diff --git a/lib/vscode/src/vs/base/parts/ipc/common/ipc.net.ts b/lib/vscode/src/vs/base/parts/ipc/common/ipc.net.ts
index 777d4379..dcce7c0e 100644
--- a/lib/vscode/src/vs/base/parts/ipc/common/ipc.net.ts
+++ b/lib/vscode/src/vs/base/parts/ipc/common/ipc.net.ts
@@ -743,6 +743,11 @@ export class PersistentProtocol implements IMessagePassingProtocol {
 		}, Math.max(ProtocolConstants.KeepAliveTimeoutTime - timeSinceLastIncomingMsg, 0) + 5);
 	}
 
+	// NOTE@coder: Set the socket without initiating a reconnect.
+	public setSocket(socket: ISocket): void {
+		this._socket = socket;
+	}
+
 	public getSocket(): ISocket {
 		return this._socket;
 	}
diff --git a/lib/vscode/src/vs/server/entry.ts b/lib/vscode/src/vs/server/entry.ts
index 901bcda6..2f458f40 100644
--- a/lib/vscode/src/vs/server/entry.ts
+++ b/lib/vscode/src/vs/server/entry.ts
@@ -6,7 +6,9 @@ import { logger } from 'vs/server/node/logger';
 import { enableCustomMarketplace } from 'vs/server/node/marketplace';
 import { Vscode } from 'vs/server/node/server';
 
-setUnexpectedErrorHandler((error) => logger.warn(error instanceof Error ? error.message : error));
+setUnexpectedErrorHandler((error) => {
+	logger.warn('Uncaught error', field('error', error instanceof Error ? error.message : error));
+});
 enableCustomMarketplace();
 proxyAgent.monkeyPatch(true);
 
diff --git a/lib/vscode/src/vs/server/node/connection.ts b/lib/vscode/src/vs/server/node/connection.ts
index 3b4d54ab..ef5cecda 100644
--- a/lib/vscode/src/vs/server/node/connection.ts
+++ b/lib/vscode/src/vs/server/node/connection.ts
@@ -3,31 +3,49 @@ import * as cp from 'child_process';
 import { VSBuffer } from 'vs/base/common/buffer';
 import { Emitter } from 'vs/base/common/event';
 import { FileAccess } from 'vs/base/common/network';
-import { ISocket } from 'vs/base/parts/ipc/common/ipc.net';
-import { WebSocketNodeSocket } from 'vs/base/parts/ipc/node/ipc.net';
 import { INativeEnvironmentService } from 'vs/platform/environment/common/environment';
+import { IRemoteExtensionHostStartParams } from 'vs/platform/remote/common/remoteAgentConnection';
 import { getNlsConfiguration } from 'vs/server/node/nls';
 import { Protocol } from 'vs/server/node/protocol';
 import { IExtHostReadyMessage } from 'vs/workbench/services/extensions/common/extensionHostProtocol';
 
 export abstract class Connection {
 	private readonly _onClose = new Emitter<void>();
+	/**
+	 * Fire when the connection is closed (not just disconnected). This should
+	 * only happen when the connection is offline and old or has an error.
+	 */
 	public readonly onClose = this._onClose.event;
 	private disposed = false;
 	private _offline: number | undefined;
 
-	public constructor(protected protocol: Protocol, public readonly token: string) {}
+	protected readonly logger: Logger;
+
+	public constructor(
+		protected readonly protocol: Protocol,
+		public readonly name: string,
+	) {
+		this.logger = logger.named(
+			this.name,
+			field('token', this.protocol.options.reconnectionToken),
+		);
+
+		this.logger.debug('Connecting...');
+		this.onClose(() => this.logger.debug('Closed'));
+	}
 
 	public get offline(): number | undefined {
 		return this._offline;
 	}
 
-	public reconnect(socket: ISocket, buffer: VSBuffer): void {
+	public reconnect(protocol: Protocol): void {
+		this.logger.debug('Reconnecting...');
 		this._offline = undefined;
-		this.doReconnect(socket, buffer);
+		this.doReconnect(protocol);
 	}
 
-	public dispose(): void {
+	public dispose(reason?: string): void {
+		this.logger.debug('Disposing...', field('reason', reason));
 		if (!this.disposed) {
 			this.disposed = true;
 			this.doDispose();
@@ -36,6 +54,7 @@ export abstract class Connection {
 	}
 
 	protected setOffline(): void {
+		this.logger.debug('Disconnected');
 		if (!this._offline) {
 			this._offline = Date.now();
 		}
@@ -44,7 +63,11 @@ export abstract class Connection {
 	/**
 	 * Set up the connection on a new socket.
 	 */
-	protected abstract doReconnect(socket: ISocket, buffer: VSBuffer): void;
+	protected abstract doReconnect(protcol: Protocol): void;
+
+	/**
+	 * Dispose/destroy everything permanently.
+	 */
 	protected abstract doDispose(): void;
 }
 
@@ -52,21 +75,22 @@ export abstract class Connection {
  * Used for all the IPC channels.
  */
 export class ManagementConnection extends Connection {
-	public constructor(protected protocol: Protocol, token: string) {
-		super(protocol, token);
+	public constructor(protocol: Protocol) {
+		super(protocol, 'management');
 		protocol.onDidDispose(() => this.dispose()); // Explicit close.
 		protocol.onSocketClose(() => this.setOffline()); // Might reconnect.
+		protocol.sendMessage({ type: 'ok' });
 	}
 
 	protected doDispose(): void {
-		this.protocol.sendDisconnect();
-		this.protocol.dispose();
-		this.protocol.getUnderlyingSocket().destroy();
+		this.protocol.destroy();
 	}
 
-	protected doReconnect(socket: ISocket, buffer: VSBuffer): void {
-		this.protocol.beginAcceptReconnection(socket, buffer);
+	protected doReconnect(protocol: Protocol): void {
+		protocol.sendMessage({ type: 'ok' });
+		this.protocol.beginAcceptReconnection(protocol.getSocket(), protocol.readEntireBuffer());
 		this.protocol.endAcceptReconnection();
+		protocol.dispose();
 	}
 }
 
@@ -85,55 +109,62 @@ type ExtHostMessage = DisconnectedMessage | ConsoleMessage | IExtHostReadyMessag
 
 export class ExtensionHostConnection extends Connection {
 	private process?: cp.ChildProcess;
-	private readonly logger: Logger;
 
 	public constructor(
-		locale: string, protocol: Protocol, buffer: VSBuffer, token: string,
+		protocol: Protocol,
+		private readonly params: IRemoteExtensionHostStartParams,
 		private readonly environment: INativeEnvironmentService,
 	) {
-		super(protocol, token);
-		this.logger = logger.named('exthost', field('token', token));
-		this.protocol.dispose();
-		this.spawn(locale, buffer).then((p) => this.process = p);
-		this.protocol.getUnderlyingSocket().pause();
+		super(protocol, 'exthost');
+
+		protocol.sendMessage({ debugPort: this.params.port });
+		const buffer = protocol.readEntireBuffer();
+		const inflateBytes = protocol.inflateBytes;
+		protocol.dispose();
+		protocol.getUnderlyingSocket().pause();
+
+		this.spawn(buffer, inflateBytes).then((p) => this.process = p);
 	}
 
 	protected doDispose(): void {
+		this.protocol.destroy();
 		if (this.process) {
 			this.process.kill();
 		}
-		this.protocol.getUnderlyingSocket().destroy();
 	}
 
-	protected doReconnect(socket: ISocket, buffer: VSBuffer): void {
-		// This is just to set the new socket.
-		this.protocol.beginAcceptReconnection(socket, null);
-		this.protocol.dispose();
-		this.sendInitMessage(buffer);
+	protected doReconnect(protocol: Protocol): void {
+		protocol.sendMessage({ debugPort: this.params.port });
+		const buffer = protocol.readEntireBuffer();
+		const inflateBytes = protocol.inflateBytes;
+		protocol.dispose();
+		protocol.getUnderlyingSocket().pause();
+		this.protocol.setSocket(protocol.getSocket());
+
+		this.sendInitMessage(buffer, inflateBytes);
 	}
 
-	private sendInitMessage(buffer: VSBuffer): void {
-		const socket = this.protocol.getUnderlyingSocket();
-		socket.pause();
+	private sendInitMessage(buffer: VSBuffer, inflateBytes: Uint8Array | undefined): void {
+		if (!this.process) {
+			throw new Error('Tried to initialize VS Code before spawning');
+		}
 
-		const wrapperSocket = this.protocol.getSocket();
+		this.logger.debug('Sending socket');
 
-		this.logger.trace('Sending socket');
-		this.process!.send({ // Process must be set at this point.
+		// TODO: Do something with the debug port.
+		this.process.send({
 			type: 'VSCODE_EXTHOST_IPC_SOCKET',
 			initialDataChunk: Buffer.from(buffer.buffer).toString('base64'),
-			skipWebSocketFrames: !(wrapperSocket instanceof WebSocketNodeSocket),
+			skipWebSocketFrames: this.protocol.options.skipWebSocketFrames,
 			permessageDeflate: this.protocol.options.permessageDeflate,
-			inflateBytes: wrapperSocket instanceof WebSocketNodeSocket
-				? Buffer.from(wrapperSocket.recordedInflateBytes.buffer).toString('base64')
-				: undefined,
-		}, socket);
+			inflateBytes: inflateBytes ? Buffer.from(inflateBytes).toString('base64') : undefined,
+		}, this.protocol.getUnderlyingSocket());
 	}
 
-	private async spawn(locale: string, buffer: VSBuffer): Promise<cp.ChildProcess> {
-		this.logger.trace('Getting NLS configuration...');
-		const config = await getNlsConfiguration(locale, this.environment.userDataPath);
-		this.logger.trace('Spawning extension host...');
+	private async spawn(buffer: VSBuffer, inflateBytes: Uint8Array | undefined): Promise<cp.ChildProcess> {
+		this.logger.debug('Getting NLS configuration...');
+		const config = await getNlsConfiguration(this.params.language, this.environment.userDataPath);
+		this.logger.debug('Spawning extension host...');
 		const proc = cp.fork(
 			FileAccess.asFileUri('bootstrap-fork', require).fsPath,
 			// While not technically necessary, makes it easier to tell which process
@@ -162,7 +193,7 @@ export class ExtensionHostConnection extends Connection {
 			this.dispose();
 		});
 		proc.on('exit', (code) => {
-			this.logger.trace('Exited', field('code', code));
+			this.logger.debug('Exited', field('code', code));
 			this.dispose();
 		});
 		if (proc.stdout && proc.stderr) {
@@ -181,12 +212,12 @@ export class ExtensionHostConnection extends Connection {
 					}
 					break;
 				case 'VSCODE_EXTHOST_DISCONNECTED':
-					this.logger.trace('Going offline');
+					this.logger.debug('Got disconnected message');
 					this.setOffline();
 					break;
 				case 'VSCODE_EXTHOST_IPC_READY':
-					this.logger.trace('Got ready message');
-					this.sendInitMessage(buffer);
+					this.logger.debug('Handshake completed');
+					this.sendInitMessage(buffer, inflateBytes);
 					break;
 				default:
 					this.logger.error('Unexpected message', field('event', event));
@@ -194,7 +225,7 @@ export class ExtensionHostConnection extends Connection {
 			}
 		});
 
-		this.logger.trace('Waiting for handshake...');
+		this.logger.debug('Waiting for handshake...');
 		return proc;
 	}
 }
diff --git a/lib/vscode/src/vs/server/node/protocol.ts b/lib/vscode/src/vs/server/node/protocol.ts
index 15fa414e..fd61d4c9 100644
--- a/lib/vscode/src/vs/server/node/protocol.ts
+++ b/lib/vscode/src/vs/server/node/protocol.ts
@@ -1,21 +1,31 @@
-import { field } from '@coder/logger';
+import { field, logger, Logger } from '@coder/logger';
 import * as net from 'net';
 import { VSBuffer } from 'vs/base/common/buffer';
 import { PersistentProtocol } from 'vs/base/parts/ipc/common/ipc.net';
 import { NodeSocket, WebSocketNodeSocket } from 'vs/base/parts/ipc/node/ipc.net';
 import { AuthRequest, ConnectionTypeRequest, HandshakeMessage } from 'vs/platform/remote/common/remoteAgentConnection';
-import { logger } from 'vs/server/node/logger';
 
 export interface SocketOptions {
+	/** The token is how we identify and connect to existing sessions. */
 	readonly reconnectionToken: string;
+	/** Specifies that the client is trying to reconnect. */
 	readonly reconnection: boolean;
+	/** If true assume this is not a web socket (always false for code-server). */
 	readonly skipWebSocketFrames: boolean;
+	/** Whether to support compression (web socket only). */
 	readonly permessageDeflate?: boolean;
+	/**
+	 * Seed zlib with these bytes (web socket only). If parts of inflating was
+	 * done in a different zlib instance we need to pass all those bytes into zlib
+	 * otherwise the inflate might hit an inflated portion referencing a distance
+	 * too far back.
+	 */
 	readonly inflateBytes?: VSBuffer;
-	readonly recordInflateBytes?: boolean;
 }
 
 export class Protocol extends PersistentProtocol {
+	private readonly logger: Logger;
+
 	public constructor(socket: net.Socket, public readonly options: SocketOptions) {
 		super(
 			options.skipWebSocketFrames
@@ -24,9 +34,12 @@ export class Protocol extends PersistentProtocol {
 					new NodeSocket(socket),
 					options.permessageDeflate || false,
 					options.inflateBytes || null,
-					options.recordInflateBytes || false,
+					// Always record inflate bytes if using permessage-deflate.
+					options.permessageDeflate || false,
 				),
 		);
+
+		this.logger = logger.named('protocol', field('token', this.options.reconnectionToken));
 	}
 
 	public getUnderlyingSocket(): net.Socket {
@@ -40,31 +53,44 @@ export class Protocol extends PersistentProtocol {
 	 * Perform a handshake to get a connection request.
 	 */
 	public handshake(): Promise<ConnectionTypeRequest> {
-		logger.trace('Protocol handshake', field('token', this.options.reconnectionToken));
+		this.logger.debug('Initiating handshake...');
+
 		return new Promise((resolve, reject) => {
+			const cleanup = () => {
+				handler.dispose();
+				onClose.dispose();
+				clearTimeout(timeout);
+			};
+
+			const onClose = this.onSocketClose(() => {
+				cleanup();
+				this.logger.debug('Handshake failed');
+				reject(new Error('Protocol socket closed unexpectedly'));
+			});
+
 			const timeout = setTimeout(() => {
-				logger.error('Handshake timed out', field('token', this.options.reconnectionToken));
-				reject(new Error('timed out'));
+				cleanup();
+				this.logger.debug('Handshake timed out');
+				reject(new Error('Protocol handshake timed out'));
 			}, 10000); // Matches the client timeout.
 
 			const handler = this.onControlMessage((rawMessage) => {
 				try {
 					const raw = rawMessage.toString();
-					logger.trace('Protocol message', field('token', this.options.reconnectionToken), field('message', raw));
+					this.logger.trace('Got message', field('message', raw));
 					const message = JSON.parse(raw);
 					switch (message.type) {
 						case 'auth':
 							return this.authenticate(message);
 						case 'connectionType':
-							handler.dispose();
-							clearTimeout(timeout);
+							cleanup();
+							this.logger.debug('Handshake completed');
 							return resolve(message);
 						default:
 							throw new Error('Unrecognized message type');
 					}
 				} catch (error) {
-					handler.dispose();
-					clearTimeout(timeout);
+					cleanup();
 					reject(error);
 				}
 			});
@@ -90,10 +116,38 @@ export class Protocol extends PersistentProtocol {
 	}
 
 	/**
-	 * Send a handshake message. In the case of the extension host, it just sends
-	 * back a debug port.
+	 * Send a handshake message. In the case of the extension host it should just
+	 * send a debug port.
 	 */
-	public sendMessage(message: HandshakeMessage | { debugPort?: number } ): void {
+	public sendMessage(message: HandshakeMessage | { debugPort?: number | null } ): void {
 		this.sendControl(VSBuffer.fromString(JSON.stringify(message)));
 	}
+
+	/**
+	 * Disconnect and dispose everything including the underlying socket.
+	 */
+	public destroy(reason?: string): void {
+		try {
+			if (reason) {
+				this.sendMessage({ type: 'error', reason });
+			}
+			// If still connected try notifying the client.
+			this.sendDisconnect();
+		} catch (error) {
+			// I think the write might fail if already disconnected.
+			this.logger.warn(error.message || error);
+		}
+		this.dispose(); // This disposes timers and socket event handlers.
+		this.getSocket().dispose(); // This will destroy() the socket.
+	}
+
+	/**
+	 * Get inflateBytes from the current socket.
+	 */
+	public get inflateBytes(): Uint8Array | undefined {
+		const socket = this.getSocket();
+		return socket instanceof WebSocketNodeSocket
+			? socket.recordedInflateBytes.buffer
+			: undefined;
+	}
 }
diff --git a/lib/vscode/src/vs/server/node/server.ts b/lib/vscode/src/vs/server/node/server.ts
index a44cbd0b..cf7faf37 100644
--- a/lib/vscode/src/vs/server/node/server.ts
+++ b/lib/vscode/src/vs/server/node/server.ts
@@ -1,4 +1,3 @@
-import { field } from '@coder/logger';
 import * as fs from 'fs';
 import * as net from 'net';
 import { release } from 'os';
@@ -123,14 +122,11 @@ export class Vscode {
 			reconnection: query.reconnection === 'true',
 			skipWebSocketFrames: query.skipWebSocketFrames === 'true',
 			permessageDeflate,
-			recordInflateBytes: permessageDeflate,
 		});
 		try {
 			await this.connect(await protocol.handshake(), protocol);
 		} catch (error) {
-			protocol.sendMessage({ type: 'error', reason: error.message });
-			protocol.dispose();
-			protocol.getSocket().dispose();
+			protocol.destroy(error.message);
 		}
 		return true;
 	}
@@ -143,56 +139,61 @@ export class Vscode {
 		switch (message.desiredConnectionType) {
 			case ConnectionType.ExtensionHost:
 			case ConnectionType.Management:
+				// Initialize connection map for this type of connection.
 				if (!this.connections.has(message.desiredConnectionType)) {
 					this.connections.set(message.desiredConnectionType, new Map());
 				}
 				const connections = this.connections.get(message.desiredConnectionType)!;
 
-				const ok = async () => {
-					return message.desiredConnectionType === ConnectionType.ExtensionHost
-						? { debugPort: await this.getDebugPort() }
-						: { type: 'ok' };
-				};
-
 				const token = protocol.options.reconnectionToken;
-				if (protocol.options.reconnection && connections.has(token)) {
-					protocol.sendMessage(await ok());
-					const buffer = protocol.readEntireBuffer();
-					protocol.dispose();
-					return connections.get(token)!.reconnect(protocol.getSocket(), buffer);
-				} else if (protocol.options.reconnection || connections.has(token)) {
-					throw new Error(protocol.options.reconnection
-						? 'Unrecognized reconnection token'
-						: 'Duplicate reconnection token'
-					);
+				let connection = connections.get(token);
+				if (protocol.options.reconnection && connection) {
+					return connection.reconnect(protocol);
 				}
 
-				logger.debug('New connection', field('token', token));
-				protocol.sendMessage(await ok());
+				// This probably means the process restarted so the session was lost
+				// while the browser remained open.
+				if (protocol.options.reconnection) {
+					throw new Error(`Unable to reconnect; session no longer exists (${token})`);
+				}
 
-				let connection: Connection;
+				// This will probably never happen outside a chance collision.
+				if (connection) {
+					throw new Error('Unable to connect; token is already in use');
+				}
+
+				// Now that the initial exchange has completed we can create the actual
+				// connection on top of the protocol then send it to whatever uses it.
 				if (message.desiredConnectionType === ConnectionType.Management) {
-					connection = new ManagementConnection(protocol, token);
+					// The management connection is used by firing onDidClientConnect
+					// which makes the IPC server become aware of the connection.
+					connection = new ManagementConnection(protocol);
 					this._onDidClientConnect.fire({
-						protocol, onDidClientDisconnect: connection.onClose,
+						protocol,
+						onDidClientDisconnect: connection.onClose,
 					});
 				} else {
-					const buffer = protocol.readEntireBuffer();
+					// The extension host connection is used by spawning an extension host
+					// and passing the socket into it.
 					connection = new ExtensionHostConnection(
-						message.args ? message.args.language : 'en',
-						protocol, buffer, token,
+						protocol,
+						{
+							language: 'en',
+							...message.args,
+						},
 						this.services.get(IEnvironmentService) as INativeEnvironmentService,
 					);
 				}
 				connections.set(token, connection);
-				connection.onClose(() => {
-					logger.debug('Connection closed', field('token', token));
-					connections.delete(token);
-				});
+				connection.onClose(() => connections.delete(token));
+
 				this.disposeOldOfflineConnections(connections);
+				logger.debug(`${connections.size} active ${connection.name} connection(s)`);
 				break;
-			case ConnectionType.Tunnel: return protocol.tunnel();
-			default: throw new Error('Unrecognized connection type');
+			case ConnectionType.Tunnel:
+				return protocol.tunnel();
+			default:
+				throw new Error(`Unrecognized connection type ${message.desiredConnectionType}`);
 		}
 	}
 
@@ -200,8 +201,7 @@ export class Vscode {
 		const offline = Array.from(connections.values())
 			.filter((connection) => typeof connection.offline !== 'undefined');
 		for (let i = 0, max = offline.length - this.maxExtraOfflineConnections; i < max; ++i) {
-			logger.debug('Disposing offline connection', field('token', offline[i].token));
-			offline[i].dispose();
+			offline[i].dispose('old');
 		}
 	}
 
@@ -295,11 +295,4 @@ export class Vscode {
 			});
 		});
 	}
-
-	/**
-	 * TODO: implement.
-	 */
-	private async getDebugPort(): Promise<number | undefined> {
-		return undefined;
-	}
 }
diff --git a/src/node/routes/index.ts b/src/node/routes/index.ts
index a4348952..5bc9f10b 100644
--- a/src/node/routes/index.ts
+++ b/src/node/routes/index.ts
@@ -41,7 +41,7 @@ export const register = async (
         if (error) {
           return reject(error)
         }
-        logger.trace(plural(count, `${count} active connection`))
+        logger.debug(plural(count, `${count} active connection`))
         resolve(count > 0)
       })
     })