreign statutes,  regulations,  ordinances and other
provisions  having the force or effect of law, all  judicial and  administrative
orders  and  determinations,  all  contractual  obligations  and all  common law
concerning public health and safety,  worker health and safety, and pollution or
protection of the environment,  including without  limitation all those relating
to  the  presence,  use,  production,   generation,  handling,   transportation,
treatment,  storage,  disposal,  distribution,  labeling,  testing,  processing,
discharge,  release,  threatened  release,  control, or cleanup of any hazardous
materials,  substances or wastes,  chemical substances or mixtures,  pesticides,
pollutants,  contaminants,  toxic chemicals,  petroleum  products or byproducts,
asbestos,  polychlorinated biphenyls, noise or radiation, each as amended and as
now or hereafter in effect.

         "ERISA" means the Employee  Retirement  Income Security Act of 1974, as
amended.

         "Excess Loss Account" has the meaning set forth in Reg. ss.1.1502-19.

         "GAAP" means United States generally accepted accounting  principles as
in effect from time to ---- time.

         "Intellectual Property" means (a) all inventions (whether patentable or
unpatentable and whether or not reduced to practice),  all improvements thereto,
and all patents, patent applications, and patent disclosures,  together with all
reissuances,  continuations,  continuations-in-part,  revisions, extensions, and
reexaminations  thereof, (b) all trademarks,  service marks, trade dress, logos,
trade names, and corporate names,  together with all translations,  adaptations,
derivations,  and  combinations  thereof and including  all goodwill  associated
therewith,  and all  applications,  registrations,  and  renewals in  connection
therewith,  (c) all copyrightable  works, all copyrights,  and all applications,
registrations,  and renewals in connection therewith, (d) all mask works and all
applications, registrations, and renewals in connection therewith, (e) all trade
secrets and confidential  business  information  (including ideas,  research and
development,  know-how,  formulas,  compositions,  manufacturing  and production
processes and techniques,  technical data,  designs,  drawings,  specifications,
customer  and supplier  lists,  pricing and cost  information,  and business and
marketing plans and proposals),  (f) all computer  software  (including data and
related documentation), (g) all other proprietary rights, and (h) all copies and
tangible embodiments thereof (in whatever form or medium).

         "Knowledge" means actual knowledge after reasonable investigation.

         "Liability"  means any  liability  (whether  known or unknown,  whether
asserted or  unasserted,  whether  absolute or  contingent,  whether  accrued or
unaccrued,  whether  liquidated  or  unliquidated,  and whether due or to become
due), including any liability for Taxes.

         "Merger" has the meaning set forth in ss.2(a) below.

         "Merger Consideration" has the meaning set forth in ss.2(d)(v) below.

         "Merger Sub" has the meaning set forth in the preface above.
<PAGE>
         "Most Recent  Balance Sheet" means the balance sheet  contained  within
financial statements for the Most Recent Fiscal Quarter End. "Most Recent Fiscal
Quarter End" has the meaning set forth in ss.3(h) below.

         "Most  Recent  Fiscal  Year End" has the  meaning  set forth in ss.3(h)
below.

         "Mr. Feil" has the meaning set forth in the preface above.

         "Multiemployer Plan" has the meaning set forth in ERISA ss.3(37).

                  "New  York  Business   Corporation  Law"  means  the  Business
Corporation Law of the State of New York, as amended.

         "New York  Certificate  of Merger" has the meaning set forth in ss.2(c)
below.

         "Ordinary  Course of Business"  means the  ordinary  course of business
consistent with past custom and practice (including with respect to quantity and
frequency)  which,  in the case of the Target,  it is understood has resulted in
operating losses.

         "Party" has the meaning set forth in the preface above.

         "Paying Agent" has the meaning set forth in ss.2(e)(i) below.

         "Payment Fund" has the meaning set forth in ss.2(e)(i) below.

         "Person"  means  an  individual,  a  partnership,  a  corporation,   an
association,  a joint stock company, a trust, a joint venture, an unincorporated
organization, `or a governmental entity (or any department, agency, or political
subdivision thereof).

         "PBGC" means the Pension Benefit Guaranty Corporation.

         "Prohibited  Transaction" has the meaning set forth in ERISA ss.406 and
Code ss.4975.

         "Public Report" has the meaning set forth in ss.3(e) below.

         "Reportable Event" has the meaning set forth in ERISA ss.4043.

         "Requisite  Stockholder  Approval"  means the  affirmative  vote of the
holders of two thirds of the Target  Shares in favor of this  Agreement  and the
Merger.

         "SEC" means the Securities and Exchange Commission.

         "Securities Act" means the Securities Act of 1933, as amended.

         "Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.
<PAGE>
         "Security  Interest"  means any mortgage,  pledge,  lien,  encumbrance,
charge, or other security  interest,  other than (a) mechanic's,  materialman's,
and similar liens, (b) liens for taxes not yet due and payable or for taxes that
the taxpayer is contesting in good faith through  appropriate  proceedings,  (c)
purchase  money liens and liens  securing  rental  payments  under capital lease
arrangements, and (d) other liens arising in the Ordinary Course of Business and
not incurred in connection with the borrowing of money.

         "Special Meeting" has the meaning set forth in ss.5(c)(ii) below.

         "Stockholder's  Agreement"  has the  meaning  set forth in the  preface
above.

         "Subsidiary"  means any  corporation  with respect to which a specified
Person (or a Subsidiary  thereof) owns a majority of the common stock or has the
power to vote or direct the voting of sufficient  securities to elect a majority
of the directors.

         "Superior   Acquisition   Proposal"   has  the  meaning  set  forth  in
ss.7(a)(iv) below.

         "Surviving Corporation" has the meaning set forth in ss.2(a) below.

         "Target" has the meaning set forth in the preface above.

         "Target Share" means any share of the Common Stock,  $.01 par value per
share, of the Target which is the only class of capital stock of the Target that
is outstanding and has voting rights..

         "Target  Stockholder"  means any Person  who or which  holds any Target
Shares.

         "Tax"  means any  federal,  state,  local,  or  foreign  income,  gross
receipts,  license, payroll,  employment,  excise, severance, stamp, occupation,
premium,  windfall profits,  environmental  (including taxes under Code ss.59A),
customs duties, capital stock, franchise, profits, withholding,  social security
(or similar), unemployment, disability, real property, personal property, sales,
use,  transfer,  registration,  value  added,  alternative  or  add-on  minimum,
estimated, or other tax of any kind whatsoever, including any interest, penalty,
or addition thereto, whether disputed or not.

         "Tax Return" means any return,  declaration,  report, claim for refund,
or information return or statement relating to Taxes,  including any schedule or
attachment thereto, and including any amendment thereof.

         "Third   Party"  means  any  "group"  as  described  in  Rule  13d-5(b)
promulgated under the Securities Exchange Act, or Person, other than the Target,
the Buyer, Merger Sub or any of their Affiliates.

         2.       Basic Transaction.
<PAGE>
         (a)      The Merger. On and subject to the terms and conditions of this
Agreement,  the Target will merge with and into Merger Sub (the "Merger") at the
Effective Time and Merger Sub shall be the corporation surviving the Merger (the
"Surviving Corporation").

         (b)      The Closing.  The closing of the transactions  contemplated by
this  Agreement  (the  "Closing")  shall  take  place at the  offices of Thacher
Proffitt & Wood, Two World Trade Center,  New York, New York  commencing at 9:00
a.m. local time on the second business day following the  satisfaction or waiver
of  all  conditions  to  the  obligations  of  the  Parties  to  consummate  the
transactions  contemplated hereby (other than conditions with respect to actions
the  respective  Parties will take at the Closing  itself) or such other date as
the Parties may mutually determine (the "Closing Date").

         (c)      Actions at the Closing.  At the  Closing,  (i) the Target will
deliver to the Buyer and Merger Sub the various certificates,  instruments,  and
documents  referred  to in  ss.6(a)  below,  (ii) the Buyer and  Merger Sub will
deliver to the Target  the  various  certificates,  instruments,  and  documents
referred to in ss.6(b) below, (iii) the Target and Merger Sub will file with the
Secretary  of  State  of  the  State  of  Delaware  a   certificate   of  merger
substantially   in  the  form  attached  hereto  as  Exhibit  A  (the  "Delaware
Certificate  of  Merger"),  (iv) the  Target  and  Merger Sub will file with the
Department  of  State  of  the  State  of  New  York  a  certificate  of  merger
substantially  in  the  form  attached  hereto  as  Exhibit  B  (the  "New  York
Certificate of Merger"),  and (v) the Buyer will cause the Surviving Corporation
to deliver the Payment Fund to the Paying Agent in the manner  provided below in
this ss.2.

         (d)      Effect of Merger.

                  (i) General.  The Merger  shall  become  effective at the time
         (the  "Effective  Time") the  Target  and Merger Sub file the  Delaware
         Certificate  of  Merger  with the  Secretary  of State of the  State of
         Delaware.  The Merger  shall have the effect set forth in the  Delaware
         General  Corporation  Law. The Surviving  Corporation  may, at any time
         after the  Effective  Time,  take any action  (including  executing and
         delivering any document) in the name and on behalf of either the Target
         or Merger  Sub in order to carry out and  effectuate  the  transactions
         contemplated by this Agreement.

                  (ii)   Certificate  of   Incorporation.   The  Certificate  of
         Incorporation of the Surviving  Corporation shall be the Certificate of
         Incorporation of Merger Sub immediately prior to the Effective Time.

                  (iii) Bylaws. The Bylaws of the Surviving Corporation shall be
         the Bylaws of Merger Sub immediately prior to the Effective Time.

                  (iv)  Directors  and  Officers.  The directors and officers of
         Merger Sub shall become the  directors  and  officers of the  Surviving
         Corporation at and as of the Effective Time (retaining their respective
         positions and terms of office).

                  (v)  Conversion of Target  Shares.  At and as of the Effective
         Time,  (A)  each  Target  Share  (other  than any  Dissenting  Share or
         Buyer-owned  Share)  shall be  converted
<PAGE>
         into the right to receive an amount (the "Merger  Consideration") equal
         to $0.27 in cash (without interest), (B) each Dissenting Share shall be
         converted  into  the  right  to  receive  payment  from  the  Surviving
         Corporation  with respect  thereto in accordance with the provisions of
         the New York Business  Corporation Law, and (C) each Buyer-owned  Share
         shall be canceled;  provided,  however,  that the Merger  Consideration
         shall be  subject  to  equitable  adjustment  in the event of any stock
         split,  stock  dividend,  reverse  stock split,  or other change in the
         number of Target Shares outstanding. No Target Share shall be deemed to
         be  outstanding  or to have any rights other than those set forth above
         in this ss.2(d)(v) after the Effective Time.

         (e)      Procedure for Payment.

                           (i)  Immediately  after the Effective  Time,  (A) the
                  Buyer  will  cause the  Surviving  Corporation  to  furnish to
                  ChaseMellon Shareholders Services, L.L.C. (the "Paying Agent")
                  a corpus (the "Payment Fund")  consisting of cash  (registered
                  in the name of the Paying Agent or its nominee)  sufficient in
                  the aggregate for the Paying Agent to make full payment of the
                  Merger  Consideration to the holders of all of the outstanding
                  Target   Shares   (other  than  any   Dissenting   Shares  and
                  Buyer-owned  Shares)  and (B) the Buyer  will cause the Paying
                  Agent to mail a letter of transmittal  (with  instructions for
                  its use) to each record  holder of  outstanding  Target Shares
                  for the holder to use in surrendering the  certificates  which
                  represented  his or its Target Shares  against  payment of the
                  Merger  Consideration.  No interest  will accrue or be paid to
                  the holder of any outstanding Target Shares.

                           (ii) The Buyer may cause the  Paying  Agent to invest
                  the  cash  included  in  the  Payment  Fund  in  one  or  more
                  investments  as the  Buyer  may  direct  from  time  to  time;
                  provided,  however,  that  the  terms  and  conditions  of the
                  investments  shall be such as to permit  the  Paying  Agent to
                  make prompt payment of the Merger  Consideration as necessary.
                  The  Buyer  may  cause  the  Paying  Agent  to pay over to the
                  Surviving  Corporation  any net  earnings  with respect to the
                  investments,   and  the  Buyer   will   cause  the   Surviving
                  Corporation  to replace  promptly  any  portion of the Payment
                  Fund which the Paying Agent loses through investments.

                  (iii) The Buyer may cause the Paying  Agent to pay over to the
                  Surviving   Corporation   any  portion  of  the  Payment  Fund
                  (including any earnings  thereon)  remaining 60 days after the
                  Effective Time, and thereafter all former  stockholders  shall
                  be entitled to look to the Surviving  Corporation  (subject to
                  abandoned  property,  escheat,  and  other  similar  laws)  as
                  general  creditors  thereof  with  respect to the cash payable
                  upon surrender of their certificates.

                           (iv) The Buyer shall cause the Surviving  Corporation
                  to pay all charges and expenses of the Paying Agent.
<PAGE>
         (f)      Closing  of  Transfer  Records.   After  the  Effective  Time,
transfers of Target Shares  outstanding prior to the Effective Time shall not be
made on the stock transfer books of the Surviving Corporation.

         3.  Representations and Warranties of the Target. The Target represents
and warrants to the Buyer and Merger Sub that the  statements  contained in this
ss.3 are correct and  complete  as of the date of this  Agreement,  and that the
statements  contained in ss.ss.3(a),  (b), (c), (d), (e), (f), (k) and (bb), and
will be correct and  complete as of the Closing Date (as though made then and as
though  the  Closing  Date  were  substituted  for the  date  of this  Agreement
throughout the aforesaid  subsections of this ss.3),  except as set forth in the
disclosure  schedule  accompanying  this  Agreement and initialed by the Parties
(the  "Disclosure  Schedule").  The  Disclosure  Schedule  will be  arranged  in
paragraphs  corresponding to the lettered and numbered  paragraphs  contained in
this ss.3.

         (a)      Organization, Qualification, and Corporate Power. Each of the
Target and its Subsidiaries is a corporation duly organized,  validly  existing,
and in good standing under the laws of the jurisdiction of its incorporation, as
set forth in the Disclosure Schedule. Each of the Target and its Subsidiaries is
duly  authorized to conduct  business and is in good standing  under the laws of
each  jurisdiction in which the failure to be so qualified would have a material
adverse effect upon the business,  financial condition,  operations,  results of
operations  or future  prospects of the Target and its  Subsidiaries  taken as a
whole.  Each of the Target and its  Subsidiaries  has full  corporate  power and
authority and all licenses,  permits,  and authorizations  necessary to carry on
the  businesses in which it is engaged and to own and use the  properties  owned
and used by it except for such licenses, permits and authorizations, the absence
of which would not have a material  adverse effect upon the business,  financial
condition,  operations,  results of operations or future prospects of the Target
and its Subsidiaries taken as a whole.  ss.3(a) of the Disclosure Schedule lists
the  directors  and  officers  of each of the Target and its  Subsidiaries.  The
Target has delivered to the Buyer and Merger Sub correct and complete  copies of
the  certificate  of  incorporation  and  bylaws of each of the  Target  and its
Subsidiaries (as amended to date).  The minute books  (containing the records of
meetings of the stockholders,  the board of directors, and any committees of the
board of directors),  the stock certificate books, and the stock record books of
each of the Target and its  Subsidiaries  are correct and complete.  None of the
Target and its Subsidiaries is in default under or in violation of any provision
of its certificate of incorporation or bylaws.

         (b)      Capitalization.  The entire  authorized  capital  stock of the
Target consists of 20,000,000  Target Shares,  of which 5,428,621  Target Shares
are issued and outstanding and 1,719,322 Target Shares are held in treasury. All
of the issued and  outstanding  Target Shares have been duly  authorized and are
validly  issued,  fully paid,  and  nonassessable.  There are no  outstanding or
authorized options, warrants,  purchase rights,  subscription rights, conversion
rights,  exchange  rights,  or other contracts or commitments that could require
the Target to issue,  sell, or otherwise cause to become  outstanding any of its
capital  stock.  There are no  outstanding  or  authorized  stock  appreciation,
phantom  stock,  profit  participation,  or similar  rights with  respect to the
Target.   There  are  no  voting  trusts,   proxies,   or  other  agreements  or
understandings with respect to the voting of the capital stock of the Target.
<PAGE>
         (c)      Authorization  of  Transaction.  The board of directors of the
Target has adopted this  Agreement  (including  the plan of merger  incorporated
herein) in accordance with Section 902 of the New York Business Corporation Law.
The Target has full power and  authority  (including  full  corporate  power and
authority) to execute and deliver this Agreement and to perform its  obligations
hereunder;  provided,  however,  that the Target  cannot  consummate  the Merger
unless and until it receives the Requisite Stockholder Approval.  This Agreement
constitutes the valid and legally binding obligation of the Target,  enforceable
in accordance with its terms and conditions.

         (d)      Noncontravention.  Neither the  execution  and the delivery of
this Agreement,  nor the consummation of the transactions  contemplated  hereby,
will (i)  violate  any  constitution,  statute,  regulation,  rule,  injunction,
judgment, order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which any of the Target and its Subsidiaries is
subject or any provision of the certificate of incorporation or bylaws of any of
the Target and its  Subsidiaries  or (ii) conflict with,  result in a breach of,
constitute a default under,  result in the  acceleration of, create in any party
the right to accelerate,  terminate,  modify,  or cancel, or require any notice,
consent or approval  under any material  agreement,  contract,  lease,  license,
instrument, or other arrangement to which any of the Target and its Subsidiaries
is a party or by which it is bound or to which any of its assets is subject  (or
result in the imposition of any Security Interest upon any of its assets). Other
than in connection with the provisions of the New York Business Corporation Law,
the Securities  Exchange Act, and applicable  state securities laws, none of the
Target and its  Subsidiaries  needs to give any notice to, make any filing with,
or  obtain  any  authorization,  consent,  or  approval  of  any  government  or
governmental  agency in order for the  Parties to  consummate  the  transactions
contemplated  by this  Agreement,  except for such  authorizations,  consents or
approvals which, if not obtained,  would not have a material adverse effect upon
the business, financial condition,  operations,  results of operations or future
prospects of the Target and its Subsidiaries taken as a whole.

         (e)      Filings with the SEC. The Target has made all filings with the
SEC  that  it has  been  required  to  make  under  the  Securities  Act and the
Securities Exchange Act (collectively the "Public Reports").  Each of the Public
Reports has complied with the Securities Act and the Securities  Exchange Act in
all material respects. None of the Public Reports, as of their respective dates,
contained any untrue statement of a material fact or omitted to state a material
fact  necessary in order to make the  statements  made therein,  in light of the
circumstances  under  which  they were  made,  not  misleading.  The  Target has
provided  the Buyer with  access to a correct and  complete  copy of each Public
Report (together with all exhibits and schedules thereto and as amended to date)
filed by the Target since January 1, 1994.

         (f)      Title to Assets. The Target and its Subsidiaries have good and
marketable title to, or a valid leasehold interest in, the properties and assets
used by them,  located on their  premises,  or shown on the Most Recent  Balance
Sheet or  acquired  after  the date  thereof,  free  and  clear of all  Security
Interests,  except for properties and assets  disposed of in the Ordinary Course
of Business since the date of the Most Recent Balance Sheet.

         (g)      Subsidiaries.  ss.3(g) of the  Disclosure  Schedule sets forth
for  each   Subsidiary  of  the  Target  (i)  its  name  and   jurisdiction   of
incorporation, (ii) the number of shares of authorized
<PAGE>
capital stock of each class of its capital stock, (iii) the number of issued and
outstanding  shares of each class of its capital stock, the names of the holders
thereof,  and the number of shares held by each such holder, and (iv) the number
of  shares  of its  capital  stock  held  in  treasury.  All of the  issued  and
outstanding  shares of capital stock of each  Subsidiary of the Target have been
duly authorized and are validly issued,  fully paid, and  nonassessable.  One of
the Target and its Subsidiaries holds of record and owns beneficially all of the
outstanding  shares  of each  Subsidiary  of the  Target,  free and clear of any
restrictions on transfer (other than  restrictions  under the Securities Act and
state  securities  laws  or in the  case of V Band  plc,  foreign  law),  Taxes,
Security Interests, options, warrants, purchase rights, contracts,  commitments,
equities,  claims, and demands.  There are no outstanding or authorized options,
warrants,  purchase rights,  subscription  rights,  conversion rights,  exchange
rights,  or other contracts or commitments  that could require any of the Target
and its  Subsidiaries  to sell,  transfer,  or otherwise  dispose of any capital
stock of any of its  Subsidiaries  or that could  require any  Subsidiary of the
Target to issue,  sell, or otherwise cause to become  outstanding any of its own
capital  stock.  There are no  outstanding  stock  appreciation,  phantom stock,
profit  participation,  or similar  rights with respect to any Subsidiary of the
Target.   There  are  no  voting  trusts,   proxies,   or  other  agreements  or
understandings with respect to the voting of any capital stock of any Subsidiary
of the  Target.  None of the Target and its  Subsidiaries  controls  directly or
indirectly  or  has  any  direct  or  indirect  equity   participation   in  any
corporation,  partnership,  trust, or other business  association which is not a
Subsidiary of the Target.

         (h)      Financial Statements.  The Target has filed a Quarterly Report
on Form 10-Q for the fiscal  quarter  ended  January 31, 1999 (the "Most  Recent
Fiscal Quarter End") and an Annual Report on Form 10-K for the fiscal year ended
October 31, 1998 (the "Most Recent Fiscal Year End").  The financial  statements
included in or  incorporated  by reference into these Public Reports  (including
the related notes and  schedules)  have been  prepared in  accordance  with GAAP
applied on a consistent basis  throughout the periods covered  thereby,  present
fairly the  financial  condition  of the Target and its  Subsidiaries  as of the
indicated dates and the results of operations of the Target and its Subsidiaries
for the indicated  periods,  are correct and complete in all  respects,  and are
consistent  with the books  and  records  of the  Target  and its  Subsidiaries;
provided,  however,  that the interim  statements are subject to normal year-end
adjustments.

         (i)      Events  Subsequent to Most Recent Fiscal Quarter End. From the
Most Recent Fiscal Quarter End to the date of this Agreement, there has not been
any material adverse change in the business,  financial  condition,  operations,
results of operations,  or future  prospects of the Target and its  Subsidiaries
taken as a whole.

         (j)      Undisclosed   Liabilities.   None  of  the   Target   and  its
Subsidiaries  has any Liability,  including any Liability for Taxes,  except for
(i)  Liabilities  set forth on the face of, or in the notes to, the Most  Recent
Balance  Sheet or in the notes to the balance  sheet dated as of the Most Recent
Fiscal Year End, (ii) Liabilities which have arisen after the Most Recent Fiscal
Quarter  End in the  Ordinary  Course of  Business  and (iii)  Liabilities  that
individually or in the aggregate do not have a material  adverse effect upon the
business,  financial  condition,  operations,  results of operations,  or future
prospects of the Target and its Subsidiaries taken as a whole.
<PAGE>
         (k)      Brokers' Fees. None of the Target and its Subsidiaries has any
liability or obligation to pay any fees or commissions to any broker, finder, or
agent with respect to the transactions contemplated by this Agreement.

         (l) Legal Compliance.  Each of the Target, its Subsidiaries,  and their
respective  predecessors  and Affiliates  has complied with all applicable  laws
(including rules,  regulations,  codes, plans, injunctions,  judgments,  orders,
decrees,  rulings, and charges thereunder) of federal, state, local, and foreign
governments (and all agencies thereof) the failure of which to comply with would
have a material adverse effect on the business, financial condition, operations,
results of  operations  or future  prospects of the Target and its  Subsidiaries
taken as a whole,  and no  action,  suit,  proceeding,  hearing,  investigation,
charge, complaint,  claim, demand, or notice has been filed or commenced against
any of them alleging any failure so to comply.

         (m)      Tax Matters.

                  (i) Each of the Target and its  Subsidiaries has filed all Tax
         Returns that it was required to file. All such Tax Returns were correct
         and  complete in all  material  respects.  All Taxes owed by any of the
         Target and its  Subsidiaries  (whether  or not shown on any Tax Return)
         have been paid.  None of the Target and its  Subsidiaries  currently is
         the  beneficiary  of any extension of time within which to file any Tax
         Return.  No claim has ever been made by an authority in a  jurisdiction
         where any of the Target and its Subsidiaries  does not file Tax Returns
         that it is or may be subject to  taxation by that  jurisdiction.  There
         are no Security Interests on any of the assets of any of the Target and
         its Subsidiaries  that arose in connection with any failure (or alleged
         failure) to pay any Tax.

                  (ii) Each of the Target and its  Subsidiaries has withheld and
         paid all Taxes  required to have been  withheld and paid in  connection
         with amounts  paid or owing to any  employee,  independent  contractor,
         creditor, stockholder, or other Third Party.

                  (iii)  Neither  the Target nor its  Subsidiaries  expects  any
         authority to assess any  additional  Taxes for any period for which Tax
         Returns have been filed.  There is no dispute or claim  concerning  any
         Tax  Liability  of any of the  Target and its  Subsidiaries  either (A)
         claimed  or raised by any  authority  in writing or (B) as to which the
         Target and its  Subsidiaries  has Knowledge based upon personal contact
         with  any  agent  of such  authority.  ss.3(m)(iii)  of the  Disclosure
         Schedule  lists all  federal,  state,  local,  and  foreign  income Tax
         Returns  filed with  respect to any of the Target and its  Subsidiaries
         for taxable periods ended on or after October 31, 1994, indicates those
         Tax Returns that have been  audited,  and  indicates  those Tax Returns
         that  currently  are the subject of audit.  The Target has provided the
         Buyer with access to correct and complete  copies of all federal income
         Tax  Returns,  examination  reports,  and  statements  of  deficiencies
         assessed against or agreed to by any of the Target and its Subsidiaries
         since October 31, 1994.

                  (iv) None of the  Target and its  Subsidiaries  has waived any
         statute of  limitations  in respect of Taxes or agreed to any extension
         of time with respect to a Tax assessment or deficiency.
<PAGE>
                  (v)  None of the  Target  and  its  Subsidiaries  has  filed a
         consent under Code ss.341(f) concerning collapsible corporations.  None
         of the Target and its Subsidiaries has made any payments,  is obligated
         to make any payments, or is a party to any agreement that under certain
         circumstances  could  obligate it to make any payments that will not be
         deductible under Code ss.280G.  None of the Target and its Subsidiaries
         has been a United States real property holding  corporation  within the
         meaning of Code ss.897(c)(2)  during the applicable period specified in
         Code  ss.897(c)(1)(A)(ii).  None of the Target and its Subsidiaries has
         issued or assumed (A) any obligation described in Section 279(b) of the
         Code, (B) any applicable high yield discount obligation,  as defined in
         Section   163(i)  of  the  Code,   or  (C)  any   registration-required
         obligations,  within the meaning of Section 163(f)(2) of the Code, that
         is not in registered  form. Each of the Target and its Subsidiaries has
         disclosed on its federal income Tax Returns all positions taken therein
         that could give rise to a substantial  understatement of federal income
         Tax within  the  meaning  of Code  ss.6662.  None of the Target and its
         Subsidiaries  is a party to any Tax  allocation  or sharing  agreement.
         None of the  Target  and its  Subsidiaries  (A) has been a member of an
         Affiliated Group filing a consolidated federal income Tax Return (other
         than a group the common  parent of which was the Target) or (B) has any
         Liability for the Taxes of any Person (other than any of the Target and
         its Subsidiaries)  under Reg.  ss.1.1502-6 (or any similar provision of
         state,  local,  or foreign  law),  as a  transferee  or  successor,  by
         contract, or otherwise.

                  (vi)  ss.3(m)(vi)  of the  Disclosure  Schedule sets forth the
         following  information  with  respect  to  each of the  Target  and its
         Subsidiaries (or, in the case of clause (B) below, with respect to each
         of the Subsidiaries) as of the most recent practicable date (as well as
         on an estimated pro forma basis as of the Closing  giving effect to the
         consummation of the transactions contemplated hereby): (A) the basis of
         the  Target  or  each  Subsidiary  in its  assets;  (B)  [intentionally
         omitted] (C) the amount of any net  operating  loss,  net capital loss,
         unused  investment  or other  credit,  unused  foreign  tax,  or excess
         charitable contribution allocable to the Target or any Subsidiary;  and
         (D) the amount of any deferred gain or loss  allocable to the Target or
         any Subsidiary arising out of any Deferred Intercompany Transaction.

                  (vii) The unpaid Taxes of the Target and its  Subsidiaries (A)
         did not, as of the Most Recent Fiscal  Quarter End,  exceed the reserve
         for  Tax  Liability   (rather  than  any  reserve  for  deferred  Taxes
         established to reflect timing differences  between book and Tax income)
         set forth on the face of the Most Recent  Balance Sheet (rather than in
         any notes  thereto)  and (B) do not exceed that reserve as adjusted for
         the passage of time  through the Closing  Date in  accordance  with the
         past custom and practice of the Target and its  Subsidiaries  in filing
         their Tax Returns.

         (n)      Real Property.

                  (i)      Neither the Target nor its Subsidiaries owns any real
property.
<PAGE>
                  (ii)   ss.3(n)(ii)  of  the  Disclosure   Schedule  lists  and
         describes briefly all real property leased or subleased to or by any of
         the Target and its Subsidiaries. The Target has provided the Buyer with
         access to correct  and  complete  copies of the  leases  and  subleases
         listed in ss.3(n)(ii) of the Disclosure  Schedule (as amended to date).
         With respect to each lease and sublease  listed in  ss.3(n)(ii)  of the
         Disclosure Schedule:

                           (A) the  lease  or sublease is legal, valid, binding,
                  enforceable, and in full force and effect;

                           (B) the lease or sublease  will continue to be legal,
                  valid, binding,  enforceable,  and in full force and effect on
                  identical terms following the consummation of the transactions
                  contemplated hereby;

                           (C) no  party  to  any  lease  or  sublease  that  is
                  material to the  business,  financial  condition,  operations,
                  results of  operations  or future  prospects of the Target and
                  its Subsidiaries taken as a whole is in breach or default, and
                  no event has  occurred  which,  with  notice or lapse of time,
                  would  constitute  a breach or default or permit  termination,
                  modification, or acceleration thereunder;

                           (D) no party to the lease or sublease has  repudiated
                  any provision thereof;

                           (E)  there  are  no  disputes,  oral  agreements,  or
                  forbearance programs in effect as to the lease or sublease;

                           (F)   with    respect   to   each    sublease,    the
                  representations  and warranties  set forth in subsections  (A)
                  through  (E) above are true and  correct  with  respect to the
                  underlying lease;

                           (G)  none  of the  Target  and its  Subsidiaries  has
                  assigned,  transferred,  conveyed, mortgaged, deeded in trust,
                  or encumbered any interest in the leasehold or subleasehold;

                           (H)  each  facility   leased  or  subleased  that  is
                  material to the  business,  financial  condition,  operations,
                  results of  operations  or future  prospects of the Target and
                  its Subsidiaries taken as a whole thereunder have received all
                  approvals of governmental  authorities (including licenses and
                  permits)  required  to  be  obtained  by  the  Target  or  its
                  Subsidiaries in connection with the operation thereof and have
                  been operated and maintained, to the extent the Target and its
                  Subsidiaries  are required to do so, in all material  respects
                  in accordance with applicable  laws,  rules,  and regulations;
                  and

                           (I) all facilities leased or subleased thereunder are
                  supplied with utilities and other  services  necessary for the
                  operation of said facilities.
<PAGE>
         (o)      Intellectual Property.

                  (i) The Target and its  Subsidiaries  own or have the right to
         use  pursuant to license,  sublicense,  agreement,  or  permission  all
         Intellectual  Property necessary for the operation of the businesses of
         the Target and its  Subsidiaries as presently  conducted.  Each item of
         Intellectual  Property  owned  or  used  by any of the  Target  and its
         Subsidiaries  immediately  prior to the Closing hereunder will be owned
         or available for use by the Target or the Subsidiary on identical terms
         and conditions immediately subsequent to the Closing hereunder. Each of
         the  Target and its  Subsidiaries  has taken all  action  necessary  to
         maintain and protect each item of Intellectual Property that it owns or
         uses  which  is  material  to  the  business  of  the  Target  and  its
         Subsidiaries as presently conducted.

                  (ii) None of the Target and its  Subsidiaries  has  interfered
         with, infringed upon, misappropriated,  or otherwise come into conflict
         with any Intellectual Property rights of third parties, and none of the
         Target and its Subsidiaries has received any charge, complaint,  claim,
         demand,  or  notice  alleging  any  such  interference,   infringement,
         misappropriation,  or  violation  (including  any claim that any of the
         Target and its  Subsidiaries  must  license  or refrain  from using any
         Intellectual  Property rights of any Third Party, in each case which is
         pending on the date of this Agreement).

                  (iii) ss.3(o)(iii) of the Disclosure  Schedule identifies each
         patent or  registration  which has been issued to any of the Target and
         its  Subsidiaries  with  respect to any of its  Intellectual  Property,
         identifies   each  pending  patent   application  or  application   for
         registration which any of the Target and its Subsidiaries has made with
         respect  to any of  its  Intellectual  Property,  and  identifies  each
         license, agreement, or other permission which any of the Target and its
         Subsidiaries  has granted to any Third Party with respect to any of its
         Intellectual Property (together with any exceptions).

                  (iv)  ss.3(o)(iv) of the Disclosure  Schedule  identifies each
         item of Intellectual Property that any Third Party owns and that any of
         the Target and its Subsidiaries  uses pursuant to license,  sublicense,
         agreement, or permission.

         (p)      Tangible Assets.  The Target and its Subsidiaries own or lease
all buildings, machinery, equipment, and other tangible assets necessary for the
conduct of their businesses as presently  conducted and as presently proposed to
be conducted.

         (q)      Inventory.  All inventory of the Target and its  Subsidiaries,
whether or not reflected in the Most Recent Balance Sheet, consists of a quality
and quantity usable and salable in the Ordinary Course of Business of the Target
and its  Subsidiaries,  except for items of obsolete  materials and materials of
below standard  quality,  all of which have been written down in the Most Recent
Balance Sheet to realizable  market value,  or for which adequate  reserves have
been  provided in the Most Recent  Balance  Sheet.  The present  quantity of all
inventory of the Target and its  Subsidiaries is reasonable and warranted in the
present circumstances of the business of the Target and its Subsidiaries.
<PAGE>

         (r)      Contracts.  ss.3(r)  of  the  Disclosure  Schedule  lists  the
following  contracts  and other  agreements  to which any of the  Target and its
Subsidiaries is a party on the date of this Agreement:

                  (i) any  agreement  (or group of related  agreements)  for the
         lease of personal  property to or from any Person  providing  for lease
         payments in excess of $50,000 per annum;

                  (ii) any  agreement (or group of related  agreements)  for the
         purchase or sale of raw materials, commodities,  supplies, products, or
         other personal  property,  or for the furnishing or receipt of services
         (including  maintenance),  the  performance of which will extend over a
         period  of more  than one year or  involve  consideration  in excess of
         $10,000 per annum;

                  (iii) any agreement concerning a partnership or joint venture;

                  (iv) any  agreement  (or group of  related  agreements)  under
         which it has created, incurred, assumed, or guaranteed any indebtedness
         for borrowed money, or any capitalized lease  obligation,  in excess of
         $50,000 or under which it has imposed a Security Interest on any of its
         assets,  tangible or intangible  or any  agreement  under which it is a
         guarantor  or  otherwise  is liable  for any  Liability  or  obligation
         (including indebtedness) of any other Person;

                  (v)      any agreement concerning noncompetition;

                  (vi) any profit sharing,  stock option, stock purchase,  stock
         appreciation,  deferred  compensation,  severance,  or  other  plan  or
         arrangement  for  the  benefit  of its  current  or  former  directors,
         officers, and employees;

                  (vii)    any collective bargaining agreement;

                  (viii) any agreement for the employment of any individual on a
         full-time,  part-time,  consulting,  or other  basis  providing  annual
         compensation  in excess of $75,000 or providing  severance or change of
         control benefits;

                  (ix) any  agreement  under which it has advanced or loaned any
         amount to any of its  directors,  officers,  and employees  outside the
         Ordinary Course of Business;

                  (x) any agreement under which the consequences of a default or
         termination  could  have a  material  adverse  effect on the  business,
         financial  condition,  operations,  results  of  operations,  or future
         prospects of any of the Target and its  Subsidiaries  taken as a whole;
         or

                  (xi) any other agreement (or group of related  agreements) the
         performance of which involves consideration in excess of $100,000.
<PAGE>
Target has provided the Buyer with access to a correct and complete copy of each
written  agreement  listed in ss.3(r) of the Disclosure  Schedule (as amended to
date) and a written  summary setting forth the terms and conditions of each oral
agreement referred to in ss.3(r) of the Disclosure Schedule. With respect to any
such  agreement  which  is  material  to  the  business,   financial  condition,
operations,  results of  operations  or future  prospects  of the Target and its
Subsidiaries  taken as a whole:  (A) the  agreement  is legal,  valid,  binding,
enforceable, and in full force and effect; (B) the agreement will continue to be
legal, valid,  binding,  enforceable,  and in full force and effect on identical
terms following the consummation of the transactions contemplated hereby; (C) no
party is in breach or default,  and no event has  occurred  which with notice or
lapse of time  would  constitute  a breach or  default,  or permit  termination,
modification,  or  acceleration,  under  the  agreement;  and (D) no  party  has
repudiated any provision of the agreement.

         (s)      Notes  and  Accounts   Receivable.   All  notes  and  accounts
receivable of the Target and its  Subsidiaries  are reflected  properly on their
books and records, are valid receivables subject to no setoffs or counterclaims,
are current and  collectible,  and will be  collected in  accordance  with their
terms at their recorded  amounts,  subject only to the reserve for bad debts set
forth on the face of the Most Recent  Balance  Sheet  (rather  than in any notes
thereto)  as  adjusted  for the  passage of time  through  the  Closing  Date in
accordance with the past custom and practice of the Target and its Subsidiaries.

         (t)      Powers  of  Attorney.  There  are  no  outstanding  powers  of
attorney executed on behalf of any of the Target and its Subsidiaries.

         (u)      Insurance.  ss.3(u) of the Disclosure  Schedule sets forth the
following  information with respect to each insurance policy (including policies
providing property, casualty,  liability, and workers' compensation coverage and
bond and surety  arrangements)  to which any of the Target and its  Subsidiaries
has been a party, a named insured,  or otherwise the  beneficiary of coverage at
any time within the past six (6) years:

                  (i)      the name, address, and telephone number of the agent;

                  (ii) the name of the  insurer,  the name of the  policyholder,
         and the name of each covered insured;

                  (iii)    the policy number and the period of coverage;

                  (iv)  the  scope  (including  an  indication  of  whether  the
         coverage was on a claims made,  occurrence,  or other basis) and amount
         (including a description of how deductibles and ceilings are calculated
         and operate) of coverage;

                  (v)   a description of  any retroactive premium adjustments or
         other   loss-sharing arrangements; and

                           (vi) a list of losses  incurred  that were covered in
                  whole or in part by such policies.
<PAGE>
         (v)      Litigation. ss.3(v) of the Disclosure Schedule sets forth each
instance in which any of the Target and its  Subsidiaries  (i) is subject to any
outstanding injunction,  judgment, order, decree, ruling, or charge or (ii) is a
party  or,  to the  Knowledge  of the  Target  and its  Subsidiaries,  has  been
threatened  to be made a party to any  action,  suit,  proceeding,  hearing,  or
investigation  of, in, or before any court or  quasi-judicial  or administrative
agency of any  federal,  state,  local,  or foreign  jurisdiction  or before any
arbitrator.  Neither the Target nor its  Subsidiaries  has any reason to believe
that any other such action, suit,  proceeding,  hearing, or investigation may be
brought or threatened against any of the Target and its Subsidiaries.

         (w)      Product Warranty. Each product manufactured,  assembled, sold,
leased,  or  delivered  by any of the  Target and its  Subsidiaries  has been in
conformity,   in  all  material  respects,   with  all  applicable   contractual
commitments and all express and implied  warranties,  and none of the Target and
its  Subsidiaries  has any  Liability  (and there is no Basis for any present or
future action, suit,  proceeding,  hearing,  investigation,  charge,  complaint,
claim,  or  demand  against  any of  them  giving  rise  to any  Liability)  for
replacement or repair thereof or other damages in connection therewith,  subject
only to the  reserve for  product  warranty  claims set forth on the face of the
Most Recent Balance Sheet (rather than in any notes thereto) as adjusted for the
passage of time through the Closing Date in accordance  with the past custom and
practice  of the Target and its  Subsidiaries.  No product  manufactured,  sold,
leased, or delivered by any of the Target and its Subsidiaries is subject to any
guaranty,  warranty, or other indemnity beyond the applicable standard terms and
conditions of sale or lease.  ss.3(w) of the Disclosure Schedule includes copies
of the standard terms and conditions of sale or lease for each of the Target and
its  Subsidiaries  (containing  applicable  guaranty,  warranty,  and  indemnity
provisions).

         (x)      Product Liability. None of the Target and its Subsidiaries has
any  Liability  (and there is no basis for any present or future  action,  suit,
proceeding, hearing, investigation,  charge, complaint, claim, or demand against
any of  them  giving  rise  to any  Liability)  arising  out  of any  injury  to
individuals or property as a result of the ownership,  possession, or use of any
product manufactured, assembled, sold, leased, or delivered by any of the Target
and its  Subsidiaries,  which Liability would have a material  adverse effect on
the business, financial condition,  operations,  results of operations or future
prospects of the Target and its Subsidiaries taken as a whole.

         (y)      Employees.   To  the   Knowledge   of  the   Target   and  its
Subsidiaries, no executive, key employee, or group of employees has any plans to
terminate  employment with any of the Target and its  Subsidiaries.  None of its
Subsidiaries is a party to or bound by any collective bargaining agreement,  nor
has any of them  experienced  any  strikes,  grievances,  claims of unfair labor
practices,  or other collective bargaining disputes.  None of the Target and its
Subsidiaries has committed any unfair labor practice. Neither the Target nor its
Subsidiaries has any Knowledge of any organizational effort presently being made
or  threatened  by or on behalf of any labor union with  respect to employees of
any of the Target and its Subsidiaries.

         (z)      Employee Benefits.
<PAGE>
                  (i) ss.3(z) of the  Disclosure  Schedule  lists each  Employee
         Benefit Plan that any of the Target and its  Subsidiaries  maintains or
         to which any of the Target and its Subsidiaries  contributes or has any
         obligation to contribute.

                           (A) Each such Employee Benefit Plan (and each related
                  trust,  insurance  contract,  or fund) complies in form and in
                  operation in all respects with the applicable  requirements of
                  ERISA, the Code, and other applicable laws.

                           (B) All required reports and descriptions  (including
                  Form 5500 Annual Reports,  summary annual  reports,  PBGC-1's,
                  and summary  plan  descriptions)  have been  timely  filed and
                  distributed  appropriately  with respect to each such Employee
                  Benefit  Plan.  The  requirements  of COBRA have been met with
                  respect  to  each  such  Employee  Benefit  Plan  which  is an
                  Employee Welfare Benefit Plan.

                           (C)  All   contributions   (including   all  employer
                  contributions  and employee  salary  reduction  contributions)
                  which are due have been  paid to each  such  Employee  Benefit
                  Plan  which  is an  Employee  Pension  Benefit  Plan  and  all
                  contributions  for any period  ending on or before the Closing
                  Date  which  are not  yet  due  have  been  paid to each  such
                  Employee  Pension  Benefit Plan or accrued in accordance  with
                  the  past   custom  and   practice   of  the  Target  and  its
                  Subsidiaries.  All premiums or other  payments for all periods
                  ending  on or  before  the  Closing  Date  have been paid with
                  respect  to  each  such  Employee  Benefit  Plan  which  is an
                  Employee Welfare Benefit Plan.

                           (D)  Each  such  Employee  Benefit  Plan  which is an
                  Employee  Pension  Benefit  Plan meets the  requirements  of a
                  "qualified  plan" under Code ss.401(a),  has received,  within
                  the last two years, a favorable  determination letter from the
                  Internal  Revenue  Service that it is a "qualified  plan," and
                  Seller is not aware of any facts or  circumstances  that could
                  result in the revocation of such determination letter.

                           (E) The  market  value  of  assets  under  each  such
                  Employee  Benefit  Plan which is an Employee  Pension  Benefit
                  Plan (other than any Multiemployer Plan) equals or exceeds the
                  present  value  of  all  vested  and   nonvested   Liabilities
                  thereunder   determined  in  accordance   with  PBGC  methods,
                  factors,  and  assumptions  applicable to an Employee  Pension
                  Benefit Plan terminating on the date for determination.

                           (F) The Target  has  provided  Buyer  with  access to
                  correct and complete  copies of the plan documents and summary
                  plan  descriptions,   the  most  recent  determination  letter
                  received from the Internal  Revenue  Service,  the most recent
                  Form 5500 Annual  Report,  and all related  trust  agreements,
                  insurance  contracts,   and  other  funding  agreements  which
                  implement each such Employee Benefit Plan.
<PAGE>
                  (ii) With  respect to each  Employee  Benefit Plan that any of
         the Target, its Subsidiaries, and any ERISA Affiliate maintains or ever
         has  maintained  or  to  which  any  of  them  contributes,   ever  has
         contributed, or ever has been required to contribute:

                           (A)  No  such  Employee  Benefit  Plan  which  is  an
                  Employee  Pension  Benefit Plan (other than any  Multiemployer
                  Plan) has been completely or partially  terminated or been the
                  subject of a  Reportable  Event as to which  notices  would be
                  required to be filed with the PBGC.  No proceeding by the PBGC
                  to terminate  any such  Employee  Pension  Benefit Plan (other
                  than any  Multiemployer  Plan) has been  instituted or, to the
                  Knowledge of the Target and its Subsidiaries, threatened.

                           (B) There have been no Prohibited  Transactions  with
                  respect to any such  Employee  Benefit  Plan. No Fiduciary has
                  any  Liability  for  breach  of  fiduciary  duty or any  other
                  failure to act or comply in connection with the administration
                  or investment of the assets of any such Employee Benefit Plan.
                  No action,  suit,  proceeding,  hearing, or investigation with
                  respect to the  administration or the investment of the assets
                  of any such Employee  Benefit Plan (other than routine  claims
                  for  benefits)  is pending or, to the  Knowledge of the Target
                  and its Subsidiaries,  threatened.  Neither the Target nor its
                  Subsidiaries  has any  Knowledge  of any  basis  for any  such
                  action, suit, proceeding, hearing, or investigation.

                           (C)  Neither  the  Target  nor its  Subsidiaries  has
                  incurred  or has any  reason to expect  that any of the Target
                  and its  Subsidiaries  will incur,  any  Liability to the PBGC
                  (other than PBGC premium payments) or otherwise under Title IV
                  of ERISA  (including  any  withdrawal  liability as defined in
                  ERISA  ss.4201)  or under  the Code with  respect  to any such
                  Employee  Benefit  Plan which is an Employee  Pension  Benefit
                  Plan.

                  (iii)  None of the  Target,  its  Subsidiaries,  and the other
         members  of the  Controlled  Group  that  includes  the  Target and its
         Subsidiaries  contributes to, ever has contributed to, or ever has been
         required to contribute to any  Multiemployer  Plan or has any Liability
         (including  withdrawal liability as defined in ERISA ss.4201) under any
         Multiemployer Plan.

                  (iv) None of the Target and its Subsidiaries maintains or ever
         has maintained or contributes,  ever has contributed,  or ever has been
         required to contribute to any Employee  Welfare  Benefit Plan providing
         medical,  health, or life insurance or other welfare-type  benefits for
         current or future retired or terminated  employees,  their spouses,  or
         their dependents (other than in accordance with COBRA).

         (aa) Environmental, Health, and Safety Matters. Each of the Target, its
Subsidiaries,  and their respective predecessors and Affiliates has complied and
is in compliance with all Environmental,  Health, and Safety  Requirements,  the
failure  to comply  with  which  would  have a  material  adverse  effect on the
business,  financial  condition,  operations,  results of  operations  or future
prospects of the Target and its Subsidiaries taken as a whole.
<PAGE>
         (bb)  Disclosure.  The Definitive  Proxy Materials will comply with the
Securities Exchange Act in all material respects. The Definitive Proxy Materials
will not  contain  any untrue  statement  of a material  fact or omit to state a
material fact  necessary in order to make the  statements  made therein,  in the
light of the  circumstances  under  which  they  will be made,  not  misleading;
provided,  however,  that the Target makes no  representation  or warranty  with
respect  to  any  information   that  the  Buyer  and  Merger  Sub  will  supply
specifically for use in the Definitive Proxy Materials.

         4.  Representations and Warranties of the Buyer and Merger Sub. Each of
the  Buyer and  Merger  Sub  represents  and  warrants  to the  Target  that the
statements  contained  in this ss.4 are correct  and  complete as of the date of
this  Agreement  and will be correct and  complete  as of the  Closing  Date (as
though made then and as though the Closing Date were substituted for the date of
this  Agreement  throughout  this ss.4),  except as set forth in the  Disclosure
Schedule.  The Disclosure Schedule will be arranged in paragraphs  corresponding
to the numbered and lettered paragraphs contained in this ss.4.

         (a)      Organization.   Each  of  the  Buyer  and   Merger  Sub  is  a
corporation  duly organized,  validly  existing,  and in good standing under the
laws of the jurisdiction of its incorporation.

         (b)      Authorization of Transaction. Each of the Buyer and Merger Sub
has full power and authority  (including  full corporate power and authority) to
execute and deliver this  Agreement  and to perform its  obligations  hereunder.
This Agreement  constitutes the valid and legally binding  obligation of each of
the  Buyer  and  Merger  Sub,  enforceable  in  accordance  with its  terms  and
conditions.

         (c)      Noncontravention.  Neither the  execution  and the delivery of
this Agreement,  nor the consummation of the transactions  contemplated  hereby,
will (i)  violate  any  constitution,  statute,  regulation,  rule,  injunction,
judgment, order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which either the Buyer or Merger Sub is subject
or any provision of the  certificate  of  incorporation  or bylaws of either the
Buyer or Merger Sub or (ii) conflict with,  result in a breach of,  constitute a
default under,  result in the  acceleration of, create in any party the right to
accelerate,  terminate,  modify,  or  cancel,  or require  any notice  under any
material agreement,  contract, lease, license,  instrument, or other arrangement
to which either the Buyer or Merger Sub is a party or by which it is bound or to
which any of its assets is subject. Other than in connection with the provisions
of the Delaware  General  Corporation  Law,  the  Securities  Exchange  Act, the
Securities  Act, and applicable  state  securities  laws,  neither the Buyer nor
Merger  Sub needs to give any notice to,  make any  filing  with,  or obtain any
authorization,  consent, or approval of any government or governmental agency in
order for the  Parties  to  consummate  the  transactions  contemplated  by this
Agreement,  except for such authorizations,  consents or approvals which, if not
obtained,  would  have a  material  adverse  effect on the  business,  financial
condition,  operations,  results of operations, or future prospects of the Buyer
and its Subsidiaries taken as a whole.

         (d)      Brokers'  Fees.  Neither  the  Buyer  nor  Merger  Sub has any
liability or obligation to pay any fees or commissions to any broker, finder, or
agent with respect to the transactions  contemplated by this Agreement for which
any of the Target and its Subsidiaries could become liable or obligated.
<PAGE>
         (e)      Disclosure.  None of the information that the Buyer and Merger
Sub will supply  specifically  for use in the  Definitive  Proxy  Materials will
contain any untrue statement of a material fact or omit to state a material fact
necessary  in order to make the  statements  made  therein,  in the light of the
circumstances under which they will be made, not misleading.

         (f)      Merger  Sub.  Merger  Sub has  not  heretofore  conducted  any
business and has no material assets or liabilities  other than those  associated
with this Agreement.

         5.  Covenants.  The Parties agree as follows with respect to the period
from and after the execution of this Agreement.

         (a)      General. Each of the Parties will use its best efforts to take
all action and to do all things  necessary,  proper,  or  advisable  in order to
consummate and make effective the  transactions  contemplated  by this Agreement
(including satisfaction,  but not waiver, of the closing conditions set forth in
ss.6 below).

         (b)      Notices and  Consents.  The Target will give any notices  (and
will cause each of its  Subsidiaries to give any notices) to third parties,  and
will use its best efforts to obtain (and will cause each of its  Subsidiaries to
use its best  efforts to obtain)  any Third Party  consents,  that the Buyer may
request in connection with the matters referred to in ss.3(d) above.

         (c) Regulatory Matters and Approvals. Each of the Parties will (and the
Target  will cause each of its  Subsidiaries  to) give any  notices to, make any
filings with, and use its best efforts to obtain any  authorizations,  consents,
and approvals of governments  and  governmental  agencies in connection with the
matters  referred  to  in  ss.3(d)  and  ss.4(c)  above.  Without  limiting  the
generality of the foregoing:

                  (i)  Securities  Exchange Act and State  Securities  Laws. The
         Target will prepare and file with the SEC  preliminary  proxy materials
         under the Securities Exchange Act relating to the Special Meeting.  The
         Target will use its best  efforts to respond to the comments of the SEC
         thereon and will make any further  filings  (including  amendments  and
         supplements) in connection therewith that may be necessary,  proper, or
         advisable.  The Buyer will provide the Target with whatever information
         and assistance in connection with the foregoing  filing that the Target
         reasonably may request.

                  (ii) New York Business Corporation Law. The Target will call a
         special meeting of its stockholders (the "Special  Meeting") as soon as
         practicable in order that the  stockholders  may consider and vote upon
         the  adoption  of this  Agreement  and the  approval  of the  Merger in
         accordance with the New York Business  Corporation Law. The Target will
         mail the  Definitive  Proxy  Materials to its  stockholders  as soon as
         reasonably practicable. The Definitive Proxy Materials will contain the
         affirmative  recommendation  of the board of directors of the Target in
         favor of the adoption of this Agreement and the approval of the Merger;
         provided, however,   that neither the board of directors  nor any
<PAGE>
         director  or officer of the Target  shall be  required  to violate  any
         fiduciary  duty  or  other  requirement  imposed  by law in  connection
         therewith.

         (d)      Operation of Business. The Target will not (and will not cause
\or permit any of its Subsidiaries  to) engage in any practice, take any action,
or enter into any transaction  outside the Ordinary Course of Business.  Without
limiting the generality of the foregoing:

                  (i)      none of   the    Target   and its  Subsidiaries  will
         authorize  or effect any change in its certificate of incorporation or
         bylaws;

                  (ii) none of the  Target and its  Subsidiaries  will grant any
         options,  warrants,  or other  rights to  purchase or obtain any of its
         capital  stock or  issue,  sell,  or  otherwise  dispose  of any of its
         capital  stock  (except  upon the  conversion  or  exercise of options,
         warrants, and other rights currently outstanding);

                  (iii) none of the Target and its  Subsidiaries  will  declare,
         set aside,  or pay any  dividend or  distribution  with  respect to its
         capital stock (whether in cash or in kind), or redeem,  repurchase,  or
         otherwise acquire any of its capital stock;

                  (iv) none of the  Target and its  Subsidiaries  will issue any
         note,  bond,  or other debt  security  or  create,  incur,  assume,  or
         guarantee any  indebtedness  for borrowed  money or  capitalized  lease
         obligation  outside the Ordinary Course of Business  (including in such
         Ordinary  Course of Business,  transactions  under the Target's  Credit
         Facility with National Bank of Canada and its successors and assigns);

                  (v) none of the Target  and its  Subsidiaries  will  impose or
         allow any Security Interest upon any of its assets outside the Ordinary
         Course of Business;  (including  in such  Ordinary  Course of Business,
         transactions  under the Target's  Credit Facility with National Bank of
         Canada and its successors and assigns);

                  (vi) none of the  Target  and its  Subsidiaries  will make any
         capital  investment  in, make any loan to, or acquire the securities or
         assets of any other Person outside the Ordinary Course of Business;

                  (vii) none of the Target  and its  Subsidiaries  will make any
         change in  employment  terms for any of its  directors,  officers,  and
         employees outside the Ordinary Course of Business; and

                  (viii) none of the Target and its Subsidiaries  will commit to
any of the foregoing.
<PAGE>
         (e)      Full  Access.  The  Target  will (and will  cause  each of its
Subsidiaries to) permit  representatives of the Buyer to have full access during
normal business hours to all premises,  properties,  personnel,  books,  records
(including  tax records),  contracts,  and documents of or pertaining to each of
the Target and its Subsidiaries. Each of the Buyer and Merger Sub will treat and
hold and use as such any  Confidential  Information  it receives from any of the
Target and its
<PAGE>
Subsidiaries in the course of the reviews  contemplated by this ss.5(e),  solely
in  accordance  with the terms of the  Confidentiality  Agreement,  and, if this
Agreement  is  terminated  for any  reason  whatsoever,  agrees to return to the
Target  all  tangible  embodiments  (and all  copies)  thereof  which are in its
possession.

         (f)      Notice of  Developments.  Each Party will give prompt  written
notice to the others of any  development  (i) causing a breach of any of its own
representations  and warranties in ss.3 and ss.4 above and (ii) any  development
which  would  cause a breach  of such  representations  and  warranties  if such
representations  and warranties were required to be correct and complete on each
day from the date of this  Agreement to the Closing  Date.  No disclosure by any
Party pursuant to this ss.5(f),  however, shall be deemed to amend or supplement
the Disclosure Schedule or to prevent or cure any  misrepresentation,  breach of
warranty, or breach of covenant.

         (g)      Exclusivity.

                  (i) the  Target  shall  not,  and shall not  permit any of its
         Subsidiaries  to (whether  directly  or  indirectly  through  advisors,
         agents or other intermediaries) and,

                  (ii) the  Target  shall  not,  and shall not permit any of its
         Subsidiaries  to,  authorize  or  knowingly  permit any of its or their
         officers, directors, agents, representatives,  advisors or Subsidiaries
         to,

solicit, initiate or knowingly encourage the submission of inquiries,  proposals
or offers from any Third Party relating to (A) any acquisition of 10% or more of
the consolidated assets of the Target and its Subsidiaries or of over 10% of any
class of equity  securities  of the Target or any of its  Subsidiaries,  (B) any
tender  offer  (including  a self  tender  offer)  or  exchange  offer  that  if
consummated would result in any Third Party  beneficially  owning 10% or more of
any class of equity securities of the Target or any of its Subsidiaries, (C) any
merger,  consolidation,  business  combination,  recapitalization,  liquidation,
dissolution  or  similar  transaction   involving  the  Target  or  any  of  its
Subsidiaries  whose assets,  individually  or in the aggregate,  constitute more
than 10% of the  consolidated  assets of the Target,  other than the transaction
contemplated by this Agreement or (D) any other  transaction the consummation of
which would, or could reasonably be expected to impede,  interfere with, prevent
or materially  delay the Merger or which would, or could  reasonably be expected
to, materially dilute the benefits to the Buyer of the transaction  contemplated
hereby  (collectively,  the  "Acquisition  Proposals" and which, if consummated,
will be an  "Acquisition  Transaction")  or  enter  into or  participate  in any
discussions  (except  as may  be  necessary  to  inform  a  Third  Party  of the
provisions of this ss.5(g), or negotiations  regarding any of the foregoing,  or
furnish  to any Third  Party  any  information  with  respect  to the  business,
properties  or  assets  of the  Target  in  connection  with the  foregoing,  or
otherwise  cooperate in any way with,  or knowingly  assist or  participate  in,
facilitate or encourage,  any effort or attempt by any Third Party to do or seek
any of the  foregoing;  provided,  however,  that the provisions of this ss.5(g)
shall not limit or  prohibit  the  Target  or its  board of  directors  from (i)
engaging in discussions or  negotiations  with such a Third Party who has made a
Superior  Acquisition Proposal but only if the board of directors of the Target,
after  consultation with and advice from its outside counsel  determines in good
faith that, in the exercise of its fiduciary responsibilities,  such discussions
or negotiations  should be commenced or such information  should be furnished
<PAGE>
or such  facilitation  undertaken;  (ii) furnishing  information  pursuant to an
appropriate and customary  confidentiality  letter concerning the Target and its
businesses,  properties  or  assets  to a Third  Party  who has made a  Superior
Acquisition Proposal as to which a prior determination of the board of directors
of the Target as  contemplated  under  clause (i) above as been made;  provided,
further  that (A) the board  directors  of the Target  shall not,  and shall not
authorize any officers or representatives  to, take any of the foregoing actions
until notice to the Buyer of the Target's  intent to take such action shall have
been given;  and (B) if the board of directors of the Target receives a Superior
Acquisition Proposal, to the extent it may do so without breaching its fiduciary
duties as determined in good faith after  consultation with its outside counsel,
and  without  violating  any of the  conditions  of  such  Superior  Acquisition
Proposal,  then the Target shall promptly inform the Buyer of the material terms
and  conditions  of such proposal and the identity of the Third Party making it;
or (iii) taking a position on a tender  offer by a Third  Party,  as required by
Rule 14e-2 under the  Securities  Exchange Act (provided no such position  shall
constitute a  recommendation  of such  transaction  if it does not  constitute a
Superior Acquisition Proposal), or complying with its duties of disclosure under
applicable state law. As of the date hereof,  the Target shall immediately cease
and cause each of its Subsidiaries and its and their advisors,  agents and other
intermediaries  to  cease,  any  and all  existing  activities,  discussions  or
negotiations  with any Third Party  conducted  heretofore with respect to any of
the foregoing.

         (h)      Insurance  and  Indemnification.  The Buyer  will not take any
action to alter or impair any  exculpatory  or  indemnification  provisions  now
existing in the  certificate  of  incorporation  or bylaws of the Target for the
benefit of any  individual  who served as a director or officer of the Target at
any time prior to the  Effective  Time.  For six years after the  Closing  Date,
Buyer will provide,  pursuant to a policy  maintained by Buyer or will cause the
Surviving Corporation to provide officers' and directors' liability insurance in
respect of acts or omissions  occurring  prior to the Closing Date covering each
such Person currently covered by the Target's officers' and directors' liability
insurance on terms with respect to coverage  and amount no less  favorable  than
those of such policy in effect on the date hereof.

         (i)      Stock Options.  At the Effective Time, each option to purchase
Target  Shares  granted  by the  Target to an  employee  or  director  under any
employee or director stock option plan or other compensation plan or arrangement
of the Target,  which is outstanding  and unexercised  immediately  prior to the
Effective  Time  (whether or not such  options are then vested or  exercisable),
shall be adjusted so as to entitle the option holder to receive, in lieu of each
Target Share that would  otherwise  have been issuable upon the exercise of such
option, an amount, in cash, computed by multiplying (i) the positive difference,
if any, between (x) $0.27 per Target Share and (y) the exercise price per Target
Share  applicable to the option by (ii) the number of Target  Shares  subject to
such option. Prior to the Effective Time, the Target agrees to take, or cause to
be taken,  all  actions  necessary  under  such  options  to  provide  for their
adjustment  and  final  settlement  in  accordance  with  this  ss.5(i).  At the
Effective Time, the Surviving  Corporation  will make the cash payment,  if any,
required to be made to each option  holder at which time each such option  shall
be canceled and declared null and void.  Notwithstanding  any other provision of
this ss.5(i), the Surviving Corporation shall have the right to withhold payment
in respect of any option to  purchase  Target  Shares  that is  outstanding  and
unexercised  at the Effective Time and otherwise  eligible for final  settlement
hereunder,  until such time as it receives satisfactory written documentation of
the  adjustments  required
<PAGE>
to be made to such option under this ss.5(i) and evidence of the option holder's
consent to such adjustment and settlement.

         (j)      National Bank of Canada.  The Target will use its best efforts
to take all steps  necessary  (i) to enable  the entire  indebtedness  under the
Credit  Facility and  otherwise to the National Bank of Canada to be paid by the
Surviving  Corporation in full immediately  after the Closing and (ii) to obtain
from the National Bank of Canada  immediately  after the Closing,  in return,  a
full and complete  release,  including the return of all  collateral  physically
possessed,  the reassignment of any collateral and the execution of UCC-3's,  as
the case may be, of all Security  Interests  related  thereto,  including  those
granted under the General Security Agreement, as amended, the Security Agreement
- Patents,  Trademarks  and  Copyright,  as  amended,  the May 28,  1997  Pledge
Agreement, as amended, and the March 5, 1999 Pledge Agreement.

         (k)      Form 10-Q.  The Target will make all filings with the SEC that
it is hereinafter  required to make under the Securities  Exchange Act including
the quarterly report on Form 10-Q for the quarter ended April 30, 1999.

         6.       Conditions to Obligation to Close.

         (a)      Conditions  to  Obligation  of the Buyer and Merger  Sub.  The
obligation of each of the Buyer and Merger Sub to consummate the transactions to
be performed by it in connection  with the Closing is subject to satisfaction or
waiver by the Buyer and Merger Sub of the following conditions:

                  (i)      this Agreement and the Merger shall have received the
         Requisite Stockholder Approval;

                  (ii) the  representations  and  warranties  set  forth in ss.3
         above shall be true and correct in all  material  respects at and as of
         the Closing Date except (A) for those expressly stated to be made as of
         the  date  of  this   Agreement,   (B)  where  the   failure   of  such
         representations  and warranties  (taken together  without regard to any
         materiality  or Knowledge  qualification  set forth therein) to be true
         and correct has not had, or could not be reasonably expected to have, a
         material   adverse  effect  on  the  business,   financial   condition,
         operations, results of operations or future prospects of the Target and
         its  Subsidiaries  taken as a whole or (C)  where the  failure  of such
         representations  and  warranties  to be  true  is  contemplated  by the
         Business Plan;

                  (iii)  the   representations   and  warranties  set  forth  in
         ss.ss.3(a),  (b),  (c), (d), (e), (f), (k) and (bb) above shall be true
         and correct at and as of the Closing Date;

                  (iv) the Target shall have  performed and complied with all of
         its covenants hereunder in all material respects through the Closing;

                  (v) since the Most Recent Fiscal Quarter End, there shall have
         been no material adverse change in the business,  financial  condition,
         operations, results of
<PAGE>
         operations or future prospects of the Target and its Subsidiaries taken
         as a whole, except as contemplated by the Business Plan;

                  (vi) no  action,  suit,  or  proceeding  shall be  pending  or
         threatened before any court or quasi-judicial or administrative  agency
         of any federal,  state,  local,  or foreign  jurisdiction or before any
         arbitrator wherein an unfavorable injunction,  judgment, order, decree,
         ruling,  or  charge  would  (A)  prevent  consummation  of  any  of the
         transactions  contemplated  by this  Agreement,  (B)  cause  any of the
         transactions  contemplated by this Agreement to be rescinded  following
         consummation,  (C) affect  adversely  the right of the Buyer to own the
         capital stock of the Surviving Corporation and to control the Surviving
         Corporation   and  its   Subsidiaries   after  giving   effect  to  the
         transactions  contemplated by this Agreement,  or (D) affect  adversely
         the right,  before or following  the Closing,  of any of the  Surviving
         Corporation  and its  Subsidiaries to own its assets and to operate its
         businesses (and no such injunction, judgment, order, decree, ruling, or
         charge shall be in effect);

                  (vii) the Target shall have  delivered to the Buyer and Merger
         Sub a certificate to the effect that each of the  conditions  specified
         above in ss.6(a)(i)-(vi) is satisfied in all respects;

                  (viii)  the  holders  of not more than 10% of the  outstanding
         Target  Shares  shall  have  demanded   appraisal  of  such  shares  in
         accordance with New York Business Corporation Law;

                  (ix) the  Parties  shall  have  received  all  authorizations,
         consents,  and  approvals  of  governments  and  governmental  agencies
         referred  to in  ss.3(d)  and  ss.4(c)  above  (and not  subject to the
         exception set forth in the last sentence therein);

                  (x) the Buyer and Merger Sub shall have  received from counsel
         to the Target an opinion  substantially  in form and  substance  as set
         forth in Exhibit C attached  hereto,  addressed to the Buyer and Merger
         Sub, and dated as of the Closing Date;

                  (xi)  the  Buyer  and  Merger  Sub  shall  have  received  the
         resignations, effective as of the Closing, of each director and officer
         of the  Target  and its  Subsidiaries  other  than those whom the Buyer
         shall have  specified in writing at least five  business  days prior to
         the Closing;
                  (xii) the Target and its  Subsidiaries  shall have operated in
         all material respects  consistent with the Business Plan which has been
         agreed to among the parties hereto; and

                  (xiii) all  actions  to be taken by the  Target in  connection
         with  consummation  of the  transactions  contemplated  hereby  and all
         certificates,  opinions,  instruments,  and other documents required to
         effect the  transactions  contemplated  hereby will be  satisfactory in
         form and substance to the Buyer and Merger Sub.
<PAGE>
         (b)      Conditions to Obligation of the Target. The obligation of the
Target to consummate the  transactions  to be performed by it in connection with
the  Closing  is subject to  satisfaction  or waiver by Target of the  following
conditions:

                  (i) the representations and warranties set forth in ss.4 above
         shall be true and  correct in all  material  respects  at and as of the
         Closing  Date  except for those  expressly  stated to be made as of the
         date of this Agreement;

                  (ii) each of the Buyer and Merger Sub shall have performed and
         complied with all of its covenants  hereunder in all material  respects
         through the Closing;

                  (iii) no  action,  suit,  or  proceeding  shall be  pending or
         threatened before any court or quasi-judicial or administrative  agency
         of any federal,  state,  local,  or foreign  jurisdiction or before any
         arbitrator wherein an unfavorable injunction,  judgment, order, decree,
         ruling,  or  charge  would  (A)  prevent  consummation  of  any  of the
         transactions  contemplated  by this  Agreement  or (B) cause any of the
         transactions  contemplated by this Agreement to be rescinded  following
         consummation;

                  (iv) each of the Buyer and Merger Sub shall have  delivered to
         the  Target a  certificate  to the effect  that each of the  conditions
         specified above in ss.6(b)(i)-(iii) is satisfied in all respects;

                  (v) this  Agreement  and the Merger  shall have  received  the
         Requisite Stockholder Approval;

                  (vi) the  Parties  shall  have  received  all  authorizations,
         consents,  and  approvals  of  governments  and  governmental  agencies
         referred  to in  ss.3(d)  and  ss.4(c)  above  (and not  subject to the
         exception set forth in the last sentence therein);

                  (vii) the Target shall have received from counsel to the Buyer
         and Merger Sub an opinion  substantially  in form and  substance as set
         forth in Exhibit D attached hereto,  addressed to the Target, and dated
         as of the Closing Date; and

                  (viii) all  actions to be taken by the Buyer and Merger Sub in
         connection with  consummation of the transactions  contemplated  hereby
         and  all  certificates,  opinions,  instruments,  and  other  documents
         required  to  effect  the  transactions  contemplated  hereby  will  be
         satisfactory in form and substance to the Target.

         7.       Termination.

         (a)  Termination  of Agreement.  Any of the Parties may terminate  this
Agreement with the prior authorization of its board of directors (whether before
or after stockholder approval) as provided below:

                  (i) the  Parties   may   terminate   this  Agreement by mutual
          written consent at any time prior to the Effective Time;
<PAGE>
                  (ii) the Buyer and Merger Sub may terminate  this Agreement by
         giving  written notice to the Target at any time prior to the Effective
         Time  (A)  in  the  event  the  Target  has   breached   any   material
         representation,  warranty,  or covenant  contained in this Agreement in
         any material  respect,  the Buyer or Merger Sub has notified the Target
         of the breach,  and the breach has continued  without cure for a period
         of 10 days after the notice of breach or (B) if the  Closing  shall not
         have  occurred on or before July 31, 1999,  by reason of the failure of
         any  condition  precedent  under  ss.6(a)  hereof  (unless  the failure
         results   primarily   from  the  Buyer  or  Merger  Sub  breaching  any
         representation, warranty, or covenant contained in this Agreement);

                  (iii)  the  Target  may  terminate  this  Agreement  by giving
         written  notice to the Buyer and  Merger  Sub at any time  prior to the
         Effective  Time (A) in the event the Buyer or Merger  Sub has  breached
         any material  representation,  warranty,  or covenant contained in this
         Agreement  in any material  respect,  the Target has notified the Buyer
         and Merger Sub of the breach, and the breach has continued without cure
         for a period  of 10 days  after  the  notice  of  breach  or (B) if the
         Closing  shall not have  occurred on or before July 31, 1999, by reason
         of the failure of any condition  precedent under ss.6(b) hereof (unless
         the  failure   results   primarily   from  the  Target   breaching  any
         representation, warranty, or covenant contained in this Agreement);

                  (iv) The Target may terminate this Agreement by giving written
         notice to the Buyer at any time  prior to the  Effective  Time,  in the
         event that a Person has made an Acquisition  Proposal that the board of
         directors of the Target determines,  in good faith is reasonably likely
         to be subject to  completion  and would,  if  consummated,  result in a
         transaction  more  favorable,  from a financial  point of view,  to the
         Target  Stockholders  than this  Agreement  and the Merger (a "Superior
         Acquisition Proposal"); or

                  (v) any Party may terminate  this  Agreement by giving written
         notice to the other  Parties at any time after the  Special  Meeting in
         the event this  Agreement  and the Merger fail to receive the Requisite
         Stockholder Approval.

         (b) Effect of Termination. Other than as set forth in ss.7(c) below, if
any Party  terminates this Agreement  pursuant to ss.7(a) above,  all rights and
obligations of the Parties  hereunder shall  terminate  without any liability of
any Party to any other  Party  (except  for any  liability  of any Party then in
breach);  provided,  however,  that the confidentiality  provisions contained in
ss.5(e) above shall survive any such termination.
         (c) Termination Fee. In the event of termination by the Target pursuant
to (i) 7(iv) above or (ii) if Requisite Stockholder Approval is not obtained and
the Target and/or any of its Subsidiaries,  on or before December  31,1999,  has
entered into an agreement  providing for an Acquisition  Transaction (which, for
purposes of this  subsection  (c),  shall  substitute 33 % for 10% each time 10%
appears in ss.5(g)  hereof),  Target shall pay to Buyer a termination fee of two
hundred thousand  dollars  ($200,000) not as a penalty but in recognition of the
substantial time and efforts expended, expenses incurred and other opportunities
foregone by the Buyer in connection with this Agreement.
<PAGE>
         8.       Miscellaneous.

         (a)      Survival.  None  of  the  representations,   warranties,   and
covenants of the Parties  (other than the  provisions  in ss.2 above  concerning
payment  of the  Merger  Consideration  and  the  provisions  in  ss.5(h)  above
concerning insurance and indemnification) will survive the Effective Time.

         (b)      Press Releases and Public Announcements.  No Party shall issue
any press release or make any public announcement relating to the subject matter
of this  Agreement  without the prior  written  approval  of the other  Parties;
provided,  however, that any Party may make any public disclosure it believes in
good faith is required  by  applicable  law or any listing or trading  agreement
concerning its  publicly-traded  securities (in which case the disclosing  Party
will use its best  efforts  to  advise  the  other  Party  prior to  making  the
disclosure).

         (c)      No Third-Party Beneficiaries.  This Agreement shall not confer
any  rights  or  remedies  upon any  Person  other  than the  Parties  and their
respective  successors and permitted assigns;  provided,  however,  that (i) the
provisions  in ss.2 above  concerning  payment of the Merger  Consideration  are
intended for the benefit of the Target  Stockholders  and (ii) the provisions in
ss.5(h)  above  concerning  insurance and  indemnification  are intended for the
benefit  of  the  individuals  specified  therein  and  their  respective  legal
representatives.

         (d)      Entire  Agreement.  This  Agreement  (including the Disclosure
Schedule  and the other  documents  referred to herein) and the  Confidentiality
Agreement  constitute the entire  agreement among the Parties and supersedes any
prior  understandings,  agreements,  or representations by or among the Parties,
written or oral,  to the extent they  related in any way to the  subject  matter
hereof or thereof.

         (e)      Succession and  Assignment.  This  Agreement  shall be binding
upon and inure to the benefit of the Parties  named herein and their  respective
successors and permitted  assigns.  No Party may assign either this Agreement or
any of its rights, interests, or obligations hereunder without the prior written
approval of the other Parties.

         (f)      Counterparts.  This  Agreement  may be executed in one or more
counterparts,  each of  which  shall  be  deemed  an  original  but all of which
together will constitute one and the same instrument.

         (g)      Headings. The section headings contained in this Agreement are
inserted  for  convenience  only and shall not affect in any way the  meaning or
interpretation of this Agreement.

         (h)      Notices. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand, claim,
or other  communication  hereunder  shall be deemed  duly given if (and then two
business days after) it is sent by registered or certified mail,  return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
<PAGE>
         If to the Target:

         V Band Corporation
         3 Westchester Plaza
         Elmsford, New York 10523
         Attention:  Thomas Hughes, President
         Phone:  (914) 347-7118
         Fax:    (914)  347-7524

         Copy to:

         Buchanan Ingersoll P.C.
         Eleven Penn Center 14th Center
         1835 Market Street
         Philadelphia, Pennsylvania  19103-2895
         Attention:  Brian North
         Phone:  (215) 665-3828
         Fax:    (215) 665-8760

         If to the Buyer:

         IPC Information Systems, Inc.
         88 Pine Street
         Wall Street Plaza
         New York, New York  10005
         Attention: Daniel Utevsky
         Phone: (212) 858-7908
         Fax:   (212) 509-7959

         Copy to:

         Thacher Proffitt & Wood
         Two World Trade Center
         New York, New York 10048
         Attention:  Thomas N. Talley
         Phone: (212) 912-7645
         Fax:   (212) 432-7152
<PAGE>
         If to Merger Sub:

         IPC Merger Sub, Inc.
         c/o IPC Information System, Inc.
         88 Pine Street
         Wall Street Plaza
         New York, New York  10005
         Attention: Daniel Utevsky
         Phone: (212) 858-7908
         Fax:   (212) 509-7959

         Copy to:

         Thacher Proffitt & Wood
         Two World Trade Center
         New York, New York 10048
         Attention:  Thomas N. Talley
         Phone:   (212) 912-7645
         Fax:  (212) 432-7152

Any Party may send any notice,  request,  demand,  claim, or other communication
hereunder  to the  intended  recipient  at the address set forth above using any
other means (including personal delivery,  expedited courier, messenger service,
telecopy,  telex,  ordinary  mail,  or  electronic  mail),  but no such  notice,
request, demand, claim, or other communication shall be deemed to have been duly
given  unless and until it actually is received by the intended  recipient.  Any
Party may change the address to which notices,  requests,  demands,  claims, and
other  communications  hereunder are to be delivered by giving the other Parties
notice in the manner herein set forth.

         (i) Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of New York without giving effect
to any choice or conflict of law  provision or rule (whether of the State of New
York or any other  jurisdiction) that would cause the application of the laws of
any jurisdiction other than the State of New York.

         (j) Jurisdiction;  Service of Process. Any action or proceeding seeking
to enforce  any  provision  of, or based  upon any right  arising  out of,  this
Agreement  may be brought  against any of the Parties in the courts of the State
of New York, County of New York, or, if it has or can acquire  jurisdiction,  in
the United States District Court for the Southern District of New York, and each
of  the  Parties  consents  to the  jurisdiction  of  such  courts  (and  of the
appropriate  appellate  courts) in any such action or proceeding  and waives any
objection to venue laid therein. Process in any action or proceeding referred to
in the preceding sentence may be served on any Party anywhere in the world.

         (k)  Amendments  and  Waivers.  The  Parties  may  mutually  amend  any
provision  of this  Agreement at any time prior to the  Effective  Time with the
prior authorization of their respective boards of directors;  provided, however,
that any amendment effected  subsequent to stockholder  approval will be subject
to the  restrictions  contained  in the New York  Business
<PAGE>
Corporation  Law. No amendment of any provision of this Agreement shall be valid
unless the same shall be in writing and signed by all of the Parties.  No waiver
by any  Party of any  default,  misrepresentation,  or  breach  of  warranty  or
covenant hereunder, whether intentional or not, shall be deemed to extend to any
prior or  subsequent  default,  misrepresentation,  or  breach  of  warranty  or
covenant  hereunder  or affect in any way any  rights  arising  by virtue of any
prior or subsequent such occurrence.

         (l)      Severability.  Any term or provision of this Agreement that is
invalid or unenforceable  in any situation in any jurisdiction  shall not affect
the validity or  enforceability  of the remaining terms and provisions hereof or
the validity or  enforceability  of the offending term or provision in any other
situation or in any other jurisdiction.

         (m)      Expenses.  Each of the  Parties  will  bear its own  costs and
expenses  (including  legal fees and expenses)  incurred in connection with this
Agreement and the transactions  contemplated hereby. Target and its Subsidiaries
shall not incur expenses to Third Parties in connection  with this Agreement and
the  Merger  in  excess  of  two  hundred  thousand  dollars  ($200,000)  in the
aggregate.

         (n)      Construction.  The Parties  have  participated  jointly in the
negotiation  and  drafting  of this  Agreement.  In the  event an  ambiguity  or
question of intent or interpretation  arises,  this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof shall
arise  favoring or  disfavoring  any Party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local, or
foreign  statute  or law  shall  be  deemed  also  to  refer  to all  rules  and
regulations promulgated  thereunder,  unless the context otherwise requires. The
word "including" shall mean including without limitation.

         (o)      Incorporation  of Exhibits  and  Schedules.  The  Exhibits and
Schedules  identified in this Agreement are incorporated herein by reference and
made a part hereof.
<PAGE>
         IN WITNESS WHEREOF,  the Parties hereto have executed this Agreement as
of the date first above written.


                                               IPC INFORMATION SYSTEMS, INC.

                                          By:
                                             -----------------------------------
                                          Name:

                                          Title:


                                                                               V
                                          BAND CORPORATION

                                                                             By:
                                          -----------------------------------
                                          Name:

                                          Title:



                                                  IPC MERGER SUB, INC.

                                                                             By:
                                          -----------------------------------
                                          Name:

                                          Title: