AGREEMENT AND PLAN OF REORGANIZATION

                                      among

                            ICG COMMUNICATIONS, INC.,

                         ICG CANADIAN ACQUISITION, INC.,

                          ICG HOLDINGS (CANADA), INC.,

                                       and

                            ICG HOLDINGS (CANADA) CO.






                          Dated as of November 4, 1998

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                                TABLE OF CONTENTS

                                                                          Page

ARTICLE I      
          DEFINITIONS AND CONSTRUCTION......................................1
    1.1   Certain Definitions...............................................1
    1.2   Terms Generally...................................................4

ARTICLE II
          THE REORGANIZATION AND RELATED MATTERS............................4
    2.1   The Reorganization................................................4
          (a)      Exchange of Class A Shares...............................4
          (b)      Acquisition of Company Common Shares Owned by ICG........5
          (c)      Treatment of Warrants....................................5
          (d)      Continuation of the Company..............................5
    2.2   Closing...........................................................6
    2.3   Exchange of Shares................................................6
          (a)      Appointment of Exchange Agent............................6
          (b)      Letter of Transmittal....................................6
          (c)      Exchange Procedure.......................................6
          (d)      Unregistered Transfers of Company Common Shares..........6
          (e)      Lost, Stolen or Destroyed Certificates...................7
          (f)      No Dividends Before Surrender of Certificates............7
          (g)      No Further Ownership Rights in Company Common Shares.....7
          (h)      Abandoned Property Laws..................................7

ARTICLE III
          CERTAIN ACTIONS...................................................8
    3.1   Shareholder Meeting...............................................8
    3.2   Reasonable Efforts................................................8

ARTICLE IV
          REPRESENTATIONS AND WARRANTIES OF THE COMPANY.....................9
    4.1   Organization and Qualification....................................9
    4.2   Authorization and Validity of Agreement...........................9

ARTICLE V
          REPRESENTATIONS AND WARRANTIES OF ICG, ACQUISITION AND NOVA 
          SCOTIA............................................................9
    5.1   Organization......................................................9
    5.2   Authorization and Validity of Agreement..........................10

ARTICLE VI
          TRANSACTIONS PRIOR TO CLOSING....................................10
    6.1   Access to Information............................................10
    6.2   Expenses.........................................................10
    6.3   Notification of Certain Matters..................................10
    6.4   Actions by ICG and Acquisition...................................11
<PAGE>

ARTICLE VII
          CONDITIONS PRECEDENT.............................................11
    7.1   Conditions Precedent to the Obligations of ICG, Acquisition, 
          Nova Scotia and the Company......................................11
          (a)      Shareholder Approval....................................11
          (b)      Absence of Injunctions..................................11
    7.2   Conditions Precedent to the Obligations of ICG, Acquisition and 
          Nova Scotia......................................................11
          (a)      Accuracy of Representations and Warranties..............12
          (b)      Performance of Agreements...............................12
          (c)      Officers' Certificates..................................12
          (d)      No Adverse Enactments...................................12
          (e)      Receipt of Licenses, Permits and Consents...............12
    7.3   Conditions Precedent to the Obligations of the Company...........12
          (a)      Accuracy of Representations and Warranties..............13
          (b)      Performance of Agreements...............................13
          (c)      Officers' Certificates..................................13
          (d)      No Adverse Enactments...................................13
          (e)      Receipt of Licenses, Permits and Consents...............13

ARTICLE VIII
          TERMINATION......................................................13
    8.1   Termination and Abandonment......................................13
    8.2   Effect of Termination............................................14

ARTICLE IX
          MISCELLANEOUS....................................................14
    9.1   Effectiveness of Representations, Warranties and Agreements......14
    9.2   Notices..........................................................14
    9.3   Entire Agreement.................................................15
    9.4   Assignment; Binding Effect; Benefit..............................15
    9.5   Amendment........................................................15
    9.6   Extension; Waiver................................................15
    9.7   Headings.........................................................16
    9.8   Counterparts.....................................................16
    9.9   Applicable Law...................................................16
    9.10  Limited Liability................................................16
    9.11  Severability.....................................................16



Exhibit A         Articles of Amendment
Exhibit B         Sole Shareholder's Resolution

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                    AGREEMENT AND PLAN OF REORGANIZATION


     THIS AGREEMENT AND PLAN OF  REORGANIZATION  (this  "Agreement") is made and
entered  into  as of the  fourth  day  of  November,  1998,  by  and  among  ICG
Communications,  Inc., a Delaware corporation ("ICG"), ICG Canadian Acquisition,
Inc., a Delaware  corporation  ("Acquisition"),  ICG Holdings (Canada),  Inc., a
corporation   organized  under  the  Canadian  Business  Corporations  Act  (the
"Company"),  and ICG Holdings  (Canada) Co. ("Nova  Scotia"),  a newly organized
unlimited  liability  company  organized  under the laws of the Province of Nova
Scotia.

     WHEREAS,   ICG  is  the  parent  of  the  Company  and  beneficially   owns
approximately 99.93% of the outstanding common shares of the Company;

     WHEREAS,  ICG desires to cause  Acquisition to acquire  ownership of all of
the common shares of the Company not owned by it;

     WHEREAS,  the Boards of Directors of ICG,  Acquisition and the Company each
have  determined  that  it is  advisable  and in the  best  interests  of  their
respective  stockholders for ICG to so acquire such shares and, to that end, for
Acquisition  to acquire all of the  outstanding  shares of the Company  upon the
terms and subject to the  conditions of this  Agreement,  and thereafter for the
Company to be continued as an unlimited liability company under the laws of Nova
Scotia; and

     WHEREAS, for United States federal income tax purposes, it is intended that
the  Reorganization  (as  defined  below)  qualify as a tax-free  reorganization
within the meaning of Section  368(a) of the Internal  Revenue Code of 1986,  as
amended (the "Code").

     NOW,  THEREFORE,  in  consideration  of the  premises  and  of  the  mutual
covenants,  representations,  warranties and agreements  contained  herein,  the
parties hereto agree as follows:


                                    ARTICLE I

                          DEFINITIONS AND CONSTRUCTION

     I.1 Certain  Definitions.  As used in this  Agreement,  the following terms
will have the following meanings unless the context otherwise requires:

          "Acquisition" has the meaning specified in the preamble.

          "Affiliate" means, with respect to any Person, any Person controlling,
     controlled by or under common control with such Person.

          "Agreement" means this Agreement and Plan of Reorganization, including
     the attached Exhibits.


<PAGE>

          "Articles of Amendment" has the meaning set forth in Section 2.1(a).

          "Certificates" means certificates  evidencing shares of Company Common
     Shares held by Persons other than ICG or Acquisition.

          "Closing" means the consummation of the  transactions  contemplated by
     this Agreement.

          "Closing Date" means the date on which the Closing occurs  pursuant to
     Section 2.2.

          "Code" has the meaning specified in the preamble.

          "Company" has the meaning specified in the preamble.

          "Company Board" means the Board of Directors of the Company.

          "Company Charter" means the Articles of Arrangement of the Company, as
     amended to the date of this  Agreement  and as they may be further  amended
     prior to the Closing.

          "Company Common Shares" means shares of the Company's Class A Shares.

          "Control" means, with respect to any Person, the possession, direct or
     indirect,  of the power to direct or cause the direction of the  management
     and  policies  of such  Person,  whether  through the  ownership  of voting
     securities or partnership interests, by contract or otherwise.

          "Exchange Act" means the Securities  Exchange Act of 1934, as amended,
     and the rules and regulations thereunder.

          "Exchange Agent" has the meaning specified in Section 2.3(a).

          "Exchange  Agent  Agreement"  has the  meaning  specified  in  Section
     2.3(a).

          "Governmental Entity" means any court,  arbitrator,  administrative or
     other   governmental   department,   agency,   commission,   authority   or
     instrumentality, domestic or foreign.

          "ICG" has the meaning specified in the preamble.

          "ICG Common Stock" means shares of common stock of ICG, par value $.01
     per share.

          "Injunction" has the meaning specified in Section 3.2.

                                       2

<PAGE>


          "License"  means any  license,  franchise,  ordinance,  authorization,
     permit, certificate,  variance, exemption, concession, lease, right of way,
     easement, instrument, order and approval, domestic or foreign.

          "Material  Adverse  Effect"  means (A) with respect to ICG, a material
     adverse  effect  on  the  business,  properties,  operations  or  financial
     condition  of ICG and  its  subsidiaries  (including  the  Company  and its
     subsidiaries)  taken as a whole,  other than any such effect arising out of
     or resulting  from general  business or economic  conditions  in the United
     States,  and (B) with respect to the Company,  a material adverse effect on
     the business, properties,  operations or financial condition of the Company
     and its subsidiaries  taken as a whole,  other than any such effect arising
     out of or resulting from general  business or economic  conditions in areas
     where the Company does business.

          "Nova Scotia" has the meaning set forth in the preamble.

          "Person"  means  an  individual,  partnership,   corporation,  limited
     liability  company,  trust,   unincorporated   organization,   association,
     unlimited  liability  company,  or joint venture or a  government,  agency,
     political subdivision, or instrumentality thereof.

          "Reorganization" has the meaning specified in Section 2.1.

          "Special Meeting" has the meaning specified in Section 3.1.

          "Subsidiary"  when used with  respect to any  Person,  means any other
     Person, of which (x) in the case of a corporation,  at least (A) a majority
     of the  equity  and (B) a majority  of the  voting  interests  are owned or
     controlled,  directly or  indirectly,  by such first Person,  by any one or
     more of its  subsidiaries,  or by such first  Person and one or more of its
     subsidiaries  or (y) in the case of any Person  other  than a  corporation,
     such first Person,  one or more of its  subsidiaries,  or such first Person
     and one or more of its  subsidiaries  (A)  owns a  majority  of the  equity
     interests  thereof and (B) has the power to elect or direct the election of
     a majority of the members of the  governing  body thereof or otherwise  has
     control over such  organization  or entity;  provided that, for purposes of
     the  agreements  set  forth in  Article  3 and  Article  6,  references  to
     subsidiaries  will not include  any Person as to which such first  Person's
     voting  interests  are  subject to a voting  agreement,  proxy,  management
     contract or other  arrangement  as a result of which such first Person does
     not control  such other  Person.  For  purposes of this  Agreement,  unless
     otherwise  specified,  neither the Company nor any of its subsidiaries will
     be deemed to be subsidiaries of ICG or any of ICG's  subsidiaries,  whether
     or not  they  otherwise  would  be  subsidiaries  of  ICG  or any of  ICG's
     subsidiaries under the foregoing definition.

          "Warrant Agreement" means the Warrant Agreement between Intelcom Group
     Inc. and Norwest Bank Colorado National Association, dated August 8, 1995.
 
                                      3
<PAGE>

          "Warrants" means each of the rights to subscribe for shares of Company
     Common Shares issued and outstanding under the Warrant Agreement.

          "Wholly-Owned Subsidiary" will mean, as to any Person, a Subsidiary of
     such  Person  100% of the  equity and  voting  interest  in which is owned,
     directly or indirectly, by such Person.

          I.2 Terms Generally. The definitions in Section 1.1 will apply equally
to both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun will include the corresponding masculine,  feminine and
neuter forms. The words "include,"  "includes" and "including" will be deemed to
be followed by the phrase "without limitation." The words "herein," "hereof" and
"hereunder"  and words of similar import refer to this Agreement  (including the
Exhibits)  in its  entirety  and not to any part hereof  unless the context will
otherwise  require.  All references herein to Articles,  Sections,  and Exhibits
will be deemed  references  to Articles  and  Sections of, and Exhibits to, this
Agreement unless the context  otherwise  requires.  Unless the context otherwise
requires,  any  references  to any  agreement or other  instrument or statute or
regulation are to it as amended and supplemented  from time to time (and, in the
case of a statute or regulation, to any successor provisions).  Any reference in
this   Agreement  to  a  "day"  or  number  of  "days"   (without  the  explicit
qualification  of  "business")  will be interpreted as a reference to a calendar
day or number of calendar  days. If any action or notice is to be taken or given
on or by a particular calendar day, and such calendar day is not a business day,
then such action or notice will be deferred  until, or may be taken or given on,
the next business day. As used herein,  the phrase "made  available"  means that
the information referred to has been made available if requested by the party to
whom such information is to be made available.


                                   ARTICLE II

                     THE REORGANIZATION AND RELATED MATTERS

          2.1 The Reorganization.

               The "Reorganization" will consist of the following  transactions,
          all of which will be considered  part of one  integrated  and mutually
          interdependent plan undertaken by the parties:

          (a)  Exchange  of  Class  A  Shares.  The  following  actions  will be
     undertaken to facilitate the  acquisition of Class A Shares held by Persons
     other than ICG or Acquisition:

               (i)  The  Company   will  prepare  and  file  with  the  Director
                    appointed  under  the  Canada  Business   Corporations  Act,
                    Articles  of  Amendment  to the  provisions  of the  Company
                    Charter  attaching  to  the  Company  Shares,  in  the  form
                    attached as Exhibit A (the "Articles of Amendment").

                                       4
<PAGE>

               (ii) The Company  will declare an  Automatic  Redemption  Date on
                    December 1, 1998 or as soon as possible thereafter.

               (iii)ICG will assign the Redemption  Call Right  contained in the
                    Company Charter to Acquisition and Acquisition will exercise
                    the  Redemption  Call  Right  in  respect  of the  Automatic
                    Redemption  Date declared  pursuant to the foregoing  clause
                    (ii).

               (iv) The effect of the foregoing clauses (i), (ii) and (iii) will
                    be to provide for the automatic exchange on the Closing Date
                    of each Company Common Share outstanding and held by Persons
                    other than ICG or Acquisition  for an equal number of shares
                    of ICG  Common  Stock.  As a result,  on the  Closing  Date,
                    Acquisition  will acquire all of the Company  Common  Shares
                    held by Persons  other than ICG or  Acquisition  in exchange
                    for an equal number of shares of ICG Common Stock.

          (b)  Acquisition of Company Common Shares Owned by ICG. On or prior to
     the Closing Date, in addition to the Company  Common Shares held by Persons
     other than ICG or Acquisition  acquired by Acquisition  pursuant to Section
     2.1(a), Acquisition will acquire from ICG, in exchange for 100 newly issued
     shares of  Acquisition  common  stock  (representing  all of  Acquisition's
     issued  capital  stock),  all of the Company Common Shares owned by ICG and
     22,370 shares of ICG Common Stock.  Notwithstanding the prior sentence, the
     consideration  for the Company Common Shares  acquired by Acquisition  from
     ICG  shall be deemed to be an equal  number of shares of ICG  Common  Stock
     deemed to have been contributed to the capital of Acquisition by ICG. Thus,
     to avoid  the  inconvenience  of  authorizing,  issuing,  contributing  and
     returning  actual  shares of ICG Common  Stock,  ICG and  Acquisition  will
     dispense with this formality,  resulting in a constructive  contribution of
     ICG Common Stock by ICG to Acquisition  and a constructive  issuance of ICG
     Common  Stock by  Acquisition  to ICG in exchange  for the  Company  Common
     Shares owned by ICG.

          (c)  Treatment of Warrants.  On and after January 1, 1999, as a result
     of and pursuant to the  Reorganization,  (i) each of the  Warrants  will no
     longer be exercisable for Company Common Shares;  (ii) each of the Warrants
     will  become  exercisable  for ICG Common  Stock  issuable  by ICG (and not
     issuable by the  Company);  and (iii) the holders of the  Warrants  will be
     entitled to  purchase  ICG Common  Stock  solely from ICG (and not from the
     Company) on the same terms and  conditions  as are set forth in the Warrant
     Agreement  with  respect to the  purchase  of  Company  Common  Shares.  In
     accordance  with this  Section  2.1(c),  on and after the Closing  Date the
     Warrant  Agreement will provide solely for the issuance of ICG Common Stock
     by ICG upon the exercise of Warrants rather than Company Common Shares. All
     other terms and  conditions  of the Warrant  Agreement  will remain in full
     force and effect.

          (d)  Continuation  of the  Company.  On or prior to the Closing  Date,
     Acquisition  will  organize  Nova  Scotia.   Promptly  after  the  Closing,
 
                                       5
<PAGE>


     Acquisition will adopt a sole  shareholder's  resolution (the form of which
     is attached as Exhibit B) approving the  continuation  of the Company under
     the laws of the Province of Nova Scotia.  As soon as practicable  following
     such  continuance,  the  Company  will be  amalgamated  with and into  Nova
     Scotia, with Nova Scotia as the survivor,  and the Company will continue as
     an unlimited  liability company organized under the laws of the Province of
     Nova Scotia.

          2.2 Closing. Unless this Agreement shall have been terminated pursuant
     to Section 8.1 and subject to the satisfaction or, when permissible, waiver
     of the  conditions  set forth in Article 7, the Closing will take place (a)
     at 10:00  a.m.  (Denver  time) at the  executive  offices of ICG in Denver,
     Colorado,  on the later of (i)  December  1, 1998 or (ii) the date on which
     the last of the  conditions  set forth in  Article  7 (other  than any such
     conditions  which by their terms are not capable of being  satisfied  until
     the Closing Date or thereafter) is satisfied or, when permissible,  waived,
     or (b) on such other date  and/or at such  other time  and/or  place as the
     parties may mutually agree.

          2.3 Exchange of Shares.

          (a)  Appointment of Exchange Agent. On or before the Closing Date, ICG
     and  the  Company  will  enter  into  an  agreement  (the  "Exchange  Agent
     Agreement")   with  an  exchange  agent  selected  by  ICG  and  reasonably
     acceptable to the Company (the "Exchange Agent"), authorizing such Exchange
     Agent to act as Exchange Agent hereunder.

          (b) Letter of Transmittal. Prior to the Closing, ICG will instruct the
     Exchange  Agent  to  mail to each  holder  of  record  (other  than  ICG or
     Acquisition) of a Certificate or Certificates  which  immediately  prior to
     such mailing evidenced issued and outstanding  Company Common Shares: (i) a
     Management  Proxy Circular  describing the Articles of Amendment and (ii) a
     letter of transmittal (which will state that delivery will be effected, and
     risk of loss and title to the  Certificates  will  pass,  only upon  proper
     delivery of the  Certificates to the Exchange Agent) with  instructions for
     use in  effecting  the  surrender  and exchange of the  Certificates.  Such
     notice, letter of transmittal and instructions will contain such provisions
     and be in such form as ICG and the Company may jointly specify.

          (c)  Exchange   Procedure.   Promptly  following  the  surrender,   in
     accordance with such  instructions,  of a Certificate to the Exchange Agent
     (or such other agent or agents as may be appointed by the Exchange Agent or
     ICG pursuant to the Exchange Agent Agreement), together with such letter of
     transmittal  (duly  executed)  and any  other  documents  required  by such
     instructions or letter of transmittal, ICG will, subject to Section 2.3(d),
     cause to be distributed to the Person in whose name such Certificate  shall
     have  been  issued a  certificate  registered  in the  name of such  Person
     representing the number of shares of ICG Common Stock into which the shares
     previously  represented  by the  surrendered  Certificate  will  have  been
     exchanged at the Closing  pursuant to this Article 2. Each  Certificate  so
     surrendered will be canceled.

          (d) Unregistered Transfers of Company Common Shares. In the event of a
     transfer of ownership of Company  Common Shares which is not  registered in
      
                                        6

<PAGE>


     the transfer records of the Company, a certificate  representing the proper
     number of shares of ICG  Common  Stock may be issued to the  transferee  of
     such shares if the  Certificate  evidencing  such shares of Company  Common
     Shares  surrendered to the Exchange Agent in accordance with Section 2.3(c)
     is properly  endorsed for transfer or is  accompanied  by  appropriate  and
     properly  endorsed  stock  powers and is otherwise in proper form to effect
     such transfer,  if the Person requesting such transfer pays to the Exchange
     Agent any  transfer  or other taxes  payable by reason of such  transfer or
     establishes to the  satisfaction of the Exchange Agent that such taxes have
     been paid or are not required to be paid and if such Person  establishes to
     the  satisfaction  of ICG that such transfer  would not violate  applicable
     federal or state securities laws.

          (e)  Lost,  Stolen  or  Destroyed  Certificates.   In  the  event  any
     Certificate shall have been lost,  stolen or destroyed,  upon the making of
     an affidavit of that fact by the Person  claiming  such  Certificate  to be
     lost, stolen or destroyed  satisfactory to ICG and complying with any other
     reasonable  requirements  imposed by ICG, ICG will cause to be delivered to
     such Person in respect of such lost,  stolen or destroyed  Certificate  the
     shares of ICG Common Stock or other property deliverable in respect thereof
     as  determined  in  accordance  with  this  Article  2.  ICG  may,  in  its
     discretion, require the owner of such lost, stolen or destroyed Certificate
     to give ICG a bond in such sum as it may direct as  indemnity  against  any
     claim  that may be made  against  ICG or the  Company  with  respect to the
     Certificate alleged to have been lost, stolen or destroyed.

          (f) No Dividends  Before  Surrender of  Certificates.  No dividends or
     other distributions  declared or made after the Closing with respect to ICG
     Common  Stock with a record date after the Closing Date will be paid to the
     holder of any  unsurrendered  Certificate with respect to the shares of ICG
     Common  Stock  represented  thereby,  until  the  holder  of record of such
     Certificate  surrenders such Certificate as provided herein. Subject to the
     effect of applicable  laws,  following  surrender of any such  Certificate,
     there will be paid to the record  holder of the  certificates  representing
     whole  shares of ICG Common  Stock  issued in  exchange  therefor,  without
     interest,  (i) at the time of such  surrender,  the amount of  dividends or
     other  distributions,  if  any,  with  a  record  date  after  the  Closing
     theretofore  paid by ICG with  respect to such  whole  shares of ICG Common
     Stock, and (ii) at the appropriate payment date, the amount of dividends or
     other distributions, if any, with a record date after the Closing but prior
     to surrender and with a payment date  subsequent to surrender  payable with
     respect to such whole shares of ICG Common Stock.

          (g) No Further  Ownership Rights in Company Common Shares.  All shares
     of ICG Common Stock issued to holders of  Certificates  upon the  surrender
     for exchange of Company Common Shares in accordance  with the terms of this
     Article 2 will be deemed to have been  issued in full  satisfaction  of all
     rights  pertaining  to such  Company  Common  Shares,  and there will be no
     further  registration  of  transfers  on the  stock  transfer  books of the
     Company of the Company  Common  Shares which were  outstanding  immediately
     prior to the Closing (other than shares owned by ICG or  Acquisition  prior
     to the  Closing).  Subject  to  Section  2.3(i),  if,  after  the  Closing,
     Certificates  are  presented  to the Company  for any reason,  they will be
     exchanged as provided in this Article 2.

                                       7

<PAGE>


          (h) Abandoned  Property Laws. Payment or delivery of the shares of ICG
     Common Stock and any  dividends or  distributions  with respect  thereto in
     accordance  with the terms hereof will be subject to  applicable  abandoned
     property,  escheat and  similar  laws and none of ICG,  Acquisition  or the
     Company will be liable to any holder of Company Common Shares or ICG Common
     Stock for any such shares,  for any dividends or distributions with respect
     thereto or for any cash in lieu of fractional shares which may be delivered
     to any public  official  pursuant  to any  abandoned  property,  escheat or
     similar law.


                                   ARTICLE III

                                 CERTAIN ACTIONS

     3.1  Shareholder  Meeting.  The Company,  acting through the Company Board,
will, in accordance  with  applicable law, the Company Charter and the Company's
By-laws,  duly call,  give notice of,  convene and hold,  as soon as  reasonably
practicable  after  the  date of this  Agreement,  a  meeting  of the  Company's
shareholders  (the "Special  Meeting") for the purpose of considering and voting
upon the Articles of Amendment, and the Company will, through the Company Board,
recommend to its shareholders the adoption of the Articles of Amendment.

     3.2  Reasonable  Efforts.  Subject  to the  terms  and  conditions  of this
Agreement and applicable law, each of the parties hereto will use its reasonable
best efforts to take, or cause to be taken, all actions,  and to do, or cause to
be done, all things reasonably  necessary,  proper or advisable under applicable
laws  and  regulations  or  otherwise  to  consummate  and  make  effective  the
Reorganization and the other transactions contemplated by this Agreement as soon
as reasonably  practicable,  including such actions or things as any other party
hereto may  reasonably  request in order to cause any of the  conditions to such
other party's obligation to consummate such transactions  specified in Article 7
to be fully  satisfied.  Without  limiting the generality of the foregoing,  the
parties  will  (and  will  cause  their  respective   directors,   officers  and
subsidiaries,  and use their  reasonable best efforts to cause their  respective
affiliates,  employees, agents, attorneys, accountants and representatives,  to)
consult and fully cooperate with and provide reasonable assistance to each other
in (i) obtaining all necessary consents,  approvals, waivers, licenses, permits,
authorizations, registrations, qualifications, or other permission or action by,
and giving all necessary  notices to and making all  necessary  filings with and
applications and submissions to, any Governmental  Entity or other Person;  (ii)
lifting any permanent or preliminary  injunction or  restraining  order or other
similar order issued or entered by any court or Governmental Entity of competent
jurisdiction (an  "Injunction")  of any type referred to in Section 7.1(b);  and
(iii)  in  general,   consummating   and  making   effective  the   transactions
contemplated  hereby;  provided,  however,  that in order to obtain any consent,
approval, waiver, license, permit, authorization,  registration,  qualification,
or other  permission or action or the lifting of any  Injunction  referred to in
clause  (i) or (ii) of this  sentence,  no  party  will be  required  to pay any
consideration,   to  divest  itself  of  any  of,  or  otherwise  rearrange  the
composition of, its assets or to agree to any conditions or requirements  which,
individually  or in the aggregate,  would have a Material  Adverse Effect on the

                                       8
<PAGE>


Company  or  ICG.  Prior  to  making  any  application  to or  filing  with  any
Governmental  Entity or other Person in  connection  with this  Agreement,  each
party will  provide  the other  party with  drafts  thereof and afford the other
party a reasonable opportunity to comment on such drafts.

                                   ARTICLE IV

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

     The  Company  hereby  represents  and  warrants to ICG and  Acquisition  as
follows:

     4.1 Organization and Qualification.  The Company (i) is a corporation, duly
organized,  validly  existing  and  in  good  standing  under  the  laws  of the
jurisdiction of its incorporation or organization,  (ii) has all requisite power
and  authority  to own,  lease and  operate its  properties  and to carry on its
business as it is now being  conducted  and (iii) is duly  qualified or licensed
and in good standing to do business in each  jurisdiction  in which the property
owned,  leased or operated by it or the nature of the  business  conducted by it
makes such  qualification  or license  necessary,  except in such  jurisdictions
where the failure to be so duly  qualified  or licensed or in good  standing has
not had and is not reasonably likely to have,  individually or in the aggregate,
a Material Adverse Effect on the Company.  The Company has heretofore  furnished
or made available to ICG a true and complete copy of the Company Charter and the
Company's By-laws, each as amended through and in effect on the date hereof.

     4.2 Authorization and Validity of Agreement.  The Company has all requisite
corporate  power and  authority to enter into this  Agreement and to perform its
obligations  hereunder and consummate the transactions  contemplated hereby. The
execution,  delivery and  performance  by the Company of this  Agreement and the
consummation of the transactions  contemplated  hereby have been duly authorized
by the Company Board and by all other necessary  corporate action on the part of
the Company,  subject,  in the case of the  consummation  by it of the automatic
exchange  described  in  Section  2.1(a),  to  the  approval  of  the  Company's
shareholders. This Agreement has been duly executed and delivered by the Company
and  (assuming  the due  execution  and delivery of this  Agreement by the other
parties  hereto)  constitutes  a valid and  binding  agreement  of the  Company,
enforceable  against the Company in accordance with its terms (except insofar as
enforceability   may  be   limited   by   applicable   bankruptcy,   insolvency,
reorganization,   moratorium  or  similar  laws  affecting   creditors'   rights
generally, or by principles governing the availability of equitable remedies).


                                    ARTICLE V

                         REPRESENTATIONS AND WARRANTIES
                                       OF
                        ICG, ACQUISITION AND NOVA SCOTIA

                                       9
<PAGE>

     ICG, Acquisition and Nova Scotia each hereby represents and warrants, as to
itself, to the Company as follows:

     5.1 Organization.  It (i) is a corporation or unlimited  liability company,
as the case may be, duly organized,  validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization,  (ii) has all
requisite  power and authority to own,  lease and operate its  properties and to
carry on its business as it is now being  conducted and (iii) is duly  qualified
or licensed and in good  standing to do business in each  jurisdiction  in which
the  property  owned,  leased or  operated  by it or the nature of the  business
conducted by it makes such  qualification or license  necessary,  except in such
jurisdictions  where the failure to be so duly  qualified or licensed or in good
standing has not had and is not reasonably  likely to have,  individually  or in
the aggregate,  a Material Adverse Effect on ICG, Acquisition or Nova Scotia, as
the case may be.

     5.2 Authorization and Validity of Agreement. It has all requisite corporate
power and  authority to enter into this  Agreement,  to perform its  obligations
hereunder and to consummate the transactions contemplated hereby. The execution,
delivery and  performance by it of this Agreement and the  consummation by it of
the transactions  contemplated hereby have been approved by its respective Board
of Directors and, in the case of Acquisition,  by ICG as the sole stockholder of
Acquisition,  and have been duly  authorized  by all other  necessary  corporate
action on its part.  This  Agreement  has been duly executed and delivered by it
and  (assuming  the due  execution  and delivery of this  Agreement by the other
parties to this  Agreement)  constitutes  a valid and binding  agreement  of it,
enforceable  against  it  in  accordance  with  its  terms  (except  insofar  as
enforceability   may  be   limited   by   applicable   bankruptcy,   insolvency,
reorganization,   moratorium  or  similar  laws  affecting   creditors'   rights
generally, or by principles governing the availability of equitable remedies).


                                   ARTICLE VI

                          TRANSACTIONS PRIOR TO CLOSING

     6.1  Access  to  Information.  From the date  hereof to the  Closing,  upon
reasonable notice,  each of ICG and the Company will (and will cause each of its
subsidiaries, and use its reasonable best efforts to cause its other Affiliates,
to) afford to the officers, employees, counsel, accountants and other authorized
representatives  of the other reasonable  access during normal business hours to
all its properties,  personnel,  books and records and furnish  promptly to such
Persons such  information  concerning  its business,  properties,  personnel and
affairs as such Persons will from time to time reasonably request.

     6.2 Expenses.  Except as otherwise provided in this Section 6.2, whether or
not the Reorganization is consummated,  all costs and expenses incurred or to be
incurred in connection  with this  Agreement and the  transactions  contemplated
hereby will be paid by the party incurring such cost or expense.


                                       10
<PAGE>


     6.3  Notification  of  Certain  Matters.  Between  the date  hereof and the
Closing, each party will give prompt notice in writing to the other party of (i)
any  information  that indicates that any of its  representations  or warranties
contained  herein was not true and  correct as of the date hereof or will not be
true and correct at and as of the  Closing  with the same force and effect as if
made at and as of the Closing  (except for changes  permitted or contemplated by
this Agreement),  (ii) the occurrence or  non-occurrence of any event which will
result,  or has a  reasonable  prospect  of  resulting,  in the  failure  of any
condition, covenant or agreement contained in this Agreement to be complied with
or satisfied,  (iii) any failure of the Company or ICG (or  Acquisition  or Nova
Scotia),  as the case may be, to comply with or satisfy any condition,  covenant
or  agreement to be complied  with or  satisfied  by it  hereunder  and (iv) any
notice or other  communication from any third party alleging that the consent of
such third  party is or may be  required  in  connection  with the  transactions
contemplated by this Agreement or that such  transactions  otherwise may violate
the rights of or confer remedies upon such third party.

     6VI.4 Actions by ICG and Acquisition. In its capacity as a beneficial owner
of Company Common Shares,  ICG hereby consents to the adoption of this Agreement
and agrees to cause the Company  Common Shares  beneficially  owned by ICG to be
voted in favor of the adoption of Articles of Amendment at the Special  Meeting.
In its  capacity  as  the  sole  stockholder  of  Acquisition,  ICG  will  cause
Acquisition to take all corporate action necessary on its part to consummate the
Reorganization and the transactions contemplated hereby.


                                   ARTICLE VII

                              CONDITIONS PRECEDENT

     7VII.1 Conditions  Precedent to the Obligations of ICG,  Acquisition,  Nova
Scotia and the Company.  The respective  obligations of ICG,  Acquisition,  Nova
Scotia and the  Company to  consummate  the  transactions  contemplated  by this
Agreement are subject to the  satisfaction at or prior to the Closing of each of
the  following  conditions,  any or all of which,  to the  extent  permitted  by
applicable  law, may be waived by ICG, for itself,  Acquisition  and Nova Scotia
(but  not for the  Company),  or by the  Company  for  itself  (but not for ICG,
Acquisition or Nova Scotia):

          (a)  Shareholder  Approval.  The Articles of Amendment shall have been
     duly adopted by the requisite  vote of the  shareholders  of the Company at
     the Special Meeting, in accordance with the Canadian Business  Corporations
     Act, the Company Charter and the Company's By-laws.

          (b) Absence of Injunctions.  No permanent or preliminary Injunction or
     restraining order or other order by any court or other Governmental  Entity
     of  competent  jurisdiction,  or  other  legal  restraint  or  prohibition,
     preventing consummation of the transactions  contemplated by this Agreement
     shall be in effect,  or permitting  such  consummation  only subject to any
     condition or restriction  that has or would have a Material  Adverse Effect
     on ICG or the Company.

                                       11
<PAGE>


     7.2 Conditions  Precedent to the  Obligations of ICG,  Acquisition and Nova
Scotia.  The  obligations of ICG,  Acquisition and Nova Scotia to consummate the
transactions contemplated by this Agreement are also subject to the satisfaction
at or prior to the  Closing  Date of each of the  following  conditions,  unless
waived by ICG:


          (a) Accuracy of Representations  and Warranties.  All  representations
     and warranties of the Company contained in this Agreement shall be true and
     correct  in all  material  respects  in each  case  as of the  date of this
     Agreement  and (except to the extent such  representations  and  warranties
     speak as of a  specified  earlier  date) on and as of the  Closing  Date as
     though made on and as of the Closing Date,  except for changes permitted or
     contemplated by this Agreement.

          (b) Performance of Agreements. The Company shall have performed in all
     material  respects  all  obligations  and  agreements,  and complied in all
     material  respects  with all covenants  and  conditions,  contained in this
     Agreement to be performed or complied with by it prior to or on the Closing
     Date.

          (c) Officers'  Certificates.  ICG,  Acquisition  and Nova Scotia shall
     have received such certificates of the Company,  dated the Closing Date, in
     each case  signed by an  executive  officer  of the  Company  (but  without
     personal liability thereto), to evidence satisfaction of the conditions set
     forth in Sections 7.1(a), 7.2(a) and 7.2(b) (insofar as each relates to the
     Company), as may be reasonably requested by ICG.

          (d) No Adverse Enactments. There shall not have been any action taken,
     or any  statute,  rule,  regulation,  order,  judgment or decree  proposed,
     enacted, promulgated, entered, issued, enforced or deemed applicable by any
     foreign or United States federal,  state or local Governmental  Entity, and
     there shall be no action,  suit or proceeding  pending or, to the knowledge
     of the parties, threatened, which (i) makes or may make this Agreement, the
     Reorganization,  or any of the  other  transactions  contemplated  by  this
     Agreement illegal or imposes or may impose material damages or penalties in
     connection   therewith;   or  (ii)  otherwise  prohibits,   restricts,   or
     unreasonably  delays consummation of the Reorganization or any of the other
     transactions contemplated by this Agreement or increases or may increase in
     any material  respect the  liabilities or obligations of ICG arising out of
     this  Agreement,  the  Reorganization,  or any of  the  other  transactions
     contemplated by this Agreement.

          (e) Receipt of  Licenses,  Permits and  Consents.  All consents as are
     required  in  connection  with  the   consummation   of  the   transactions
     contemplated  by this  Agreement  shall have been  obtained and shall be in
     full force and  effect,  and all  governmental  filings as are  required in
     connection with the consummation of such transactions shall have been made,
     other than those which,  if not obtained,  in force or effect,  or made (as
     the case may be) would not, either  individually  or in the aggregate,  (i)
     have a material adverse effect on the transactions  contemplated  hereby or
     (ii) assuming  consummation of the Reorganization,  have a Material Adverse
     Effect, as of or after the Closing, on the Company or ICG.


                                       12
<PAGE>

     7VII.3  Conditions  Precedent  to  the  Obligations  of  the  Company.  The
obligation of the Company to consummate the  transactions  contemplated  by this
Agreement is also subject to the satisfaction at or prior to the Closing Date of
each of the following conditions, unless waived by the Company:

          (a) Accuracy of Representations  and Warranties.  All  representations
     and  warranties  of ICG,  Acquisition  and Nova  Scotia  contained  in this
     Agreement  shall be true and correct in all material  respects in each case
     as  of  the  date  of  this  Agreement  and  (except  to  the  extent  such
     representations and warranties speak of a specified earlier date) on and as
     of the Closing  Date as though made on and as of the Closing  Date,  except
     for changes permitted or contemplated by this Agreement.

          (b)  Performance  of  Agreements.  Each of ICG,  Acquisition  and Nova
     Scotia shall have performed in all material  respects all  obligations  and
     agreements,  and complied in all material  respects  with all covenants and
     conditions, contained in this Agreement to be performed or complied with by
     each of them prior to or on the Closing Date.

          (c)  Officers'  Certificates.  The Company  shall have  received  such
     certificates  of ICG,  dated the  Closing  Date,  in each case signed by an
     executive  officer  of ICG (but  without  personal  liability  thereto)  to
     evidence  satisfaction  of the  conditions  set forth in  Sections  7.1(b),
     7.3(a) and 7.3(b)  (insofar  as each  relates to ICG,  Acquisition  or Nova
     Scotia), as may be reasonably requested by the Company.

          (d) No Adverse Enactments. There shall not have been any action taken,
     or any  statute,  rule,  regulation,  order,  judgment or decree  proposed,
     enacted, promulgated, entered, issued, enforced or deemed applicable by any
     foreign or United States federal,  state or local Governmental  Entity, and
     there shall be no action,  suit or proceeding  pending or, to the knowledge
     of the parties,  threatened,  which makes or may make this  Agreement,  the
     Reorganization,  or any of the  other  transactions  contemplated  by  this
     Agreement illegal or imposes or may impose material damages or penalties in
     connection therewith.

          (e) Receipt of  Licenses,  Permits and  Consents.  All consents as are
     required  in  connection  with  the   consummation   of  the   transactions
     contemplated  by this  Agreement  shall have been  obtained and shall be in
     full force and  effect,  and all  governmental  filings as are  required in
     connection with the consummation of such transactions shall have been made,
     other than those which,  if not obtained,  in force or effect,  or made (as
     the case may be),  would  not,  either  individually  or in the  aggregate,
     assuming  consummation  of  the  Reorganization,  have a  Material  Adverse
     Effect, as of or after the Closing, on ICG or the Company.


                                       13
<PAGE>


                                  ARTICLE VIII

                                   TERMINATION

     8.1 Termination and  Abandonment.  This Agreement may be terminated and the
transactions  contemplated  hereby  may be  abandoned  at any time  prior to the
Closing,  whether  before or after  adoption of the Articles of Amendment by the
stockholders of the Company:

          (a) by mutual consent of ICG and the Company; or

          (b) by either the Company,  on the one hand, or ICG,  Acquisition  and
     Nova Scotia,  on the other hand: (i) if the  Reorganization  shall not have
     been  consummated  before  January  1,  1999,  provided  that the  right to
     terminate  this  Agreement  pursuant  to this  clause  (b)(i)  will  not be
     available  to any party  whose  failure to perform  any of its  obligations
     under this  Agreement  required  to be  performed  by it at or prior to the
     Closing  has  been  the  cause  of  or  resulted  in  the  failure  of  the
     Reorganization to be consummated before such date, (ii) if there has been a
     material breach of any representation,  warranty,  covenant or agreement on
     the part of the other party  contained in this Agreement and such breach is
     incapable of being cured,  (iii) if any court of competent  jurisdiction or
     other competent governmental authority will have issued an order, decree or
     ruling or taken any other  action  permanently  restraining,  enjoining  or
     otherwise  prohibiting the Reorganization and such order, decree, ruling or
     other  action  will have  become  final and  nonappealable,  or (iv) if the
     required  adoption of the Articles of Amendment by the  stockholders of the
     Company shall not have been duly obtained.

     8.2  Effect  of  Termination.  In the  event  of any  termination  of  this
Agreement  by the  Company  or ICG  pursuant  to  Section  8.1,  this  Agreement
forthwith  will become void and there will be no liability or  obligation on the
part  of  ICG,  Acquisition,  Nova  Scotia,  the  Company  or  their  respective
Affiliates, stockholders,  directors, officers, agents or representatives except
to the  extent  such  termination  results  from  the  willful  breach  by  ICG,
Acquisition,  Nova  Scotia  or  the  Company  of  any  of  its  representations,
warranties, covenants or agreements contained in this Agreement.


                                   ARTICLE IX

                                  MISCELLANEOUS

     IX.1 Effectiveness of Representations, Warranties and Agreements. Except as
set forth in the next sentence, the respective  representations,  warranties and
agreements of the parties  contained in this Agreement or in any  certificate or
other  instrument  delivered  pursuant  hereto  prior to or at the Closing  will
remain operative and in full force and effect,  regardless of any  investigation
made by or on behalf of the other parties hereto,  whether prior to or after the
execution  of this  Agreement.  The  representations,  warranties,  covenants or
agreements contained in this Agreement or in any certificate or other instrument


                                       14

<PAGE>

delivered  pursuant to this Agreement will terminate at the Closing,  except for
the agreements contained in Article 2, Section 6.3 and in this Article 9.

     9.2  Notices.   All   notices,   requests,   demands,   waivers  and  other
communications required or permitted to be given under this Agreement will be in
writing  and will be  deemed to have been  duly  given if  delivered  to a party
personally or mailed, certified or registered mail with postage prepaid, or sent
by telegram or confirmed telex or telecopier, addressed as follows:


                 c/o ICG Communications, Inc.
                     161 Inverness Drive West
                     Englewood, Colorado 80112
                     Attention:  H. Don Teague
                     Executive Vice President,
                     General Counsel and Secretary
                     Facsimile:  (303) 414-8839

or to such  other  Person or  address  as any party  will  specify  by notice in
writing to the other party.  All such notices,  requests,  demands,  waivers and
communications  will be deemed to have been  received on the date of delivery or
on the third business day after the mailing thereof, except that any notice of a
change of address will be effective only upon actual receipt thereof.

     9.3 Entire Agreement.  This Agreement (including the Exhibits)  constitutes
the entire  agreement of the parties and  supersedes  all prior  agreements  and
understandings,  oral and  written,  between  the  parties  with  respect to the
subject matter hereof.

     9.4 Assignment;  Binding Effect; Benefit. Neither this Agreement nor any of
the  rights,  benefits  or  obligations  hereunder  may be assigned by any party
(whether by operation of law or otherwise)  without the prior written consent of
each other party.  Subject to the preceding  sentence,  this  Agreement  will be
binding  upon,  inure to the  benefit of and be  enforceable  by the parties and
their respective successors and assigns. Nothing in this Agreement, expressed or
implied,  is intended to confer on, or to make  enforceable by, any Person other
than the  parties  or their  respective  successors  and  assigns,  any  rights,
remedies, obligations or liabilities under or by reason of this Agreement.

     9.5  Amendment.  This  Agreement may be amended by the parties  hereto,  by
action taken or authorized by their respective Boards of Directors,  at any time
prior to the Closing.  This Agreement may not be amended except by an instrument
in writing signed by the parties.

     9.6  Extension;  Waiver.  At any  time  prior  to the  Closing,  any of the
parties, by action taken or authorized by such party's Board of Directors,  may,
to the extent  legally  allowed,  (i) extend the time  specified  herein for the
performance  of any of the  obligations  of any  other  party,  (ii)  waive  any
inaccuracies in the  representations and warranties of any other party contained
herein or in any document delivered  pursuant hereto,  (iii) waive compliance by
any other  party with any of the  agreements  or  covenants  of such other party


                                       15
<PAGE>

contained herein or (iv) waive any condition to such waiving party's  obligation
to consummate  the  transactions  contemplated  hereby or to any of such waiving
party's other obligations hereunder.  Any such extension or waiver will be valid
only if set forth in a written  instrument  signed by the party or parties to be
bound thereby. Any such extension or waiver by any party will be binding on such
party but not on the other party  entitled to the  benefits of the  provision of
this  Agreement  affected  unless  such  other  party  also has  agreed  to such
extension  or waiver.  No such waiver will  constitute  a waiver of, or estoppel
with respect to, any  subsequent  or other breach or failure to strictly  comply
with the provisions of this Agreement.  The failure of any party to exercise any
of its rights,  powers or remedies hereunder or with respect hereto or to insist
on strict  compliance  with this  Agreement will not constitute a waiver by such
party of its right to exercise any such or other  rights,  powers or remedies or
to demand such compliance.  Whenever this Agreement  requires or permits consent
or approval by any party, such consent or approval will be effective if given in
writing in a manner  consistent with the requirements for a waiver of compliance
as set forth in this Section 9.6.

     9.7  Headings.  The  table  of  contents  and  headings  contained  in this
Agreement  are for  reference  purposes  only and will not affect in any way the
meaning or interpretation of this Agreement.

     9.8  Counterparts.  This  Agreement  may  be  executed  in  any  number  of
counterparts,  each of which will be deemed to be an original,  and all of which
together will be deemed to be one and the same instrument.

     9.9  Applicable  Law. This  Agreement and the legal  relations  between the
parties  will be governed by and  construed in  accordance  with the laws of the
State of Delaware, without regard to the conflict of laws rules thereof.

     9.10  Limited  Liability.  Notwithstanding  any  other  provision  of  this
Agreement, no stockholder, director, officer, Affiliate, agent or representative
of any  party  (other  than  ICG as  the  sole  stockholder  of  Acquisition  or
Acquisition  as the sole  shareholder of Nova Scotia) will have any liability in
respect  of or  relating  to  the  covenants,  obligations,  representations  or
warranties of such party  hereunder or in respect of any  certificate  delivered
with respect thereto and, to the fullest extent legally permissible, each party,
for itself and its stockholders,  directors, officers and Affiliates, waives and
agrees not to seek to assert or enforce any such liability which any such Person
otherwise might have pursuant to applicable law.

     9.11  Severability.  If any term or other  provision  of this  Agreement is
invalid,  illegal or  incapable  of being  enforced by any rule of law or public
policy,  all other conditions and provisions of this Agreement will nevertheless
remain in full force and effect so long as the  economic or legal  substance  of
the transactions  contemplated  hereby is not affected in any manner  materially
adverse  to any  party.  Upon  such  determination  that  any  Section  or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
will  negotiate  in good  faith to modify  this  Agreement  so as to effect  the
original  intent of the parties as closely as  possible  to the  fullest  extent
permitted  by  applicable  law in an  acceptable  manner  to the  end  that  the
transactions contemplated hereby are fulfilled to the extent possible.


                                       16
<PAGE>


                  IN WITNESS  WHEREOF,  the parties  hereto have  executed  this
Agreement and Plan of Reorganization as of the date first above written.

                              ICG COMMUNICATIONS, INC.


                              By:  /s/ H. Don Teague
                                   --------------------------------------------
                                   H. Don Teague
                                   Executive Vice President, General Counsel and
                                   Secretary


                              ICG CANADIAN ACQUISITION, INC.


                              By:  /s/ H. Don Teague
                                   --------------------------------------------
                                   H. Don Teague
                                   Executive Vice President, General Counsel and
                                   Secretary


                             ICG HOLDINGS (CANADA), INC.


                              By:  /s/ H. Don Teague
                                   --------------------------------------------
                                   H. Don Teague
                                   Executive Vice President, General Counsel and
                                   Secretary


                             ICG HOLDINGS (CANADA) CO.


                               By:  /s/ H. Don Teague
                                   --------------------------------------------
                                   H. Don Teague
                                   Executive Vice President, General Counsel and
                                   Secretary

                                       17
<PAGE>


                                    EXHIBIT A

                              Articles of Amendment







                                       18
<PAGE>


                                    EXHIBIT B

                          Sole Shareholder's Resolution





                                       19