<PAGE>

                                                   EXHIBIT  2.1


                            ASSET PURCHASE AGREEMENT

                                  BY AND AMONG

                               HOME DIRECTOR, INC.

                                  (AS "BUYER"),

                 SPENCER TRASK INTELLECTUAL CAPITAL COMPANY LLC

                                    ("STICC")

                                       AND

                  INTERNATIONAL BUSINESS MACHINES CORPORATION,

                                  (AS "SELLER")


                          DATED AS OF DECEMBER 7, 1999



<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>



<S>                                                           <C>
Article I. Purchase and Sale of Assets . . . . . . . . . . .   5
1.1 Transferred Assets. . . . . . . .  . . . . . . . . . . .   5
1.2 Excluded Assets . . . . . . . . .  . . . . . . . . . . .   6
1.3 Consideration. . . . . . . . . . . . . . . . . . . . . .   6
1.4 Assumed Liabilities. . . . . . . . . . . . . . . . . . .   7

Article II. Closing. . . . . . . . . . . . . . . . . . . . .   7
2.1 Closing Date . . . . . . . . . . . . . . . . . . . . . .   7

Article III. Tax Matters.. . . . . . . . . . . . . . . . . .   8
3.1 Allocation of Purchase Price . . . . . . . . . . . . . .   8
3.2 Filing of Returns and Payment of Taxes . . . . . . . . .   8
3.3 Refunds and Credits. . . . . . . . . . . . . . . . . . .   8
3.4 Transfer Taxes . . . . . . . . . . . . . . . . . . . . .   8

Article IV. Additional Covenants and Agreements. . . . . . .   9
4.1 Consents, Novations and Subcontracted Work . . . . . . .   9
4.2 Employees and Employee Benefits. . . . . . . . . . . . .   9
4.3 Shrink-Wrap Software, Windows 95 and Savoy Agreement . .  11
4.4 Further Action . . . . . . . . . . . . . . . . . . . . .  11
4.5 Undertaking. . . . . . . . . . . . . . . . . . . . . . .  12
4.6 Nonsolicitation. . . . . . . . . . . . . . . . . . . . .  12
4.7 Establishment of Letter of Credit Facility . . . . . . .  12
4.8 Access to Information; Cooperation After Closing . . . .  12
4.9 Insurance; Casualty Loss . . . . . . . . . . . . . . . .  12
4.10 Warranty Work . . . . . . . . . . . . . . . . . . . . .  13

Article V. Representations and Warranties of Buyer.. . . . .  13
5.1 Incorporation. . . . . . . . . . . . . . . . . . . . . .  13
5.2 Authority. . . . . . . . . . . . . . . . . . . . . . . .  13
5.3 No Conflict. . . . . . . . . . . . . . . . . . . . . . .  13
5.4 Governmental Consents. . . . . . . . . . . . . . . . . .  14
5.5 No Broker. . . . . . . . . . . . . . . . . . . . . . . .  14

5.6 Insurance; Casualty Loss . . . . . . . . . . . . . . . .  14
Article VI. Representations and Warranties of Seller . . . .  14
6.1 Incorporation. . . . . . . . . . . . . . . . . . . . . .  14
6.2 Authority. . . . . . . . . . . . . . . . . . . . . . . .  14
6.3 No Conflict. . . . . . . . . . . . . . . . . . . . . . .  15
6.4 Governmental Consents. . . . . . . . . . . . . . . . . .  15
6.5 No Broker. . . . . . . . . . . . . . . . . . . . . . . .  15
6.6 Title to Personal Property . . . . . . . . . . . . . . .  15
6.7 Litigation . . . . . . . . . . . . . . . . . . . . . . .  15
6.8 No Rights in Others to Transferred Assets. . . . . . . .  16
                                        i
<PAGE>
6.9 Licenses and Permits . . . . . . . . . . . . . . . . . .  16
6.10 Employees . . . . . . . . . . . . . . . . . . . . . . .  16
6.11 Assumed Contracts . . . . . . . . . . . . . . . . . . .  16
6.12 Compliance with Laws. . . . . . . . . . . . . . . . . .  16
6.13 Operation of Transferred Assets and Assumed Liabilities  17
6.14 Schedule Preparation. . . . . . . . . . . . . . . . . .  17
6.15 Year 2000 . . . . . . . . . . . . . . . . . . . . . . .  17
6.16 WARRANTIES. . . . . . . . . . . . . . . . . . . . . . .  17

Article VII. Indemnity.. . . . . . . . . . . . . . . . . . .  17
7.1 Buyer Indemnification. . . . . . . . . . . . . . . . . .  17
7.2 Seller Indemnification . . . . . . . . . . . . . . . . .  17
7.3 Procedures . . . . . . . . . . . . . . . . . . . . . . .  18
7.4 Indemnity Preclusion . . . . . . . . . . . . . . . . . .  18
7.5 Indemnity Is the Exclusive Remedy. . . . . . . . . . . .  19
7.6 Exclusion of Certain Damages . . . . . . . . . . . . . .  19

Article VIII. General Matters. . . . . . . . . . . . . . . .  19
8.1 Survival of Representations and Warranties . . . . . . .  19
8.2 Limitation of Liability. . . . . . . . . . . . . . . . .  19
8.3 Public Announcements . . . . . . . . . . . . . . . . . .  20
8.4 Due Diligence. . . . . . . . . . . . . . . . . . . . . .  20
8.5 Costs. . . . . . . . . . . . . . . . . . . . . . . . . .  20
8.6 Bulk Sales . . . . . . . . . . . . . . . . . . . . . . .  20
8.7 Modification and Waiver. . . . . . . . . . . . . . . . .  20
8.8 Governing Law. . . . . . . . . . . . . . . . . . . . . .  20
8.9 Notices. . . . . . . . . . . . . . . . . . . . . . . . .  21
8.10 Assignment. . . . . . . . . . . . . . . . . . . . . . .  22
8.11 Counterparts. . . . . . . . . . . . . . . . . . . . . .  22
8.12 Entire Agreement. . . . . . . . . . . . . . . . . . . .  22
8.13 Construction. . . . . . . . . . . . . . . . . . . . . .  23
</TABLE>



Schedules:

Schedule  1.1.           Transferred  Assets

Sub-schedule  1.1(a)     Fixed  Assets  (production  equipment)

Sub-schedule  1.1(b)     Fixed  Assets  (office  furniture  and  equipment)

Sub-schedule  1.1(c)     Connection  Center  Inventory  and Controller Inventory

Sub-schedule  1.1(d)     Business  Records  Schedule  1.4.  Assumed  Liabilities

Schedule  3.1.(a)        Allocation  of  Purchase  Price

Schedule  4.2.(a)(1)     Listing  of  Regular  Employees

                                       ii
<PAGE>
Schedule  4.2.(a)(2)     Listing  of  Supplemental  Employees

Schedule  4.2.(b)        Summary of Buyer's Planned Employment Terms and Benefit
                         Plans

Schedule  6.15           Year  2000

Exhibits:

Exhibit  A     Assumption  Agreement

Exhibit  B     Bill  of  Sale

Exhibit  C     Schedule  of  Disclosure  and  Exceptions

Exhibit  D     Intellectual  Property  Agreement

Exhibit  E     Secondment  Agreement

Exhibit  F     Stockholders'  Agreement

Exhibit  G     Trademark  Agreement

Exhibit  H     Transition  Services  Agreement

                                      iii
<PAGE>

                            ASSET PURCHASE AGREEMENT

     THIS  ASSET  PURCHASE  AGREEMENT,  dated  as  of  December  7,  1999  (this
"Agreement"),  is  entered  into  by  and  among Home Director, Inc., a Delaware
corporation  ("Buyer"),  Spencer  Trask  Intellectual  Capital  Company  LL.C, a
Delaware  limited  liability  company  ("STICC"),  and  International  Business
Machines  Corporation,  a  New  York  corporation  ("Seller").

                              W I T N E S S E T H:
                              -------------------

     WHEREAS,  Seller wishes to sell certain assets related to its Home Director
business  unit;

WHEREAS,  STICC  has  formed Buyer and owns 9,500 shares of Buyer Common Stock.,
which  shares  constitute  all  of  the presently issued and outstanding capital
stock  of  Buyer,

WHEREAS,  Buyer  wishes  to  purchase from Seller, and Seller wishes to sell. to
Buyer,  the  Transferred  Assets for the Purchase Price and subject to the terms
and  conditions  hereinafter  set  forth;

WHEREAS, as partial consideration for the Contemplated Transactions, Buyer shall
issue  to  Seller  five  hundred  (500)  shares  of  Buyer  Common  Stock;  and

WHEREAS,  as a condition to Seller entering into this Agreement STICC has agreed
to  be responsible for the future payment of $1,500,000.00 of the Purchase Price
(as  more fully set forth herein) and to take the necessary steps to assure that
Buyer performs its Obligations to Seller pursuant to this Agreement, and but for
such  agreement,  Seller  would  not  have  entered  into  this  Agreement.

NOW,  THEREFORE,  in  consideration  of  the  premises  set  forth above and the
respective covenants, agreements, representations and warranties hereinafter set
forth,  and intending to be legally bound hereby, Buyer, STICC and Seller hereby
agree  as  follows:

                                  DEFINITIONS.
                                  -----------

     CERTAIN  DEFINITIONS.  As used in this Agreement, the following terms shall
have  the  meanings  specified  below:

"AFFILIATE"  shall  mean,  as to any Person, any other Person or entity which is
controlling,  controlled  by or under common control with such Person or entity.

"ALLOCATION  STATEMENTS"  shall  have  the  meaning set forth in Section 3.1(a).

"APPLICABLE  LAWS"  shall  mean,  with  respect  to  any Person, any domestic or
foreign,  federal,  state or local statute, law, ordinance, rule, administrative
interpretation,  regulation,,  order,  writ,  injunction,  decree  or  other
requirement  of  any  Governmental  Authority  (including any Environmental Law)
<PAGE>

applicable  to  such  Person  'or  any  of  its  respective  properties, assets,
officers,  directors,  employees,  consultants or agents (in connection with any
such  officer's,  director's,  employee's, consultant's or agent's activities on
behalf  of  such  Person).

"ASSUMED  CONTRACTS"  shall  mean  those  contracts  set  forth on Schedule 1.4.

"ASSUMED  LIABILITIES"  shall  have  the  meaning  set  forth  in  Section  1.4.

"ASSUMPTION AGREEMENT" shall mean the Assignment and Assumption Agreement a copy
of  which  is  attached  hereto as Exhibit A and by which Buyer shall assume the
Assumed  Liabilities.

"BENEFIT  ARRANGEMENTS"  shall  mean  all life and health insurance, retirement,
savings,  bonus,  deferred  compensation, incentive compensation, severance pay,
disability  and fringe benefit plans, workers' compensation, holiday or vacation
pay,  sick  pay,  stock  option,  profit  sharing,  seniority  and  other plans,
policies,  practices, agreements or statements of terms and conditions providing
employee  or  executive  compensation  or  benefits to Employees or any of their
dependents,  maintained by Seller or any Affiliate, other than an Employee Plan.

"BILL OF SALE" shall mean the Bill of Sale a copy of which is attached hereto as
Exhibit  B  to  be  entered  into  by  the  Parties  on  the  Closing  Date.

"BUSINESS  DAY" shall mean a day other than a Saturday, Sunday or other day: (i)
on  which  commercial  banks in New York, New York are authorized or required by
law  to close; (ii) on which Seller's corporate headquarters in Armonk, New York
are  closed;  or  (iii)  on which Buyer's corporate headquarters in Morrisville,
North  Carolina  are  closed.

"BUYER"  shall  have  the  meaning  set forth in the preamble to this Agreement.

"BUYER  COMMON  STOCK"  shall  have  the  meaning set forth for the term "Common
Stock"  in  the  Stockholders'  Agreement.

"CLOSING"  shall  have  the  meaning  set  forth  in  Section  2.1.

"CLOSING  DATE"  shall  mean  December  7,  1999.

"CODE"  shall  have  the  meaning  set  forth  in  Section  3.1(a).

"CONFIDENTIALITY  AGREEMENT"  shall  mean  the Confidential Disclosure Agreement
(Agreement  number  4999S50562)  among  Buyer and Seller dated as of the Closing
Date  and  Supplements  there  to  which  reference  the  Operative  Agreements.

"CONNECTION  CENTER INVENTORY" shall mean the items of inventory as set forth on
Sub-schedule  1.1(c).

"CONTEMPLATED  TRANSACTIONS"  shall  mean  the  transactions contemplated by the
Operative  Agreements.

                                        2
<PAGE>
"CONTROLLER  INVENTORY"  shall  mean  the  items  of  inventory  as set forth on
Sub-schedule  1.1(c).

"DISCLOSURE  SCHEDULES" shall mean the information disclosed pursuant to Article
VI  and  set  forth in Exhibit C to this Agreement dated as of the Closing Date,
attached  hereto  and  incorporated  herein  by  reference.

"EMPLOYEE  PLANS"  shall mean each "employee benefit plan" as defined in Section
3(3)  of  the Employee Retirement Income Security Act of 1974, as amended, which
is  or  has  been  entered  into,  maintained, administered or contributed to by
Seller  or  any  of  its  Affiliates and which provides benefits to Employees or
their  dependents.

"EMPLOYEES"  shall  have  the  meaning  set  forth  in  Section  4.2(a).

"ENVIRONMENTAL  LAWS"  shall  mean  any  applicable federal, state or local law,
statute,  ordinance,  judgments,  rulings,  orders,  regulations or similar laws
relating  to  any matters of pollution or of environmental regulation or control
or  protection  of  the  environment,  including such environmental, laws as the
Resource Conservation and Recovery Act, the Comprehensive Environmental Response
Compensation  and  Liability  Act,  the Federal Emergency Planning and Community
Right-to-Know  Act,  the Hazardous Materials Transportation Act, the Clean Water
Act,  and the Clean Air Act, and any state or local counterparts thereof, as any
of  the  same  have  been  amended  to  the  Date  of  Closing.

"ENVIRONMENTAL  LIABILITIES"  shall mean any liability that directly arises from
Seller's  or  any of its Affiliates violation of an Environment Law with respect
to  the  Transferred  Assets  on  or  prior  to  the.  Closing  Date.

"FIXED  ASSETS"  shall  mean  the  production equipment and office furniture and
equipment  which make up a portion of the Transferred Assets, a list of which as
of  the  Closing Date, together with the net book value of each item on the list
as  of  the  Closing  Date,  is  set  forth  on Sub-schedules 1.1(a) and 1.1(b).

"GOVERNMENTAL  AUTHORITY" shall mean any Federal, state, local or foreign court,
governmental  or  administrative  agency  or  commission  or  other governmental
agency,  authority,  instrumentality  or  regulatory  body  having  appropriate
jurisdiction  over  the  Transferred Assets, the Assumed Contracts or any Person
having  any  rights  or  obligations  under  any  Operative  Agreement.

"INDEMNIFIED  PARTY"  shall  have  the  meaning  set  forth  in  Section  7.3.

"INDEMNIFYING  PARTY"  shall  have  the  meaning  set  forth  in  Section  7.3.

"INITIAL  PAYMENT"  shall  have  the  meaning  set  forth  in Section l.3(a)(i).

"INTELLECTUAL PROPERTY AGREEMENT" shall mean the Intellectual Property Agreement
a  copy  of  which  is  attached  hereto  as  Exhibit  D.

"INVENTORY  PAYMENTS"  shall  have  the meaning set forth in section 1.3(a)(iv).

                                        3
<PAGE>
"LETTER  AGREEMENT"  shall  mean  the  letter agreement between STICC and Seller
dated  October  5,  1999  and  accepted  by  Seller  on  October  8,  1999.

"LETTER  OF  CREDIT"  shall  have  the  meaning  set  forth  in  Section  4.7.

"LIEN"  shall  mean  with  respect to any property or asset, any mortgage, lien,
pledge,  charge,  security  interest,  encumbrance,  lease,  license,  easement,
encroachment,  burden,  title  defect,  restriction, limitation or other adverse
claim  of  any  kind,  in  respect  of  such  property  or  asset.

"LIMITATION  AMOUNT"  shall  have  the  meaning  set  forth  in  Section  8.2.

"LOSS" shall mean, with respect to any Person, any and all damage, fines imposed
by  any  Governmental Authority, Loss, liability and expense, including, without
limitation,  reasonable expenses of investigation and reasonable attorney's fees
and  expenses  in  connection  with  any  claim,  action,  suit  or  proceeding.

"OBLIGATIONS"  shall  mean  all  covenants,  agreements,  warranties,  duties,
representations,  fees,  reasonable expenses, liabilities (including any and all
Assumed  Liabilities) and indebtedness of any kind and nature whatsoever, now or
hereafter  arising,  owing,  due  or  payable  from one Party to the other Party
pursuant  to  this  Agreement.

"OPERATING  EXPENSES"  shall  mean  the  ordinary  course  operating  expenses,
liabilities  and  obligations  of  the  IBM  Home  Director  business  unit.

"OPERATIVE  AGREEMENTS" shall mean this Agreement, the Assumption Agreement, the
Bill  of Sale, the Intellectual Property Agreement, the Stockholders' Agreement,
the  Trademark  Agreement,  the  Transition  Services  Agreement, the Secondment
Agreement  and  all  attachments  or  exhibits  attached  hereto  or thereto and
expressly  referenced  herein  or  therein.

"PARTIES"  shall  mean  Buyer  and  Seller.

"PERMITTED  LIENS" shall mean: (i) mechanics', carriers', workmen's, repairmen's
or  other  similar Liens arising or incurred in the ordinary course of business;
(ii)  conditional  sales  contracts  and  equipment  leases  entered into in the
ordinary  course  of  business;  (iii)  Liens  for  Taxes, assessments and other
governmental charges due and being contested in good faith by Seller, (iv) Liens
for  Taxes  either not due and payable or due but for which notice of assessment
has  not  been  given,  or  which  may  thereafter  be paid without penalty; (v)
security  given  in  the  ordinary  course  of  business  to any public utility,
Governmental  Authority  or  to  any statutory or public authority in connection
with  the  Transferred  Assets;  and  (vi)  other  imperfections  of  title  or
encumbrances,  if  any,  which items (1) - (vi) taken together do not materially
impair  the  value  of  the Transferred Assets and Assumed Contracts, taken as a
whole.

"PERSON"  shall  mean  any  individual,  firm, corporation, partnership, limited
liability company, trust, joint venture, Governmental Authority or other entity,
and  shall  include  any  successor  (by  merger  or  otherwise) of such entity.

"PRE-CLOSING  TAX  PERIOD"  shall  have  the  meaning  set forth in Section 3.2.

                                        4
<PAGE>
"PURCHASE  PRICE"  shall  have  the  meaning  set  forth  in  Section  1.3.

"SECONDMENT  AGREEMENT"  shall mean the Secondment Agreement, a copy of which is
attached  hereto  as  Exhibit  E.

"SELLER"  shall  have  the  meaning set forth in the preamble to this Agreement.

"SETTLEMENT  DATE"  shall  have  the  meaning  set  forth  in  Section  13(b).

"STICC"  shall  have  the  meaning  set forth in the Preamble to this Agreement.

"STOCKHOLDERS'  AGREEMENT"  shall  mean  the  Stockholders'  Agreement among the
Parties  and  STICC,  a  copy  of  which  is  attached  hereto  as  Exhibit  F.

"SUBCONTRACTED  WORK"  shall  have  the  meaning  set  forth  in  Section  4.1.

"TAXES"  shall  mean  all  taxes,  imposts, duties, withholdings, charges, fees,
levies,  or  other  assessments imposed by any governmental or taxing authority,
whether  domestic  or  foreign  (including  but  not limited to, income, excise,
property,  sales, use, transfer, conveyance. payroll or other employment related
tax,  license,  ad  valorem, value added, withholding, social security, national
insurance  (or  other  similar  contributions or payments), franchise, estimated
severance, stamp taxes, taxes based upon or measured by capital stock, net worth
or gross receipts and other taxes), together with all interest, fines, penalties
and  additions  attributable  to or imposed with respect to such amounts and any
obligations  under any agreement or arrangements with any Person with respect to
such  amounts.

"TAX  RETURNS"  shall  have  the  meaning  set  forth  in  Section  3.2.

"TRADEMARK  AGREEMENT"  shall mean the Trademark Agreement between the Parties a
copy  of  which  is  attached  hereto  as  Exhibit  G.

"TRANSFERRED  ASSETS"  shall  mean  such  items  of equipment, office furniture,
contracts,  inventory,  work  in  process  and other assets as are listed on the
Sub-schedules  to  Schedule  1.1.  to  this  Agreement.

"TRANSFERRED  EMPLOYEES"  shall  have  the  meaning set forth in Section 4.2(a).

"TRANSITION  SERVICES AGREEMENT" shall mean the Transition Services Agreement, a
copy  of  which  is  attached  hereto  as  Exhibit  H.

"WARN"  shall  mean  the  Worker Adjustment Retraining and Notification Act., as
amended.

                     ARTICLE I.  PURCHASE AND SALE OF ASSETS

     1.1     TRANSFERRED  ASSETS.  Upon  the terms and subject to the conditions
hereof, as of the Closing Date, Seller hereby sells, transfers, conveys, assigns

                                        5
<PAGE>
and  delivers  to Buyer, and Buyer hereby purchases and accepts from Seller, all
right,  title  and  interest  of Seller in and to all of the Transferred Assets.

1.2     EXCLUDED  ASSETS.  Notwithstanding  anything  to  the  contrary  in this
Agreement,  any  assets not set forth on the Sub-schedules to Schedule 1.1. will
be  retained by Seller and are excluded from the Transferred Assets. Except with
respect  to  Section  4.3  below  and  any intellectual property or interests in
Assumed  Contracts,  this  Agreement does not relate to intellectual property or
interests  in  intellectual  property,  such  items being the subject of certain
other  Operative  Agreements.

1.3     CONSIDERATION.    In  exchange for the sale and purchase contemplated by
the  Operative  Agreements,  Buyer has provided or will provide the following to
Seller  (collectively,  the  'Purchase  Price"):

(i)          Upon  signing  of  the Letter Agreement, STICC, on behalf of Buyer,
paid  $500,000.00  to  Seller (the "Initial Payment") receipt of which is hereby
acknowledged  by  Seller;

(ii)     Buyer  has  obtained  the  Letter  of Credit, which has been and may be
drawn  upon by Seller to pay Operating Expenses, in accordance with Section 4.7;

(iii)     On  the  Closing  Date,  Buyer  will  (x)  pay to Seller an additional
$1,000,000.00  plus an amount equal to the net book value as of the Closing Date
of  the  Fixed Assets, which net book value is set forth on Sub-schedules 1.1(a)
and 1.1(b); (y) issue 500 shares of Buyer Common Stock to Seller, and (z) assume
the  Assumed  Liabilities;

(iv)     Subject  to  Section  1.3(b),  below,  on the last Business Day of each
month  following the Closing Date through the Settlement Date, Buyer will pay to
Seller  (collectively,  the  "Inventory  Payments") the net book value as of the
Closing  Date  (which net book value is set forth on Sub-schedule 1.1(c), of any
items  of  Connection  Center  Inventory and Controller Inventory that have been
used  or  sold  by  Buyer  in  the  immediately  preceding  month;  and

(v)     On (or at Buyer's sole discretion, prior to) October 8, 2000, Buyer will
pay  to  Seller,  $1,500,000.00,  plus  interest  thereon  from the Closing Date
through  the  payment  date at a rate equal to the prime rate as reported in the
Wall  Street  Journal  on  the  Closing  Date.

(b)          Sub-schedule  1.1(c)  sets forth the inventory and work in process,
including  the net book value thereof, included in the Transferred Assets and is
categorized  as either Connection Center Inventory or Controller Inventory. On a
date  which  is  eighteen  (18)  months  from  the Closing Date (the "Settlement
Date"),  Buyer  shall pay to Seller an amount equal to the net book value of all
Connection  Center  Inventory  and Controller Inventory minus Inventory Payments
previously  paid  to  Seller  with  respect  to  Connection Center Inventory and
Controller  Inventory.

(c)     The  amounts  referenced  in  this  Section  l.3.(c)  shall  be  paid by
electronic  funds  transfer,  in immediately available funds in U.S. dollars, to
the  following  account:

Account  Name:     International  Business  Machines  Corporation

Bank:              Chase  Manhattan  Bank

                                        6
<PAGE>
Account  Number    IBM  Concentration  Account
                   Account  #:  323-213499

Reference:         Purchase  of  IBM  Home  Director  Business  Unit  Assets

ABA  Routing  Number:     021000021
Bank  Contact:     Ms.  Joyce  Leary  Bates
                   Chase  Manhattan  Bank
                   4  New  York  Plaza
                   New  York,  NY  10004
                   Telephone:  (212)  552-5684

     1.4     ASSUMED  LIABILITIES.    Pursuant  to  the  Assumption  Agreement,
Seller assigns and transfers to Buyer, and Buyer assumes and shall fully perform
and  discharge,  on a timely basis and in accordance with their respective terms
the  liabilities and obligations of Seller under the Assumed Contracts listed on
Schedule  1.4.  (collectively,  the "Assumed Liabilities"). Without limiting the
generality of the foregoing Buyer is not assuming or undertaking any obligations
or  liabilities  of  Seller to any assets or contracts which are not included in
the  Assumed  Liabilities.  Other  than Assumed Liabilities, Buyer shall not, by
virtue  of  the  Contemplated Transactions or otherwise, assume or become liable
for  any liability or obligation of Seller or its Home Director business unit of
any kind or nature whatsoever. Any rights, liabilities and obligations of Seller
to  or  from  any of its Affiliates will not be transferred to Buyer, other than
identified  as  "Canadian  Agreements"  as  set  forth  in  Schedule  1.4.

     (b)     The  Parties  will  each  use  reasonable efforts to obtain written
consents  to  the  transfer and assignment of the Transferred Assets and Assumed
Liabilities  to  Buyer,  and the novation of Seller, where the approval or other
consent  of  any  other  Person  may  be required for these actions. Buyer shall
cooperate  with  Seller  (including,  where necessary, entering into appropriate
instruments  of assumption as shall be agreed upon) to have Seller released from
all  liability to third parties with respect to the Assumed Liabilities, and the
Parties  will each solicit such releases concurrently, in a manner acceptable to
both  Parties,  with  the  solicitation  of  consents  from third parties to the
transfer,  assignment  and  novation  of  the Transferred Assets and the Assumed
Liabilities; provided, however that neither Party shall be required to grant any
additional consideration to any third party in order to obtain any such consent,
novation,  assumption  or  release.

                              ARTICLE II.  CLOSING.

     2.1     CLOSING  DATE.  The closing of the transaction provided for in this
Agreement  (the  "Closing")  shall  take  place  at the offices of Kirkpatrick &
Lockhart  LLP,  1251  Avenue  of the Americas, New York, New York on the Closing
Date.  All  transactions  provided  for herein to occur on and as of the Closing
Date shall be deemed to have occurred simultaneously and to be effective as soon
as  the Parties have completed the Closing or as of the close of business on the
Closing  Date,  whichever  first  occurs.  Risk  of  loss  with  respect  to the
Transferred  Assets  shall  pass  to Buyer as of 11:59 p.m. on the Closing Date.

                                        7
<PAGE>
                           ARTICLE III.  TAX MATTERS.

     3.1     ALLOCATION  OF  PURCHASE PRICE.    Buyer and Seller hereby agree to
the  allocation  of  the  Purchase  Price  set  forth  in Schedule 3.1 .(a) (the
"Allocation  Statements"),  allocating, pursuant to Section 1060 of the Internal
Revenue  Code  of  1986,  as  amended,  and the Treasury Regulations promulgated
thereunder  (the  "Code"),  the  total of the Purchase Price (and other payments
properly treated as additional Purchase Price for Tax purposes) to the different
Transferred  Assets.

     (b)     Buyer  and  Seller  shall each file all income, franchise and other
Tax  Returns  (as  defined  below),  and  execute such other documents as may be
required  by  any  Governmental  Authority,  in  a  manner  consistent  with the
Allocation  Statements.  Buyer shall prepare the Form 8594 under Section 1060 of
the  Code  based  on  the  Allocation  Statements  and deliver such form and all
documentation  used in the preparation and support of such form to Seller within
30  days  after  the Closing Date. Buyer and Seller agree to file such form with
each  relevant  taxing  authority  and  to  refrain  from  taking  any  position
inconsistent  with  such  form  or  the  Allocation  Statements.

     3.2     FILING  OF  RETURNS  AND PAYMENT OF TAXES. Seller shall prepare and
file,  or  cause  to be prepared and filed, with the appropriate authorities all
Tax returns, reports and forms (herein "Tax Returns") and shall pay, or cause to
be  paid,  when  due  all  Taxes  relating to the Transferred Assets and Assumed
Contracts  attributable  to  any  taxable  period  which ends on or prior to the
Closing Date (herein "Pre-Closing Tax Period"). Buyer shall prepare and file, or
cause  to  be  prepared  and  filed,  with  the  appropriate authorities all Tax
Returns,  and shall pay, or cause to be paid, when due all Taxes relating to the
Transferred  Assets  attributable  to  taxable periods which are not part of the
Pre-Closing  Tax  Period.  If,  in  order to properly prepare its Tax Returns or
other  documents  required  to  be  filed  with  Governmental Authorities, it is
necessary  that  a  party be furnished with additional information, documents or
records  relating  to the Transferred Assets, both Seller and Buyer agree to use
reasonable  efforts to furnish or make available such non-privileged information
at  the  recipient's request, cost and expense; provided, however, that no Party
shall  be  entitled  to  review  or  examine the Tax Returns of any other Party.

3.3     REFUNDS  AND  CREDITS.  Any  refunds  and  credits  attributable  to the
Pre-Closing  Tax  Period  shall be for the account of Seller and any refunds and
credits  attributable  to  any  period  which is not part of the Pre-Closing Tax
Period  shall  be  for  the  account  of  Buyer.

3.4     TRANSFER  TAXES.  All  transfer,  documentary, sales, use, registration,
value-added  and  any  other similar Taxes (including real estate conveyance, or
similar  Taxes)  and related fees incurred in connection with this Agreement and
the  other  Operative  Agreements  and  the transactions contemplated hereby and
thereby  shall  be borne by Buyer, in addition to the consideration provided for
in  Section  1.3.  To  the  extent legally able to do so, Buyer and Seller shall
cooperate  with  each  other to obtain exemptions from such taxes, provided that
neither  Party  shall  be obligated to seek any exemption that would require any
governmental  audit  of  its  books  and  records.

                                        8
<PAGE>
                ARTICLE IV.  ADDITIONAL COVENANTS AND AGREEMENTS.

     4.1     CONSENTS,  NOVATIONS AND SUBCONTRACTED WORK. Buyer and Seller shall
use  reasonable  efforts  to  obtain  all  requisite consents to assignments and
novations,  as the case may be, of all of the Transferred Assets and the Assumed
Liabilities.  For  any  Assumed  Liabilities  for which Seller has any secondary
liability  to  third  parties,  Buyer shall provide Seller reasonable access and
information in order for Seller to ascertain continuing compliance by Buyer with
all  contract  terms  and  conditions  applicable  thereto. If any such required
consents  to assignment and novation have not been secured prior to Closing, the
Parties  shall  cooperate to establish an arrangement reasonably satisfactory to
both Buyer and Seller under which Buyer would obtain, to the extent practicable,
the  claims,  rights  and  benefits of Seller and would assume the corresponding
liabilities  and  obligations  thereunder (but only to the extent Buyer receives
the  benefit  of  the claims, rights and benefits thereunder) in accordance with
the  intent  of  this  Agreement  (including  by  means  of  a  subcontracting,
sublicensing or subleasing arrangement), or under which Seller would enforce for
the  benefit  of  Buyer,  and  any and all claims, rights and benefits of Seller
against a third party thereto (the "Subcontracted Work") with Buyer assuming and
agreeing to pay Seller's obligations to the extent Buyer receives the benefit of
such  claims,  rights,  and  benefits;  and  until  the  requisite  consents and
novations  are  obtained, such obligations would not be deemed to be included in
the  Transferred  Assets and Assumed Liabilities. Buyer shall diligently perform
and  discharge  the  obligations  of Seller in connection with the Subcontracted
Work.  Buyer and Seller agree that such obligations will not be considered to be
Subcontracted  Work  after consents to assignment and novation are obtained, but
will  instead  be  deemed  to  be  Assumed  Liabilities for all purposes of this
Agreement.  In  no  event shall Seller or Buyer be obligated to pay any money or
grant  any  financial  accommodations to any Governmental Authority or any other
Person  in  connection  with  obtaining  any  consent,  waiver, confirmation, or
novation  or  approval  with  respect  to  the  Transferred  Assets  and Assumed
Liabilities.  Notwithstanding  anything  to the contrary in this Agreement, this
Agreement  shall  not constitute an agreement to assign any Transferred Asset or
Assumed  Liability  or  any  claim,  right or benefit or liability or obligation
arising  thereunder  or  resulting therefrom if an attempted assignment thereof,
without the consent of a third party thereto, would constitute a breach or other
contravention thereof, would be ineffective with respect to any party thereto or
would  in  any  way  adversely  affect the rights of Buyer or Seller thereunder.

4.2     EMPLOYEES  AND EMPLOYEE BENEFITS.    Schedule 4.2.(a)(1) contains a list
of  the  regular  employees  employed by Seller or its Affiliates as of the date
hereof in connection with the Transferred Assets (including active employees and
employees  who  are  on  leave  of  absence,  or  those receiving benefits under
Seller's  or  its  Affiliates'  Sickness and Accident Income Plan), and Schedule
4.2.(a)(2) contains a list of the supplemental employees temporarily employed by
Seller  or  its  Affiliates  as  of  the  date  hereof  in  connection  with the
Transferred  Assets (collectively, the "Employees"). Buyer shall make employment
offers to the Employees effective as of January 1, 2000. The Employees who begin
their employment with Buyer (collectively referred to herein as the "Transferred
Employees")  shall  be  employed  by Buyer in accordance with, among others, the
terms  and  conditions  set  forth  below.

     (b)     Effective  January  1,  2000,  Buyer agrees that it will employ the
Transferred  Employees  in the same positions and at the same salaries and shall
provide  the  Transferred  Employees with benefits generally comparable to those

                                        9
<PAGE>
provided  by  similarly-sized  companies,  as  more  fully set forth in Schedule
4.2(b).  Such  benefits shall include a stock option plan and a 401(k) plan with
Buyer  matching  contributions  to  commence  at  such  time  as  Buyer  becomes
profitable.  Buyer has summarized its planned employment terms and benefit plans
for  the  Transferred  Employees  in Schedule 4.2.(b). Buyer shall implement the
following  severance  pay practice for the Transferred Employees, which practice
shall  only  apply to the Transferred Employees and which obligation to maintain
such practice shall terminate on the first anniversary of the Closing Date: if a
Transferred  Employee  is  involuntarily  severed from full-time employment with
Buyer  without cause during the one-year period following the Closing Date, such
Transferred  Employee  shall  receive one (1) week of severance pay for each six
(6) months of service fully or partially completed with Buyer and Seller (in the
aggregate),  with  a minimum of eight (8) weeks and a maximum of twenty-six (26)
weeks.  Each  week  of severance pay will be an amount equal to one week of such
Transferred  Employee's  total cash employment compensation from Buyer for full-
time  employment.  For one year from the Closing Date, Buyer agrees that it will
not  change this severance pay practice as applied to the Transferred Employees.
Nothing contained in this Section 4.2. shall be construed to in any way limit or
prevent  Buyer  from  terminating  any  Transferred Employee at any time for any
reason  or  give  rise  to  an  obligation  by Buyer to pay severance pay to any
Transferred  Employee involuntarily severed from full-time employment with Buyer
during  such  one-year  period  for cause or after such one-year period expires.

(c)     As more fully set forth in the Secondment Agreement, for the period from
the  Closing  Date  through  and  including  December  31, 1999, Seller shall be
responsible  for  payment  of  all  compensation  and  employee  benefits to the
Employees,  and  Buyer shall promptly reimburse Seller for all such amounts paid
as  compensation  and for the costs of the benefits and services provided. As of
January 1, 2000, and thereafter, Buyer shall be responsible for all liabilities,
salaries,  benefits  and  similar  employer  obligations of Buyer (including the
administration  thereof)  for  all  Transferred  Employees. Upon separation from
Seller  or  its Affiliates, Transferred Employees shall be paid by Seller or its
Affiliates  for  vacation  accrued,  plus  previously  deferred  vacation,  less
vacation  taken,  plus accrued variable pay; provided, however that such accrued
variable pay shall be paid to such Transferred Employee at the same time as such
payments  are  made  to  Seller's or its Affiliates' employees and such vacation
payments  shall be made no later than 30 days after expiration of the Secondment
Agreement.

(d)     Buyer  shall  be  responsible  for  liabilities  with  respect  to  the
termination  of  any  Transferred  Employees  by  Buyer after December 31, 1999,
including  without limitation, health care continuation coverage with respect to
plans  established  or  maintained  by  Buyer  after the Closing, and damages or
settlements  arising  out  of any claims of wrongful or illegal termination, and
for  complying  with the requirements of all Applicable Laws with respect to any
such  termination.

(e)     Seller  will  provide any notices, if applicable, relating to WARN, with
respect  to  events that occur in connection with the Contemplated Transactions.

(f)     Seller  will  be  responsible  for  all  liabilities  and  obligations
pertaining  to  the  employment  or  termination  of employment of all Employees
(including  Transferred  Employees) accruing prior to January 1, 2000 (provided,
with  respect  to  the  time  period  between  Closing  and January 1, 2000, the
Employees  are  employed  by  Seller  pursuant  to  the  Secondment  Agreement).

                                       10
<PAGE>
     4.3     SHRINK-WRAP SOFTWARE, WINDOWS 95 AND SAVOY AGREEMENT. Seller hereby
transfers,  to  the  extent  it  has the legal right to do so and subject to the
applicable  license agreements with the licensors, its royalty-free usage rights
to  the  shrink-wrap personal computer software (also known as conditions-of-use
software)  being  used in its ordinary course of business as of the Closing Date
on  the  personal  computers  that  are  Transferred  Assets.  If  such software
copyrights  are  owned by Seller, Seller's license terms and conditions continue
to  apply.  In addition, Buyer is authorized to sell or otherwise distribute the
Controller  Inventory  together  with  the Microsoft Windows 95 Operating System
(WIN95),  its  associated Certificate of Authenticity (COA) and end user license
agreement  (EULA)  to  the  extent  preloaded  or  included  with the Controller
Inventory. However, Buyer may not sell or otherwise distribute WIN95, the COA or
EULA  separately  from the Controller Inventory. Further, WIN95, the COA and the
EULA  may  not  be  modified other than for normal service or support or removed
(unless  all  such  items are removed) prior to sale or distribution of units in
the  Controller  Inventory  to  the  end  user.

Further,  until  such  time Seller completes the assignment of License Agreement
number  4997RL2159-001/PCC970620  between  Savoy  Automation,  Inc.  and Seller,
effective  August  26, 1997, as amended (the "Savoy Agreement") to Buyer, Seller
grants  to Buyer, with respect to Object Code only of the Program and Derivative
Works  thereof  prepared  by  Seller  (as  such  terms  are defined in the Savoy
Agreement), a worldwide, irrevocable, nonexclusive, right and sublicense: (a) to
use,  execute,  preload,  reproduce,  copy, distribute, copies of (internally or
externally),  prepare  Derivative Works, display and perform all, or any portion
of  the  Program  or  said  Derivative Works, and such rights and licenses shall
include  all  rights  and  licenses in and to pictorial, graphic or audio/visual
works,  including  icons,  screens,  music,  sound  and characters, created as a
result  of  execution  of  the  Program  whether  such  pictorial,  graphic  or
audio/visual  works  are created by use of the Program or with other programming
or  through  other means (b) under any trade secret patent application or patent
owned  or  licensable  by  Savoy  to  make, have made, use, have used, lease, or
otherwise license or sublicense each Program either alone or in combination with
equipment  or  software or both; (c) to use, in connection with the marketing of
the  Program, the Program name(s), trade names and trademark(s) used by Savoy to
identify  the Programs including any portions thereof; and (d) to sublicense all
or  any portions of the Program to end users and others under similar provisions
used  by  Seller  to  sublicense Seller programming products, or at Buyer's sole
discretion,  under provisions provided by Savoy to license or similarly transfer
Programs.  In  connection  with such sublicense, Buyer shall comply with, and do
all  things  necessary for IBM to comply with, the Savoy Agreement. If Seller is
unable to complete an assignment of the Savoy Agreement to Buyer by December 31,
1999,  Seller  and  Buyer  agree  to:  (1)  extend  the Secondment Agreement, in
accordance with its terms, to maintain as seconded employees for the term of the
Savoy Agreement those Employees needed to create Derivative Works of the Program
reasonably  requested  by  Buyer, or (ii) take such other actions as the Parties
mutually  agree.

4.4          FURTHER  ACTION.  Each  of Seller, Buyer and STICC agrees to ex and
deliver such other documents, certificates, agreements and other writings and to
take  such  other  actions  as  may be necessary or desirable, in the reasonable
opinion  of each Party's or STICC's counsel, in order to consummate or implement
expeditiously  the  Contemplated  Transactions  and  the  terms of the Operative
Agreements.

                                       11
<PAGE>
4.5     UNDERTAKING.  STICC  hereby  agrees  to be responsible to Seller for the
prompt  payment  when  due  of Buyer's obligations under Section 1 .3(a)(v), and
STICC  shall  take  the  necessary  steps  to  assure  that  Buyer  performs its
Obligations  to  Seller  under  this  Agreement.

4.6     NONSOLICITATION.  Seller  agrees that, for a period of one year from the
Closing  Date,  it  will not, directly or indirectly, solicit for employment and
for a period of six months following the Closing Date, it will not hire (without
Buyer's  prior written consent) any Transferred Employee (so long as such person
is  employed  by  Buyer);  provided, however that solicitation shall not include
general  employment  advertising or the use of any independent employment agency
or  search  firm  not  specifically directed to employees of Buyer and provided,
further  that  it  shall  not  be  a  breach  of  this  Section  4.6  if  Seller
inadvertently  hires  any  Transferred  Employee.

     Buyer  agrees  that, for a period of one (1) year from the Closing Date, it
will  not, directly or indirectly, solicit for employment any employee of Seller
(or  any  of  its  Affiliates)  employed in Raleigh, North Carolina or with whom
Buyer had contact in connection with this transaction (so long as such person is
employed  by  Seller);  provided,  however,  that solicitation shall not include
general  employment  advertising or the use of any independent employment agency
or  search  firm  not specifically directed to employees of Seller or any of its
Affiliates.

     4.7     ESTABLISHMENT  OF LETTER OF CREDIT FACILITY. Prior to the execution
and delivery of this Agreement, Buyer has established and caused to be delivered
to  Seller an irrevocable letter of credit ("Letter of Credit") issued by United
States  Trust  Corporation  and  under  which  Seller is the beneficiary, in the
aggregate  principal  or  stated  amount of $2,000,000.00. Seller is entitled to
draw  upon  the  Letter  of  Credit  until January 31, 2000 as needed to pay any
Operating  Expenses  incurred  from  October  8,  1999  to  the  Closing  Date.
Notwithstanding  the  foregoing, under no circumstances shall Seller be entitled
to draw on the Letter of Credit after receipt from Buyer of written notification
alleging  that  Seller  is in breach of any obligations or representations under
the  Agreement;  provided, however, that Seller shall be entitled to draw on the
Letter  of  Credit  after receipt of such notification to pay Operating Expenses
accrued  through  the  date  of  such  notification.

4.8     ACCESS  TO  INFORMATION;  COOPERATION  AFTER  CLOSING.  Except as may be
deemed  appropriate  to  ensure  compliance  with respect to any Applicable Laws
(including,  without  limitation,  any antitrust regulations) and subject to any
confidentiality  obligations  or  applicable  privileges  (including,  without
limitation,  the  attorney-client  and work-product privileges), for a period of
two  (2)  years  after  the  Closing  Date,  each Party shall use its good faith
reasonable  efforts  to  provide  the other Party and its representatives at the
other  Party's  expense.  information  reasonably  requested  by the other Party
relating to the Transferred Assets or Assumed Liabilities to the extent required
by the other Party to permit the other Party to determine any matter relating to
its  rights  and  obligations  under the Operative Agreements and its compliance
with  applicable Tax and financial reporting requirements. Any requests pursuant
to  this  Section  4.8  shall  be  at  the  expense  of  the  requesting  Party.

4.9     INSURANCE; CASUALTY LOSS. Buyer agrees that, and for a period of two (2)
years  after  the  Closing  Date,  it  will  maintain  at its sole expense, with
financially  sound  and  reputable  insurance  companies:  (i)  insurance on its

                                       12
<PAGE>
properties;  (ii)  public liability insurance against claims for personal injury
or  death as a result of the use of any products sold by it; and (iii) insurance
coverage  against  other  business risks, in each case, in at least such amounts
and  against at least such risks as are usually and prudently insured against in
the same general geographical area by companies of established repute engaged in
the  same  or a similar business, but in no event less than Five Million Dollars
($5,000,000.00).  Buyer  will  furnish  to Seller, upon its written request, the
insurance certificates with respect to such insurance. In addition, with respect
to matters for which indemnification is provided by Buyer under Article VII, all
such  policies  of  insurance  so maintained are to name Seller as an additional
insured  as  its  interest  may  appear.

4.10     WARRANTY  WORK.  Buyer  shall,  at  Seller's  request,  perform  repair
services  on  products  sold  by Seller prior to the Closing Date (to the extent
Seller  would  be required to provide such repair services). To the extent that,
after the Closing Date, Buyer performs any such repair services on products sold
by  Seller  prior  to  the  Closing  Date, which services are the subject of any
warranty  extended  by  Seller,  Seller  shall reimburse Buyer for such services
performed  at  Buyer's  then-established  standard rates for time and materials,
provided, however that in the event such cost to repair such products at Buyer's
standard rates exceeds Buyer's then- established standard price of such product,
Buyer  shall  replace  such  product  and  Seller  shall reimburse Buyer for the
standard  price  of  such  replacement  product.

              ARTICLE V.  REPRESENTATIONS AND WARRANTIES OF BUYER.

     Buyer  hereby  represents  and  warrants  to  Seller  as  follows:

5.1          INCORPORATION.  Buyer  is  a duly incorporated and validly existing
corporation  in  good standing under the laws of the State of Delaware, with all
requisite  corporate  power  and authority to own its properties and conduct its
business.

5.2     AUTHORITY.  Buyer  has  the  requisite  corporate power and authority to
execute  and  deliver  each  of the Operative Agreements and the Confidentiality
Agreement  and  to  perform its obligations under each of the foregoing. Each of
the  Operative  Agreements  and  the Confidentiality Agreement has been duly and
validly  authorized,  executed and delivered, by Buyer and constitutes the valid
and binding agreement of Buyer in accordance with its respective terms except as
enforceability  may  be  limited  by  applicable  bankruptcy,  insolvency,
reorganization,  moratorium  or  other  similar  laws now or hereafter in effect
relating  to  or  affecting creditor's rights generally, including the effect of
statutory  and  other  laws  regarding  fraudulent  conveyance  and preferential
transfers.  No other corporate proceedings on the part of Buyer are necessary to
authorize  the  Operative  Agreements,  the  Confidentiality  Agreement  and the
Contemplated  Transactions.

5.3     NO  CONFLICT.  The  execution  and  delivery  by  Buyer  of  each of the
Operative  Agreements  and  the  Confidentiality  Agreement  does  not,  and the
performance  of  its  obligations  thereunder,  will  not:

(a)          conflict  with,  or result in a breach of, any of the provisions of
its  Articles  of  Incorporation  or  By-laws;

                                       13
<PAGE>
(b)     breach, violate or contravene any Applicable Law, or create any right of
termination or acceleration or encumbrance, that, in the aggregate, would have a
material  adverse  effect on its authority or ability to perform its obligations
under  the  Operative  Agreements,  the Confidentiality Agreement or the Assumed
Liabilities;  and

(c)     conflict in any respect with, or result in a breach of or default under,
any contract, license, franchise, permit or any other agreement or instrument to
which  it  is a party or by which it or any of its properties may be affected or
bound  that, singly or in the aggregate, would have a material adverse effect on
its  authority  or  ability  to  perform  its  obligations  under  the Operative
Agreements,  the  Confidentiality  Agreement  or  the  Assumed  Liabilities.

5.4                GOVERNMENTAL  CONSENTS.  No  material  consent,  approval  or
authorization  of,  or designation, declaration or filing with, any Governmental
Authority  on  the part of Buyer is required in connection with the execution or
delivery  by Buyer of the Operative Agreements, the Confidentiality Agreement or
the  consummation  by  Buyer  of  the  Contemplated  Transactions.

5.5     NO BROKER. Buyer has engaged no corporation, firm or other Person who is
entitled to any fee or commission as a finder or a broker in connection with the
negotiation  of  the  Operative Agreements, the Confidentiality Agreement or the
consummation  of  the  Contemplated Transactions, and Buyer shall be responsible
for  all  liabilities  and  claims  (including  costs  and expenses of defending
against same) arising in connection with any claim by a finder or broker that it
acted  on  behalf  of  Buyer  in  connection with the Contemplated Transactions.

5.6     INSURANCE;  CASUALTY  LOSS.  Buyer is in compliance with its obligations
pursuant  to  Section  4.9.

              ARTICLE VI.  REPRESENTATIONS AND WARRANTIES OF SELLER

     Except  as  set  forth  on  the  Disclosure Schedule delivered by Seller to
Buyer,  Seller  hereby  represents  and  warrants  to  Buyer  as  follows:

6.1          INCORPORATION.  Seller  is a duly incorporated and validly existing
corporation  in  good standing under the laws of the State of New York, with all
requisite  corporate  power  and authority to own its properties and conduct its
business,  and  is duly qualified in each jurisdiction in which its ownership of
property  requires  such  qualification  except  where the failure to so qualify
would  not have a material adverse effect upon the Transferred Assets or Assumed
Contracts.

6.2     AUTHORITY.  Seller  has  the  requisite Corporate power and authority to
execute  and  deliver the Operative Agreements and the Confidentiality Agreement
and  to  perform  its  obligations  under  each  of  the  foregoing. Each of the
Operative Agreements and the Confidentiality Agreement has been duly and validly
authorized,  executed  and  delivered  by  Seller  and constitutes the valid and
binding  agreement  of  Seller in accordance with its respective terms except as
enforceability  may  be  limited  by  applicable  bankruptcy,  insolvency,
reorganization,  moratorium  or  other  similar  laws now or hereafter in effect
relating  to  or  affecting creditor's rights generally, including the effect of
statutory  and  other  laws  regarding  fraudulent  conveyance  and preferential
transfers. No other corporate proceedings on the part of Seller are necessary to

                                       14
<PAGE>
authorize  the  Operative  Agreements,  the  Confidentiality  Agreement  and the
Contemplated  Transactions.

6.3     NO  CONFLICT.  The  execution  and  delivery  by  Seller  of each of the
Operative  Agreements  and  the  Confidentiality  Agreement  does  not,  and the
performance  by  Seller  of  its  obligations  thereunder  will  not:

(a)          conflict  with,  or result in a breach of, any of the provisions of
its  Articles  of  Incorporation  or  By-laws;

(b)     breach, violate or contravene any Applicable Law, or create any right of
termination or acceleration or encumbrance, that, in the aggregate, would have a
material  adverse  effect on its authority or ability to perform its obligations
under  the  Operative  Agreements  or  the  Confidentiality  Agreement;

(c)     conflict in any respect with, or result in a breach of or default under,
any contract, license, franchise, permit or any other agreement or instrument to
which  it  is a party or by which it or any of the Transferred Assets or Assumed
Contracts  may  be bound that, singly or in the aggregate, would have a material
adverse  effect  on the Transferred Assets or Assumed Contracts or its authority
or  ability  to  perform  its  obligations  under  the Operative Agreements, the
Confidentiality  Agreement  or  the  Assumed  Liabilities  (except  for  Assumed
Contracts  that  require  the  consent  or  approval  of  a  third  party  as  a
prerequisite  to  transfer  of  such  Assumed  Contracts  to  Buyer);  and

(d)     result in the creation or imposition of any Lien, other than a Permitted
Lien,  on  any  Transferred  Assets  or  Assumed  Contracts.

6.4          GOVERNMENTAL  CONSENTS.  No    material    consent,   approval   or
authorization  of,  or designation, declaration or filing with, any Governmental
Authority  on the part of Seller is required in connection with the execution or
delivery by Seller of the Operative Agreements and the Confidentiality Agreement
or  the  consummation  by  Seller of the transactions contemplated by any of the
foregoing.

6.5     NO  BROKER.  Seller has engaged no corporation. firm or other Person who
is  entitled to any fee or commission as a finder or a broker in connection with
the  negotiation  of  the Operative Agreements, the Confidentiality Agreement or
the  consummation  of  the  Contemplated  Transactions,  and  Seller  shall  be
responsible  for  all  liabilities  and  claims (including costs and expenses of
defending  against  same)  arising  in  connection with any claim by a finder or
broker  that  it  acted  on behalf of Seller in connection with the transactions
contemplated  thereby.

6.6     TITLE  TO PERSONAL PROPERTY. Seller has good and marketable title to all
Transferred  Assets  listed on Schedule 1.1. hereto, free and clear of any Liens
other  than  Permitted Liens. There are no Liens, other than Permitted Liens, on
the  Assumed  Contracts.

6.7     LITIGATION.  There  are no actions, suits, proceedings or investigations
pending  or,  to  the  knowledge  of  Seller's PSG general attorney, or Seller's
Raleigh  site general attorneys or Intellectual Property Law attorneys primarily
responsible  for  providing  legal  advice  to  the Home Director business unit,

                                       15
<PAGE>
threatened  in  a  writing to Seller against or directly affecting Seller's Home
Director  business  unit,  at  law  or  in  equity,  including an administrative
proceedings or condemnation actions with any Governmental Authority. There is no
existing default by Seller with respect to any judgment, order, writ, injunction
or decree of any Governmental Authority or arbitrator which materially adversely
affects  the  Transferred  Assets  or  Assumed  Contracts.

6.8     NO  RIGHTS  IN  OTHERS  TO  TRANSFERRED  ASSETS.  Neither Seller nor any
Affiliate  of Seller is party to any outstanding contracts or other arrangements
giving  any  Person any present or future right to require Seller to transfer to
any  Person any ownership or possessory interest in, or to grant any Lien, other
than  a  Permitted Lien, on, any of the Transferred Assets or Assumed Contracts,
other  than  pursuant  to  this  Agreement.

6.9     LICENSES  AND  PERMITS.  Seller  has  licenses  and  permits  and  other
governmental authorizations and approvals required for Seller's use or operation
of the Transferred Assets or performance the Assumed Contracts, except where the
failure  to  have  such  licenses  and permits would not have a material adverse
effect  On  Seller's ability to use or operate the Transferred Assets or perform
the  Assumed  Contracts.  All  licenses  and  permits  held  by Seller which are
material  to  the  use  or operation of the Transferred Assets or performance of
Assumed  Contracts  are  valid  and  in  full force and effect and there are not
pending  or,  to the knowledge of Seller, threatened in a writing to Seller, any
proceedings  which  could  result  in  the termination or impairment of any such
license  or  permit  which  termination or impairment would materially interfere
with  the  use  or operation of the Transferred Assets or performance of Assumed
Contracts  as  presently  used, operated or performed, as applicable, by Seller.
Buyer  must  seek a regulatory or other permitted transfer of, or obtain through
separate  application for itself, any applicable licenses and permits, including
environmental  licenses and permits, which are required for Buyer's operation or
ownership  of  the  Transferred  Assets  or  performance  of  Assumed Contracts.

6.10     EMPLOYEES.  Seller  is not bound by any collective bargaining agreement
covering  any  Employee.  No  representation  petition  has  been filed with the
National  Labor Relations Board with respect to Employees. There is not any, and
during the past 12 months there has not been any. labor strike, work stoppage or
lockout  with  respect  to  the  Employees.

6.11     ASSUMED  CONTRACTS. Each Assumed Contract is a legal, valid and binding
obligation  of  Seller  and,  to  the  knowledge  of Seller, of each other party
thereto,  enforceable  by  Seller  in accordance with its terms (except for such
failure  to  be  valid  and  binding or enforceable that, individually or in the
aggregate,  is  not  reasonably  likely to have a material adverse effect on the
Transferred  Assets or Assumed Contracts). Seller has performed or is performing
all  material  obligations  required  to  be  performed  by it under the Assumed
Contracts  and  is not (with or without notice, lapse of time or both) in breach
or  default in any material respect thereunder, and, to the knowledge of Seller,
no  other  party  to  any of such contracts is (with or without notice, lapse of
time  or  both)  in  breach  or  default  in  any  material  respect thereunder.

6.12     COMPLIANCE  WITH  LAWS.  The  operation  of  and use of the Transferred
Assets  and  performance  of  Assumed  Contracts  do  not  materially violate or
infringe  any  material  Applicable  Law.

                                       16
<PAGE>
6.13     OPERATION OF TRANSFERRED ASSETS AND ASSUMED LIABILITIES. Seller has, in
the United States only, operated its business relating to the Transferred Assets
and  Assumed  Liabilities  only  through  Seller,  and not through any Affiliate
except  Lotus  Development  Corporation.

6.14     SCHEDULE  PREPARATION. Seller is responsible for the preparation of the
content  of  the  Schedules  other  than  Schedules  1.1(d),  3.1(a) and 4.2(b);
provided,  however  this  provision  shall  not be interpreted to mean that such
Schedules  1.1(a)  -  (c)  or  1.4  are  a complete listing of all Home Director
business  unit  assets, contracts and liabilities prior to Closing and the terms
of  this  Agreement  only  apply  to  the  content  of  such  Schedules.

6.15     YEAR 2000. The Controller Inventory and the Connection Center Inventory
are  in  compliance with the representations made by Seller regarding such items
on  Seller's  Web  site,  which  representations are set forth on Schedule 6.15.

6.16     WARRANTIES.  EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES MADE
BY  SELLER  IN  THIS  ARTICLE  VI,  SELLER  MAKES NO REPRESENTATION OR WARRANTY,
EXPRESS  OR  IMPLIED, CONCERNING THE TRANSFERRED ASSETS AND ASSUMED LIABILITIES,
IT  BEING  SPECIFICALLY  UNDERSTOOD  BY  BUYER  THAT,  EXCEPT  FOR  THE  EXPRESS
WARRANTIES  SET  FORTH  IN  THIS  ARTICLE  VI THE TRANSFERRED ASSETS AND ASSUMED
LIABILITIES  ARE  BEING  SOLD  AND  TRANSFERRED  "AS IS" IN ALL RESPECTS. SELLER
SPECIFICALLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR SUITABILITY OR FITNESS
FOR ANY PARTICULAR PURPOSE OF BUYER'S, WHETHER OR NOT SELLER HAS BEEN MADE AWARE
OF  ANY  SUCH  PURPOSE.

                            ARTICLE VII.  INDEMNITY.

     7.1     BUYER  INDEMNIFICATION.  Subject  to  the  limitations set forth in
Sections 7.6. and 8.2. below, Buyer hereby agrees to indemnify and hold harmless
Seller,  its officers, directors, employees, owners, agents and Affiliates, for,
against,  from  and  in  respect of any and all Losses which may be sustained or
suffered by any of them arising out of, resulting from or pertaining to: (i) any
breach of any representation, warranty, covenant or agreement of Buyer contained
in  any  Operative  Agreement;  (ii)  any liabilities or obligations accruing or
required  to  be performed after the Closing Date in Connection with or relating
to  the  Assumed  Liabilities  or  the  Transferred  Assets;  (iii) any products
manufactured,  shipped,  sold  or  installed by Buyer (or any agent of, or third
party  under  contract  with,  Buyer)  after  the  Closing  Date, and any act or
omission  by  Buyer  (or  any  agent of, or any third party under contract with,
Buyer)  or  any  installer or integrator with respect to such products after the
Closing  Date;  and/or  (iv)  operation of a business by Buyer after the Closing
Date  except  as specified in the Operative Agreements or as otherwise agreed to
in  separate  written  agreements  between  the  Parties  or  in connection with
Seller's  equity  interest  in  Buyer.

7.2     SELLER INDEMNIFICATION. Subject to the limitations set forth in Sections
7.6  and  8.2  below, Seller hereby agrees to indemnify and hold harmless Buyer,
its officers, directors, employees, owners, agents and Affiliates, for, against,
from  and in respect of any and all Losses which may be sustained or suffered by

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any  of  them arising out of, resulting from or pertaining to: (i) any breach of
any  representation,  warranty, covenant or agreement of Seller contained in any
Operative Agreement; (ii) any liabilities or obligations accruing or required to
have been performed by Seller on or prior to the Closing Date in connection with
or relating to the Assumed Liabilities or Transferred Assets; (iii) any products
shipped,  sold  or  installed  by  Seller (or any agent of, or third party under
contract  with, Seller) on or prior to the Closing Date, and any act or omission
by  Seller  (or any agent of, or any third party under contract with, Seller) or
any installer or integrator with respect to such products on or prior to Closing
Date;  and/or  (iv) operation of the Home Director business unit by Seller on or
prior  to the Closing Date except as specified in the Operative Agreements or as
otherwise  agreed  to  in  separate  agreements  between  the  Parties.

7.3     PROCEDURES.  Buyer  pursuant  to  Section  7.2.  and  Seller pursuant to
Section  7.1. (the "Indemnified Party") each agrees to give prompt notice to the
other  Party  (the  "Indemnifying  Party") of the assertion of any claim, or the
commencement of any suit, action or proceeding in respect of which indemnity may
be sought under this Article VII, including the amount and other details of such
claim.  The  Indemnifying Party may participate in the defense of, and, if it so
chooses,  assume and control the defense of, any such suit, action or proceeding
at  its own expense; provided, however, that the Indemnifying Party shall assume
and  control  the defense unless it notifies the Indemnified Party in writing of
its  intent  not  to do so within 20 days after its receipt from the Indemnified
Party  of notice of such claim or action. If the Indemnifying Party assumes such
defense,  then  the  Indemnifying  Party  shall not be liable to the Indemnified
Party  for  any legal expenses subsequently incurred by the Indemnified Party in
connection  with  such  defense.  The Indemnified Party may, at its own expense,
monitor  and  participate  in the defense but not control the defense unless the
Indemnifying  Party  notifies the Indemnified Party in writing of its intent not
to  assume  the control of the defense within 20 days after its receipt from the
Indemnified  Party  of  notice  of  such  claim or action. The Indemnified Party
undertakes  to faithfully and fully cooperate with the Indemnifying Party in all
respects  required  for  the  best resolution or defense against any such claim,
suit,  action  or proceeding. For as long as the Indemnifying Party conducts the
defense  of  any  such  claim; suit, action or proceeding, the Indemnified Party
shall  take  no  actions  in relation to such claim, suit, action or proceeding,
without  the  prior  consent  of  the Indemnifying Party. The Indemnifying Party
shall  not  be  liable  under Section 7.1. or Section 7.2. respectively, for any
settlement effected without its consent of any claim, suit, action or proceeding
in  respect  of which indemnity may be sought thereunder (which consent will not
be unreasonably withheld). The Indemnifying Party shall be authorized to consent
to  a  settlement  of,  or  the entry of any judgment arising from, any claim of
which  the Indemnifying Party has assumed the defense, without the prior consent
of  the  Indemnified  Party,  provided,  however  that  a  condition to any such
settlement  shall  be a complete release from any responsibility or liability of
the  Indemnified  Party and its Affiliates with respect to such claim which does
not  impose  any  actual  or  potential  liability  upon  the Indemnified Party.

7.4     INDEMNITY  PRECLUSION.  Buyer and Seller shall be precluded from seeking
indemnification  from  each  other,  and Buyer and Seller shall not be liable to
each  other  pursuant  to  the  Operative  Agreements,  for  any  breach  of
representations  and warranties which either William H. Buchanan, Jr. or Jeffrey
J.  Doyle,  respectively,  had actual knowledge of prior to the Closing Date. In
addition, Buyer shall be precluded from seeking indemnification from Seller, and

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<PAGE>
Seller  shall  not  be liable to Buyer pursuant to the Operative Agreements, for
breaches  of  representations  and warranties by Seller which Mary E. Walker and
Lee  Griffin  had  actual  knowledge  of prior to the Closing Date and knowingly
withheld  from  William H. Buchanan, Jr. Further, Seller shall be precluded from
seeking  indemnification  from  Buyer,  and  Buyer shall not be liable to Seller
pursuant  to  the  Operative  Agreements,  for  breaches  of representations and
warranties by Buyer which Mary E. Walker and Lee Griffin had actual knowledge of
prior  to  the  Closing  Date  and  knowingly  withheld  from  Jeffrey J. Doyle.

7.5     INDEMNITY IS THE EXCLUSIVE REMEDY. Buyer and Seller each acknowledge and
agrees that its sole and exclusive remedy with respect to any and all claims for
any  Loss relating to or arising out of a breach of a representation or warranty
by  the  Indemnifying  Party  of  this  Agreement,  shall  be  pursuant  to  the
indemnification  provisions  set  forth  in  this  Article  VII.

7.6     EXCLUSION  OF CERTAIN DAMAGES. EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
IN AN OPERATIVE AGREEMENT, NEITHER SELLER NOR BUYER SHALL BE RESPONSIBLE FOR ANY
INDIRECT,  INCIDENTAL,  SPECIAL,  PUNITIVE  OR CONSEQUENTIAL DAMAGES WHATSOEVER,
INCLUDING  LOSS  OF  PROFITS  OR  GOODWILL  IN CONNECTION WITH ANY BREACH OF ANY
REPRESENTATION  OR  WARRANTY  SET  FORTH  IN  ANY  OPERATIVE  AGREEMENT.

                         ARTICLE VIII.  GENERAL MATTERS.

     8.1     SURVIVAL  OF  REPRESENTATIONS  AND  WARRANTIES.  Except  as  may be
specifically  provided  in  an  Operative  Agreement.  all  representations  and
warranties  made  by the Parties in the Operative Agreements or in any schedule,
document,  certificate  or  other  instrument  delivered  by or on behalf of the
Parties  pursuant  to  such agreements shall survive the Closing for a period of
twelve  (12)  months  after  the  Closing  Date;  provided,  however,  that  the
representations  and  warranties  in  respect of Taxes shall survive the Closing
Date  until  the  applicable period of limitation on assessment or refund of any
relevant  Tax  has  expired.

8.2     LIMITATION  OF  LIABILITY.  Notwithstanding anything to the contrary set
forth  in the Operative Agreements, unless this section is specifically excluded
from  application  to  a  specific Operative Agreement, neither Buyer nor Seller
shall  be  liable for any amounts with respect to the breach of a representation
and  warranty  unless and until such amounts shall exceed in the aggregate fifty
thousand  ($50,000)  dollars (the "Limitation Amount") (in which case such Party
shall  only  be  liable  with respect to the excess over the Limitation Amount).
There  shall be no Buyer or Seller liability with respect to any such matter for
individual  amounts  of less than two thousand five hundred ($2,500) dollars and
such  amounts  shall  not  be  taken  into  account  in  determining whether the
Limitation  Amount  has  been exceeded, provided, however that individual claims
arising  out  of  the  same  occurrence  shall be aggregated for purposes of the
limitation  set  forth  in this sentence. In no event shall Buyer's liability or
Seller's liability (other than with respect to Losses to the extent arising from
a breach of the representation and warranty in Section 6.6.) with respect to the
breach  of representations and warranties in the Operative Agreements exceed one
million  ($1,000,000)  dollars in the aggregate. The limitations in this Section
do  not apply to Losses by either Party resulting from fraud by the other Party.

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<PAGE>
8.3     PUBLIC  ANNOUNCEMENTS. The Confidentiality Agreement shall apply to, and
the  Operative  Agreements  and  the  proposed  transaction  is  subject  to and
confidential  under, the Confidentiality Agreement. For six (6) months after the
Closing  Date,  all  public  announcements  relating  to  this  Agreement or the
Contemplated  Transactions  shall  be  made  only after consultation between the
Parties,  except  for disclosures by either Party that in the opinion of counsel
for  such  Party are required by Applicable Law. Any disclosures to customers in
connection  with  commercial  relationships  shall not reveal the Purchase Price
(other  than the amount of equity participation) provided for by this Agreement.
Notwithstanding  the  foregoing,  either Party shall have the right, in its sole
discretion,  to  make  such disclosures as it may deem necessary or advisable to
any  Governmental  Authority. In the event of a breach or anticipatory breach of
this  Section  8.3.  by  either  Party,  the  other  Party shall be entitled, in
addition  to  any  and all other remedies available at law or in equity, to seek
preliminary  and  permanent  injunctive  relief and specific performance without
proving  damages.

8.4     DUE  DILIGENCE. Buyer and STICC have engaged in the entire due diligence
effort  they  deemed  appropriate prior to executing this Agreement. The sale of
the  Transferred  Assets  and  acceptance of Assumed Liabilities is based solely
upon  the  results of that due diligence and there has been no reliance upon the
representations  or  statements  of  Seller,  other than the representations and
warranties  of  Seller  set  forth  in  Article  VI  or  in  any other Operative
Agreement.

8.5     COSTS.  Each  Party  and  STICC  shall  be responsible for the costs and
expenses  incurred  by  it  in  the  negotiation,  execution and delivery of the
Operative  Agreements  and,  except  as  otherwise  provided  elsewhere  in such
agreements,  the  consummation  of  the  Contemplated  Transactions.

8.6     BULK  SALES.  Buyer  hereby  waives  compliance with any applicable bulk
sales  or  similar  laws  by  Seller.

8.7     MODIFICATION  AND  WAIVER. No modification or waiver of any provision of
this  Agreement  and no consent by either Party to any departure therefrom shall
be  effective  unless  in  a  writing referencing the particular section of this
Agreement  to be modified or waived and signed by a duly authorized signatory of
each  Party,  and the same will only then be effective for the period and on the
conditions  and  for  the  specific  instances  and  purposes  specified in such
writing.

8.8     GOVERNING  LAW. This Agreement has been delivered at and shall be deemed
to  have been made at Armonk, New York, and shall be interpreted, and the rights
and liabilities of the parties hereto determined, in accordance with the laws of
the State of New York applicable to agreements executed, delivered and performed
within  such  State,  without  regard  to  the  principles  of conflicts of laws
thereof.  As  part of the consideration for value this day received, each of the
Parties  and  STICC hereby consent to the exclusive jurisdiction of any New York
State  court  located  within the County of Westchester and any federal court of
the  United States of America located in the Southern District of New York. EACH
OF  THE  PARTIES  AND  STICC  HEREBY:  (I) WAIVES TRIAL BY JURY; (II) WAIVES ANY
OBJECTION  TO  NEW  YORK  VENUE  OF  ANY  ACTION INSTITUTED HEREUNDER; AND (III)

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<PAGE>
CONSENTS  TO  THE  GRANTING  OF  SUCH  LEGAL  OR  EQUITABLE  RELIEF AS IS DEEMED
APPROPRIATE  BY  ANY  AFOREMENTIONED  COURT.

8.9     NOTICES.  All  notices  and  other  communications hereunder shall be in
writing  and  shall be deemed to have been duly given and shall be effective (a)
when  delivered  by  messenger  or  courier,  or (b) five days after deposit for
mailing  by  registered  or  certified  mail,  postage  prepaid,  return receipt
requested,  when  also  transmitted  by  telecopy  as  follows:

     (a)     if  to  Seller,  to:

             International  Business  Machines  Corporation
             New  Orchard  Road
             Armonk,  New  York  10504

             Attention:   Lee  A.  Dayton
                          Vice President, Corporate Development and Real Estate
             Telecopy:     (914)  499-7803

             with  a  copy  to:

             International  Business  Machines  Corporation
             New  Orchard  Road
             Armonk,  New  York  10504

             Attention:     Donald  D.  Westfall,  Esq.
                            Associate  General  Counsel
             Telecopy:     (914)  499-6006

     (b)     if  to  Buyer,  to:

             Home  Director,  Inc.
             991  Aviation  Parkway,  Suite  800
             Morrisville,  North  Carolina  27560

             Attention:     Mary  E.  Walker
                            Chief  Executive  Officer

             with  a  copy  to:

             Spencer  Trask  Intellectual  Capital  Company  LLC
             535  Madison  Avenue,  18th  Floor
             New  York,  New  York  10022
             Attention:  William  H.  Buchanan,  Jr.
             Telecopy:  (212)  486-7392

                                       21
<PAGE>
             Kirkpatrick  &  Lockhart  LLP
             1251  Avenue  of  the  Americas,  45th  Floor
             New  York,  New  York  10020
             Attention:  Stephen  R.  Connoni,  Esq.
             Telecopy:  (212)536-3901

             Kirkpatrick  &  Lockhart  LLP
             Henry  W.  Oliver  Building
             535  Smithfield  Street
             Pittsburgh,  Pennsylvania  15222
             Attention:  Susan  A.  Apel,  Esq.
             Telecopy:  (412)  355-6501

     (c)     if  to  STICC,  to:

             Spencer  Trask  Intellectual  Capital  Company  LLC
             535  Madison  Avenue,  18th  Floor
             New  York.  New  York  10022
             Attention:  William  H.  Buchanan,  Jr.
             Telecopy:  (212)  486-7392

             Kirkpatrick  &  Lockhart  LLP
             1251  Avenue  of  the  Americas,  45th  Floor
             New  York.  New  York  10020
             Attention:  Stephen  R.  Connoni,  Esq.
             Telecopy:  (212)  536-3901

             Kirkpatrick  &  Lockhart  LLP
             Henry  W.  Oliver  Building
             535  Smithfield  Street
             Pittsburgh,  Pennsylvania  15222
             Attention:  Susan  A.  Apel,  Esq.
             Telecopy:  (412)  355-6501

or  to  such  other  address as either of Buyer, Seller or STICC shall hereafter
designate  to  the  other  from  time  to  time  by  similar  written  notice.

8.10          ASSIGNMENT. This Agreement shall be binding upon, and inure to the
benefit  of,  and  be enforceable by, the successors and assigns of the Parties;
provided that, neither Party may assign its rights hereunder without the written
consent  of  the  other Party, which consent shall not be unreasonably withheld.

8.11     COUNTERPARTS.  This  Agreement may be executed by the Parties and STICC
in one or more counterparts, each of which shall be an original and all of which
shall  constitute  one  and  the  same  instrument.

8.12     ENTIRE  AGREEMENT.  This  Agreement,  together  with  the  Assumption
Agreement,  the Bill of Sale, the Intellectual Property Agreement, the Trademark

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<PAGE>
Agreement, the Secondment Agreement, the Stockholders' Agreement, the Transition
Services  Agreement,  and  the  Confidentiality  Agreement,  comprise the entire
agreement  among  Buyer,  Seller  and  STICC  with respect to the subject matter
hereof  and  thereof  and  supersede  all  prior  agreements, understandings and
representations,  oral or written, among Buyer, Seller and STICC relating hereto
and  thereto.  Except  as  expressly  provided  in  any  Operative Agreement, no
Operative  Agreement  or  any  provision  thereof is intended to confer upon any
Person  other  than  the  Parties  and  STICC  any rights or remedies hereunder.

8.13     CONSTRUCTION. As used in the Operative Agreements, any reference to the
masculine,  feminine  or neuter gender will include all genders, the plural will
include  the singular, and the singular will include the plural. Use of the word
"including"  shall  mean  "including,  without  limitation"  whether or not such
words,  or  words  of  like  import,  are used. Any reference to an "Article" or
"Section"  will  be to an Article or Section hereof, unless otherwise noted, and
any  reference  to  an  "Exhibit"  or  "Schedule" will be an exhibit or schedule
attached  hereto,  unless otherwise noted. The Parties understand and agree that
this  Agreement  has been mutually negotiated, prepared and drafted, and that if
at any time the Parties desire or are required to interpret or construe any such
term  or  condition  or  any  agreement  or  instrument  subject  hereto,  no
consideration  will  be  given  to  the  issue of which party actually prepared,
drafted  or  requested  any  term  or  condition  of  this  Agreement.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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<PAGE>
IN  WITNESS  WHEREOF,  Buyer,  Seller and STICC have caused this Agreement to be
executed  by  their  duly  authorized  signatories as of the date and year first
above  written.


INTERNATIONAL BUSINESS MACHINES CORPORATION   HOME  DIRECTOR,  INC.

By:________________________________________   By:_______________________________

Name:______________________________________   Name:_____________________________

Title:_____________________________________   Title:____________________________


                                              SPENCER  TRASK  INTELLECTUAL
                                              CAPITAL  COMPANY  LLC

                                              By:_______________________________

                                              Name:_____________________________

                                              Title:____________________________




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