Code:

using System;
using System.Collections.Generic;
using System.Collections;
using System.Text;
using System.Net;
using System.Net.Sockets;
using System.Threading;
using System.Windows.Forms;

namespace WindowsApplication8
{
    class Telnet
    {

        public int XXX = 1;

        public Telnet()
        {
            connect();
        }
        #region Deklaracije
        Char IAC = Convert.ToChar(255);
        Char DO = Convert.ToChar(253);
        Char DONT = Convert.ToChar(254);
        Char WILL = Convert.ToChar(251);
        Char WONT = Convert.ToChar(252);
        Char SB = Convert.ToChar(250);
        Char SE = Convert.ToChar(240);
        const Char IS = '0';
        const Char SEND = '1';
        const Char INFO = '2';
        const Char VAR = '0';
        const Char VALUE = '1';
        const Char ESC = '2';
        const Char USERVAR = '3';
        string m_strResp;

        private ArrayList m_ListOptions = new ArrayList();
        private IPEndPoint iep;
        private AsyncCallback callbackProc;
        private string address;
        private int port;
        private Socket s;
        Byte[] m_byBuff = new Byte[32767];
        #endregion

        private void connect()
        {
            address = "sezampro.yu";
            port = 23;

            IPHostEntry IPHost = Dns.Resolve(address);
            string[] aliases = IPHost.Aliases;
            IPAddress[] addr = IPHost.AddressList;

            try
            {
                // Create New Socket 
                s = new Socket(AddressFamily.InterNetwork, SocketType.Stream, ProtocolType.Tcp);
                // Create New EndPoint
                iep = new IPEndPoint(addr[0], port);
                // This is a non blocking IO
                s.Blocking = true;
                // Assign Callback function to read from Asyncronous Socket
                callbackProc = new AsyncCallback(ConnectCallback);
                // Begin Asyncronous Connection
                s.BeginConnect(iep, callbackProc, s);

            }
            catch (Exception eeeee)
            {
                MessageBox.Show(eeeee.Message, "Application Error!!!", MessageBoxButtons.OK, MessageBoxIcon.Stop);
                Application.Exit();
            }
        }

        public void ConnectCallback(IAsyncResult ar)
        {
            try
            {
                // Get The connection socket from the callback
                Socket sock1 = (Socket)ar.AsyncState;
                if (sock1.Connected)
                {
                    // Define a new Callback to read the data 
                    AsyncCallback recieveData = new AsyncCallback(OnRecievedData);
                    // Begin reading data asyncronously
                    sock1.BeginReceive(m_byBuff, 0, m_byBuff.Length, SocketFlags.None, recieveData, sock1);
                }
            }
            catch (Exception ex)
            {
                MessageBox.Show("Setup Recieve callbackProc failed!");
            }
        }

        public void OnRecievedData(IAsyncResult ar)
        {
            // Get The connection socket from the callback
            Socket sock = (Socket)ar.AsyncState;
            // Get The data , if any
            int nBytesRec = sock.EndReceive(ar);
            if (nBytesRec > 0)
            {
                string sRecieved = Encoding.ASCII.GetString(m_byBuff, 0, nBytesRec);
                string m_strLine = "";
                for (int i = 0; i < nBytesRec; i++)
                {
                    Char ch = Convert.ToChar(m_byBuff[i]);
                    switch (ch)
                    {
                        case '\r':
                            m_strLine += Convert.ToString("\r\n");
                            break;
                        case '\n':
                            break;
                        default:
                            m_strLine += Convert.ToString(ch);
                            break;
                    }
                }
                try
                {
                    int strLinelen = m_strLine.Length;
                    if (strLinelen == 0)
                    {
                        m_strLine = Convert.ToString("\r\n");
                    }

                    Byte[] mToProcess = new Byte[strLinelen];
                    for (int i = 0; i < strLinelen; i++)
                        mToProcess[i] = Convert.ToByte(m_strLine[i]);
                    // Process the incoming data
                    string mOutText = ProcessOptions(mToProcess);
                    if (mOutText != "")
                    {
                        parsirajTekst(mOutText);
                        //MessageBox.Show(mOutText);
                        
                    }

                    // Respond to any incoming commands
                    RespondToOptions();
                }
                catch (Exception ex)
                {
                    Object x = this;
                    MessageBox.Show(ex.Message, "Information!");
                }
            }
            else
            {
                // If no data was recieved then the connection is probably dead
                Console.WriteLine("Disconnected", sock.RemoteEndPoint);
                sock.Shutdown(SocketShutdown.Both);
                sock.Close();
                Application.Exit();
            }
        }

        private void parsirajTekst(string s)
        {
            char[] newLineSplitter = { '\n' };
            char[] spaceSplitter = { ' ' };
            char[] xSplitter = { ' ', 'x' };

            string[] line = s.Split(newLineSplitter, StringSplitOptions.RemoveEmptyEntries);

            foreach (string l in line)
            {
                if (l.StartsWith("john.doe"))
                {
                    XXX = 2;
                }
            }
        }

        private string ProcessOptions(byte[] m_strLineToProcess)
        {
            string m_DISPLAYTEXT = "";
            string m_strTemp = "";
            string m_strOption = "";
            string m_strNormalText = "";
            bool bScanDone = false;
            int ndx = 0;
            int ldx = 0;
            char ch;
            try
            {
                for (int i = 0; i < m_strLineToProcess.Length; i++)
                {
                    Char ss = Convert.ToChar(m_strLineToProcess[i]);
                    m_strTemp = m_strTemp + Convert.ToString(ss);
                }

                while (bScanDone != true)
                {
                    int lensmk = m_strTemp.Length;
                    ndx = m_strTemp.IndexOf(Convert.ToString(IAC));
                    if (ndx > lensmk)
                        ndx = m_strTemp.Length;

                    if (ndx != -1)
                    {
                        m_DISPLAYTEXT += m_strTemp.Substring(0, ndx);
                        ch = m_strTemp[ndx + 1];
                        if (ch == DO || ch == DONT || ch == WILL || ch == WONT)
                        {
                            m_strOption = m_strTemp.Substring(ndx, 3);
                            string txt = m_strTemp.Substring(ndx + 3);
                            m_DISPLAYTEXT += m_strTemp.Substring(0, ndx);
                            m_ListOptions.Add(m_strOption);
                            m_strTemp = txt;
                        }
                        else
                            if (ch == IAC)
                            {
                                m_DISPLAYTEXT = m_strTemp.Substring(0, ndx);
                                m_strTemp = m_strTemp.Substring(ndx + 1);
                            }
                            else
                                if (ch == SB)
                                {
                                    m_DISPLAYTEXT = m_strTemp.Substring(0, ndx);
                                    ldx = m_strTemp.IndexOf(Convert.ToString(SE));
                                    m_strOption = m_strTemp.Substring(ndx, ldx);
                                    m_ListOptions.Add(m_strOption);
                                    m_strTemp = m_strTemp.Substring(ldx);
                                }
                    }
                    else
                    {
                        m_DISPLAYTEXT = m_DISPLAYTEXT + m_strTemp;
                        bScanDone = true;
                    }
                }
                m_strNormalText = m_DISPLAYTEXT;
            }
            catch (Exception eP)
            {
                MessageBox.Show(eP.Message, "Application Error!!!", MessageBoxButtons.OK, MessageBoxIcon.Stop);
                Application.Exit();
            }
            return m_strNormalText;
        }

        public void DispatchMessage(string strText)
        {
            try
            {
                Byte[] smk = new Byte[strText.Length];
                for (int i = 0; i < strText.Length; i++)
                {
                    Byte ss = Convert.ToByte(strText[i]);
                    smk[i] = ss;
                }

                IAsyncResult ar2 = s.BeginSend(smk, 0, smk.Length, SocketFlags.None, callbackProc, s);
                s.EndSend(ar2);
            }
            catch (Exception ers)
            {
                MessageBox.Show("ERROR IN RESPOND OPTIONS");
            }
        }

        void RespondToOptions()
        {
            try
            {
                string strOption;
                for (int i = 0; i < m_ListOptions.Count; i++)
                {
                    strOption = (string)m_ListOptions[i];
                    ArrangeReply(strOption);
                }
                DispatchMessage(m_strResp);
                m_strResp = "";
                m_ListOptions.Clear();
            }
            catch (Exception ers)
            {
                MessageBox.Show("ERROR IN RESPOND OPTIONS");
            }
        }

        void ArrangeReply(string strOption)
        {
            try
            {

                Char Verb;
                Char Option;
                Char Modifier;
                Char ch;
                bool bDefined = false;

                if (strOption.Length < 3) return;

                Verb = strOption[1];
                Option = strOption[2];

                if (Option == 1 || Option == 3)
                {
                    //                case 1:    // Echo
                    //                case 3: // Suppress Go-Ahead
                    bDefined = true;
                    //                    break;
                }

                m_strResp += IAC;

                if (bDefined == true)
                {
                    if (Verb == DO)
                    {
                        //                    case DO:
                        ch = WILL;
                        m_strResp += ch;
                        m_strResp += Option;
                        //                        break;
                    }
                    if (Verb == DONT)
                    {
                        ch = WONT;
                        m_strResp += ch;
                        m_strResp += Option;
                        //        break;
                    }
                    if (Verb == WILL)
                    {
                        ch = DO;
                        m_strResp += ch;
                        m_strResp += Option;
                        //break;
                    }
                    if (Verb == WONT)
                    {
                        ch = DONT;
                        m_strResp += ch;
                        m_strResp += Option;
                        //    break;
                    }
                    if (Verb == SB)
                    {
                        Modifier = strOption[3];
                        if (Modifier == SEND)
                        {
                            ch = SB;
                            m_strResp += ch;
                            m_strResp += Option;
                            m_strResp += IS;
                            m_strResp += IAC;
                            m_strResp += SE;
                        }
                        //                        break;
                    }
                }
                else
                {
                    //                switch(Verb)
                    //                {
                    if (Verb == DO)
                    {
                        ch = WONT;
                        m_strResp += ch;
                        m_strResp += Option;
                        //    break;
                    }
                    if (Verb == DONT)
                    {
                        ch = WONT;
                        m_strResp += ch;
                        m_strResp += Option;
                        //    break;
                    }
                    if (Verb == WILL)
                    {
                        ch = DONT;
                        m_strResp += ch;
                        m_strResp += Option;
                        //    break;
                    }
                    if (Verb == WONT)
                    {
                        ch = DONT;
                        m_strResp += ch;
                        m_strResp += Option;
                        //        break;
                    }
                }
            }
            catch (Exception eeeee)
            {
                MessageBox.Show(eeeee.Message, "Application Error!!!", MessageBoxButtons.OK, MessageBoxIcon.Stop);
                Application.Exit();
            }

        }

    }
}

Code:

private Telnet t;

        public Form1()
        {
            InitializeComponent();
            t = new Telnet();
        }

        private void button1_Click(object sender, EventArgs e)
        {
            t.DispatchMessage("john.doe");
            t.DispatchMessage("\r\n");
            MessageBox.Show(t.XXX.ToString());
        }