EXHIBIT 2.2

Christopher Alliotts (CA Bar No. 161302)
Marcus A. Tompkins (CA Bar No. 190922)
SULMEYERKUPETZ
A Professional Corporation
1080 Marsh Road, Suite 110
Menlo Park, California 94025
Telephone:  650.326.2245
Facsimile:  650.326.5134

Attorneys for Official Committee of Unsecured Creditors

Van C. Durrer, II (CA Bar No. 226693)
Kurt Ramlo (CA Bar No. 166856)
Melissa T. Kahn (CA Bar No. 229185)
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
300 South Grand Avenue, Suite 3400
Los Angeles, California  90071
Telephone: 213.687.5000
Facsimile: 213.687.5600

Attorneys for Debtors and Debtors in Possession

                         UNITED STATES BANKRUPTCY COURT

             NORTHERN DISTRICT OF CALIFORNIA, SAN FRANCISCO DIVISION

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

 In re                                     Case No. 05-30145 TEC
                                           Case No. 05-30146 TEC

                                           Jointly Administered Chapter 11 Cases
 FIRST VIRTUAL
 COMMUNICATIONS, INC.,                     DISCLOSURE STATEMENT DESCRIBING
                                           JOINT CHAPTER 11 PLAN OF
                                           REORGANIZATION PROPOSED BY
              Debtor.                      DEBTORS AND OFFICIAL COMMITTEE
                                           OF UNSECURED CREDITORS
                                           (Dated August 21, 2005)

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

 In re                                     Plan Confirmation Hearing
                                           -------------------------
                                           DATE:    [To Be Set]
 CUseeMe NETWORKS, INC.                    TIME:    [To Be Set]
                                           PLACE:   U.S. Bankruptcy Court
                                                    Courtroom 23
              Debtor.                               235 Pine Street
                                                    San Francisco, CA 94104
                                           JUDGE:   Hon. Thomas E. Carlson

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

<PAGE>

                                       I.

                                  INTRODUCTION

     First Virtual Communications, Inc., a Delaware corporation ("FVC"), and its
wholly-owned subsidiary, CUseeMe Networks, Inc., a Delaware corporation
("CUseeMe"), are the debtors and debtors in possession in jointly administered
Chapter 11 bankruptcy cases. (FVC and CUseeMe are collectively referred to
herein as the "Debtors.") On January 20, 2005, the Debtors commenced their
bankruptcy cases by each filing a voluntary petition for reorganization under
Chapter 11 of Title 11 of the United States Code (the "Bankruptcy Code").

     Chapter 11 allows debtors and, under some circumstances, creditors and
others parties in interest, to propose a plan of reorganization. A plan of
reorganization may provide for a debtor to reorganize by continuing to operate,
to liquidate by selling assets of their estates, or a combination of both. The
Debtors and the Official Committee of Unsecured Creditors (the "Committee")
appointed in these bankruptcy cases are the parties proposing the Joint Chapter
11 Plan of Reorganization (the "Plan") sent to you in the same envelope as this
document. The Debtors and the Committee are collectively referred to herein as
the "Plan Proponents". THE DOCUMENT YOU ARE READING IS THE DISCLOSURE STATEMENT
FOR THE ENCLOSED PLAN.

     The Plan proposed by the Plan Proponents is a plan of reorganization.
Pursuant to the Plan, it is anticipated that the Liquidating Trustee will (1)
facilitate the Merger of FVC with U.S. Dry Cleaning, (2) make payments to
Creditors and holders of Interests of the Debtors by distributing proceeds
received from the sale of the Debtors' assets and any other amounts recovered
from the prosecution of the Causes of Action, and (3) distribute the shares of
New Common Stock to be issued to the Estate pursuant to the Merger of FVC and
U.S. Dry Cleaning, which shall be equal to 3.25% of the issued and outstanding
common stock of the Reorganized Debtor on the Effective Date or approximately
313,871 shares of New Common Stock.

                                       -2-
<PAGE>

     In addition, the Plan contemplates the substantive consolidation of the
Debtors' Chapter 11 estates, such that all of the assets and liabilities of each
estate will be treated as one and the same. The Plan Proponents will file a
separate motion, to be heard at the same time as confirmation of the Plan, for
such substantive consolidation, which is needed to eliminate any issues over the
allocation of assets and liabilities between the separate Chapter 11 estates
resulting from the incomplete acquisition of CUseeMe by FVC and to avoid the
substantial fees and costs associated with investigating and resolving such
issues.

     Finally, the Plan provides for the distribution of all of the Debtors'
assets in accordance with the priority scheme set forth in the Bankruptcy Code.
There may be Persons who may wish to claim a lien or other interest in such
property. Any Person who wishes to assert a lien or other interest in such
property must file a written objection to confirmation of the Plan and serve
such objection on counsel for the Debtors and the Committee by no later than
_____________, 2005. Absent such an objection, the right to assert a lien or
other interest in property of the Debtors' Chapter 11 estates will be forever
barred.

     If confirmed, the Effective Date of the Plan shall be __________, 2005.

A.   PURPOSE OF THIS DOCUMENT

     The purpose of this Disclosure Statement is to provide adequate information
to enable parties who are entitled to vote on the Plan to make an informed
judgment about the Plan. This Disclosure Statement summarizes what is in the
Plan, and tells you certain information relating to the Plan and the process the
Bankruptcy Court follows in determining whether or not to approve, or "confirm,"
the Plan.

     READ THIS DISCLOSURE STATEMENT CAREFULLY IF YOU WANT TO KNOW ABOUT:
     -------------------------------------------------------------------

     (1)  WHO CAN VOTE ON, OR OBJECT TO, THE PLAN;

     (2)  WHAT THE TREATMENT OF YOUR CLAIM IS (i.e., what you will receive on
          account of your claim will receive if the Plan is confirmed), AND HOW

                                       -3-
<PAGE>

          THIS TREATMENT COMPARES TO WHAT YOUR CLAIM WOULD RECEIVE IN A CHAPTER
          7 LIQUIDATION;

     (3)  THE HISTORY OF THE DEBTORS AND SIGNIFICANT EVENTS DURING THEIR
          BANKRUPTCY CASES;

     (4)  WHAT THINGS THE BANKRUPTCY COURT WILL LOOK AT TO DECIDE WHETHER OR NOT
          TO CONFIRM THE PLAN;

     (5)  WHAT IS THE EFFECT OF CONFIRMATION; and

     (6)  WHETHER THE PLAN IS FEASIBLE.

          This Disclosure Statement cannot tell you everything about your
rights. You should consider consulting your own lawyer to obtain more specific
advice on how the Plan will affect you and what is the best course of action for
you.

          Be sure to read the Plan as well as the Disclosure Statement. If there
are any inconsistencies between the Plan and the Disclosure Statement, the Plan
provisions will govern.

          The Bankruptcy Code requires a Disclosure Statement to contain
"adequate information" concerning the Plan. The Bankruptcy Court has approved
this document as an adequate Disclosure Statement, containing enough information
to enable parties affected by the Plan to make an informed judgment about the
Plan. Any party can now solicit votes for or against the Plan.

B.   IDENTITY OF PERSON TO CONTACT FOR MORE INFORMATION REGARDING THE PLAN

          Any interested party desiring further information about the Plan
should contact the attorney for the Committee, Christopher Alliotts, Esq.,
SulmeyerKupetz, A Professional Corporation, 1080 Marsh Road, Suite 110, Menlo
Park, California 94025, telephone number (650) 326-2245, facsimile number (650)
326-5134, and e-mail address calliotts@sulmeyerlaw.com.

C.   DISCLAIMERS

          The financial data relied upon in formulating the Plan is based on the
Debtors' books and records as well as the Schedules and Statement of Financial

                                       -4-
<PAGE>

Affairs filed by the Debtors in the Chapter 11 Cases. The information set forth
in this Disclosure Statement is provided by the Debtors and the Committee with
the assistance of their retained professionals. The Debtors and the Committee
represent that everything stated in this Disclosure Statement is true to the
best of their knowledge.

          With the exception of historical financial information, some matters
discussed herein, including the projections and valuation analysis described
herein, are "forward looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward looking statements are
subject to risks, uncertainties and other factors that could cause actual
results to differ materially from future results expressed or implied by such
forward looking statements. Furthermore, the projected financial information
contained herein has not been the subject of an audit. The projections of
distributions represent the Plan Proponents' good faith estimate of what
Creditors should receive pursuant to the Plan, but do not constitute warranties
or guaranties of the outcome. Subsequent to the date hereof, there can be no
assurance that (a) the information and representations contained herein will
continue to be materially accurate, or (b) this Disclosure Statement will
continue to contain all material information.

          No party is authorized by the Plan Proponents or the Bankruptcy Court
to give any information or make any representations with respect to the Plan
other than that which is contained in this Disclosure Statement. No
representations or information concerning the Debtors, their future business
operations, or the value of their assets have been authorized by the Plan
Proponents, other than as set forth herein. Any information or representations
given to obtain your acceptance or rejection of the Plan that are different from
or inconsistent with the information or representations contained herein and in
the Plan should not be relied upon by any person voting on the Plan.

          This Disclosure Statement has been prepared in accordance with section
1125 of the Bankruptcy Code and not in accordance with federal or state
securities laws or other applicable non-bankruptcy law. Entities holding or
trading in or otherwise purchasing, selling or transferring Claims against, or

                                       -5-
<PAGE>

Interests in, the Debtors should evaluate this Disclosure Statement only in
light of the purpose for which it was prepared.

          With respect to contested matters, adversary proceedings and other
pending or threatened actions (whether pending or not), this Disclosure
Statement and the information contained herein shall not be construed as an
admission or stipulation by any entity, but rather statements made in settlement
negotiations governed by Rule 408 of the Federal Rules of Evidence and any other
rule or statute of similar import.

          The contents of this Disclosure Statement should not be construed as
legal, business, or tax advice. Each Creditor and Equity Interest holder should
consult its own legal counsel and accountant as to legal, tax and other matters
concerning its Claim or Equity Interest.

          Although the Bankruptcy Court has determined that this Disclosure
Statement contains adequate information to enable parties to make an informed
judgment about the Plan, the Bankruptcy Court has not yet determined whether or
not the Plan is confirmable and makes no recommendation as to whether or not you
should vote for or against the Plan. However, as a proponent of the Plan, the
Committee, which was appointed by the U.S. Trustee to represent the interests of
unsecured Creditors, supports the Plan and recommends that you vote to accept
the Plan.

                                      II.

                                   BACKGROUND

A.   DESCRIPTION AND HISTORY OF THE DEBTORS' BUSINESS

          FVC and its wholly owned subsidiary, CUseeMe, are corporations
incorporated under the laws of Delaware. FVC, with CUseeMe, was a world leader
in providing easy-to-use, scalable, integrated real-time rich media
communications solutions to enterprises, service providers and portals. Among
other things, FVC's software products enabled interactive voice, video and data
collaboration over IP-based networks. Through its products, FVC provided
cost-effective, integrated end-to-end solutions for large-scale deployments to
enterprise desktops. It also enabled best of breed videoconferencing solutions

                                       -6-
<PAGE>

to be extended through ISDN and ATM networks. By way of example, FVC's solution
was the software communications infrastructure, which managed, in real time, the
multi-point connections and the voice, video and data traffic across the
extended network of the United States Department of Defense, including those
relating to its current operations in Afghanistan and Iraq. Other representative
key customers included AT&T, Siemens, and IBM.

          The company's flagship product, Click to Meet(TM), provides a complete
framework for delivering a new generation of video-enabled web collaboration
applications that address the real-time communications needs of companies
worldwide. Click to Meet can be integrated seamlessly into popular enterprise
messaging and collaboration environments such as Microsoft Exchange/Outlook and
instant messaging. FVC served its customers through a worldwide network of
resellers and partners. For the fiscal year ended December 31, 2003, the company
generated revenues of $21.3 million. For the eleven months ended November 30,
2004, the company generated revenues of $12.1 million.

B.   DEBT STRUCTURE

     1.   SILICON VALLEY LOAN AGREEMENT

          The Debtors were parties to a secured credit facility with Silicon
Valley Bank ("SVB") dated as of April 3, 2003 (as amended, the "Loan
Agreement"). The obligations under the Loan Agreement were secured by
substantially all of the Debtors' assets. On September 8, 2004, the Debtors
became aware of, and gave notice to SVB, of a violation of a monthly liquidity
covenant under the Loan Agreement. On September 13, 2004, the Debtors entered
into a Temporary Forbearance Agreement with SVB, whereby, among other things,
SVB agreed to forbear from exercising its remedies as a result of the existing
default until September 21, 2004. On September 29, and again on November 9,
2004, the Debtors and SVB entered into extensions of the Temporary Forbearance
Agreement. The last forbearance period expired on November 15, 2004. As of the

                                       -7-
<PAGE>

Petition Date, the outstanding principal balance due under the Loan Agreement
was approximately $2,500,000.

     2.   SECURED SERVICE PROVIDERS

          On September 29, 2004, FVC entered into a Services, Payment and
Security Agreement, effective as of August 19, 2004, with independent legal
counsel and forensic accountants and data discovery experts retained by them
(collectively, the "Secured Service Providers"). Under the terms of the
agreement, and in consideration of the continued work by these service providers
on the Special Investigation (discussed below), FVC acknowledged that
approximately $1,548,000 was owed to these service providers as of July 31, 2004
for work previously performed. FVC agreed to pay $450,000 of this balance upon
entering into the agreement, and agreed to pay the remaining balance owed, plus
any additional amount incurred subsequent to July 31, 2004, on the earlier of
the completion of a financing or December 31, 2004. As part of this agreement,
the Secured Service Providers were also granted a security interest in
substantially all of FVC's assets. Under the terms of this agreement, as well as
a Subordination Agreement between the Secured Service Providers and SVB, this
security interest was subordinated to the security interest of SVB under the
Loan Agreement. As of the Petition Date, the amount due under the Services,
Payment and Security Agreement was approximately $1,700,000.

C.   DEBTORS' MANAGEMENT AND CORPORATE RELATIONSHIPS

          As of the Petition Date, Jonathan G. Morgan was the Debtors'
President, Chief Executive Officer, and Chief Financial Officer as well as a
director of their boards of directors. Truman Cole was the Debtors' Chief
Financial Officer until he resigned in November 2004.

          As of the Petition Date, FVC held a 100% ownership interest in
CUseeMe; First Virtual Communications BV (Netherlands); First Virtual
Communications (UK) Limited; First Virtual Ltd. (UK); First Virtual
Communications Japan Inc.; First Virtual Communications BV; First Virtual
Communications (Asia) Ltd.; First Virtual Communications Pvt.; and Icast

                                       -8-
<PAGE>

Corporation. First Virtual Communications BV (Netherlands), in turn, directly or
indirectly owns First Virtual Communications (Korea), First Virtual
Communications SAS, First Virtual Communications GMBH, and FVC.COM Italy, all of
which are either not active, are being discontinued or dissolved, and/or have no
employees. First Virtual Communications (Asia) Ltd., in turn, holds a 100%
ownership interest in FVC.COM (s) Pvt. Ltd. Singapore, which is in the process
of being dissolved. CUseeMe holds a 100% ownership interest in First Virtual
Communications SARL France (with some nominee shareholders), and held 467,730
shares in Powerlan Limited, all of which are either not active, are being
discontinued, dissolved or liquidated, and/or have no employees.

D.   EVENTS LEADING TO BANKRUPTCY FILINGS

          Since 1993, the company engineered, manufactured and sold
videoconferencing products. From April 1998 through August 2002, FVC's common
stock traded on the Nasdaq. On or about November 26, 2002, the Securities &
Exchange Commission ("SEC") filed a complaint against three former corporate
executives of FVC alleging that the three former executives, Ralph K. Ungermann,
James O. Mitchell and Alan J. McMillan caused the company to overstate its
revenues and earnings and then selling their shares of FVC's common stock before
the issuance of correct financial information. On or prior to December 2, 2002,
without admitting or denying the allegations of the complaint, the former
executives agreed to repay approximately $1,300,000 in illegal trading profits,
interest, and civil money penalties. In a related enforcement action, the SEC
ordered the company to cease and desist from violating certain securities laws
resulting from the former executives alleged improper conduct and, without
admitting or denying the underlying allegations, the company consented to the
cease and desist order.

          In 2003, following the settlements described above, the Debtors
commenced a major restructuring of their operations. In addition to replacing
the former executives that were the subject of the SEC's complaint, the Debtors

                                       -9-
<PAGE>

began to de-emphasize their legacy hardware operations to concentrate on the
core software business. In 2004, revenues from hardware operations declined as
the company phased out of this line of business. In addition, software revenues
declined by about $4,500,000. The decline in software revenues was primarily
attributable to the decision to transition to a single software platform, which
took longer than expected and tied up significant sales and marketing resources.

          The liquidity crisis created by the product migration to a single
software platform was exacerbated by a special investigation by the audit
committee of the board of directors (the "Special Investigation"). Specifically,
in April 2004, the audit committee of the company's board of directors initiated
an internal investigation into certain irregular sales transactions in Asia. The
audit committee determined that these transactions alone would not have required
a restatement of previously issued financial statements due to their
immateriality for reporting purposes.

          However, as a result of certain prematurely recognized revenues
involving one United States customer, the audit committee determined in November
2004 that it would be necessary to restate financial results for the years ended
December 31, 2001, 2002, and 2003. Although no impropriety by executive officers
had been suggested and the SEC had not taken any action with respect to this
matter, approximately $5,000,000 was spent in connection with the Special
Investigation. This cash drain, which otherwise would have been used for
operations, stalled the growth of the business.

          During the pendency of the Special Investigation, the company was
unable to file interim financial statements with the SEC in a timely manner,
resulting in the company's de-listing from the NASDAQ SmallCap Market. In the
same quarter, indirectly in connection with the Special Investigation, the
company and two of its officers were named in a class action securities
complaint. The resulting depressed share price, combined with the lack of
liquidity in the company's securities market, significantly limited the
company's ability to obtain additional financing or implement its desired
restructuring.

                                      -10-
<PAGE>

          After previous attempts to explore strategic and financial
alternatives to raise capital, in late November 2004, FVC engaged Gordian Group,
LLC ("Gordian") as its investment banker in connection with the formulation,
evaluation and implementation of various options for a restructuring,
reorganization or other strategic alternative of the company. FVC also retained
Skadden, Arps, Slate, Meagher & Flom LLP ("Skadden, Arps") to act as its
restructuring counsel. Gordian pursued finding a transaction partner and
financing for a Chapter 11 bankruptcy filing. In connection therewith, Gordian
identified and contacted over 30 potential transaction partners, and pursued
leads or continued discussions with over ten (10) parties identified by FVC or
Skadden, Arps. Based on initial expressions of interest, over ten (10) parties
entered into confidentiality agreements with the company and were provided the
opportunity to conduct due diligence. Several of these parties expressed an
interest in a financial or strategic transaction with the Debtors.

          Despite the ongoing efforts of the Debtors and their advisors to
restructure the Debtors' financial affairs, the liquidity crisis deepened in the
weeks leading up to the Debtors' bankruptcy filings. As a result, the Debtors
were forced to furlough its entire work force of approximately seventy-five (75)
employees. Despite the furlough and based upon their personal loyalties and
belief in the business, many of these employees continued to work on fulfilling
the Debtors' contractual obligations and securing additional sales.

E.   THE BANKRUPTCY FILINGS

          Despite all of these efforts, the Debtors were unable to access
necessary capital to effectuate an out-of-court restructuring as a result of the
Special Investigation, among other things. Faced with a deepening liquidity
crisis, the Debtors each filed a voluntary petition for relief under Chapter 11
of the Bankruptcy Code on January 20, 2005 in order to preserve the value of
their assets by allowing them to use cash collateral, while attempting to access
emergency debtor in possession financing. The Debtors continue to manage their

                                      -11-
<PAGE>

businesses and properties as debtors in possession pursuant to 11 U.S.C. ss.ss.
1101(1), 1107 and 1108.

F.   SIGNIFICANT EVENTS DURING THE BANKRUPTCY CASES

          The following is a list of significant events that have occurred
during these cases:

     1.   THE "FIRST DAY" MOTIONS AND APPLICATIONS

          Along with their Chapter 11 petitions, the Debtors filed numerous
"first day" motions and applications relating to the Debtors' ongoing operations
and maintaining the value of their estates during the Chapter 11 Cases. Based
upon such motions, the Bankruptcy Court entered orders (1) designating Jonathan
G. Morgan as the individual responsible for fulfilling the duties of the Debtors
in these cases; (2) authorizing the Debtors to pay certain pre-petition wage,
salary and benefit claims; (3) prohibiting utility companies from altering or
discontinuing service on account of outstanding pre-petition invoices; and (4)
approving a stipulation between the Debtors and SVB authorizing the Debtors to
use cash collateral, which included providing SVB with a replacement lien and
other forms of adequate protection.

          Significantly, the Debtors also presented a motion to obtain
post-petition financing on a secured, first priority basis in an amount not to
exceed $2,000,000 from MTVP (First Virtual Investments), LLC ("MTVP"). SVB and
the Secured Service Providers consented to have their liens "primed" by the loan
from MTVP, and the Court approved such post-petition financing on an interim
basis in the amount of $750,000. The Court subsequently approved the entire
post-petition financing in the full amount of $2,000,000; however, the Debtors
only borrowed approximately $822,812.50 and never resorted to the balance of the
loan.

          The Debtors also filed motions relating to the general administration
of their cases. Based upon such motions, the Bankruptcy Court entered orders (1)
providing for the joint administration of the Debtors' separate bankruptcy
cases, and (2) limiting the manner in which notice would be given to creditors
for certain matters.

                                      -12-
<PAGE>

     2.   APPOINTMENT OF OFFICIAL COMMITTEE OF UNSECURED CREDITORS

          On January 25, 2005, the U.S. Trustee filed a Notice of Appointment of
Creditors' Committee, by which it appointed the following creditors as the
Official Committee of Unsecured Creditors in these cases pursuant to section
1102 of the Bankruptcy Code: Cornell Research Foundation, Market-Vantage
Internet Performance Marketing LLC, Gung-Ho Company, and BroadPR, Inc. Gung-Ho
Company and Market-Vantage Internet Performance Marketing LLC subsequently
transferred their Claims to a third party and resigned from the Committee.

     3.   EMPLOYMENT OF PROFESSIONALS

          The Bankruptcy Court has approved the employment of the following
professionals:

          a.   RESPONSIBLE INDIVIDUAL FOR DEBTORS: As previously stated herein,
the Debtors appointed Jonathan G. Morgan as the individual responsible for
fulfilling the duties of the Debtors in these cases. The order designating him
as the responsible individual was entered on January 31, 2005.

          b.   ATTORNEYS FOR COMMITTEE: The Committee employed SULMEYERKupetz, a
Professional Corporation, as its attorneys. The order approving its employment
was entered on February 14, 2005.

          c.   ATTORNEYS FOR DEBTORS: The Debtors employed Skadden, Arps, Slate,
Meagher & Flom LLP as their attorneys. The order approving its employment was
entered on March 7, 2005.

          d.   INVESTMENT BANKER FOR DEBTORS: The Debtors employed Gordian
Group, LLC as their investment banker. The order approving its employment was
entered on March 7, 2005.

          e.   CHIEF RESTRUCTURING OFFICER FOR DEBTORS: After the sale of the
Debtors' assets (discussed below), the Debtors employed Gregory Sterling as
Chief Restructuring Officer and designated him as the individual responsible for

                                      -13-
<PAGE>

the duties of the Debtors. The order approving Sterling's employment and
designating him as the responsible individual was entered on June 7, 2005.

     4.   RECALL OF EMPLOYEES

          Shortly after the Chapter 11 filings, the Debtors recalled
approximately fifty (50) of its seventy-five (75) employees from furlough. The
Debtors' recall of these employees was necessary because of their indispensable
role in restarting operations and maximizing the value of the business. The
Debtors' decision to recall these employees was supported by parties expressing
interest in acquiring the Debtors' assets.

     5.   SALE OF DEBTORS' ASSETS

          Since the time that Gordian was retained, the Debtors and their
advisors actively pursued a sale of assets or other transaction that would be
implemented through a plan of reorganization. One day prior to the Petition
Date, the Debtors executed a letter of intent received from RADvision, Ltd.
("RADvision") to purchase certain of the Debtors' assets for $5,000,000. Under
the letter of intent, the parties agreed to seek approval by the Bankruptcy
Court of certain bidding procedures and bid protections designed to obtain the
highest and best bid for the sale of the Debtors' assets. RADvision's commitment
to consummate the sale contemplated by the letter of intent was subject to
certain conditions, including completion of limited due diligence, negotiation
of a final form of an asset purchase agreement, and approval by the Bankruptcy
Court of the bidding procedures and bid protections.

          Following commencement of the Chapter 11 Cases, the Debtors sought
approval of the bidding procedures and bid protections under the letter of
intent, albeit with certain minor modifications. At a hearing on January 26,
2005, the Bankruptcy Court approved, on an interim basis, the bidding procedures
and bid protections proposed by the Debtors. A further hearing was held on
February 14, 2005 on the bidding procedures and bid protections, which the
Bankruptcy Court approved pursuant to its Final Order Approving Bidding
Procedures and Protections (the "Final Bidding Procedures Order").

                                      -14-
<PAGE>

          During this process, the Debtors continued their negotiations with
RADvision and worked with Gordian in identifying and procuring offers from
potential bidders. At one point, RADvision presented its form of asset purchase
agreement to the Debtors, who in turn discussed its terms with MTVP, SVB and the
Secured Service Providers (collectively, the "Secured Lenders"). Because
RADvision's proposed agreement provided for a reduced purchase price of
$4,500,000 and contained other onerous terms, the Secured Lenders made their own
offer based upon a form of asset purchase agreement that proposed a full credit
bid of all of the approximately $5,200,000 owing to the Secured Lenders and
eliminated the onerous terms in RADvision's proposed agreement.

          The Debtors used the Secured Lenders' offer as its "stalking horse"
bid. As of the February 25, 2005 overbid deadline established by the Court's
Final Bidding Procedures Order, the Debtors had received one overbid proposal,
from RADvision, which the Debtors determined to be a Qualified Competing
Proposal as defined in the Final Bidding Procedures Order. On February 28, 2005,
the Debtors conducted a solicitation conference at the New York offices of
Skadden, Arps in accordance with the Final Bidding Procedures Order. At the
conclusion of the solicitation conference, the Debtors determined, in
consultation with Gordian and their other advisors and the Committee, that the
final offer from RADvision to purchase the Debtors' assets for $7,150,000 plus
certain other consideration was the highest and best offer. Immediately after
the solicitation conference concluded, the Debtors' boards of directors approved
the RADvision offer, subject to approval by the Bankruptcy Court.

          On March 14, 2005, the Bankruptcy Court entered an order which, among
other things, (1) approved the sale of certain assets to RADvision free and
clear of any Claims and Interests, (2) authorized the Debtors to use up to
$200,000 of the sale proceeds to pay performance bonuses to the Debtors'
employees who made a substantial contribution to the Debtors' reorganization
and/or facilitated the sale closing, (3) pay undisputed Claims secured by the
assets sold, including the secured Claims of the Secured Lenders totaling

                                      -15-
<PAGE>

approximately $5,200,000, and (4) ordered the Debtors to hold the balance of the
sale proceeds, then estimated to be $1,419,000, as cash collateral pending
further order of the Bankruptcy Court.

          The Plan provides for the distribution of all of the Debtors' assets,
including the balance of the sale proceeds, in accordance with the priority
scheme set forth in the Bankruptcy Code. There may be Persons who may wish to
claim a lien or other interest in such property. Any Person who wishes to assert
a lien or other interest in such property must file a written objection to
confirmation of the Plan and serve such objection on counsel for the Debtors and
the Committee by no later than _____________, 2005. Absent such an objection,
the right to assert a lien or other interest in property of the Debtors' Chapter
11 estates will be forever barred.

     6.   SETTING OF CLAIMS BAR DATE

          Pursuant to an order of the Bankruptcy Court, the last day to file
proofs of Claim against the Debtors and the Estate was May 23, 2005. Thus, with
certain exceptions, the time for filing proofs of Claims has elapsed.

     7.   CAUSES OF ACTION

          On the Effective Date, all Causes of Action of the Debtors and the
Estate shall be transferred to the Liquidating Trust. The Committee and the
Liquidating Trustee shall investigate and determine which Causes of Action, if
any, should be prosecuted in accordance with the Plan and the Liquidating Trust
Agreement. The Committee and the Liquidating Trustee may, but are not required
to, prosecute, settle, adjust, retain, enforce or abandon any Cause of Action as
representatives of the Estate under Section 1123(b) of the Bankruptcy Code or
otherwise in accordance with the Plan and the Liquidating Trust Agreement.

          A list of all presently known Causes of Action is attached hereto as
Exhibit "A". There may be other claims, rights, objections, counterclaims,
defenses, setoffs and Causes of Actions of the Debtors and the Estate of which
the Plan Proponents are not yet aware. However, all such claims, rights,
objections, counterclaims, defenses, setoffs and Causes of Actions of the

                                      -16-
<PAGE>

Debtors and the Estate, whether currently known or not, shall be transferred to
the Liquidating Trust on the Effective Date.

          At this time, the potential Causes of Actions have not been evaluated
and it is uncertain whether such Causes of Action will ultimately enhance the
recovery to Creditors. It will be solely within the discretion of the Committee
and the Liquidating Trustee to evaluate and, if appropriate, prosecute any
Causes of Action post-confirmation. The Committee and the Liquidating Trustee
will make such decisions in the best interest of Creditors taking into account
the potential recoveries, legal fees and costs, the total amount of Claims, and
the potential benefit to Creditors. The estimated distributions to Creditors set
forth in this Disclosure Statement are made without taking into account the
potential recoveries or legal fees and costs associated with the Causes of
Action.

G.   OTHER LEGAL PROCEEDINGS

          In addition to the Causes of Action discussed above, the Debtors are
defendants in certain legal proceedings commenced prior to the Chapter 11 Cases.
A list of these legal proceedings is attached hereto as Exhibit "B". The claims
in those actions are subject to defenses, counterclaims and other rights of the
Debtors and the Estate. The Committee and the Liquidating Trustee will determine
to what extent, if any, action should be taken with respect to these litigation
proceedings.

H.   MERGER WITH U.S. DRY CLEANING CORPORATION

          In order to create value for creditors, the Plan Proponents have
negotiated a reverse merger transaction with U.S. Dry Cleaning as part of the
Plan. Pursuant to the reverse merger, on the Effective Date the operations of
U.S. Dry Cleaning will be acquired by FVC, which will then change its name to
U.S. Dry cleaning Corporation. The proposed Merger is the result of arms-length
and good faith negotiations between unrelated parties.

          U.S. Dry Cleaning is a recently formed Delaware corporation that
intends to become a consolidator of dry cleaning stores. U.S. Dry Cleaning

                                      -17-
<PAGE>

recently acquired two dry cleaning operations, Coachella Valley Retail, LLC
("CVR") in California and Steam Press Holdings, Inc. ("SPHI") in Hawaii, with a
portion of a private offering of $3,500,000. The balance of the proceeds raised
in the private offering are to be used for general working capital purposes,
funding growth of acquired stores and funding the acquisition in the short term
of more than twenty (20) additional dry cleaning stores.

          A pro forma balance sheet and a pro forma income statement for the
Reorganized Debtor, to be named U.S. Dry Cleaning Corporation, are collectively
attached hereto as Exhibit "C".

I.   OFFICERS AND DIRECTORS OF REORGANIZED DEBTOR

          The following executives, who have no prior relationship with the
Debtors, will be the initial officers and directors of the Reorganized Debtor:

          ROBERT Y. LEE is a founder of U.S. Dry Cleaning and Chairman of the
Board as well as a material owner of CVR. He has gained operational expertise
through comprehensive private and public company experience as a Chief Executive
Officer. During Mr. Lee's 23-year career in the retail industry, he has opened,
acquired and operated over 500 video retail stores as either Chief Executive
Officer or owner-operator. Prior to U.S. Dry Cleaning, Mr. Lee led the growth of
Video City, a retail video store consolidation from a regional chain of eighteen
(18) stores with $10,000,000 in revenues to a top ten (10) nationally-ranked
video retail company in twenty-four (24) months. The company grew to a
multi-state operation owning and managing 350 corporate stores and 150
franchised stores from California to Maine overseeing system wide revenues of
over $150,000,000. Mr. Lee will enter into a consulting agreement under which he
will earn fees based on acquisitions made by U.S. Dry Cleaning, which may be
paid in cash or common stock at his election. He will have a draw of $10,000 per
month to be credited against those fees.

          MICHAEL E. DRACE has been the President and principal shareholder of
SPHI since 1995. Upon completion of the acquisition of SPHI by U.S. Dry
Cleaning, Mr. Drace became the Chief Executive Officer and a director of U.S.

                                      -18-
<PAGE>

Dry Cleaning. Mr. Drace will also become the Chief Executive Officer of the
Reorganized Debtor after the Merger. Mr. Drace began his career in 1969 as a
maintenance engineer for a large commercial laundry company. He has successfully
overseen all phases of operations in an executive capacity for some of the
nation's largest laundry and dry cleaning companies. Mr. Drace has experience in
corporate restructuring, divestitures of divisions, and assimilation of
purchased companies subsequent to consolidation. Mr. Drace has dealt
successfully with a myriad of operational issues ranging from new factory
openings to decertification of a union bargaining unit. Mr. Drace will receive a
base salary of $175,000 per year as Chief Executive Officer of the Reorganized
Debtor.

          ANTHONY J.A. BRYAN has an M.B.A degree from Harvard and has had a long
and distinguished career in business and finance. He has been an officer or
Chairman of the Executive Committee of the boards of directors of a number of
large companies, such as Monsanto Chemical Corporation and Copperweld Steel
Corporation. He has also been a director of a number of other major
corporations, including ITT Corporation (1973-1978), Koppers Company
(1984-1988), Chrysler Corporation (1978-1991), and, most recently, as a member
of the Audit Committee of the board of Federal Express Corporation (from 1978 to
1998). Mr. Bryan shall receive no salary for serving on the Board of the
Reorganized Debtor, but may receive standard fees and reimbursements for
attending meetings.

          EARL GREENBURG is a former Deputy Attorney General for the State of
Pennsylvania. He is also a founding member of Transactional Marketing Partners
("TMP") and is currently serving as Chairman of TMP's Board of Directors. TMP
has offices in Santa Monica and Palm Springs, California, Florida and Oregon and
does business development for companies in the direct response industry. Mr.
Greenburg was the only three-term Chairman of the Electronic Retailer
Association, and was the President of the Home Shopping Network ("HSN"). He was
selected by Brandon Tartikoff to serve as Vice President of NBC for daytime
programming, and has produced hundreds of hours of programming for NBC, ABC, and
FOX. Mr. Greenburg, an award-winning producer, established the Greenburg Family

                                      -19-
<PAGE>

Foundation, which raises significant funds for numerous charities. Mr. Greenburg
also serves as Chairman of the Board of the Palm Springs International Film
Festival.

J.   EXEMPTION FROM REGISTRATION AND RESALE ISSUES

          In reliance upon an exemption from the registration requirements of
the Securities Act of 1933, as amended (the "Securities Act"), and of state and
local securities laws afforded by Section 1145 of the Code, the New Common Stock
to be issued to holders of Allowed Claims and Interests pursuant to the Plan on
and after the Effective Date need not be registered under the Securities Act or
any state or local securities laws. The New Common Stock issued to holders of
Allowed Claims and Interests pursuant to the Plan will not be subject to any
statutory restrictions on transferability and may be resold by any holder
without registration under the Securities Act or other federal securities laws
pursuant to the exemption provided by section 4(1) of the Securities Act, unless
the holder is an "underwriter" with respect to such securities, as that term is
defined in Section 1145(b) of the Bankruptcy Code. Entities who believe they may
be "underwriters" under the definition contained in Section 1145 of the
Bankruptcy Code are advised to consult their own counsel with respect to the
availability of the exemption provided by Section 1145.

                                      III.

                      SUMMARY OF THE PLAN OF REORGANIZATION

A.   OVERVIEW

          The following is a summary of the Plan, and is qualified in its
entirety by the full text of the Plan itself. Defined terms are set forth in
Article II of the Plan. All terms defined in the Plan have the same meaning in
this Disclosure Statement.

          The purpose of the Plan is to (1) facilitate the Merger of FVC with
U.S. Dry Cleaning, (2) make payments to Creditors and holders of Interests of
the Debtors by distributing proceeds received from the sale of the Debtors'
assets, any amounts recovered in litigation of Causes of Action, and any other
property received or recovered by the Liquidating Trust, and (3) distribute the

                                      -20-
<PAGE>

New Common Stock to be issued pursuant to the Merger. The assets described above
shall be held in trust by a Liquidating Trustee, who shall administer and
distribute the assets as specified in the Plan. The Plan is intended to resolve
all Claims against the Debtors and the Estate, and all Equity Interests in the
Debtors of whatever character, whether or not they are contingent, unliquidated
or disputed, and whether or not allowed by the Bankruptcy Court pursuant to
section 502 of the Bankruptcy Code.

          In addition, the Plan contemplates the substantive consolidation of
the Debtors' Chapter 11 estates, such that all of the assets and liabilities of
each estate will be treated as one and the same. The Plan Proponents will file a
separate motion, to be heard at the same time as confirmation of the Plan, for
such substantive consolidation, which is needed to eliminate any issues over the
allocation of assets and liabilities between the separate Chapter 11 estates
resulting from the incomplete acquisition of CUseeMe by FVC and to avoid the
substantial fees and costs associated with investigating and resolving such
issues.

          Finally, the Plan provides for the distribution of all of the Debtors'
assets in accordance with the priority scheme set forth in the Bankruptcy Code.
There may be Persons who may wish to claim a lien or other interest in such
property. Any Person who wishes to assert a lien or other interest in such
property must file a written objection to confirmation of the Plan and serve
such objection on counsel for the Debtors and the Committee by no later than
_____________, 2005. Absent such an objection, the right to assert a lien or
other interest in property of the Debtors' Chapter 11 estates will be forever
barred.

B.   WHAT CREDITORS AND INTEREST HOLDERS WILL RECEIVE UNDER THE PROPOSED PLAN

          As required by the Bankruptcy Code, the Plan classifies Claims and
Equity Interests into various Classes. A Claim or Interest shall be deemed
classified in a particular Class only to the extent that the Claim or Equity
Interest qualifies within the description of that Class and shall be deemed
classified in a different Class to the extent that any remainder of the Claim or

                                      -21-
<PAGE>

Equity Interest qualifies within the description of such different Class. A
Claim is in a particular Class only to the extent that the Claim is Allowed in
that Class. The Plan states whether each Class of Claims or Equity Interests is
impaired or unimpaired, and provides the treatment each Class will receive.

     1.   UNCLASSIFIED CLAIMS

          Certain types of Claims are not placed into classes; instead, they are
unclassified. They are not considered impaired and they do not vote on the Plan
because they are automatically entitled to specific treatment provided for them
in the Bankruptcy Code. As such, the Plan Proponents have not placed the
following Claims in a class.

          a.   ADMINISTRATIVE EXPENSE CLAIMS

               (1)  Definition
                    ----------

          An Administrative Expense Claim is a Claim under sections 503(b) and
507(a)(1) of the Bankruptcy Code, including but not limited to (a) the actual
and necessary costs and expenses of preserving the Estate, (b) the actual and
necessary costs and expenses of operating the business of the Debtors, (c)
compensation and reimbursement of expenses for legal and other services awarded
under sections 328, 330(a) and 331 of the Bankruptcy Code, and (d) all fees and
charges assessed against the Estate pursuant to Chapter 123 of Title 28, United
States Code (28 U.S.C. ss.ss. 1911 et seq.).

               (2)  Bar Date for Requests
                    ---------------------

          Except for requests by Professionals for fees and reimbursement of
expenses, all requests for payment of Administrative Expense Claims must be
filed with the Bankruptcy Court and served on the Liquidating Trustee, the
Committee's Counsel, the U.S. Trustee, and parties requesting notice in
accordance with Article XII of the Plan on or before ten (10) days after the
Effective Date. Any Person who fails to file a request for payment of an
Administrative Expense Claim in accordance with the Plan shall be forever barred
from asserting such Administrative Expense Claim against the Debtors, the Estate

                                      -22-
<PAGE>

or the Liquidating Trust, and shall receive no distribution under the Plan.
Notwithstanding this deadline, anyone whose Administrative Expense Claims have
been paid in full by the Debtors prior to the Effective Date need not comply
with this subsection. Administrative Expense Claims asserted to date and which
have not been paid total approximately $770,000.

          Any objection to a request for payment of an Administrative Expense
Claim must be filed within the time period, and served upon the parties
specified in, the applicable Local Bankruptcy Rules and the Plan.

               (3)  Treatment
                    ---------

          Each holder of an unpaid and Allowed Administrative Expense Claim
shall receive an amount in Cash equal to the Allowed amount of such Claim on or
as soon as reasonably practicable after the later of (i) the Effective Date, or
(ii) the date such Administrative Expense Claim becomes Allowed; provided,
however, that an Allowed Administrative Expense Claim that is a post-Petition
Date trade payable incurred by Debtors in the ordinary course of business during
the Chapter 11 Cases shall be paid in the ordinary course of business in
accordance with the terms and conditions of any agreements relating thereto.
Distributions to holders of Administrative Expense Claims under the Plan shall
be made by the Liquidating Trustee.

          b.   PRIORITY TAX CLAIMS

               (1)  Definition
                    ----------

          A Priority Tax Claim is any Claim against the Debtors or the Estate
entitled to priority in payment as specified in section 507(a)(8) of the
Bankruptcy Code and under the terms of the Plan. Priority Tax Claims filed or
listed in the Debtors' Schedules to date total approximately $446,641.49.

               (2)  Treatment
                    ---------

          In accordance with section 1129(a)(9)(C) of the Bankruptcy Code, each
holder of an unpaid and Allowed Priority Tax Claim shall receive an amount in
Cash equal to the Allowed amount of such Claim on or as soon as reasonably

                                      -23-
<PAGE>

practicable after the later of (i) the Effective Date, (ii) the date such
Priority Tax Claim becomes Allowed, or (iii) if the payment on the Claim is not
due as of the Effective Date, the date the payment is due in the ordinary course
of the Debtors' business. For purposes of distribution and otherwise under the
Plan, an Allowed Priority Tax Claim shall not include any amounts claimed for
penalties or other non-pecuniary loss; such amounts shall be separately
classified in a Class junior to all other Classes for pecuniary losses.
Distributions to holders of Priority Tax Claims under the Plan shall be made by
the Liquidating Trustee.

     2.   CLASSIFIED CLAIMS AND INTERESTS

          a. CLASS 1 - SECURED TAX CLAIMS

               (1)  Definition
                    ----------

          A Secured Tax Claim is a Secured Claim of a governmental unit. For
purposes of distribution and otherwise under the Plan, an Allowed Secured Tax
Claim shall not include any amounts claimed for penalties or other non-pecuniary
loss; such amounts shall be separately classified in a Class junior to all
Claims for pecuniary losses. Secured Tax Claims filed or listed in Debtors'
Schedules to date total $147.03.

               (2)  Impairment and Voting
                    ---------------------

          Secured Tax Claims are impaired by the Plan, and holders of Secured
Tax Claims are entitled to vote on the Plan.

               (3)  Treatment
                    ---------

          Unless otherwise agreed, each holder of an unpaid and Allowed Secured
Tax Claim shall receive an amount in Cash equal to the Allowed amount of such
Claim on or as soon as reasonably practicable after the later of: (i) the
Effective Date, (ii) the date such Claim becomes Allowed; or (iii) if the
payment on the Claim is not due until after the Effective Date, the date the
payment is due in the ordinary course of the Debtors' business. No deficiency
claim will be Allowed, as set forth in section 502(b)(3) of the Bankruptcy Code.
For purposes of distribution and otherwise under the Plan, an Allowed Secured
Tax Claim shall not include any amounts claimed for penalties or other

                                      -24-
<PAGE>

non-pecuniary loss; such amounts shall be separately classified in a Class
junior to all other Classes for pecuniary losses. Distributions to holders of
Secured Tax Claims under the Plan shall be made by the Liquidating Trustee.

          b.   CLASS 2 - SECURED NON-TAX CLAIMS

               (1)  Definition
                    ----------

          A Secured Non-Tax Claim is a Secured Claim other than a Secured Tax
Claim. The large majority of Secured Non-Tax Claims, consisting mostly of the
Claims by the Secured Lenders, have previously been paid pursuant to an order of
the Bankruptcy Court. Secured Non-Tax Claims filed or listed in the Debtors'
Schedules that have not yet been paid total $30,642.66.

          In addition to the Secured Non-Tax Claims set forth above, there may
be Persons who may wish to assert a Secured Non-Tax Claim. Any Person who wishes
to assert a lien or other interest in such property must file a written
objection to confirmation of the Plan and serve such objection on counsel for
the Debtors and the Committee by no later than _____________, 2005. Absent such
an objection, the right to assert a lien or other interest in property of the
Debtors' Chapter 11 estates will be forever barred.

               (2)  Impairment and Voting
                    ---------------------

          Secured Non-Tax Claims are not impaired by the Plan, and holders of
Secured Non-Tax Claims are not entitled to vote on the Plan. Holders of Secured
Non-Tax Claims are conclusively presumed to have accepted the Plan.

               (3)  Treatment
                    ---------

          Each unpaid and Allowed Secured Non-Tax Claim shall (i) be reinstated
or rendered unimpaired in accordance with section 1124 of the Bankruptcy Code,
or (ii) receive such other treatment as the Liquidating Trustee, the Committee
and the holder of the Claim agree to in writing. Any obligations resulting from
such reinstatement or agreement shall be satisfied by the Liquidating Trustee.

          c.   CLASS 3 - PRIORITY NON-TAX CLAIMS

               (1)  Definition
                    ----------

                                      -25-
<PAGE>

          A Priority Non-Tax Claim is a Claim entitled to priority in payment as
specified in section 507(a) of the Bankruptcy Code, other than an Administrative
Expense Claim or a Priority Tax Claim. Many Priority Non-Tax Claims, consisting
mostly of Claims by employees for wages and other benefits, have previously been
paid pursuant to an order of the Bankruptcy Court. Priority Non-Tax Claims filed
or listed in the Debtors' Schedules total $1,296,224.52.

               (2)  Impairment and Voting
                    ---------------------

          Priority Non-Tax Claims are not impaired by the Plan, and holders of
Priority Non-Tax Claims are not entitled to vote on the Plan. Holders of
Priority Non-Tax Claims are conclusively presumed to have accepted the Plan.

               (3)  Treatment
                    ---------

          Unless otherwise agreed, each holder of an Allowed Priority Non-Tax
Claim shall receive an amount in Cash equal to the Allowed amount of such Claim
on or as soon as reasonably practicable after the later of (i) the Effective
Date, (ii) the date such Claim becomes Allowed; or (iii) if the payment on the
Claim is not due as of the Effective Date, the date the payment is due in the
ordinary course of the Debtors' business. Distributions to holders of Priority
Non-Tax Claims under the Plan shall be made by the Liquidating Trustee.

          d.   CLASS 4 -- GENERAL UNSECURED CLAIMS

               (1)  Definition
                    ----------

          A General Unsecured Claim is any Claim against the Debtors that is not
a Secured Claim, an Administrative Expense Claim, a Priority Claim, a Penalty
Claim, a Preferred Stock Interest, a Post-Effective Date Administrative Fee and
Expense, an Equity Interest, or an Intercompany Claim. General Unsecured Claims
filed or listed in Debtors' Schedules to date total $6,785,707.95.

               (2)  Impairment and Voting
                    ---------------------

          General Unsecured Claims are impaired by the Plan, and holders of
General Unsecured Claims are entitled to vote on the Plan.

                                      -26-
<PAGE>


               (3)  Treatment
                    ---------

          Except to the extent that a holder of a General Unsecured Claim agrees
to different treatment, holders of Allowed Class 4 Claims shall receive an
amount equal to no more than the Allowed amount of such Claim (1) in New Common
Stock equal in number to the Pro Rata share of 3.25% of the issued and
outstanding common stock of the Reorganized Debtor on the Effective Date, which
constitutes 313,871 shares of New Common Stock, plus (2) Cash, equal to the Pro
Rata share of the remaining Cash held by the Liquidating Trust after payment or
reservation of all amounts to be distributed under the Plan to the holders of
Administrative Expense Claims, Priority Claims, Secured Claims, and
Post-Effective Date Administrative Fees and Expenses. Distributions will be made
to Creditors holding General Unsecured Claims as soon as practicable after all
of the Trust Assets have been liquidated (other than the New Common Stock) and
all Disputed Claims have been resolved in accordance with Article VI of the
Plan. If appropriate, the Liquidating Trust may authorize interim distributions.
Distributions to holders of General Unsecured Claims under the Plan shall be
made by the Liquidating Trustee.

     3.   CLASS 5 - PENALTY CLAIMS

          a.   Impairment and Voting
               ---------------------

          Class 5 is impaired by the Plan, and holders of Class 5 Penalty Claims
are entitled to vote on the Plan.

          b.   Treatment
               ---------

          The Plan Proponents expect that there will not be any funds available
for distribution to holders of Class 5 Penalty Claims unless the value of the
New Common Stock, as determined in accordance with Section C.3 of this Article
III, and Excess Cash exceeds the amount of Class 4 Claims. In the event that the
value of the New Common Stock and Excess Cash exceeds the amount of Class 4
Claims, and except to the extent that a holder of an Allowed Class 5 Penalty
Claim agrees to a different treatment, each holder of an Allowed Class 5 Penalty

                                      -27-
<PAGE>

Claim shall receive an amount in Cash equal to its Pro Rata share of any Excess
Cash remaining after Class 4 Claims have been paid in full with pre-petition
interest. Distributions will be made to holders of Class 5 Penalty Claims as
soon as practicable once all of the Debtors' assets have been liquidated and all
Disputed Claims have been resolved in accordance with Article VI of this Plan.
Distributions to holders of Class 5 Penalty Claims under the Plan shall be made
by the Liquidating Trustee.

     4.   CLASS 6 - PREFERRED STOCK INTERESTS

          a.   Impairment and Voting
               ---------------------

          Class 6 is impaired by the Plan, and holders of Class 6 Preferred
Stock Interests are entitled to vote on the Plan.

          b.   Treatment
               ---------

          The Plan Proponents expect that there will not be any funds available
for distribution to holders of Class 6 Stock Interests unless the value of the
New Common Stock, as determined in accordance with Section C.3 of this Article
III, and Excess Cash exceeds the amount of Class 4 Claims and Class 5 Claims. In
the event that the value of the New Common Stock and Excess Cash exceeds the
amount of Class 4 Claims and Class 5 Claims, and except to the extent that a
holder of an Allowed Class 6 Preferred Stock Interest agrees to a different
treatment, each holder of an Allowed Class 6 Preferred Stock Interest shall
receive an amount in Cash equal to its Pro Rata share of any Excess Cash
remaining after Class 5 Claims have been paid in full with pre-petition
interest. Distributions will be made to holders of Class 6 Preferred Stock
Interests as soon as practicable once all of the Debtors' assets have been
liquidated and all Disputed Claims have been resolved in accordance with Article
VI of this Plan. Distributions to holders of Class 6 Preferred Stock Interests
under the Plan shall be made by the Liquidating Trustee. All Class 6 Preferred
Stock Interests shall be cancelled and extinguished on the Effective Date.

     5.   CLASS 7 - OLD COMMON STOCK INTERESTS

          a.   Impairment and Voting
               ---------------------

                                      -28-
<PAGE>

          Class 7 is impaired by the Plan. Because holders of Class 7 Old Common
Stock Interests are not entitled to receive or retain any property under the
Plan, holders of Class 7 Old Common Stock Interests are deemed not to have
accepted the Plan.

          b.   Treatment
               ---------

          On the Effective Date, Class 7 Old Common Stock Interests shall be
cancelled and extinguished and holders of Class 7 Old Common Stock Interests
shall not be entitled to, and shall not receive, any property or interest in
property on account of such Class 7 Old Common Stock Interests; provided,
however, that after payment of all Class 6 Preferred Stock Interests in full,
each holder of a Class 7 Old Common Stock Interest shall receive an amount equal
to such holder's Pro Rata share of any remaining Cash held by the Liquidating
Trust.

C.   MEANS FOR IMPLEMENTATION AND EXECUTION OF THE PLAN

     1.   SUBSTANTIVE CONSOLIDATION

          On the Effective Date, all assets of FVC and CUseeMe shall be deemed
merged and treated as though they were held by a single entity, and all
liabilities of FVC and CUseeMe shall be treated as though they were owed by a
single entity, for all purposes related to the Plan, including, but not limited
to, voting, confirmation, and distribution. No distributions shall be made under
the Plan on account of any Intercompany Claim. Any and all obligations of FVC
arising from guarantees of CUseeMe's liabilities, and any and all obligations of
CUseeMe arising from guarantees of FVC's liabilities, shall be deemed eliminated
so that any Claim against one of the Debtors and any guarantee thereof executed
by the other and any joint or several liability of any of the Debtors shall be
deemed to be one obligation of the consolidated Debtors, and each and every
Claim filed or to be filed in the Chapter 11 Cases shall be deemed filed against
the consolidated Debtors. Such substantive consolidation shall not (other than
for purposes related to the Plan) affect the legal and corporate structures of
the Debtors.

     2.   FUNDING FOR THE PLAN

                                      -29-
<PAGE>

          The Plan will be funded by the Trust Assets, which include (a) all
property of the Estate transferred by the Debtors to the Liquidating Trust in
accordance with Article IV of the Plan, (b) any recoveries received by the
Liquidating Trust from the prosecution of Causes of Action, (c) any other
property of the Estate received or recovered by the Liquidating Trust, and (d)
the shares of New Common Stock to be issued to the Estate pursuant to the Merger
of FVC and U.S. Dry Cleaning, which shall be equal to 3.25% of the issued and
outstanding common stock of the Reorganized Debtor on the Effective Date or
approximately 313,871 shares of New Common Stock.

     3.   THE LIQUIDATING TRUST

          a.   APPOINTMENT OF LIQUIDATING TRUSTEE

          Gregory Sterling of Receivers Incorporated, who has been appointed
Chief Restructuring Officer and designated the Estate's Responsible Individual
by order dated June 7, 2005, shall be appointed Liquidating Trustee in the
Confirmation Order. Such appointment is subject to the terms of the Liquidating
Trust Agreement, which is attached to the Plan as Exhibit "A".

          b.   ESTABLISHMENT OF LIQUIDATING TRUST

          On the Effective Date, the Debtors, the Liquidating Trustee and the
Committee shall execute the Liquidating Trust Agreement and shall take all other
steps necessary to establish the Liquidating Trust. The Liquidating Trust shall
be represented by, and act through, the Liquidating Trustee, and its affairs and
administration shall be governed by the Plan, the Confirmation Order, the
Liquidating Trust Agreement, and applicable bankruptcy and non-bankruptcy law.

          c.   TRANSFER OF ASSETS TO THE LIQUIDATING TRUST

          On the Effective Date, the Debtors shall transfer all of the Trust
Assets, except for assets needed to consummate the anticipated merger of FVC
with U.S. Dry Cleaning, to the Liquidating Trust. The Debtors shall also execute
and deliver all documents reasonably required by the Liquidating Trust,
including the endorsement of any instruments, all business records of the
Debtors, and authorizations to permit the Liquidating Trust to access all bank

                                      -30-
<PAGE>

records, tax returns, and other files and records of the Debtors. All business
records of the Debtors transferred to the Liquidating Trust shall constitute the
business records of the Liquidating Trust pursuant to Federal Rule of Evidence
803(b) in any subsequent legal proceeding(s). The Liquidating Trust, after the
Effective Date, shall control all of the Debtors' applicable legal privileges,
including control over the attorney-client privilege, for matters arising from
or relating to transactions occurring, in whole or in part, prior to the
Effective Date. The Liquidating Trust shall be considered the successor in
interest to the Debtors.

          The transfer of assets to the Liquidating Trust shall be treated for
federal income tax purposes and for all purposes of the Internal Revenue Code of
1986, as amended (the "Tax Code") (e.g., sections 61(a)(12), 483, 1001, 1012 and
1274), as a transfer to creditors to the extent creditors are beneficiaries of
the Liquidating Trust. The transfer will be treated as a deemed transfer to the
beneficiary-creditors followed by a deemed transfer by the beneficiary-creditors
to the Liquidating Trust. The beneficiaries of the Liquidating Trust shall be
treated as the grantors and deemed owners of the Liquidating Trust for federal
income tax purposes.

          On the Effective date, U.S. Dry Cleaning will merge with and into FVC.
Upon successful completion of the Merger, the Liquidating Trust shall receive
shares of New Common Stock equal to 3.25% of the issued and outstanding common
stock of the Reorganized Debtor on the Effective Date or approximately 313,871
shares of New Common Stock for the benefit of the beneficiaries of the
Liquidating Trust in accordance with the Plan, the Liquidating Trust Agreement,
the Confirmation Order and applicable law. In accordance with order approving
the retention of Gregory Sterling as Chief Reorganization Officer, he will
receive 0.75% of common stock in the Reorganized Debtor or approximately ___
shares of New Common Stock, upon successful completion of the Merger; the ___
shares of New Common Stock to be issued to Gregory Sterling are in addition to
the 313,871 shares of New Common Stock to be issued to the Liquidating Trust.

                                      -31-
<PAGE>

          U.S. Dry Cleaning has calculated, on a pro forma basis, that the value
of the shares of New Common Stock equal to 3.25% of the issued and outstanding
common stock of the Reorganized Debtor has an aggregate value of $520,000. It is
anticipated that the common stock of the Reorganized Debtor, including the
approximately 313,871 shares of New Common Stock, will begin to be publicly
traded approximately two months following confirmation of the Plan. For purposes
of calculating distributions to be made under the Plan, the value of the 313,871
shares of New Common Stock shall be calculated based upon the average closing
bid price for a share of stock for the five (5) trading days prior to the close
of trading on the sixtieth (60th) day following the first day that such stock
was traded publicly. The Liquidating Trustee shall not distribute any of the New
Common Stock any earlier than the later of (a) the sixtieth (60th) day following
the first day that such stock was traded publicly, and (b) the date of the
initial distribution (other than New Common Stock) to holders of Class 4 General
Unsecured Claims.

          d.   RIGHTS, POWERS AND DUTIES OF LIQUIDATING TRUST/TRUSTEE

          The Liquidating Trustee shall have all rights, powers and duties
specified in the Plan, the Liquidating Trust Agreement, the Confirmation Order
and applicable law. The Liquidating Trustee's duties shall include, but not be
limited to, converting to Cash the Trust Assets, making timely distributions of
Cash and the New Common Stock, and not unduly prolonging the duration of the
Liquidating Trust. The Liquidating Trustee's rights and powers shall include,
but not be limited to, the rights and powers of a debtor in possession under
section 1107 of the Bankruptcy Code, the power to administer the Trust Assets,
prosecute for the benefit of the Liquidating Trust any Causes of Action, and to
otherwise perform the functions and take the actions provided for or permitted
in the Liquidating Trust Agreement. On the Effective Date, the Liquidating
Trustee shall be designated and serve as the representative of the Estate in
accordance with section 1123(b)(3)(B) of the Code.

          e.   PROSECUTION OF CAUSES OF ACTION

                                      -32-
<PAGE>

          Any and all proceeds generated from the prosecution of the Causes of
Action shall constitute property of the Liquidating Trust to be distributed in
accordance with the Plan. On the Effective Date, the Liquidating Trustee and the
Committee shall be designated and serve as representatives of the Estate in
accordance with section 1123(b)(3)(B) of the Code. The Liquidating Trustee and
the Committee shall have authority, but shall not be required, to prosecute
Causes of Action on behalf of the Liquidating Trust. The Liquidating Trust and
the Committee shall not be subject to any counterclaims in respect of the Causes
of Action; provided, however, that the Causes of Action will be subject to any
setoff rights to the same extent as if the Debtors had pursued the Causes of
Action themselves.

          Notwithstanding any provision or interpretation to the contrary
(except Article IX of this Plan), nothing in the Plan or the Confirmation Order,
including the entry thereof, or the Liquidating Trust Agreement shall constitute
or be deemed to constitute a release, waiver, relinquishment or bar, in whole or
in part, of any Causes of Action possessed by the Estate or the Debtors prior to
the Effective Date. In the event that the Bankruptcy Court, or any other court
of competent jurisdiction, determines that the assignment of any Causes of
Action to the Liquidating Trust pursuant to the Plan is invalid or does not
grant to the Liquidating Trust, through either the Liquidating Trustee or the
Committee, standing to pursue such Causes of Action, then in such case the
Liquidating Trust shall be deemed appointed as the representative of the Estate
for purposes of pursuing such Causes of Action, and the proceeds thereof shall
be distributed in accordance with the terms of the Plan.

          f.   POST-EFFECTIVE DATE ADMINISTRATIVE FEES AND EXPENSES

          Except as otherwise ordered by the Bankruptcy Court or provided in the
Plan and Liquidating Trust Agreement, the amount of any reasonable
Post-Effective Date Administrative Fees and Expenses shall be paid by the
Liquidating Trustee in Cash in accordance with the Liquidating Trust Agreement.
The Liquidating Trustee shall also comply with all reporting requirements of the
U.S. Trustee. The Liquidating Trustee shall have the authority to employ counsel

                                      -33-
<PAGE>

by order of the Bankruptcy Court upon a duly-filed application in accordance
with the Bankruptcy Code and Bankruptcy Rules.

          g.   DISSOLUTION OF LIQUIDATING TRUST

          Upon completion of its function as designated in the Plan and in the
Liquidating Trust Agreement, the Liquidating Trust shall be dissolved.

     4.   EMPLOYEE ISSUES

          a.   EMPLOYEES

          As of the Effective Date, the then-current directors, officers and
other employees of the Debtors shall be relieved of their positions and
corresponding duties and obligations, and shall be deemed terminated "without
cause," including for purposes of any employment agreements or severance
obligations, in addition to any rejection of employment agreements or severance
obligations in accordance with Article VIII.

          b.   TREATMENT OF EMPLOYEE BENEFIT PROGRAMS

          As soon as practicable following the Effective Date, to the extent not
otherwise accomplished prior to the Effective Date, all Employee Benefit
Programs shall be deemed terminated in accordance with their terms without
further action by the Debtors, the Estate, the Liquidating Trustee, or the
Committee. All rights are reserved to assert that the agreements underlying any
of the Employee Benefit Programs constitute executory contracts that may be
rejected pursuant to Article VIII of the Plan. The Liquidating Trustee, in
consultation with the Committee, shall take any actions and make payment of the
actual amount, if any, required to be contributed to or on account of an
employee program to permit the termination of such programs and discharge all
benefit liabilities to participants and beneficiaries of such program.

     5.   DISSOLUTION OF CUSEEME

          As of the Effective Date, CUseeMe, after having transferred all its
property to the Liquidating Trust pursuant to the Plan, and after having
terminated the employment of all employees, if any, shall be deemed dissolved
without the necessity for any further actions, except for such administrative
actions as may be necessary to carry out the purposes of the Plan and wind-up of

                                      -34-
<PAGE>

its affairs; provided, however, that CUseeMe or the Liquidating Trustee shall
file with the Secretary of State for its state of incorporation a certificate of
dissolution and/or other document necessary for dissolution, which may be
executed by an officer of CUseeMe or the Liquidating Trustee without the need
for approval by the Board of Directors or Equity Interest holders or compliance
with state law.

D.   RISK FACTORS

          The projected percentage distribution to creditors in the Plan is a
function of the amount of Cash on hand, the amount of Cash actually recovered
through prosecution of Causes of Action or otherwise, the value of the New
Common Stock and the amount of Claims ultimately allowed against the Estate. The
following may directly impact the amount paid out to holders of Allowed Claims
and the value of the New Common Stock:

     1.   THE OUTCOME OF CLAIM OBJECTIONS AND LITIGATION, IF ANY

          The success of the Liquidating Trustee and the Committee with respect
to Claim objections and litigation (including but not limited to prosecution of
Causes of Action), if any, will directly impact the amount paid out to holders
of Allowed Claims. At this time, the Claims have not been reviewed nor the
potential Causes of Actions evaluated. It will be solely within the discretion
of the Committee and the Liquidating Trustee to perform these tasks
post-confirmation. The Committee and the Liquidating Trustee will make such
decisions in the best interest of Creditors taking into account the potential
recoveries, legal fees and costs, the total amount of Claims, and the potential
benefit to Creditors.

     2.   THE FINAL LIQUIDATION VALUES OF THE CLAIMS

          Certain Claims against the Debtors are contingent, unliquidated and/or
disputed. Consequently, the amounts paid out to holders of General Unsecured
Claims (and to holders of junior Claims and Equity Interests) may be directly
affected by the occurrence or non-occurrence of contingencies, and/or the final
liquidation values of the Claims.

                                      -35-
<PAGE>

     3.   RISK FACTORS RELATING TO NEW COMMON STOCK

          There can be no assurances that U.S. Dry Cleaning will be able to
identify suitable acquisition candidates, complete any such acquisitions,
integrate acquired operations into existing operations or expand into new
markets. Costs of integrating acquisitions with U.S. Dry Cleaning's operations
may adversely affect U.S. Dry Cleaning's operating results, particularly in the
quarters immediately following one or more acquisition(s). Once integrated, an
acquired operation may not achieve anticipated levels of revenue or
profitability or otherwise perform as expected. Furthermore, U.S. Dry Cleaning
intends to finance future acquisitions and new store openings with cash from
operations, the issuance of stock, borrowings, and the net proceeds from the
sale of debt and/or equity securities. If U.S. Dry Cleaning does not have
sufficient cash from operations, adequate credit facilities or the ability to
raise cash through the sale of debt and/or equity securities, it will be unable
to pursue its growth strategy. Of course, there can be no assurances as to the
trading price of the New Common Stock.

E.   THE COMMITTEE

     1.   SURVIVAL OF THE COMMITTEE

          Except as otherwise provided in the Plan, the Committee shall
continue, as presently constituted in the Chapter 11 Cases, after the Effective
Date and shall exercise the rights and powers set forth in this Article.

     2.   RIGHTS, POWERS AND DUTIES OF THE COMMITTEE

          a.   POWERS OF COMMITTEE, GENERALLY.

          After the Effective Date and until the Chapter 11 Cases are closed or
dismissed, the Committee shall continue to have all the powers and duties
provided under section 1103 of the Bankruptcy Code and the Plan. The Committee
is also appointed as an additional representative of the Estate under section
1123(b)(3) of the Bankruptcy Code, subject to the limitations set forth in the
Plan and the Liquidating Trust Agreement.

          b.   POWERS OF THE COMMITTEE OVER THE LIQUIDATING TRUSTEE

                                      -36-
<PAGE>

          With respect to the Liquidating Trustee, the Committee shall have the
power to (a) monitor and supervise the Liquidating Trustee; (b) remove the
Liquidating Trustee upon a majority vote of the Committee approving such removal
and thirty (30) days' written notice to the Liquidating Trustee; (c) appoint a
replacement Liquidating Trustee (in the event that the Liquidating Trustee
voluntarily resigns or is removed by the Committee) upon a majority vote of the
Committee; (d) in the event of a breach by the Liquidating Trustee, take such
action as the Committee deems necessary to protect the interests of the Estate
or the beneficiaries of the Liquidating Trust; and (e) prosecute Causes of
Action on behalf of the Estate, the Liquidating Trust and Liquidating Trustee.

     3.   LIABILITY OF THE COMMITTEE AND ITS MEMBERS

          a.   STANDARD OF CARE

          Except in the case of willful misconduct or gross negligence, neither
the Committee nor any member thereof shall be liable for any loss or damage by
reason of any action taken or omitted by it pursuant to the discretion, power,
and authority conferred by the Plan or Bankruptcy Court orders.

          b.   NO LIQUIDATING TRUSTEE LIABILITY

          The Liquidating Trustee shall not be personally liable for the acts or
omissions of the Committee or any Committee member, or any person employed by
the Committee.

          c.   NO IMPLIED OBLIGATIONS

          There are no implied covenants or obligations of the Committee or its
members except for those that are in the Plan or Confirmation Order.

          d.   ADVICE OF PROFESSIONALS

          In the exercise or administration of any powers granted under the

Plan, or in the performance of any of the Committee's duties and obligations in
connection therewith, the Committee may consult with and act directly or through
any Professional. Neither the Committee nor its members shall be liable for
anything done, suffered or omitted in good faith in accordance with the advice
or opinion of any Professional, so long as such advice or opinion pertains to

                                      -37-
<PAGE>

matters that the Committee may reasonably presume to be within the scope of such
Professional's expertise.

          e.   EXCULPATION OF THE COMMITTEE

          The Committee shall have no duties or obligations to the Estate or the
Liquidating Trust except as set forth in the Plan and the Confirmation Order.

          f.   INDEMNIFICATION OF THE COMMITTEE

          Neither the Committee nor any Committee member shall be liable to any
individual Creditor, and shall be liable only to the Estate, for acts or
omissions related to performance of its duties for the Estate. The Committee
shall be liable to the Estate only for such of its own acts as shall constitute
willful misconduct or gross negligence. Except as provided in the Plan, the
Committee shall be defended, held harmless, and indemnified by the Estate
against any and all losses, claims, costs, expenses, and liabilities (including
reasonable legal fees and expenses) asserted by any Person other than the Estate
and any costs of defending any action brought by any Person other than the
Estate to which the Committee may be subject by reason of its execution in good
faith of its duties under the Plan and the Confirmation Order and in a manner
the Committee reasonably believes to be in the best interests of the Estate.
This indemnity is intended to be and shall be interpreted as providing indemnity
to the fullest extent permissible under California law.

     4.   EMPLOYMENT AND COMPENSATION OF COMMITTEE'S COUNSEL

          a. After the Effective Date, the employment of Committee's Counsel by

the Estate shall continue post-Confirmation on the same terms and conditions as
its employment in the Chapter 11 Cases. Committee's Counsel shall monitor the
post-Confirmation activities of the Liquidating Trust, advise the Committee of
such activities, prosecute Causes of Action and objections to Claims where
appropriate, and perform all reasonably necessary actions to ensure the
execution of the Plan. The Committee may not employ additional Professionals
absent an order of the Bankruptcy Court, after notice to the Liquidating
Trustee, the U.S. Trustee, and parties requesting notice in accordance with

                                      -38-
<PAGE>

Article XII of the Plan and a hearing. Committee's Counsel shall be compensated
by the Liquidating Trustee, with such compensation being subject to approval by
the Bankruptcy Court on notice to the Committee, the Liquidating Trustee, the
U.S. Trustee and parties requesting post-confirmation notice.

          b. Committee members shall serve without compensation, but shall be
entitled to reimbursement of their reasonable and necessary out of pocket
expenses. Committee members shall submit a detailed invoice to the Liquidating
Trustee and the Committee's Counsel, which invoice shall be paid within thirty
(30) days of the submission thereof. If the Liquidating Trustee objects to a
portion of the invoice, the Liquidating Trustee shall timely pay the undisputed
portion of the invoice and shall reserve monies in the amount of the disputed
invoice pending resolution of the objection by (a) written agreement between the
member submitting the invoice and the Liquidating Trustee, or (b) resolution of
the disputed amount by the Bankruptcy Court pursuant to a Final Order. Committee
members shall also be entitled to coverage by an errors and omissions policy to
indemnify them against claims, including defense costs, to the same extent as
the Liquidating Trustee.

     5.   TERMINATION OF THE COMMITTEE

          Except as otherwise provided in the Plan, the Committee shall be
dissolved and its members discharged upon entry of a final decree in the Chapter
11 Cases.

F.   DISPUTED CLAIMS

     1.   OBJECTIONS TO CLAIMS

          a.   AUTHORITY TO PROSECUTE CLAIM OBJECTIONS

          Unless otherwise ordered by the Bankruptcy Court after notice and a
hearing, and except as expressly provided herein, from and after the Effective
Date the Liquidating Trustee and the Committee shall have the exclusive right to
file objections to Claims and Equity Interests. As to objections filed by the
Debtors or the Committee prior to the Effective Date but not resolved or
determined before the Effective Date, the Liquidating Trustee and the Committee

                                      -39-
<PAGE>

shall be vested on the Effective Date with all rights, interests, and authority
of the Debtors or the Committee with respect to the objections.

          b.   CLAIMS OBJECTION DEADLINE

          Except as otherwise provided in the Plan, the deadline for objecting
to Claims shall be one hundred eighty (180) days after the Effective Date or as
may be further extended by order of the Bankruptcy Court; provided, however,
that if the holder of a Claim is a debtor under any Chapter of the Bankruptcy
Code, then the deadline shall be one hundred eighty (180) days after the
Liquidating Trustee or the Committee obtains relief from stay or other relief
which will permit the filing of an objection to such Claim.

          c.   NO DISTRIBUTIONS PENDING ALLOWANCE

          Notwithstanding any other provision of the Plan, no Cash or other
property shall be distributed under the Plan on account of any Claim or portion
thereof unless and until such Claim or portion thereof becomes Allowed.

          d.   AUTHORITY TO SETTLE DISPUTED CLAIMS

          From and after the Effective Date, the Liquidating Trustee and the

Committee shall be authorized to compromise or settle, pursuant to Bankruptcy
Rule 9019 and section 105(a) of the Bankruptcy Code, Disputed Claims or Equity
Interests that are not Allowed under the Plan or by Final Order of the
Bankruptcy Court in accordance with the following procedures, which shall
constitute sufficient notice in accordance with the Bankruptcy Code and the
Bankruptcy Rules for compromise or settlement of claims:

          1) If the proposed amount at which the Disputed Claim to be Allowed is
less than or equal to $10,000, the Liquidating Trustee or the Committee, as
appropriate, shall be authorized and empowered to settle the Disputed Claim and
execute necessary documents, including a stipulation of settlement or release,
upon (i) the Liquidating Trustee or the Committee's receipt of the consent (such
consent not to be unreasonably withheld) of the Committee in the case of a
settlement by the Liquidating Trustee or the consent of the Liquidating Trustee
in the case of a settlement by the Committee, or (ii)

                                      -40-
<PAGE>

Bankruptcy Court approval of such settlement after a hearing on notice to the
Liquidating Trustee or the Committee (as appropriate), the U.S. Trustee and
parties requesting post-confirmation notice in accordance with Article XII of
the Plan and a hearing; and

          2) If the proposed amount at which the Disputed Claim is to be Allowed
is greater than $10,000, the Liquidating Trustee or the Committee (as
appropriate) shall be authorized and empowered to settle such Disputed Claim and
execute necessary documents, including a stipulation of settlement or release,
only upon receipt of Bankruptcy Court approval of such settlement after notice
to the Liquidating Trustee or the Committee (as appropriate), the U.S. Trustee
and parties requesting post-confirmation notice in accordance with Article XII
of the Plan and a hearing.

          e.   SETOFFS

          The Liquidating Trustee may, in accordance with section 553 of the
Bankruptcy Code and applicable non-bankruptcy law, set off against any Allowed
Claim and the distributions to be made pursuant to the Plan on account of such
Claim (before any distribution is made on account of such Claim), the claims,
rights and causes of action of any nature that the Debtors or the Estate may
hold against the holder of such Allowed Claim; provided, however, that neither
the failure to effect such a setoff nor the allowance of any Claim hereunder
shall constitute a waiver or release by the Debtors, the Estate, the Liquidating
Trustee or the Committee of any such claims, rights and causes of action that
the Debtors or the Estate may possess against such holder.

          f.   ESTIMATION OF CLAIMS

          Subject to the allocation of authority and responsibility provided in
the Plan, the Liquidating Trustee or the Committee may at any time request that
the Bankruptcy Court estimate, pursuant to section 502(c) of the Bankruptcy
Code, any Claim that is contingent, unliquidated or disputed, regardless of
whether any party in interest has previously objected to such Claim or whether
the Bankruptcy Court has ruled on any such objection, and the Bankruptcy Court
will retain jurisdiction to estimate any Claim at any time during litigation

                                      -41-
<PAGE>

concerning any objection to any Claim, including during the pendency of any
appeal relating to any such objection.

          In the event that the Bankruptcy Court estimates any contingent.
unliquidated or disputed Claim, the amount of such estimation will constitute
either the Allowed amount of such Claim or a maximum limitation on such Claim,
as determined by the Bankruptcy Court. If the estimated amount constitutes a
maximum limitation on such Claim, the Liquidating Trustee or the Committee, as
appropriate, may elect to pursue any supplemental proceedings to object to any
ultimate payment on account of such Claim.

          All of the aforementioned Claims objection, estimation and resolution
procedures are cumulative and are not necessarily exclusive of one another.
Claims may be estimated and thereafter resolved by any mechanism permitted under
the Bankruptcy Code or the Plan.

     2.   AMENDMENTS TO CLAIMS

          Prior to the Confirmation Date, a Claim may be amended only as agreed
upon by the Liquidating Trustee, the Committee, and the holder of such Claim, or
as otherwise permitted by the Bankruptcy Court, the Bankruptcy Rules and
applicable law. After the Confirmation Date, a Claim may be filed only with the
authorization of the Bankruptcy Court, and may be amended only with the
authorization of the Bankruptcy Court or as agreed upon by the Liquidating
Trustee, the Committee, and the holder of such Claim. Any new or amended Claim
filed in violation of this paragraph shall be deemed disallowed in full without
any action by the Debtors, the Liquidating Trustee, or the Committee.

G.   DISTRIBUTIONS

     1.   DISBURSING AGENT

          The Liquidating Trustee shall act as the disbursing agent under the
Plan. Cash distributions shall be made by the Liquidating Trustee in accordance
with the Plan.

     2.   CLAIM DISTRIBUTION RECORD DATE

                                      -42-
<PAGE>

          The date of record for determining the entitlement of any holder of a
Claim is the Claim Distribution Record Date. The Debtors, the Liquidating
Trustee, the Committee and each of their respective agents, successors, and
assigns shall have no obligation to recognize any transfer of Claims occurring
after the Claim Distribution Record Date and shall be entitled instead to
recognize and deal for all purposes hereunder only with those record holders of
Claims as of the Claim Distribution Record Date irrespective of the number of
distributions to be made under the Plan to such Persons or the date of such
distributions. An assignee of a transferred and assigned scheduled or filed
Claim shall be permitted to receive distributions in accordance with the Plan
only if the transfer and assignment has been reflected on the Bankruptcy Court's
docket as of the Claim Distribution Record Date.

          a.   DISPUTED CLAIMS RESERVE

          On the Effective Date and from time-to-time as further distributions
are made, the Liquidating Trustee shall deposit into the Disputed Claims Reserve
Account distributions for any Disputed Claims based on the assumption that all
such disputed items will be allowed in full, unless the Bankruptcy Court shall
estimate that a smaller reserve is sufficient. If the Bankruptcy Court so
orders, any claimant whose Claim is so estimated shall have recourse only to the
reserve established by the Bankruptcy Court for such Claimant's Disputed Claim,
and not to the Debtors, the Estate, the Liquidating Trustee, the Committee or
any Person receiving property or distributions under the Plan, even if the
Allowed Claim of such claimant exceeds the maximum estimation of such Claim.
THUS, THE BANKRUPTCY COURT'S ESTIMATION OF A DISPUTED CLAIM WILL LIMIT THE
DISTRIBUTION TO BE MADE THEREON, REGARDLESS OF THE AMOUNT FINALLY ALLOWED ON
ACCOUNT OF SUCH CLAIM. All interest, dividends, and profits earned in the
Disputed Claims Reserve Account shall be property of the Estate and shall accrue
for the benefit of the Estate, and no holder of any Claim or any Disputed Claim
shall have any rights in such interest, dividends, or profits, except as
provided in the Plan.

                                      -43-
<PAGE>

     3.   MANNER OF PAYMENT UNDER THE PLAN

          Any payments of Cash made by the Liquidating Trustee on account of
Allowed Claims pursuant to the Plan may be made either by check or by wire
transfer, at the option of the Liquidating Trustee, and drawn on or from the
Plan Disbursement Account.

     4.   DELIVERY OF DISTRIBUTIONS AND UNDELIVERABLE DISTRIBUTIONS

          Distributions to holders of Allowed Claims under the Plan shall be
made at the address of each such holder as set forth on the Schedules filed with
the Bankruptcy Court, unless superseded by a new address as set forth (i) on a
proof of claim filed by a holder of the Claim, (ii) in another writing notifying
the Liquidating Trustee of a change of address prior to the Claim Distribution
Record Date, or (iii) in a request for payment of an Administrative Expense
Claim, as the case may be. If any holder's distribution is returned as
undeliverable, no further distributions to such holder shall be made unless and
until the Liquidating Trustee is notified of such holder's then-current address,
at which time all missed distributions shall be made to such holder, without
interest.

          Except as provided in the Plan, any distribution under the Plan on
account of an Allowed Claim that is undeliverable to the claimant's last known
address and which is unclaimed ("Unclaimed Property") shall be deposited into
the Disputed Claims Reserve Account to be held for the benefit of the holders of
Allowed Claims entitled thereto under the terms of the Plan. Upon presentation
of proper proof by a claimant entitled to such Unclaimed Property, the Unclaimed
Property due the claimant shall be released from the Disputed Claims Reserve
Account and paid to such claimant.

          Notwithstanding the foregoing, one (1) year after the Unclaimed
Property is initially distributed, claimants shall cease to be entitled to the
Unclaimed Property in which they previously had an interest, and such Unclaimed
Property shall then be transferred to the Plan Disbursement Account and
distributed in the same manner as other distributions, and the claimant to whom
such Unclaimed Property was delivered shall forever be removed as the holder of
an Allowed Claim against the Debtors or the Estate and shall receive no

                                      -44-
<PAGE>

distributions under the Plan. Any distribution of New Common Stock under the
Plan on account of an Allowed Claim that is undeliverable to the claimant's last
known address and which is unclaimed for one (1) year following the initial
distribution shall be cancelled on the books and records of the Reorganized
Debtor one (1) year after the New Common Stock is initially distributed under
the Plan.

     5.   INTEREST ON CLAIMS

          Unless otherwise specifically provided for in the Plan or the
Confirmation Order, or required by applicable bankruptcy law, interest, fees,
costs, and other charges accruing or incurred on or after the Petition Date
shall not be paid on any Claim or Equity Interest. With respect to oversecured
Claims (see 11 U.S.C. ss. 506(b)), post-petition interest shall accrue on such
Claims at the applicable statutory or contractual non-default rate, as the case
may be.

     6.   COMPLIANCE WITH TAX REQUIREMENTS

          In connection with the Plan, to the extent applicable, the Liquidating
Trustee in making Distributions under the Plan shall comply with all tax
withholding and reporting requirements imposed by any governmental unit, and all
distributions pursuant to the Plan shall be subject to such withholding and
reporting requirements. The Liquidating Trustee may withhold the entire
distribution due to any holder of an Allowed Claim until such time as such
holder provides the necessary information to comply with any withholding
requirements of any governmental unit. Any property so withheld will then be
paid by the Liquidating Trustee to the appropriate authority. If the holder of
an Allowed Claim fails to provide the information necessary to comply with any
withholding requirements of any governmental unit within six (6) months from the
date of first notification to the holder of the need for such information or for
the Cash necessary to comply with any applicable withholding requirements, then
the holder's distribution shall be treated as an undeliverable distribution in
accordance with the Plan.

     7.   ALLOCATION OF DISTRIBUTIONS

                                      -45-
<PAGE>

          Distributions to any holder of an Allowed Claim shall be allocated
first to the original principal portion of any such Allowed Claim, and then, to
the extent the consideration exceeds such amount, to the remainder of such
Claim.

     8.   FRACTIONAL DOLLARS

          Any other provision of the Plan notwithstanding, payments of fractions
of dollars shall not be made. Whenever any payment of a fraction of a dollar
under the Plan would otherwise be called for, the actual payment made shall
reflect a rounding of such fraction to the nearest whole dollar (up or down),
with half dollars being rounded up. No fractional shares of New Common Stock
shall be issued and all fractional shares shall be rounded down to the nearest
whole share. Holders of Allowed Claims who would be entitled to fractional
shares but for this provision shall receive no consideration therefor because
such amount will be de minimis.

     9.   DE MINIMIS DISTRIBUTIONS

          No Cash payment of less than twenty dollars ($20.00) shall be made by
the Liquidating Trustee to any holder of an Allowed Claim unless a request
therefor is made in writing to the Liquidating Trustee. Any undistributed amount
shall be held over to the next distribution date, if any. No distribution of New
Common Stock shall be made to any holder of an Allowed Claim of less than five
hundred dollars ($500.00) as such distribution will be de minimis.

     10.  NO DISTRIBUTIONS ON ACCOUNT OF INTERCOMPANY CLAIMS

          Notwithstanding anything to the contrary in the Plan, there shall be
no distributions on account of Intercompany Claims.

     11.  INVESTMENT OF CASH

          The Liquidating Trustee shall invest and deposit Cash only in Allowed
Investments and the Accounts referenced in the Plan and the Liquidating Trust
Agreement. Interest earned on any invested and deposited Cash shall not be
payable to any particular Class or Claim, but shall be held generally as Cash of
the Estate.

     12.  CLAIMS COVERED BY INSURANCE

                                      -46-
<PAGE>

          Any Allowed Claim that has available as a source of payment either an
insurance policy issued to the Debtors or the Liquidating Trustee or in which
either Debtors, the Liquidating Trustee or the Estate has any rights as named
insured or beneficiary, including but not limited to general liability, workers
compensation, and automobile insurance, shall receive distributions pursuant to
this section. Nothing in the Plan modifies, limits, impairs, or otherwise
affects the terms or provisions of any particular insurance policy, program, or
agreement, or the nature and extent of coverage thereunder.

          a.   AUTHORIZED INSURANCE PAYMENTS

          If an insurer stipulates that payment of an Allowed Claim will not
affect coverage for other Claims that may be made under the same insurance
policy (i.e., aggregate limits are sufficient to cover all such Claims), the
claimant may receive payment from said insurer without further order of the
Bankruptcy Court. If there is no such stipulation by the insurer (i.e., an
aggregate limit may exist), the Liquidating Trustee shall use his best efforts
to obtain an order from the Bankruptcy Court authorizing the insurer to exercise
either of the following two (2) payment options:

          1) Option A: The insurer shall pay the amount of the Allowed Claim (up
to the amount of policy limits) to the claimant if the Bankruptcy Court
estimates that total Claims will not exceed the limits of the policy at issue
and authorizes payment; or

          2) Option B: The insurer shall pay the amount of the Allowed Claim (up
to the amount of the policy or bond limits) to the Estate for Pro Rata
distribution to all holders of Allowed Claims whose Claims are insured by the
particular insurance policy at issue. Upon said payment, all suits against the
insurer based upon, arising out of, or related to the Claim for which payment
was made shall be enjoined. The funds paid to the Estate under this section
shall be deposited into a separate account, which shall be interest-bearing if
possible, and held for payment of only those Allowed Claims that are covered by
the insurance policy at issue; and distribution of funds in this account shall
be made only when and on such terms as the Bankruptcy Court authorizes.

                                      -47-
<PAGE>

          3) The Liquidating Trustee or any holder of an Allowed Claim that is
covered by an insurance policy may file a motion in the Bankruptcy Court for an
order authorizing payment or distribution under this section, on notice to the
Liquidating Trustee, the Committee, the U.S. Trustee and parties requesting
post-confirmation notice in accordance with Article XII of the Plan, the
claimant, and the applicable insurance company.

          b.   EXHAUSTION OF INSURANCE

          Distributions on account of Allowed Claims shall be made first from
the applicable insurance policies before any distribution is made on account of
such Allowed Claims from the Cash in the Estate, including from the Disputed
Claims Reserve Account. The Bankruptcy Court may provisionally determine or
estimate that a Claim would be covered by an insurance policy, if and to the
extent it were an Allowed Claim, in which event the Claim shall be provisionally
disallowed and shall not receive any distributions from the Estate or the
Disputed Claims Reserve Account pending a determination by an arbitrator, judge,
or court of competent jurisdiction as to whether and to what extent such Claim
is covered by the insurance policy. Each Allowed Claim shall be reduced by all
payments that the holders of said Allowed Claim receives pursuant to any
insurance policy.

          c.   COVERAGE DENIED

          a. If an insurer denies coverage of an Allowed Claim, then such Claim
shall be treated the same as an Allowed Claim in accordance with the Plan.

          b. If the Estate, or the holder of an Allowed Claim, obtains a
recovery from an insurer for an Allowed Claim for which coverage was earlier
denied, then the recovery shall be treated the same as a payment on account of
distributions made to holders of Allowed Claims in the same Class under this
Plan. If the Claimant has previously received a distribution of Cash from the
Estate on account of its Allowed Claim, such distribution shall be credited
against the distribution made on account of Allowed Claims in its Class and, to
the extent that the insurance recovery plus the prior distribution exceeds the

                                      -48-
<PAGE>

distribution on account of such Allowed Claim, said surplus shall be retained by
the Estate or, if held by the claimant, turned over to the Estate.

          d.   CALCULATION OF CLAIM FOR DISTRIBUTIONS

          In the event an Allowed Claim receives payment from an insurance
policy and the holder thereof also seeks distributions of Cash from the Estate,
then the aggregate of (a) all payments received on account of said Allowed Claim
from any insurance, plus (b) distributions of Cash from the Estate on account of
said Allowed Claim, shall not exceed (c) an amount equal to the Cash and New
Common Stock said Allowed Claim would have been entitled to under the Plan.

H.   TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES

     1.   APPROVAL OF REJECTION OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES

          All executory contracts and unexpired leases that exist between the
Debtors and any Person, whether or not previously listed by the Debtors on their
Schedule G's, shall be deemed rejected as of the Confirmation Date, except for
any executory contract or unexpired lease that (a) has been assumed or rejected
pursuant to an order of the Bankruptcy Court entered prior to the Confirmation
Date, or (b) as to which a motion for approval of the assumption of such
contract or lease has been filed and served prior to the Confirmation Date.
Entry of the Confirmation Order shall constitute the approval, pursuant to
section 365(a) of the Bankruptcy Code, of the rejection of the executory
contracts and unexpired leases rejected pursuant to the Plan.

     2.   BAR DATE FOR FILING PROOFS OF CLAIM RELATING TO EXECUTORY CONTRACTS
          AND UNEXPIRED LEASES REJECTED PURSUANT TO THE PLAN

          Claims arising out of the rejection of an executory contract or
unexpired lease pursuant to the Plan must be filed with the Bankruptcy Court no
later than thirty (30) days after the Confirmation Date. Any Claims not filed
within such applicable time periods shall be forever barred from assertion and
shall receive no distributions under the Plan.

I.   SETTLEMENT, EXCULPATION, INDEMNIFICATION AND RELEASES

                                      -49-
<PAGE>

     1.   EXCULPATION OF PLAN PROPONENTS AND THEIR AGENTS

          Neither the Debtors, the Committee, nor any of their respective
members, officers, directors, employees, representatives, and agents (including,
but not limited to any attorneys, advisors, investment bankers and other
professionals retained by such Persons) shall have or will incur any liability
to any holder of a Claim or Equity Interest for any act or omission in
connection with, or arising out of the Chapter 11 Cases, the pursuit of
confirmation of the Plan, the consummation of the Plan, the administration of
the Plan, or the distribution of property under the Plan, except for liability
based on willful misconduct or gross negligence as determined by Final Order of
the Bankruptcy Court. This provision shall not supercede the "safe harbor" from
liability provided by section 1125(e) of the Bankruptcy Code.

     2.   INDEMNIFICATION

          The Debtors shall indemnify all of their officers and directors in
office on the Confirmation Date from and against any liability to the extent
such liability is covered by any insurance policy in which such directors and
officers are insured.

     3.   RELEASE OF PARTIES ENTITLED TO INDEMNIFICATION AND EXCULPATION

          All Creditors and Equity Interest holders who vote to accept the Plan
shall be deemed to release the members, officers, directors, employees,
representatives, and agents of the Debtors and the Committee (including, but not
limited to any attorneys, advisors, investment bankers and other professionals
retained by such Persons) with respect to all claims, rights and causes of
action that could have been brought by or on behalf of such Creditors or Equity
Interest holders, whether arising before, on or after the Petition Date, known
or unknown, suspected or unsuspected, in law or in equity.

          In addition, the Debtors shall be deemed to release the members,
officers, directors, employees, representatives, and agents of the Debtors and
the Committee (including, but not limited to any attorneys, advisors, investment
bankers and other professionals retained by such Persons) with respect to all
claims, rights and causes of action that could have been brought by or on behalf
of such Creditors or Equity Interest holders, whether arising before, on or

                                      -50-
<PAGE>

after the Petition Date, known or unknown, suspected or unsuspected, in law or
in equity, except for liability based on willful misconduct as determined by
Final Order of the Bankruptcy Court.

                                       IV.

                    CONFIRMATION REQUIREMENTS AND PROCEDURES

          PERSONS OR ENTITIES CONCERNED WITH CONFIRMATION OF THE PLAN SHOULD
CONSULT WITH THEIR OWN ATTORNEYS BECAUSE THE LAW ON CONFIRMING A PLAN OF
REORGANIZATION IS VERY COMPLEX. The following discussion is intended solely for
the purpose of alerting readers about basic confirmation issues that they may
wish to consider, as well as certain deadlines for filing Claims. The Plan
Proponents CANNOT and DO NOT represent that the discussion contained below is a
complete summary of the law on this topic.

          Many requirements must be met before the Bankruptcy Court can confirm
a Plan. The requirements are set forth in section 1129 of the Bankruptcy Code.
For example, the Plan must be proposed in good faith and must be feasible.
Whether creditors accept the Plan (by vote), and whether the Plan pays creditors
at least as much as creditors would receive in a Chapter 7 liquidation, are also
important. These requirements are not the only requirements for confirmation.

A.   VOTING TO ACCEPT OR REJECT THE PLAN

     1.   WHO MAY VOTE TO ACCEPT/REJECT THE PLAN

          The Plan divides Claims against and Equity Interests in the Debtors
into various classes, and provides separate treatment for each class. A party
has a right to vote to accept or reject the Plan if that party has a Claim or
Equity Interest that is both (1) Allowed for voting purposes, and (2) classified
in an impaired class. Note, however, that that a class is deemed to have not
accepted the Plan if the Plan provides that the Claims or Equity Interests of
such class do not entitle the holders of such Claims or Equity Interests to
receive or retain any property under the Plan on account of such Claims or
Equity Interests.

                                      -51-
<PAGE>

          a.   WHAT IS AN ALLOWED CLAIM OR INTEREST

          A Claim or Equity Interest is Allowed for voting purposes if (i) it is
listed by the Debtors on their Schedules as undisputed, liquidated, and
non-contingent, or asserted in a proof of claim or proof of interest filed with
the Bankruptcy Court; and (ii) no party in interest has objected to the Claim or
Equity Interest on or before the hearing on confirmation of the Plan. When an
objection to a Claim or Equity Interest is filed, the creditor or interest
holder holding the Claim or Equity Interest cannot vote unless the Bankruptcy
Court, after notice and a hearing, either overrules the objection or allows the
Claim or Equity Interest for voting purposes.

          b.   WHAT IS AN IMPAIRED CLAIM/INTEREST

          A class is impaired if the Plan alters the legal, equitable, or
contractual rights of the members of that class. For example, a class comprised
of General Unsecured Claims is impaired if the Plan fails to pay the members of
that class one hundred percent (100%) of what they are owed.

          In this case, the Plan Proponents believe that Classes 1, 4, 5, 6 and
7 are impaired, and that holders of Claims or Interests in each of these Classes
are therefore entitled to vote to accept or reject the Plan, except Class 7.
Class 7 is deemed not to have accepted the Plan because the holders of Equity
Interests in such Class do not receive or retain anything under the Plan on
account of such Equity Interests. The Plan Proponents believe that Classes 2 and
3 are unimpaired and that holders of Claims in each of these Classes therefore
do not have the right to vote to accept or reject the Plan. Parties who dispute
the Plan Proponents' characterization of their Claim or Equity Interest as being
impaired or unimpaired may file an objection to the Plan contending that the
Plan Proponents have incorrectly characterized the Class.

          Some parties may hold Allowed Claims or Interests in more than one
impaired Class. These parties must vote separately for each Class that is
entitled to vote, and should receive a Ballot for all of their Claims in each
such Class and should complete, sign and return each Ballot received.

                                      -52-
<PAGE>

          The Plan Proponents have provided a copy of the Plan, Disclosure
Statement and a Ballot to parties entitled to vote on the Plan (i.e. members of
Classes 1, 4, 5 and 6, who hold Claims that are allowed for voting purposes).

     2.   WHO IS NOT ENTITLED TO VOTE

          The following four types of Claims are not entitled to vote: (1)
Claims that have been disallowed; (2) Claims in unimpaired classes; (3) Claims
entitled to priority pursuant to Code sections 507(a)(1), (a)(2), and (a)(8);
and (4) Claims in classes that do not receive or retain any value under the
Plan. Claims in unimpaired classes are not entitled to vote because such classes
are deemed to have accepted the Plan. Claims entitled to priority pursuant to
Bankruptcy Code sections 507(a)(1), (a)(2), and (a)(7) are not entitled to vote
because such claims are not placed in classes and they are required to receive
certain treatment specified by the Bankruptcy Code. Claims in classes that do
not receive or retain any value under the Plan do not vote because such classes
are deemed to have rejected the Plan. EVEN IF YOUR CLAIM IS OF THE TYPE
DESCRIBED ABOVE, YOU MAY STILL HAVE A RIGHT TO OBJECT TO THE CONFIRMATION OF THE
PLAN.

     3.   VOTES NECESSARY FOR A CLASS TO ACCEPT THE PLAN

          A class of Claims is considered to have accepted the Plan when more

than one-half (1/2) in number and at least two-thirds (2/3) in dollar amount of
the Claims that properly submitted ballots on the Plan voted in favor of the
Plan. A class of Equity Interests is considered to have accepted the Plan when
the holders of at least two-thirds (2/3) in amount of the Interests of such
class who properly submitted ballots on the Plan voted in favor of the Plan.

     4.   VOTES NECESSARY TO CONFIRM THE PLAN

          If impaired classes exist, the Bankruptcy Court cannot confirm the
Plan unless (1) at least one impaired class has accepted the Plan without
counting the votes of any insiders within that class, and (2) all impaired
classes have voted to accept the Plan, unless the Plan is eligible to be

                                      -53-
<PAGE>

confirmed by "cram down" on non-accepting classes, as discussed immediately
below in Section IV.B.5.

          As noted above, the Plan Proponents will separately file a motion to
substantively consolidate the Debtors' Chapter 11 estates. Votes by Creditors
with respect to the Plan will thus be tabulated by (a) each class of Claims
separately with respect to each Debtor, and (b) each class of Claims jointly as
to both Debtors. Thus, if each class of Claims votes to accept the Plan
separately with respect to each Debtor, the motion to substantively consolidate
the Chapter 11 estates would become moot and the Court could otherwise confirm
the Plan without considering that motion. Conversely, if the motion were
granted, the Court could confirm the Plan upon the votes to accept the Plan by
each class of Claims jointly as to both Debtors.

     5.   CONFIRMATION OF PLAN WITHOUT NECESSARY ACCEPTANCES

          As noted above, even if impaired classes do not accept the proposed
Plan, the Court may nonetheless confirm the Plan if the non-accepting classes
are treated in the manner required by the Code. The process by which
non-accepting classes are forced to be bound by the terms of the Plan is
commonly referred to as "cram down." The Bankruptcy Code allows the Plan to be
"crammed down" on non-accepting classes of Claims or Equity Interests if the
Plan meets all consensual requirements except the voting requirements of section
1129(a)(8), and if the Plan does not "discriminate unfairly" and is "fair and
equitable" toward each impaired class that has not voted to accept the Plan as
referred to in section 1129(b) and applicable case law.

          The Plan Proponents will ask the Bankruptcy Court to confirm the Plan
by cram down on impaired classes 1, 4, 5 and 6 if any of these classes do not
vote to accept the Plan.

     6.   PROCEDURE FOR VOTING

          a.   RETURN OF BALLOT FORMS

          In voting for or against the Plan, please use only the Ballot(s) sent
to you with this Disclosure Statement. You may receive more than one Ballot, and

                                      -54-
<PAGE>

if you do, you should assume each Ballot is for a Claim or Equity Interest in a
different Class in which you are entitled to vote.

          Parties entitled to vote should vote on the Plan by completing the
enclosed Ballot and delivering it to counsel for the Committee at the following
address:

          Christopher Alliotts, Esq.
          SULMEYERKupetz, A Professional Corporation
          1080 Marsh Road, Suite 110
          Menlo Park, California 94025
          Facsimile: (650) 326-5134

          b.   DEADLINE

          For a Ballot to be counted and considered in the voting on the Plan,
it must be received at the above address no later than 5:00 p.m. (Pacific
Standard Time) on _______________, 2005 (the "Voting Deadline").

          c.   METHOD OF DELIVERY

          Ballots may be returned via regular U.S. Mail, postage prepaid;
overnight delivery, hand delivery; or by facsimile; provided that, for the
Committee to count a Ballot received by facsimile, the Committee must also
receive the original of the Ballot by U.S. Mail, postage prepaid, overnight
delivery, or hand delivery within forty-eight (48) hours of the Voting Deadline.
In addition, oral ballots cannot be received or counted. Creditors are therefore
urged to complete, date, sign and return the enclosed Ballot so that it will be
received by the time and date set forth above.

          d.   PROCEDURE FOR WITHDRAWING OR CHANGING VOTES

          A holder of a Claim who has delivered a valid Ballot voting on the
Plan may withdraw or change such vote solely in accordance with Bankruptcy Rule
3018(a), which provides in relevant part that the Bankruptcy Court may permit a
Creditor to change or withdraw its vote after notice and a hearing and for cause
shown.

B.   LIQUIDATION ANALYSIS

          Another confirmation requirement is the "Best Interest Test", which
requires a liquidation analysis. Under the Best Interest Test, if a Creditor or

                                      -55-
<PAGE>

Equity Interest holder is in an impaired class and that Creditor or Equity
Interest holder does not vote to accept the Plan, then that Creditor or Equity
Interest holder must receive or retain under the Plan property of a value not
less than the amount that such Creditor or Equity Interest holder would receive
or retain if the Debtors were liquidated under Chapter 7 of the Bankruptcy Code.

          Generally, in a Chapter 7 case, a debtor's assets are usually sold by
a Chapter 7 trustee. Secured creditors are paid first from the sales proceeds of
properties on which the secured creditor has a lien. Administrative expense
claims and other priority claims are paid next. Unsecured creditors are then
paid from any remaining sales proceeds, according to their rights to priority.
Unsecured creditors with the same priority share in proportion to the amount of
their allowed claim in relationship to the amount of total allowed unsecured
claims. Finally, interest holders receive the balance that remains, if any,
after all creditors are paid.

          For the Bankruptcy Court to be able to confirm the Plan, the Court
must find that all Creditors and Equity Interest holders who do not accept the
Plan will receive at least as much under the Plan as such holders would receive
under a Chapter 7 liquidation. The Plan Proponents maintain that this
requirement is met here for the following reasons.

          In a Chapter 7 case, a Chapter 7 trustee is appointed and is entitled
to compensation from the bankruptcy estate in an amount not to exceed 25% of the
first $5,000 of all moneys disbursed, 10% of any amount over $5,000 but less
than $50,000, 5% of any amount over $50,000 but less than $1 million, and 3% of
all amounts over $1 million. In this case, assuming a distribution of
approximately $1,419,000, a Chapter 7 trustee's compensation is estimated to be
approximately $95,820.00. Counsel for a Chapter 7 trustee would incur additional
fees and costs of estimated to be approximately $100,000.00. By contrast, it is
anticipated that the fees of the Liquidating Trustee will be approximately
$170,000, consisting of $50,000 in hourly fees and $120,000 in New Common Stock.

                                      -56-
<PAGE>

          In addition, because the Chapter 7 trustee would likely replace the
professionals currently employed by the Estate, the Chapter 7 trustee's new
professionals would burden the Estate with additional fees to become familiar
with the issues in this case. Furthermore, the Plan Proponents believe that in a
Chapter 7 liquidation, distributions to Creditors would be delayed due to, among
other things: (a) the setting of a new bar date for the filing of proofs of
claim, which could also result in the filing of additional claims and thus
reduce the Pro Rata distribution to each of the Debtors' Creditors; (b) the
preparation of the Debtors' final report to the U.S. Trustee; and (c) the
administrative activities of the U.S. Trustee and the Court clerk's office in
connection with, among other activities, converting and closing the case. Thus,
the Plan Proponents conclude that the Plan provides fair and equitable treatment
of all classes of Creditors and the greatest feasible recovery to all Creditors.

          Further, if this case were converted to Chapter 7, the Estate would
not receive the shares of New Common Stock equal to 3.25% of the issued and
outstanding common stock of the Reorganized Debtor from the anticipated Merger
of FVC with U.S. Dry Cleaning. The value of the approximately 313,871 shares of
New Common Stock in the Reorganized Debtor have a pro forma value of $520,000.
Thus, the New Common Stock would not be an asset of a Chapter 7 estate, the
absence of which would further diminish the return to claimants in this case.
Instead, pursuant to the Plan, the Liquidating Trustee will facilitate the
merger of FVC with U.S. Dry Cleaning and thus significantly increase the value
of the Estate for the beneficiaries of the Liquidating Trust.

          Below is a demonstration, in tabular format, that all Creditors and
Equity Interest holders will receive at least as much under the Plan as such
Creditor or Equity Interest holder would receive in a Chapter 7 liquidation case
assuming a conversion occurred in November 2005. This information is provided by
the Plan Proponents.

                                      -57-

<PAGE>


<TABLE>
<CAPTION>

  =============================================  ===================================================================================
     Assets, Claims, Classes, and Interests       Dollar Amounts of          Payout           Dollar Amounts of          Payout
                                                    Assets, Claims         Percentage           Assets, Claims        Percentage in
                                                   and Interests in       in Chapter 7         and Classes in        Under the Plan
                                                      Chapter 7            Liquidation            Chapter 11
  =============================================  ====================  ====================  ====================  =================
  <S>                                            <C>                   <C>                   <C>                   <C>

  Current Assets - Cash on Hand                           $1,419,000                                  $1,419,000
  New Common Stock in Chapter 11                                                                        $520,000
  Total Assets Available for Distribution                 $1,419,000                                  $1,939,000
  Administrative Claims - Chapter 7 trustee                 $195,820          100%                         $0.00           100%
  Administrative Claims - Chapter 11                        $600,000          100%                      $600,000           100%
  ---------------------------------------------  --------------------  --------------------  -------------------   -----------------
  Priority Tax Claims[1]                                       $0.00          100%                         $0.00           100%
  Class 1 - Secured Tax Claims                                 $0.00          100%                         $0.00           100%
  Class 2 - Secured Non-Tax Claims                             $0.00          100%                         $0.00           100%
  Class 3 - Priority Non-Tax Claims                         $379,429          100%                      $379,429           100%
  Class 4 - General Unsecured Claims                      $1,784,115           14%                    $1,784,115           43%
  Class 5 - Preferred Stock Interests                  27,437 shares           0%                  27,437 shares            0%
  Class 6 - Equity Interests                       16,113,486 shares           0%              16,113,486 shares            0%
  ---------------------------------------------  --------------------  --------------------  -------------------   -----------------

</TABLE>

PERCENTAGE OF DISTRIBUTION UNSECURED CREDITORS WOULD RECEIVE ON ACCOUNT OF THEIR
CLAIMS IN A CHAPTER 7 LIQUIDATION: = 0.00%
PERCENTAGE OF DISTRIBUTION UNSECURED CREDITORS WOULD RECEIVE ON ACCOUNT OF THEIR
CLAIMS UNDER THE PLAN: = approximately 43.00%

          In summary, the percentage to be paid to general unsecured creditors
is greater under the Plan than in a Chapter 7 liquidation case for two reasons.

------------------------------
          ((1) The amounts listed in the tabulation under each category of
     Claims are as listed in the Schedules. As noted above under the Summary of
     the Plan (Article III of this Disclosure Statement), Creditors have filed
     proofs of claim that have increased the face amount of priority tax claims
     to $446,641.49, secured tax claims to $147.03, secured claims to
     $32,642.66, non-tax priority claims to $1,296,224.52, and general unsecured
     claims to $6,785,707.95. The Debtors believe that the aggregate amount of
     Allowed Claims, after completion of the Claims reconciliation process,
     should be closer to the amounts reflected on the Schedules than on the
     proofs of claim. In any event, to the extent the aggregate Claim amounts
     are higher or lower than the amounts reflected in the Schedules, the
     percentage distribution available for holders of Allowed General Unsecured
     Claims in Chapter 11 will nevertheless exceed that available in Chapter 7
     due to, as noted above, the additional assets available under the Plan
     (i.e., the New Common Stock) and the lower amount of liabilities incurred
     in a Chapter 11 case (i.e., the absence of chapter 7 trustee fees and
     expenses).

                                      -58-
<PAGE>

The first is that the Estate will not have to pay the fees and costs associated
with the appointment of a Chapter 7 trustee. The second is that the Estate will
receive the shares of New Common Stock equal to 3.25% of the issued and
outstanding common stock of the Reorganized Debtor, which has a pro forma value
of $520,000, as part of the reorganization contemplated by the Plan. The Estate
would not receive the New Common Stock if this case were converted to Chapter 7.

C.   FEASIBILITY

          Another requirement for confirmation involves the feasibility of the
Plan, which means that confirmation of the Plan is not likely to be followed by
the liquidation, or the need for further financial reorganization, of the
Debtors or any successor to the Debtors under the Plan, unless such liquidation
or reorganization is proposed in the Plan. There are at least two important
aspects of a feasibility analysis.

          The first aspect considers whether the Debtors will have enough cash
on hand on the Effective Date of the Plan to pay all the Claims and
Administrative Expenses that are entitled to be paid on such date. The Plan
Proponents maintain that this aspect of feasibility is satisfied by virtue of
the fact that the Debtors currently have approximately $1,805,643 in cash on
hand. This amount is more than sufficient to pay in full all Administrative
Expense Claims, statutory costs and charges, and other payments due on the
Effective Date.

          The second aspect considers whether the Plan Proponents will have
enough cash over the life of the Plan to make the required Plan payments. This
aspect of feasibility is not applicable here because the Plan is a "pot plan"
that does not contemplate payments over the life of the Plan. Rather, the Plan
proposed is the vehicle by which the Debtors will distribute the Cash currently
on hand, other amounts subsequently recovered by the Estate and to distribute
the New Common Stock issued to the Estate as part of the Plan. The Plan
Proponents have therefore not provided financial information on a going forward
basis.

D.   TIME AND PLACE OF THE CONFIRMATION HEARING

                                      -59-
<PAGE>

          The hearing where the Bankruptcy Court will determine whether or not
to confirm the Plan will take place on _____________, 2005 at ______ (Pacific
Standard Time), in Courtroom 23, United States Bankruptcy Court, 235 Pine
Street, San Francisco, California 94104. The hearing may be adjourned from time
to time without further notice except for an announcement made at the hearing or
any adjourned hearing.

E.   OBJECTIONS TO CONFIRMATION

     1.   WHO MAY OBJECT TO CONFIRMATION OF THE PLAN

          Any party in interest may object to the confirmation of the Plan
(although, as explained above, not everyone is entitled to vote to accept or
reject the Plan).

     2.   PROCEDURE FOR OBJECTING TO THE CONFIRMATION OF THE PLAN

          Any objection to confirmation of the Plan must be made in writing,
state all grounds for objection, be filed with the Clerk of the Bankruptcy Court
and served upon the attorneys for the Debtors and the Committee (at the
addresses stated in the upper left-hand corner of the first page of this
Disclosure Statement), and the U.S. Trustee, by 5:00 p.m. on _____________,
2005.

                                       V.

                         EFFECT OF CONFIRMATION OF PLAN

A.   BINDING EFFECT OF THE PLAN.

          The provisions of the Plan and the Liquidating Trust Agreement shall
bind the Debtors, each Creditor, each Equity Interest holder, the Committee, the
Liquidating Trustee, and any successor or assign, including any Chapter 7 or
Chapter 11 trustee, whether or not the Claim or Equity Interest of such Person
arose before or after the Petition Date or the Effective Date, whether or not
the Claim or Equity Interest is impaired under the Plan, and whether or not such
Person has accepted the Plan. Except as provided for in the Plan, all property
of the Estate is free and clear of all liens, interests in such property, Claims
and Equity Interests (including claims for Post-Effective Date Administrative
Fees and Expenses).

B.   SUBORDINATION OF CLAIMS

                                      -60-
<PAGE>

          Nothing in the Plan shall be deemed to release the rights, if any,
that the Debtors, the Estate, the Committee, the Liquidating Trustee, or any
Creditor may have to seek to subordinate any Claim pursuant to section 510 of
the Bankruptcy Code.

C.   TERM OF BANKRUPTCY INJUNCTION OR STAYS

          All injunctions or stays provided for in the Chapter 11 Cases under
sections 105 or 362 of the Bankruptcy Code, or otherwise, and in existence on
the Confirmation Date, shall remain in full force and effect until all property
of the Estate and all Trust Assets have been distributed in accordance with the
Plan and all other actions required by the Plan have been taken. Without
limiting the foregoing, except as otherwise provided in the Plan or the
Confirmation Order, on and after the Effective Date, all Persons who have held,
currently hold or may hold a Claim or an Equity Interest (including claims for
Post-Effective Date Administrative Fees and Expenses) treated or provided for
pursuant to the Plan are enjoined, until all Trust Assets have been distributed
and the Liquidating Trust has been dissolved, from taking any of the following
actions, without leave of the Bankruptcy Court, on account of such Claim or
Equity Interest: (i) commencing or continuing, in any manner and in any place,
any action or proceeding against the Debtors, the Estate, the Liquidating Trust,
the Liquidating Trustee, Professionals or the Committee; (ii) enforcing,
attaching, collecting, or recovering in any manner any judgment, award, decree
or other order against the Debtors, the Estate, the Liquidating Trust, the
Liquidating Trustee, Professionals or the Committee; (iii) creating, perfecting
or enforcing any lien against property of the Estate or any Trust Asset; (iv)
taking any action to obtain possession of property of the Estate or any Trust
Asset or to obtain possession of property from the Estate the Liquidating Trust
or to exercise control over the Estate, property of the Estate, the Liquidating
Trust or Trust Assets; and (v) commencing or continuing any action or
proceeding, in any manner and in any place, that does not comply with or is
inconsistent with the provisions of the Plan; provided, however, that
injunctions and stays provided under the Plan shall not affect or apply to (i)
the filing and prosecution of requests for payment of Administrative Expense

                                      -61-
<PAGE>

Claims in accordance with Article III.B.1 of the Plan, (ii) adversary
proceedings or Claims resolution proceedings commenced in or pending in the
Bankruptcy Court, (iii) proceedings commenced in the Bankruptcy Court to enforce
provisions of the Plan or with respect to disputes concerning payment of
Post-Effective Date Administrative Fees and Expenses, (iv) proceedings pending
in courts other than the Bankruptcy Court for the sole purpose of liquidating
post-Petition Date Claims, (v) accepting any distributions made in accordance
with the Plan or payments on Post-Effective Date Claims, and (vi) settling,
adjusting, litigating, paying, or otherwise handling, processing, or
administering claims under any insurance programs or policies of the Debtors.

D.   DISCHARGE

          FVC will receive a discharge under this Plan pursuant to and in
accordance with the provisions of Section 1141 of the Bankruptcy Code because
FVC, following its anticipated Merger with U.S. Dry Cleaning, will survive as
the Reorganized Debtor.

DATED: August 24, 2005                  FIRST VIRTUAL COMMUNICATIONS, INC., a
                                        Delaware corporation, debtor and debtor
                                        in possession


                                        By: ____________________________________
                                            Name:
                                            Title:



DATED: August 24, 2005                  CUseeME NETWORKS, INC., a Delaware
                                        corporation, debtor and debtor in
                                        possession


                                        By: ____________________________________
                                            Name:
                                            Title:




DATED: August 24, 2005                  OFFICIAL COMMITTEE OF UNSECURED
                                        CREDITORS


                                        By: ____________________________________
                                            Name:  Tracy Wemett, BroadPR, Inc.
                                            Title: Chairperson