<PAGE>
 
                                                                   EXHIBIT 10.59
                               CARRIER AGREEMENT

                    T E R M S   A N D   C O N D I T I O N S
 
  This Carrier Agreement (the "Agreement"), is between MCI TELECOMMUNICATIONS
CORPORATION ("MCI"), and CONCENTRIC NETWORK CORPORATION ("Customer"), a resale
common carrier subject to the Communications Act of 1934, as amended.

1.   Scope of Agreement.
     ------------------ 

     1.1   Carrier to Carrier.  MCI shall provide to Customer certain specified
           ------------------                                                  
     domestic interstate service(s), international services, and intrastate
     common carriage services.  For domestic interstate and international
     services, this Agreement incorporates by reference the terms of MCI Tariff
     FCC No. 1 on file with the Federal Communications Commission ("FCC"),
     together with any successor to such tariff ("Tariff"), which may be
     modified from time to time by MCI in accordance with law and thereby affect
     the services furnished Customer under this Agreement, except that the
     following terms and conditions shall supplement or, to the extent
     inconsistent, supersede Tariff terms and conditions.  Subject to amendment
     by the parties, the terms and conditions of this Agreement shall remain in
     effect throughout the Service Term (as defined herein).  For intrastate
     services, this Agreement incorporates by reference each applicable state
     tariff filed by MCI, which may be modified by MCI from time to time, and
     thereby affect the service(s) furnished to Customer.  This Agreement is
     entered pursuant to Section 211(a) of the Communications Act of 1934, as
     amended.

     1.2   Definitions.  Capitalized terms not otherwise defined in this
           -----------
     Agreement shall have the meanings assigned to them in the Tariff.

2.   Term.
     ---- 

     2.1   Service Term.  Following execution of this Agreement by both
           ------------                                                
     parties in accordance with paragraph 19 herein, the term of this Agreement
     ("Service Term") shall begin effective as of  August 1, 1998 ("Effective
     Date") and will continue for a period of twenty-four (24) months therefrom.

     2.2   Expiration of Service Term.  Unless extended pursuant to
           --------------------------                              
     Paragraph 2.3 herein, this Agreement shall automatically terminate upon
     expiration of the Service Term, and Customer shall be fully subject to all
     the terms and conditions, including standard tariff rates, set forth in the
     Tariff and respective state tariffs for MCI Services received by Customer
     after such expiration.

     2.3   Extension of Service Term.  Upon expiration of the Service Term,
           -------------------------                                       
     Customer shall have the option to renew the Agreement on a month-to-month
     basis for up to a period of twelve (12) months, provided Customer has
     satisfied its Monthly Commitment pursuant to Paragraph 3 herein.  After the
     twelfth month following expiration of the Agreement, and upon no less than
     thirty (30) days written notice from Customer to MCI before the end of the
     twelfth month,  Customer shall notify MCI of its desire to renew the
     Agreement for an additional one-year term (the "Notification Date").  MCI
     may refuse to renew the Agreement for an additional one year term by giving
     Customer written notice within thirty (30) days of the Notification Date.

________________
[*] Certain information in this exhibit has been omitted and filed separately 
with the Securities and Exchange Commission.  Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL
<PAGE>
 
3.   Monthly Usage; Monthly Commitment.
     --------------------------------- 

     3.1  Monthly Usage.   As used herein, "Monthly Usage" shall mean the amount
          -------------                                                        
     of Customer's usage of MCI Services during each monthly billing period of
     the Service Term, calculated in accordance with the following:
 
          3.1.1   Domestic interstate and international MCI services
          (hereinafter "Interstate Services" and "International Services") shall
          be calculated at the rates set forth in Attachment 1, after
          application of all discounts and credits;

          3.1.2   Domestic intrastate MCI services shall be calculated at
          standard tariff rates (hereinafter "Intrastate Services'); and

          3.1.3   Monthly Usage excludes: (i) charges for tariffed MCI products
          and services not set forth herein; (ii) charges for any non-Tariffed
          products or services; (iii) access or egress (or related) charges,
          including without limitation, tariffed access charges and access
          charges imposed by third parties, except to the extent any rates
          herein expressly include such charges; (iv) standard Tariffed non-
          recurring charges; (v) installation charges; (vi) charges for
          equipment and collocation; (vii) taxes, tax-related surcharges or tax-
          like surcharges; (vii) and other MCI tariffed charges or surcharges,
          including without limitation, Universal Service fund charges,
          Presubscribed Interexchange Carrier charges, National Access Fees and
          payphone use charges; any of which, to the extent applicable, are
          payable by Customer in addition to Monthly Usage charges.

          3.1.4   "MCI Services" shall include only those Interstate Services,
          International Services and Intrastate Services provided by MCI
          pursuant to the terms of this Agreement and specifically described
          herein.

     3.2  Monthly Commitment.  During each monthly billing period of the Service
          ------------------                                                    
     Term, Customer's Monthly Usage shall equal or exceed the following:
     ("Monthly Commitment")

          Months           Monthly Commitment
          ------           ------------------
          1 through 24     $500,000

          3.2.1   Customer may satisfy up to thirty percent (30%) of its Monthly
     Commitment through the use of MCI provided Local Loop revenue.

          3.2.2   Revenue from the IOC's associated with MCI OC-3 or OC-12 point
     to point Private Line circuits provided to Customer under this Agreement
     will count towards satisfying Customer's Monthly Commitment.

     3.3  Underutilization.  During any month of the Service Term in which
          ----------------
     Customer's Monthly Usage is less than the Monthly Commitment, for that
     month, Customer will pay, in addition to all other applicable charges,
     Customer's Usage Charges (as hereinafter defined), plus an underutilization
     charge (which Customer agrees is reasonable) equal to the difference
     between Customer's Usage Charges and the Monthly Commitment
     ("Underutilization Charge"). In no event, however, shall Customer be
     obligated pursuant to this Paragraph to pay more in any month than
     Customer's Monthly Commitment for that month.

                               MCI CONFIDENTIAL

                                      -2-
<PAGE>
 
4.   Rates and Additional Terms.
     -------------------------- 

     4.1  Rates.  Customer shall pay the rates and charges for MCI Services set
          -----
     forth in the Attachments and Exhibits to this Agreement and agrees to the
     additional terms and conditions set forth in such Attachments and Exhibits.
     Except as expressly provided to the contrary, the rates set forth in the
     Attachments and Exhibits are in lieu of, and not in addition to, any other
     discount, promotion, and/or credit (tariffed or otherwise). The rates for
     all other MCI products and services not explicitly referenced within this
     Agreement shall be governed by the applicable MCI tariff.

          The rates set forth in this Agreement do not include the following:
     charges for MCI Services other than those set forth herein; non-Tariffed
     products; access or egress (or related) charges, including without
     limitation, tariffed access charges and access charges imposed by third
     parties; standard Tariffed non-recurring charges; installation; taxes, tax-
     related surcharges, or tax-like surcharges; and other tariffed charges,
     including without limitation, universal service fund charges, presubscribed
     interexchange carrier charges, national access fees and payphone use
     charges; which, to the extent applicable, are additional. Except as
     expressly provided to the contrary, the rates set forth herein are in lieu
     of, and not in addition to, any other discounts, promotions, and/or credits
     (tariffed or otherwise).

     4.2  Program Review.  MCI retains the right to review and revise the
          --------------      
     rates, terms and/or composition of the MCI Prism I and MCI Toll Free DAL
     LEC Groups provided herein, including without limitation, the rates and
     charges, credits and discounts and/or the composition of the aforementioned
     LEC Groups set forth in the Attachments and Exhibits to this Agreement,
     upon not less than thirty (30) days prior written notice to Customer,
     stating the effective date and terms of the revision, in accordance with
     the following ("Program Review"):

          4.2.1  If Customer demonstrates to MCI that the Program Review results
          in (i) an average rate increase, for an individual MCI product, of
          more than [*]* above the rates in effect immediately prior to the
          effectiveness of the Program Review changes, or (ii) a rate increase
          to any LEC Group that affects more than [*] of Customer's total MCI
          Prisim I or MCI Toll Free DAL traffic measured at the rates in effect
          at the time of the adjustment with each MCI product calculated
          independently, Customer will have the option to move traffic affected
          by the Program Review to another carrier.

          4.2.2  If Customer elects to move such traffic to another carrier, MCI
          will reduce Customer's Monthly Commitment by an amount equal to the
          "Monthly Commitment Adjustment." The Monthly Commitment Adjustment
          shall be calculated by obtaining Customer's monthly average usage of
          the traffic affected by the Program Review during the three (3)
          consecutive months prior to the time of the adjustment or, if Customer
          has less than three (3) consecutive months usage, during the period of
          Customer's actual usage prior to the time of the adjustment. The
          Monthly Commitment Adjustment shall be measured at the rates in effect
          at the time of the adjustment and [*].

          4.2.3  If the Monthly Commitment Adjustment results in a decrease in
          Customer's Monthly Commitment of [*], the parties may elect to
          negotiate a new agreement or either party may terminate this Agreement
          without liability by providing the other party with no fewer than
          thirty (30) day prior written notice and such termination shall not be
          considered a breach of this Agreement.

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -3-
<PAGE>
 
     4.3  MCI International Rate Review.  MCI may, at its option, revise the
          -----------------------------                                     
     rates for any International Services contained herein by providing written
     notice to Customer given not fewer than thirty (30) days prior to the
     effective date of the rate revision ("Rate Review") in accordance with the
     following:

          4.3.1  If Customer demonstrates to MCI that the International Rate
          Review results in (i) a rate increase to any country [*] the rates in
          effect at the time of the adjustment, or (ii) a rate increase that [*]
          measured at the rates in effect at the time of the adjustment,
          Customer will have the option to cease traffic to that country and
          move such traffic to another carrier.

          4.3.2  If, pursuant to Paragraph 4.3.1 above, Customer elects to move
          such traffic to another carrier, MCI will reduce Customer's Monthly
          Commitment by an amount equal to the "Monthly Commitment Adjustment."
          The Monthly Commitment Adjustment shall be calculated by obtaining
          Customer's monthly average usage of International Prism I,
          International Toll Free DAL and/or Canadian Toll Free Service to the
          country in which Customer elects to move traffic during the three (3)
          consecutive months prior to the time of the adjustment or, if Customer
          has less than three (3) consecutive months usage, during the period of
          Customer's actual usage prior to the time of the adjustment. The
          Monthly Commitment Adjustment shall be measured at the rates in effect
          at the time of the adjustment and [*][*].

     4.4  Service Limitations.  The following provisions are applicable to
          -------------------                                             
          Customer's use of MCI Service, in addition to all applicable
          provisions of the Tariff governing the use and misuse of MCI Service.
          If MCI detects the use of MCI Services for international call-back
          offerings using uncompleted call signaling, or detects the use of
          "polling" technique by Customer for signaling, setup or completion of
          calls, MCI may, in its sole judgment and determination, and subject to
          and without limitation upon the Tariff, block the applicable calls, or
          block all service to the affected country or countries.  MCI may, in
          its independent judgment, immediately terminate this Agreement or any
          affected services herein, without liability, if the FCC, any other
          agency or body of the federal government, any agency or body of any
          state or local government, any state or federal court, or any foreign
          PTT, international authority, government, or regulatory body, or any
          International Telecommunications Operator ("ITO") (each a "Regulatory
          Entity"), takes action, or issues an order, ruling or judgment, or
          threatens to do so pending corrective action by MCI, which has the
          effect of preventing or impeding MCI from performing any material
          obligation in this Agreement.  No MCI action under this Paragraph
          resulting from the action or threatened action of a Regulatory Entity
          as described above shall be considered a breach of this Agreement by
          MCI.

     4.5  Payphone Surcharge.  Pursuant to Section 276 of the Telecommunications
          ------------------
     Act of 1996, and the regulations implementing Section 276, the FCC has
     prescribed regulations that establish a compensation plan to ensure that
     all payphone service providers are compensated for calls from a payphone
     ("Payphone Compensation Law"). MCI reserves the right to adjust its rates,
     including the rates herein, or to impose additional charges or surcharges
     in order to recover amounts MCI is required to pay to payphone service
     providers pursuant to the Payphone Compensation Law, and any costs incurred
     by MCI in connection with the Payphone Compensation Law.

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -4-
<PAGE>
 
5.   Security.
     -------- 

     5.1  Alternative or Additional Security.  Nothing contained herein shall
          ----------------------------------                           
     limit or be interpreted to limit MCI's rights as provided for in Section
     B-7.04 of the Tariff to require, in MCI's sole discretion, alternative or
     additional security from Customer. Customer's failure or refusal to comply
     with such requirement upon MCI's request therefor may result in the
     cancellation of this Agreement and Customer's service for cause pursuant to
     Section B-11.01 of the Tariff. The security arrangements provided for
     hereunder shall survive the expiration of the Service Term, as defined
     herein, and shall remain in effect so long as Customer uses MCI Services or
     has any outstanding balance due for use of MCI Services.

     5.2  Letter of Credit.  Consistent with Section B-7.04 of the Tariff and in
          ----------------                                                      
     specific implementation of such Tariff provision, Customer shall be
     required, as a condition precedent to receipt of MCI Services hereunder, to
     provide within ten (10) days of executing this Agreement a security deposit
     or unconditional and irrevocable stand-by letter of credit in a form and
     from a bank acceptable to MCI in an amount equal to the greater of: [*]*.
     MCI shall not accept any orders from Customer for MCI Services until the
     security deposit or letter of credit described in  this Paragraph 5.2 has
     been provided by Customer.

6.   Payment.
     --------

     6.1  Payment is due on or before 5:00 p.m. (eastern standard time) of the
     third day of each month for the prior calendar month's MCI consolidated
     invoice, with the amount due based on an MCI estimate or, if MCI does not
     provide Customer with an estimate before the date on which payment is due,
     then Customer's payment shall be equal to one hundred percent (100%) of the
     amount of Customer's most recent MCI consolidated invoice, plus any
     shortfall due thereunder.  If, at the beginning of the Service Term,
     Customer has not received an estimated amount from MCI or any prior MCI
     consolidated invoice at the time payment is due, then Customer shall pay an
     amount equal to Customer's reasonable estimate of Customer's usage of MCI
     Services during the initial month.  If Customer's estimated payment is less
     than the amount of the prior calendar month's MCI consolidated invoice
     ("shortfall"), then Customer shall pay the shortfall amount within thirty
     days (30) days from the original payment due date of the prior calendar
     month's MCI consolidated invoice.  If Customer's estimated payment is
     greater than the amount of the prior calendar month's MCI consolidated
     invoice ("excess"), then Customer shall deduct the excess amount from the
     following month's estimated payment.

     6.2  Customer's failure to pay either the amount due or any shortfall in
     accordance with Paragraph 6.1 above may result in (i) the exercise of MCI's
     rights under the security provisions contained in Paragraphs 5.1 and 5.2
     immediately above; (ii) the exercise of MCI's rights under Tariff Section
     B-11.01 or Paragraph 8.2.3 hereof with respect to termination of this
     Agreement; and/or (iii) MCI's application of any amount owed by MCI to
     Customer, whether under this Agreement or otherwise, to satisfy all or a
     portion of the amounts owed by Customer under this Paragraph 6.

     6.3  Billing Disputes.  If Customer disputes in good faith any portion of a
          ----------------                                                     
     monthly invoice, Customer may either pay the disputed amount in protest or
     withhold the disputed amount from the payment otherwise due for such month,
     provided Customer pays the balance of such invoice to MCI when due and
     provides written notice and Complete Documentation of such claim to MCI at
     the time that Customer pays the invoice on which such charge appears.
     Complete Documentation shall mean documents which identify the charge(s)
     disputed by the Customer (including corporate id, service location and
     circuit level detail), the

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -5-
<PAGE>
 
     reason for such dispute, and the amount being withheld by Customer pending
     resolution of such dispute. In addition, Customer must provide to MCI
     additional information not later than five (5) business days following any
     MCI request for additional information. If MCI determines that the disputed
     portion is a valid charge, Customer shall, within five (5) business days of
     such determination, remit such amount to MCI. The Customer shall be
     responsible for any late payment or other charges which may be applicable
     to such withheld payment. If MCI determines that any disputed charge is an
     invalid charge, MCI shall credit Customer's invoice for such amount in the
     next appropriate billing cycle.
 
7.   Dispute Resolution.  Any dispute arising out of or related to this
     ------------------                                                
     Agreement, including but not limited to tort claims, shall be submitted to
     J.A.M.S./ENDISPUTE for final and binding arbitration pursuant to the
     J.A.M.S./ENDISPUTE Arbitration Rules and Procedures in effect on the date
     of commencement of arbitration, and as modified by this Paragraph. The
     arbitration shall be conducted in accordance with the United States
     Arbitration Act, 9 U.S.C. 1 et seq. ("USAA"), notwithstanding any choice of
     law provision in this Agreement.  Each party shall bear the fees and costs
     it incurs in preparing and presenting its own case. The parties agree that
     Washington, D.C., or Los Angeles, CA, at the option of the party filing
     such claim, shall be the location for the arbitration hearing.  Any
     controversy over whether an issue is arbitrable shall be determined by the
     arbitrator. The arbitrator shall have no authority to award punitive or
     exemplary damages. The award may be confirmed and enforced in any court of
     competent jurisdiction. All post-award proceedings shall be governed by the
     USAA.  Neither party may seek injunctive relief of any kind prior to the
     confirmation of an arbitration award, except as expressly provided herein.
 
8.   Termination.
     ----------- 

     8.1  Termination for Insolvency.  If Customer becomes or is declared
          --------------------------                                     
     insolvent or bankrupt, is the subject of any proceedings related to its
     liquidation, insolvency or for the appointment of a receiver or similar
     officer for it, makes an assignment for the benefit of all or substantially
     all of its creditors, or enters into an agreement for the composition,
     extension, or readjustment of all or substantially all of its obligations,
     MCI may, upon ten (10) days prior written notice, terminate this Agreement
     without liability as of the date specified in such notice.

     8.2  Termination  by MCI.  In addition to the cancellation rights set
          -------------------                                             
     forth in Section B-11 of the Tariff, MCI may, without incurring any
     liability, terminate this Agreement in whole or in part, as follows:

          8.2.1  MCI may terminate this Agreement, without termination liability
          by Customer, if Customer experiences a change in ownership or control
          or other transaction described in Paragraph 15.2 hereof, following the
          notice provided therein.

          8.2.2  If a Regulatory Entity takes or threatens action which give
          rise to an MCI right to terminate service as described in Paragraph
          4.4 hereof, or if MCI determines, in its sole discretion, that
          continued provision of MCI Service would contravene any local, state,
          national or international regulation, law, tariff or other legal
          restriction, MCI may immediately terminate this Agreement or the
          affected services, to be followed promptly by written notice to
          Customer.  If Customer's actions were a direct or primary contributing
          cause of a Regulatory Entity's actions resulting in or otherwise
          directly the cause of MCI's termination of service under this
          Paragraph, such termination shall be for cause.

          8.2.3  MCI may terminate this Agreement for cause if Customer fails to
          meet any payment obligation hereunder or fails to provide any
          requested security deposit or letter of credit and such failure is not
          cured within three (3) business days after Customer's receipt of
          written notice from MCI notifying Customer of such failure.

                               MCI CONFIDENTIAL

                                      -6-
<PAGE>
 
          8.2.4  MCI may terminate this Agreement for cause upon thirty (30)
          days prior written notice, if Customer violates any applicable law,
          order or regulation, including without limitation, all rules
          pertaining to the sale or delivery of Customer's service(s) to end
          users or the sale or delivery of operator services to detention
          facilities, provided that MCI may immediately suspend service to
          customer in advance of such termination date if reasonably necessary
          in MCI's determination to prevent or limit potential loss or liability
          to MCI.

          8.2.5  MCI may terminate this Agreement for cause upon thirty (30)
          days prior written notice if Customer fails to abide by the
          requirements in Paragraph 9 (Nondisclosure), or Paragraph 17.1 (use of
          MCI's name).

          8.2.6  MCI may terminate this Agreement for cause if Customer shall
          have failed to meet its Monthly Commitment for three (3) consecutive
          monthly billing periods and fails to meet the Monthly Commitment for
          the full monthly billing period following Customer's receipt of
          written notice of termination under this Paragraph.

          8.2.7  MCI may terminate this Agreement for cause upon thirty (30)
          days written notice to Customer if Customer fails to comply with any
          other material term of this Agreement and Customer does not cure such
          failure within such 30 day period.

     8.3  Termination by Customer.
          ----------------------- 

          8.3.1  In addition to the cancellation rights set forth in Section B-5
          of the Tariff, Customer may terminate this Agreement for cause,
          without incurring any liability except for payment of services
          rendered, upon thirty (30) days written notice to MCI if MCI fails to
          comply with a material term of this Agreement and does not cure such
          failure with such 30-day period.

     8.4. Transition Period.  If MCI terminates the Agreement pursuant to
          -----------------                                              
     Paragraph 8.2.1, 8.2.2, or 8.2.6, MCI shall provide Customer with a three
     month period, beginning on the date Customer receives written termination
     notice,  to transition the MCI Services ("Transition Period"), provided
     that, if MCI reasonably determines that the continued provision of MCI
     Services during the Transition Period would expose MCI to significant legal
     or financial liability or threaten MCI's good will and reputation, MCI may
     restrict, suspend or terminate MCI Services prior to the end of the
     Transition Period to the extent necessary to avoid such result.   During
     the Transition Period Customer shall be subject to the rates, terms and
     conditions set forth in the Agreement provided, however, that
     underutilization charges shall be waived and  MCI will not accept any
     orders for new MCI Services during such period.  Upon expiration of the
     Transition Period, Customer shall be fully subject to all the terms and
     conditions set forth in the Tariff and respective state tariffs for MCI
     Services received by Customer after such expiration, including without
     limitation standard Tariff rates and charges.

     8.5. Termination Liability.  If this Agreement is terminated before
          ---------------------                                         
     the expiration of the Service Term, (i) by Customer other than as provided
     in Paragraph 8.3; or (ii) by MCI for cause in accordance with Paragraph 8.2
     above (other than Paragraph 8.2.1), or for cause pursuant to the Tariff,
     then Customer shall pay MCI, within thirty (30) days of the effective date
     of such termination, an amount equal [*]*.  Such payment shall be in
     addition to all unsatisfied payment obligations incurred by Customer under
     this Agreement through such termination date.  Customer shall also repay
     MCI the credits received pursuant to the Attachment(s) and Exhibit(s) of
     this Agreement, other than usage-based credits measured by intrastate usage
     of MCI Services.

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -7-
<PAGE>
 
     Charges payable by Customer under this Paragraph 8.5 are not exclusive of
     any other rights or remedies to which MCI may be entitled with respect to
     any breach or failure by Customer.

9.   Confidential Information; Nondisclosure.
     --------------------------------------- 

     9.1  Confidential Information.  As used in this Agreement, "Confidential
          ------------------------
     Information" shall mean any of the terms and conditions set forth in this
     Agreement, any information related to the performance of or subject matter
     of this Agreement, or any information and materials that may be reasonably
     understood (from legends, the nature of such information or the
     circumstances of such information's disclosure) to be confidential and/or
     proprietary to the party to this Agreement disclosing such information
     ("Discloser") or to third parties to whom Discloser owes a duty of
     nondisclosure, which is disclosed to the other party to this Agreement
     ("Recipient"). Confidential Information shall include any product
     descriptions or documentation, procedures, reports, software, databases,
     customer information, notices, invoices or other communications related to
     this Agreement and the Services provided hereunder, together with all
     proposals, presentations, communications, or other material related to the
     negotiation of this Agreement. "Proprietary Information" shall include such
     Confidential Information disclosed under this Agreement as is by its nature
     and the intent of its disclosure to be and remain the property of the owner
     thereof (whether the Discloser or a third party), the disclosure of which
     is intended to be only for temporary viewing or use by the Recipient. No
     proprietary interest shall be obtained by a Recipient of Proprietary
     Information hereunder or by any person or entity to whom Recipient may
     transfer Proprietary Information, whether such transfer is in compliance
     with this Agreement or otherwise.

     9.2  Obligations.
          ----------- 

          9.2.1  Except as provided in Paragraph 9.3 below, Recipient shall not
          disclose Confidential Information in its possession to any third party
          during the Service Term of this Agreement, or during the three (3)
          year period thereafter, without the prior written consent of the
          Discloser.

          9.2.2  Recipient shall protect Confidential Information received by it
          from disclosure to others, using the same degree of care used to
          protect its own confidential or proprietary information of like
          importance, but in any case using no less than a reasonable degree of
          care.

          9.2.3  Recipient shall not make any copies of Confidential Information
          received by it except to the extent necessary in connection with the
          purposes of such disclosure or as otherwise expressly permitted by the
          Discloser.  Any copies of Confidential Information shall be made so as
          to reproduce such proprietary legends or notices (whether of the party
          providing the Confidential Information or of a third party owner
          thereof) as are contained in or on the original.

          9.2.4  Recipient shall use Confidential Information only in connection
          with the services provided pursuant to or in performance of
          obligations under this Agreement, except as otherwise expressly
          permitted by the Discloser in writing.

          9.2.5  Recipient shall return Proprietary Information and any copies
          thereof upon written request, upon expiration or earlier termination
          of this Agreement, or upon Recipient's discontinuation of use of the
          related service, and such Proprietary Information shall not thereafter
          be retained in any form by Recipient, its affiliates, or any employees
          or independent contractors thereof.

                               MCI CONFIDENTIAL

                                      -8-
<PAGE>
 
     9.3  Exceptions.
          -----------

          9.3.1  A Recipient may disclose Confidential Information received
          hereunder to its employees who have a need to know to perform
          obligations or exercise rights under this Agreement, and who are bound
          to protect the received Confidential Information from unauthorized use
          and disclosure under the terms of a written confidentiality agreement
          with Recipient (including without limitation a pre-existing written
          agreement).

          9.3.2  A Recipient may disclose Confidential Information if such
          disclosure is lawfully required by any federal or state governmental
          agency or is otherwise required by law or is necessary in any
          proceeding establishing rights and obligations under this Agreement.
          In the event Recipient is required by law, regulation or court order
          to disclose any Confidential Information, to the extent permitted by
          time and the governing authority compelling such disclosure, Recipient
          will promptly notify Discloser in writing prior to making any such
          disclosure in order to allow Discloser to seek a protective order or
          other appropriate remedy from the proper authority.  Recipient agrees
          to cooperate with Discloser in seeking such order or other remedy, to
          the extent legally permitted and commercially reasonable.  Recipient
          further agrees that, under any circumstances, Recipient will furnish
          only that portion of the Confidential Information which is legally
          required and will exercise all reasonable efforts to obtain reliable
          assurances that confidential treatment will be accorded the
          Confidential Information by the governing authority receiving such
          information.

          9.3.3  The restrictions set forth in this Agreement on the use and
          disclosure of Confidential Information shall not apply to information
          that: (a) was publicly known at the time of Discloser's communication
          thereof to Recipient or subsequently becomes publicly known through no
          fault of Recipient; (b) is in Recipient's possession free of any
          obligation of confidentiality at the time of Discloser's communication
          thereof to Recipient; (c) is developed by Recipient independently of
          and without use of any Confidential Information previously disclosed
          by Discloser to Recipient or to a third party under a condition of
          confidentiality; (d) is rightfully obtained by Recipient without
          restriction from third parties authorized by Discloser to provide such
          information to Recipient or third parties; or (e) is identified by
          Discloser in writing as no longer proprietary or confidential.

     9.4  Additional Terms.
          ---------------- 

          9.4.1  Disclosures of Confidential Information subject to this
          Agreement shall include disclosures in written or other tangible form
          (including on electronic, digital or magnetic media) or by audible,
          visual, electronic or other means.

          9.4.2  No licenses or rights, proprietary or otherwise, with respect
          to any Proprietary Information, patent, copyright, trademark, or trade
          secret are granted or are to be implied by this Agreement, except to
          the extent expressly provided herein.

          9.4.3  The Parties acknowledge that Confidential Information is unique
          and valuable, and that disclosure in breach of this Agreement is
          material and will result in irreparable injury to the owner thereof
          for which monetary damages alone would not be an adequate remedy.
          Therefore, the parties agree that in the event of a breach or
          threatened breach of confidentiality, a party shall be entitled to
          specific performance and injunctive or other equitable relief as a
          remedy for any such breach or anticipated breach without the necessity
          of posting a bond.  Any such relief shall be in addition to and not in
          lieu of any other applicable remedies or relief to which such party is
          entitled, including termination of this Agreement and monetary
          damages.

                               MCI CONFIDENTIAL

                                      -9-
<PAGE>
 
10.  Notices.
     ------- 

     All notices, reports and other communications pursuant to or in connection
     with this Agreement shall be given by personal delivery, registered or
     certified mail (return receipt requested), or courier service. Notice shall
     be deemed received from the date the communications is delivered to the
     applicable location at the address shown below:

     If to MCI:                            If to Customer:

     MCI Telecommunications Corporation    Concentric Network Corporation
     205 N. Michigan, Suite 2600           10590 N. Tantau Ave.
     Chicago, IL  60601                    Cupertino, CA   95014
     ATTN.:  Business Markets,             ATTN.:  Henry R. Nothhaft,    
             Legal Affairs                 Chairman, President, CEO

     CC:  MCI Account Team

     MCI
     100 S. Fourth Street; Suite 300
     St. Louis, MS  63102
     ATTN.:  Mr. Edward C. Schneider

11.  Letter of Agency.
     ---------------- 

     Customer shall appoint MCI as its agent with respect to the ordering and
     provisioning of service pursuant to a Letter of Agency in substantially the
     form attached hereto and incorporated herein as Attachment 2 to this
     Agreement.  MCI will not be responsible for any delays or limitations in
     the provision of services with local exchange carriers (LECs) resulting
     from the failure of Customer to provide such agency or the failure of a LEC
     to accept such authorization.

12.  Surcharge Exemption and Tax Exemption.
     --------------------------------------

     12.1  When applicable, Customer shall certify that any special access
     circuits  provided  in connection with MCI Services terminate in a device
     that is not capable of interconnecting MCI's service with the local
     exchange network and, as such, the special access circuits  are surcharge
     exempt from the Local Exchange Carrier's ("LECs") special access surcharge
     ("Surcharge Exempt").  If Customer is not Surcharge Exempt Customer shall
     pay all applicable LEC surcharges.

     12.2  When applicable, Customer shall provide MCI certifications that
     Customer is exempt from federal, state, and/or local taxes.

13.  Limitation of Liability; Indemnification.
     ---------------------------------------- 

     13.1  Under no circumstances shall either party be liable for any indirect,
     incidental, special, exemplary, punitive or consequential damages,
     including, without limitation loss of use or lost business, revenue,
     profits or goodwill, that results from MCI's provision of or failure to
     provide, or Customer's use of or inability to use any of the MCI Services
     provided under this Agreement, even if such party had been advised, knew or
     should have known of the possibility of such damages,.  The foregoing
     limitation applies to all causes of actions and claims, including without
     limitation breach of contract, breach of warranty, negligence, strict
     liability, misrepresentation and other torts.  Further, no cause of action
     which arose more than one (1) year prior to the institution of a legal
     proceeding alleging such cause of action may be asserted by either party
     against the other.

                               MCI CONFIDENTIAL

                                      -10-
<PAGE>
 
     13.2  To the extent applicable, the terms and conditions of the Tariff
     shall govern the extent of MCI's liability with respect to this Agreement
     and the Services provided hereunder. With respect to any service, product,
     action, obligation, facility or event not covered by the terms of the
     Tariff, whether outside of the terms of the Tariff or determined not to be
     covered under the Tariff by a final decision of a court of competent
     jurisdiction, the total liability of MCI to Customer in connection
     therewith shall be limited to the lesser of (a) direct damages proven by
     Customer or (b) the aggregate amounts paid by Customer to MCI under this
     Agreement for the one (1) month period prior to accrual of such cause of
     action for the specific product or service which forms the basis for such
     cause of action. The foregoing limitation applies to all causes of actions
     and claims, including, without limitation, breach of contract, breach of
     warranty, negligence, strict liability, misrepresentation and other torts.
     Further, MCI's liability with respect to individual MCI services may also
     be further limited pursuant to the terms and conditions of the applicable
     Attachments and Exhibits to this agreement. Customer acknowledges and
     accepts the reasonableness of the foregoing disclaimers and limitations of
     liability.

     13.3  In addition to any indemnification rights set forth in the
     Attachments and Exhibits to this Agreement or in the Tariff, Customer
     agrees to indemnify, defend at Customer's expense and hold harmless MCI,
     its parent, affiliates, subsidiaries, directors, officers, employees, and
     agents (collectively the "MCI Indemnitees") against any actions, claims,
     suits, losses, expenses or damages asserted against or incurred by any of
     the MCI Indemnitees arising out of or related to: (i) Customer's acts,
     omissions and/or breach of its obligations hereunder; (ii) the violation of
     any FCC or other applicable international, federal, state or local law or
     regulation by Customer; (iii) the accuracy of or authorization for any
     service orders submitted by Customer hereunder; or (iv) Customer's
     connection of any MCI facility, product, or service to any third party
     facility, service or network, including without limitation damages
     resulting from unauthorized use of, or access to, MCI's network.
     Notwithstanding any other provision of this Agreement, Customer shall pay
     all damages, settlements, expenses and costs, including costs of
     investigation, court costs and reasonable attorneys' fees and costs
     (including allocable costs of in-house counsel) incurred by MCI Indemnitees
     as set forth in this Paragraph, including, without limitation, reasonable
     attorneys' fees and costs (including allocable costs of in-house counsel)
     incurred in enforcing this Agreement.

     13.4  Customer shall be fully responsible to MCI for all acts or omissions
     of Customer's employees, customers, end-users (whether authorized users or
     otherwise), vendors, subcontractors, and agents with respect to the
     ordering or use of the MCI Services provided hereunder, or in any respect
     related to the provisions or subject matter of this Agreement.

14.  Governing Law.
     ------------- 

     This Agreement, including all matters relating to the validity,
     construction, performance and enforcement thereof, shall be governed by the
     laws of the Communications Act of 1934, as amended and as interpreted and
     applied by the FCC, except to the extent matters must be governed by state
     law, in which case such matters shall be governed by the laws of the State
     of New York without giving reference to its principles of conflicts of law.

15.  Assignment.
     ---------- 

     15.1  This Agreement shall be binding on Customer and its respective
     successors and assigns.  Customer may not assign this Agreement, whether by
     operation of law or otherwise, without the prior written consent of MCI,
     which shall not be unreasonably withheld.  Any attempted assignment to
     which MCI does not consent shall be void.

     15.2  If Customer undergoes a merger, sale or corporate reorganization
     involving a change of control, or a change of more than fifty percent (50%)
     of Customer's ownership or management, or if Customer sells,

                               MCI CONFIDENTIAL

                                      -11-
<PAGE>
 
     divests,transfers or leverages more than fifty percent (50%) of Customer's
     assets, telecommunications facilities or customer base, MCI may elect to
     terminate this Agreement by providing written notice of such election to
     Customer at least thirty (30) days prior to the date designated by MCI for
     such termination.

     15.3  This Agreement shall be binding on MCI and its respective successors
     and assigns.

16.  No Waiver.
     --------- 

     No waiver of any of the provisions of this Agreement shall be binding
     unless it is in writing and signed by both parties. The failure of either
     party to insist on the strict enforcement of any provision of this
     Agreement shall not constitute a waiver of any provision and all terms
     shall remain in full force and effect.

17.  Resale of MCI Services.
     ---------------------- 

     17.1  In reselling MCI Services under this Agreement, Customer will
     observe the highest standard of integrity and fair dealing with members of
     the public.  Customer agrees to sell and bill its own services under
     Customer's own name, identity or mark, and Customer further agrees not to
     reference MCI's name or marks in any context involving Customer's
     furnishing of services to the public.  In addition to other applicable
     remedies, MCI shall be entitled to seek injunctive relief with respect to
     any violation of this Paragraph 17.1.  Any opportunity to cure a breach of
     this Paragraph shall be subject to MCI's reasonable satisfaction as to the
     curability of the original injury caused by such breach and the
     effectiveness of any attempted cure.  MCI's right to enforce this Paragraph
     as a material provision of this Agreement shall not in any manner require a
     showing of financial, legal or other loss or injury to MCI of any kind.

     17.2  Customer agrees that it will obtain and maintain any and all
     approvals to resell MCI Services hereunder from the FCC, including
     requirements imposed by Section 214 of the Communications Act of 1934, as
     amended, and state regulatory bodies. In the event Customer fails to obtain
     or maintain the appropriate approvals, MCI shall not be liable for any
     suspension of service or other delay or failure to provide MCI Services.

     17.3  Customer shall have sole responsibility for interacting with its
     customers in all matters pertaining to service, including the placing and
     handling of service orders, service installation, operation and
     termination, dispute handling and resolution, and billing and collection
     matters.  MCI shall incur no obligation, nor shall it be deemed to have any
     obligation, to interact with Customer's customers and end users ("End
     Users") for any reason or purpose.  Customer shall cooperate with MCI as
     necessary to address and resolve service-related issues and problems and
     shall impose upon its customers an obligation to cooperate with Customer in
     addressing and resolving service-related issues and problems.

     17.4  Customer understands and accepts that, as part of MCI's normal
     business policy and practices and its obligations under law, MCI will
     engage in extensive marketing efforts in an attempt to sell its services to
     the public and that such efforts will result in active competition with
     Customer for the business of users who are Customer's End Users or
     prospects, provided MCI will not use Confidential Information to actively
     compete with Customer. Accordingly, Customer further understands and
     accepts that such competition by MCI is in all respects fair and proper and
     that Customer shall not complain, nor be heard to complain, of business
     lost to MCI. Under no circumstance shall any inference be derived that
     MCI's entry into this Agreement with Customer means that MCI will restrict
     its efforts to compete against Customer in any way.

     17.5  Customer understands and accepts that no fiduciary relationship
     arises by virtue of this Agreement and that, accordingly, MCI incurs none
     of the obligations that arise in such relationship as an incident of its
     fulfilling its obligations under this Agreement.  Further, Customer
     understands and accepts that MCI neither

                               MCI CONFIDENTIAL

                                      -12-
<PAGE>
 
     insures the profits for Customer nor guarantees the success of Customer's
     business as a result of Customer's receipt of service(s) under this
     Agreement.

     17.6  If Customer violates or fails to abide by its obligations in this
Paragraph 17 during the Service Term (or any extension of the Service Term) of
the Agreement, then MCI in its discretion may terminate the Agreement without
liability upon five (5) business days notice to Customer.  Customer agrees to
indemnify and hold MCI harmless for any actions, claims, suits, losses or
damages (including attorneys' fees), arising out of or relating to any violation
or breach by Customer of its obligations under this Paragraph 17.

18.  Signature Authorization.
     ----------------------- 

     The parties have duly executed and agreed to be bound by this Agreement as
     evidenced by the signatures of their authorized representatives below.
     Each party represents and warrants to the other that the signatory
     identified beneath its name below has full authority to execute this
     Agreement on its behalf.

19.  Entire Agreement; Amendments.
     ---------------------------- 

     This Agreement shall be valid only if signed by Customer by August 14,
     1998, and if subsequently accepted by MCI. This Agreement, including the
     Exhibits and Attachments hereto, constitutes the entire agreement between
     the parties with respect to its subject matter. Any and all prior or
     contemporaneous offers, agreements, representations and understandings with
     respect thereto, whether written or oral, are hereby superseded. Exclusive
     of any Tariff or state tariff modifications initiated by MCI, once this
     Agreement has been executed, any amendments hereto must be made in writing
     and signed by both parties.

IN WITNESS WHEREOF, the parties hereto each acting with proper authority have
executed this Agreement.

MCI TELECOMMUNICATIONS CORPORATION

By:
    ------------------------------
Print Name:  Jon McGuire
             ---------------------

Title:       Vice President
       ---------------------------

Date:
       ---------------------------

CONCENTRIC NETWORK CORPORATION

By:
    ------------------------------
Print Name:
            ----------------------
Title:  
      ----------------------------
Date:
      ----------------------------

(carrier/chicago/tgc/concentriccarriertgc7/8-10-98)

                               MCI CONFIDENTIAL

                                      -13-
<PAGE>
 
                                  ATTACHMENT 1


                                        

GENERAL
-------

The rates set forth in this Agreement  do not include the following:  charges
for MCI Services other than those set forth herein; non-Tariffed products;
access or egress (or related) charges, including without limitation, tariffed
access charges and access charges imposed by third parties; standard Tariffed
non-recurring charges; installation; taxes or tax-like surcharges, and other
tariffed  charges, including without limitation, Universal Service Fund charges,
Primary Interexchange Carrier charges, National Access Fees, and payphone use
charges; which, to the extent applicable, are additional.   Except as expressly
provided to the contrary, the rates set forth herein are in lieu of, and not in
addition to, any other discounts, promotions, and/or credits (tariffed or
otherwise).

1.  Definitions
    -----------

1.1  "ECC Locations" shall mean locations tariffed by MCI as extended call
coverage locations, including, without limitation, Alaska, Hawaii, Puerto Rico,
the U.S. Virgin Islands, Guam, the Northern Mariana Islands (Saipan), and
American Samoa.

1.2  For purposes of this Agreement, "LEC Groups" shall mean collectively the
groups set forth in Exhibit AA of this Attachment.  Each LEC Group shall be
known by the heading assigned to it in Exhibit AA of this Attachment and shall
be comprised of the entity or entities ("Members") listed under said heading,
subject to the Program Review (as defined in Paragraph 4.2 above).  The headings
in Exhibit AA of this Agreement are for reference and convenience only, and in
no way shall they define or limit the scope of each LEC Group.  Any LEC which is
not listed in Exhibit AA of this Attachment shall  be deemed a member of the
"All Other LECs " group, subject to the Program Review.

1.3  "Terminating LEC" and "Originating LEC" will mean the LEC to which an
outbound call terminates or an inbound call originates, based upon NPA/NXX
designations, or complete ANI information when systems capability is developed
to process such information, as determined in the Local Exchange Routing Guide
("LERG").

1.4  "Customer Location" shall mean a switch owned and operated or leased and
operated by Customer or a Customer-owned and operated point of presence (POP)
(i.e., a physical location at which a long distance carrier's or cellular
provider's network interfaces with the network of a LEC, to which the LEC
terminates subscribers circuits for cellular or long distance service).

1.5  "postalized rates" shall mean the non-distance sensitive per minute rates
set forth in this Agreement.

1.6  "Peak" period shall apply during business day or standard rate periods and
"Off Peak" shall apply during all other times.

2.  Product Rates.
    --------------

Customer shall receive the following rates during the Service Term for MCI
Services which outbound traffic originates and inbound traffic terminates at a
Customer Location.  For all Intrastate Services, Customer shall pay the standard
Tariff rates.

                               MCI CONFIDENTIAL

                                      -14-
<PAGE>
 
2.1  MCI PRISM I Service.
 
     2.1.1  Domestic Interstate PRISM 1 Service. For domestic interstate
     switched outbound service originating via dedicated access from a Customer
     Location to an MCI point of presence ("POP") (MCI PRISM I Service), except
     for MCI PRISM I Service terminating to ECC Locations, which will be billed
     at Tariff less applicable Tariff discounts (see Option H in the Tariff),
     Customer will pay the following non-distance sensitive ("postalized") rate
     per minute as determined by the terminating LEC Group and the applicable
     rate period.

------------------------------------------------------------------
LEC                               Peak              Off-Peak
------------------------------------------------------------------
 AMERITECH                         [*]*                [*]
 AMERITECH  IL                     [*]                 [*]
 BELL ATLANTIC                     [*]                 [*]
 BELL SOUTH                        [*]                 [*]
 NYNEX                             [*]                 [*]
 PAC BELL-CA                       [*]                 [*]
 PAC BELL  NV                      [*]                 [*]
 SWB                               [*]                 [*]
 US WEST                           [*]                 [*]
 GTE 1                             [*]                 [*]
 GTE 2                             [*]                 [*]
 GTE 3                             [*]                 [*]
 GTE 4                             [*]                 [*]
 GTE 5                             [*]                 [*]
 MCI                               [*]                 [*]
 NECA 1                            [*]                 [*]
 NECA 2                            [*]                 [*]
 NECA 3                            [*]                 [*]
 NECA 4                            [*]                 [*]
 ALIANT                            [*]                 [*]
 CENTEL                            [*]                 [*]
 CONTEL 1                          [*]                 [*]
 CONTEL 2                          [*]                 [*]
 SNET*                             [*]                 [*]
 UNITED 1                          [*]                 [*]
 UNITED 2                          [*]                 [*]
 UNITED 3                          [*]                 [*]
 OTHER**                           [*]                 [*]
------------------------------------------------------------------

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -15-
<PAGE>
 
  2.1.2  MCI PRISM I Service Credits.  For domestic intrastate MCI PRISM I
Service, Customer shall pay standard tariff rates in each applicable MCI state
tariff.  Customer shall receive an additional debit or credit determined by
subtracting the following rates from the applicable MCI domestic intrastate
tariffed rates for each minute of usage:

              -----------------------------------
                 State                  Rate Per
                                         Minute
              -----------------------------------
              Alabama                      [*]*
              Arizona                      [*]
              Arkansas                     [*]
              California                   [*]
              Colorado                     [*]
              Connecticut                  [*]
              Delaware                     [*]
              Florida                      [*]
              Georgia                      [*]
              Idaho                        [*]
              Illinois                     [*]
              Indiana                      [*]
              Iowa                         [*]
              Kansas                       [*]
              Kentucky                     [*]
              Louisiana                    [*]
              Maine                        [*]
              Maryland                     [*]
              Massachusetts                [*]
              Michigan                     [*]
              Minnesota                    [*]
              Mississippi                  [*]
              Missouri                     [*]
              Montana                      [*]
              Nebraska                     [*]
              Nevada                       [*]
              New Hampshire                [*]
              New Jersey                   [*]
              New Mexico                   [*]
              New York                     [*]
              North Carolina               [*]
              North Dakota                 [*]
              Ohio                         [*]
              Oklahoma                     [*]
              Oregon                       [*]

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                          MCI CONFIDENTIAL            
            

                                      -16-
<PAGE>
 
              Pennsylvania                 [*]*
              Rhode Island                 [*]
              South Carolina               [*]
              South Dakota                 [*]
              Tennessee                    [*]
              Texas                        [*]
              Utah                         [*]
              Vermont                      [*]
              Virginia                     [*]
              Washington                   [*]
              West Virginia                [*]
              Wisconsin                    [*]
              Wyoming                      [*]
            
     The debit or credit amount shall be applied to Customer's domestic
     interstate monthly usage charges. Such amount shall not exceed Customer's
     domestic interstate monthly charges (excluding applicable taxes,
     surcharges, and pass-through access/egress or related charges) and may not
     be carried forward to the next month.
     
     2.1.3  MCI International PRISM I Service.  For MCI International PRISM I
     Service originating via dedicated access from a Customer Location and
     terminating in international countries, Customer shall pay the rates set
     forth in Exhibit A of this Attachment 1. Where rates are not provided for
     specific countries in Exhibit A, Customer shall pay Tariff rates less
     applicable Tariff discounts.
            
2.2  MCI Toll Free Service.
            
     2.2.1  Domestic Interstate MCI Toll Free DAL Service. For domestic
     interstate inbound services terminating via dedicated access from an MCI
     POP to a Customer Location (MCI Toll Free DAL Service), except for MCI Toll
     Free DAL Service originating from ECC Locations as provided below, and
     except for Peak toll free traffic as noted below, Customer will pay the
     following postalized rate per minute as determined by the originating LEC
     Group and Customer's Monthly Usage:
<TABLE> 
<CAPTION> 
     --------------------------------------------------------------------------------------------------------
                                 [*]                        [*]                        [*]
     --------------------------------------------------------------------------------------------------------
     Originating LEC        Peak      Off-Peak         Peak      Off-Peak         Peak      Off-Peak
     --------------------------------------------------------------------------------------------------------
     <S>                    <C>       <C>              <C>       <C>              <C>       <C>
     AMERITECH               [*]
     AMERITECH  IL
     BELL ATLANTIC
     BELL SOUTH
     NYNEX
     PAC BELL-CA
     PAC BELL  NV
     SWB
     US WEST
     GTE 1
     --------------------------------------------------------------------------------------------------------
</TABLE> 
_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -17-
<PAGE>
 
<TABLE> 
<CAPTION> 
     --------------------------------------------------------------------------------------------------------
                                 [*]                        [*]                        [*]
     --------------------------------------------------------------------------------------------------------
     Originating LEC        Peak      Off-Peak         Peak      Off-Peak         Peak      Off-Peak
     --------------------------------------------------------------------------------------------------------
     <S>                    <C>       <C>              <C>       <C>              <C>       <C>
     GTE 2                   [*]*
     GTE 3
     GTE 4
     GTE 5
     MCI
     NECA 1
     NECA 2
     NECA 3
     NECA 4
     ALIANT
     CENTEL
     CONTEL 1
     CONTEL 2
     SNET
     UNITED 1
     UNITED 2
     UNITED 3
     OTHER
     -------------------------------------------------------------------------------------------------------
</TABLE> 
     For MCI Toll Free DAL Service originating from ECC locations, Customer will
     pay standard MCI tariffed rates, less applicable tariffed discounts (see
     Option F in the Tariff).

     2.2.2   Peak Surcharge.   Customer agrees that during each month of the
     Service Term, Customer's peak domestic interstate traffic for MCI Toll Free
     DAL Service shall not exceed [*] of Customer's total domestic interstate
     traffic for such service ("Peak Traffic Threshold").  Customer shall pay an
     additional charge of $[*] per minute on all traffic exceeding the Peak
     Traffic Threshold.

     2.2.3   MCI Toll Free DAL Service Credits. For domestic intrastate MCI Toll
     Free DAL Service, Customer shall pay standard tariff rates in each
     applicable MCI state tariff. Customer shall receive a debit or credit
     determined by subtracting the following rates from the applicable MCI
     domestic intrastate tariffed rates for each minute of usage:

                       State           Rate Per
                                        Minute
                     ------------------------------
                     Alabama              [*]
                     Arizona              [*]
                     Arkansas             [*]
                     California           [*]
                     Colorado             [*]
                     Connecticut          [*]
                     Delaware             [*]
                     Florida              [*]

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -18-
<PAGE>
 
                       Georgia              [*]*
                       Idaho                [*]
                       Illinois             [*]
                       Indiana              [*]
                       Iowa                 [*]
                       Kansas               [*]
                       Kentucky             [*]
                       Louisiana            [*]
                       Maine                [*]
                       Maryland             [*]
                       Massachusetts        [*]
                       Michigan             [*]
                       Minnesota            [*]
                       Mississippi          [*]
                       Missouri             [*]
                       Montana              [*]
                       Nebraska             [*]
                       Nevada               [*]
                       New Hampshire        [*]
                       New Jersey           [*]
                       New Mexico           [*]
                       New York             [*]
                       North Carolina       [*]
                       North Dakota         [*]
                       Ohio                 [*]
                       Oklahoma             [*]
                       Oregon               [*]
                       Pennsylvania         [*]
                       Rhode Island         [*]
                       South Carolina       [*]
                       South Dakota         [*]
                       Tennessee            [*]
                       Texas                [*]
                       Utah                 [*]
                       Vermont              [*]
                       Virginia             [*]
                       Washington           [*]
                       West Virginia        [*]
                       Wisconsin            [*]
                       Wyoming              [*]


     The debit or credit amount shall be applied to Customer's domestic
     interstate monthly usage charges. Such amount in any month shall not exceed
     Customer's domestic interstate monthly usage charges (excluding taxes,
     
_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -19-
<PAGE>
 
     surcharges, and pass through access/egress or related charges) and may not
     be carried forward to the next month.

     2.2.4  MCI Toll Free DAL Service Charges. For the domestic interstate MCI
     Toll Free DAL Features noted below, Customer shall pay the charges listed
     in Table A below, per each 800 number, except that Customer shall pay no
     more than the maximum amount indicated in Table B below for the Toll Free
     Features, for each Corporate I.D. For any Toll Free Feature not listed in
     Table A below, Customer shall pay the Tariff rates in Sections 3.086 and
     3.088 of the Tariff (or successor Tariff sections):

A.
           --------------------------------------------------------------------
           FEATURE (Charge is per 800         Monthly    Install     Changes
           number):
           -------------------------------------------------------------------
            Basic Routing Feature Package:      $[*]*      $[*]       $[*]
            .  Point of Call Routing
            .  MCI Exchange Routing
            .  Day of Week Routing
            .  Time Interval Routing
            .  Percentage Allocation Routing
            .  Sequential Allocation Routing
            .  MCI Quota Routing
            .  MCI Profile Routing
            .  Most Available Agent Routing
            .  MCI Rules Based Routing
            Tailored Call Coverage
            Holiday Routing
            ID Codes (per 100)
            DNIS
           ---------------------------------------------------------------------

     B.
            --------------------------------------------------------------------
            Maximum Amounts on MCI Toll Free DAL Features (per Corporate ID):
            --------------------------------------------------------------------
            Monthly Recurring Charges:                        $[*]/Corp ID
            Non-Recurring Install Charges:                    $[*]/Corp ID
            Non-Recurring Change Order Charges:               $[*]/Corp ID/month
            --------------------------------------------------------------------

     2.2.5  MCI International Toll Free DAL Service.  For MCI Toll Free DAL
     Service calls that originate in an international country and terminate in
     the domestic United States via dedicated access (excluding service to ECC
     Locations for which Customer shall pay Tariff rates less applicable Tariff
     discounts), Customer shall receive a [*] discount off the standard Tariff
     rates in Option F, Section 3.082121 (or any successor Tariff section) for
     such service. Customer is not eligible to receive the MCI Toll Free Service
     Value Insurance Plan Plus ("VIP Plus") or the MCI Toll Free Service Multi-
     Option Discount ("Toll Free MOD") discounts set forth in the Tariff, for
     MCI International Toll Free DAL Service.

     2.2.6  International Toll Free DAL Service Originating in Canada.  For
     International Toll Free DAL Service traffic terminating via dedicated
     access and originating in Canada, Customer will pay the postalized rate per
     minute of $[*].

2.3  MCI Domestic Interstate Private Line Services.

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -20-
<PAGE>
 
     2.3.1  DS-O, TDS 1.5 and TDS-45 (collectively or individually referred to
     herein as "Private Line Service" or "Private Line Circuits") with [*]* or
     greater domestic interstate traffic shall be deemed MCI domestic interstate
     Private Line Service and Customer shall receive the rates set forth below.
     Private Line Circuits with less than [*] domestic interstate traffic shall
     be deemed MCI domestic intrastate Private Line Service and shall receive
     standard tariff rates and shall contribute to Customer's Monthly Commitment
     and any applicable subcommitments.

     2.3.2  The following pricing is only for channelized or non-channelized
     point to point Private Line Circuits. For channelized Private Line
     Circuits, additional charges may apply. For domestic interstate Private
     Line Service terminating at a Customer Location, Customer will pay, in
     addition to all taxes and tax-related surcharges, the Inter-Office Channel
     ("IOC") monthly charges based on circuit mileage as set forth in the tables
     below.

     A.   DS-0
 
          Circuit Length                      Rate
          --------------                      ----
          1-99 miles                          $[*] flat
          100-599 miles                       $[*] per DS0 mile
          600+ miles                          $[*] per DS0 mile

 
     B.   TDS 1.5
          Circuit Length                      Rate
          --------------                      ----
          1-49 miles                          $[*] flat
          50-99 miles                         $[*] per DSO mile
          100+ miles                          $[*] per DS0 mile

     C.   TDS 45

          Circuit Length                      Rate
          --------------                      -----
          1-50 miles                          $[*] flat
          51-114 miles                        $[*] flat
          115-250 miles                       $[*] per DSO mile
          251+ miles                          $[*] per DS0 mile

     2.3.3  In addition to all other charges described in this section, Customer
     shall pay the following installation charge and monthly charges to cross
     connect Private Line Circuits:
     
          Access  Type          Monthly Rate       Installation
          ------------          ------------       ------------
          Per channel of
          a T-1                      [*]               [*]
          T-1                        [*]               [*]
          DS-3                       [*]               [*]


     2.3.4  The IOC monthly charges for domestic interstate Private Line
     Services include all monthly recurring Central Office Connection ("COC")
     and monthly recurring Access Coordination ("AC") and exclude all monthly
     recurring access charges and monthly non-recurring charges for Private Line
     Services. The rates for

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -21-
<PAGE>
 
     domestic interstate Private Line Services provided herein are in lieu of
     any promotions and discounts available from MCI in the Tariff or applicable
     state tariff for the AC, COC and IOC portion of such service including,
     without limitation, the Network Pricing Plan(s) specified in the Tariff.

     2.3.5  Rates for domestic interstate Private Line Services are based on a
     least mileage routing and the mileage per route is determined by using the
     airline mileage between the two applicable MCI Dedicated Leased Line cities
     in accordance with the calculation as set forth in Section C-11, Table I,
     Part A of the Tariff. Rates for domestic interstate Private Line Service
     shall apply only to circuits that are wholly-owned and operated end-to-end
     by MCI. MCI will be under no obligation to obtain or provide, by lease or
     otherwise, any circuit not available on MCI's network at the time an order
     is placed by Customer for such circuit. If MCI, in its discretion, elects
     to obtain a circuit for Customer where MCI circuits are otherwise
     unavailable, the rates herein will not apply and the parties shall agree
     upon applicable charges for such circuit prior to MCI obtaining such
     circuit.

     2.3.6  The rates for domestic interstate Private Line Services provided
     herein are in lieu of any rates, charges, promotions and discounts
     available from MCI in the Tariff or applicable state tariff for the AC, COC
     and IOC portion of such service including, without limitation, the Network
     Pricing Plan(s) specified in the Tariff.

     2.3.7  The provisioning of domestic interstate Private Line Service is
     based upon service availability, as determined by MCI. The availability of
     domestic interstate Private Line Service is limited and MCI does not
     guarantee the provisioning of such service. Customer's ability to comply
     with the Monthly Commitment set forth in Paragraph 2, shall not be
     contingent upon the provisioning of domestic interstate Private Line
     Service.

     2.3.8  Customer shall receive a recurring monthly discount of [*]* on
     Customer's total monthly usage for dedicated Private Line Service (Local
     Loop), e.g., dedicated Private Line and dedicated voice services, utilizing
     T-1 and DS-3 circuits, provided, Customer has such circuits located at MCI
     facilities or locations or has otherwise provided for local access.
     Customer shall not be obligated to pay any AC or COC charges as set forth
     in the Tariff for such circuits.

3.   Domestic HyperStream Frame Relay Service.

Customer will receive the standard hpp discount associated with a [*] Monthly
Minimum and two (2) year term of service as set forth in the Tariff. This
discount shall not apply to the following: charges for MCI services other than
those described in Section 2; non-tariffed products; access or egress (or
related) charges imposed by third parties; Directory Assistance charges;
standard tariffed non-recurring charge; taxes and tax-related surcharges; and
government surcharges.

4.   Directory Assistance.

For domestic interstate directory assistance, Customer will pay, in addition to
all applicable federal, state and local taxes and surcharges, $[*] per
call. in each month in which Customer's total number of domestic interstate
directory assistance calls equals or exceeds [*], the above postalized rate
for directory assistance shall be reduced by $[*] per call.

5.   MCI Carrier Debit Card.

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -22-
<PAGE>
 
     5.1  Customer shall utilize MCI for the debit card platform and transport
     of Customer's domestic interstate termination of debit card traffic. Debit
     card units shall be as defined in the Tariff (hereinafter "Debit Card
     Units"). The rates below shall include access to the MCI debit card
     platform, transport, order entry and debit card activation. customer shall
     pay the following rate per Debit Card Unit, as determined by the number of
     Debit Card Units purchased by customer in each individual purchase, and not
     determined by the aggregate number of debit card units purchased throughout
     the service term. The rates listed below do not include operator services.
     If Customer chooses to purchase mci operator services, pursuant to the
     terms and conditions of the tariff, an additional $[*]* per Debit Card Unit
     shall be added to the rates below. The rates listed below do not include
     customer services. If Customer chooses to purchase MCI customer services,
     pursuant to the terms and conditions of the Tariff, an additional $[*] per
     Debit Card Unit shall be added to the rates below.

     Total Units
     Per Order               Rate Per Unit 
     -----------             -------------    
     50,000 - 300,000        [*]
     300,001 - 600,000       [*]
     600,001 - 900,000       [*]
     900,001 - 2,000,000     [*]
     2,000,001 - 5,000,000   [*]

     5.2  Customer shall order a minimum of [*] Units per order. Notwithstanding
     Paragraph 6 of the Agreement, Customer shall pay MCI for all orders under
     this Paragraph 5 before fulfillment of such orders.

     5.3  Customer's Debit Card Units will only be reduced by the Debit Card
     Units utilized by completed calls (calls that are answered at the ultimate
     destination). MCI shall determine the number of Debit Card Units necessary
     to receive one minute of international calling ("Depletion Schedule").
     Presently the depletion schedule is in accordance with Option Y, Section
     C.3.2.6 of the Tariff (or any successor Tariff section) ("Tariff depletion
     schedule"). MCI retains the right to develop and implement (upon thirty
     (30) day prior notice) a separate and distinct depletion schedule which
     shall supersede the Tariff depletion schedule. Customer shall receive no
     refund or reimbursement for unused Debit Card Units.

     5.4  In addition to the above rates, Customer shall pay an additional [*]
     charge for each customized script identifying Customer to its end user.

     5.5  Unless otherwise provided herein, Customer shall be solely responsible
     for all debit card fulfillment, customer service and any operator services.
     
     5.6  Customer shall not include MCI's name or logo on any Customer debit
     card.

     5.7  The debit card is a non-replenishable promotion card.

6.   MCI Feature Card Service.

Customer will receive the rates, terms and conditions for MCI Feature Card
Service set forth in Exhibit B of this Attachment 1 and the Attachment to
Exhibit B.

7.   Network MCI Conferencing.

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -23-
<PAGE>
 
     7.1  If Customer elects to use network MCI Conferencing, Customer agrees
     that during each monthly billing period of the Service Term Customer will
     purchase from MCI at [*]* of networkMCI Conferencing Service (net of taxes
     and tax-related surcharges) ("Conference Calling Subcommitment"). If
     Customer fails to equal or exceed such subcommitment, Customer will pay the
     amount billed plus the difference between the amount billed and the
     Conference Calling Subcommitment. In no event shall this amount exceed the
     Conference Calling Subcommitment.

     7.2  For the types of domestic interstate networkMCI Conferencing
     ("Conferencing") specified below, Customer shall pay (in addition to all
     applicable taxes and tax-related surcharges), the following postalized
     rates per minute per bridge port used, with rounding to the next higher
     full minute.  The per minute rates shall not include Tariff set-up fees,
     which are waived.  Such rates for domestic interstate networkMCI
     Conferencing are in lieu of Tariff rates described in Section C.17211 and
     C.1741, and also in lieu of any volume discounts or promotions.  All other
     fees and charges for the service shall be at Tariff rates.

     7.3  For domestic interstate Toll  Meet Me Service, Customer shall
     pay (in addition to all applicable taxes and tax-related surcharges) the
     postalized rate of $[*] per minute per bridge port used during all
     conference calling.

     7.4  For domestic interstate Dial-Out Service and Toll Free Meet Me
     Services, Customer shall pay (in addition to all applicable taxes and tax-
     related surcharges), the following postalized rates per minute per bridge
     port used, on all networkMCI Conferencing and as determined by Customer's
     total monthly net networkMCI Conferencing usage measured at the postalized
     rate of $[*] per minute per bridge port.

                  Total Monthly Net
                  networkMCI                  Rate
                  Conferencing Usage          Per Minute
                  ------------------          ----------
                  [*]                         [*]
                  [*]                         [*]
                  [*]                         [*]
                  [*]                         [*]
                  [*]                         [*]
                  [*]                         [*]
                  [*]                         [*]

     7.5  For domestic interstate Unattended Meet Me Service, Customer shall pay
     (in addition to all applicable taxes and tax-related surcharges), the
     following postalized rates per minute per bridge port used during all
     Conferencing as determined by Customer's total monthly net networkMCI
     Conferencing usage measured at the postalized rate of [*] per minute per
     bridge port.

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -24-
<PAGE>
 
                Total Monthly Net
                networkMCI                Rate
                Conferencing Usage        Per Minute
                ------------------        ----------
                [*]*                      [*]
                [*]                       [*]
                [*]                       [*]
                [*]                       [*]
                [*]                       [*]
                [*]                       [*]
                [*]                       [*]

     7.6  In order to receive the rates set forth in subsections 7.3, 7.4
     and 7.5 above, Customer must fulfill the following criteria throughout the
     term:

          (a)  Customer shall provide a toll free line to Customer's end-users
               exclusively used for customer service purposes; and
          (b)  Customer shall provide a toll free line to the MCI Conference
               Center exclusively used for reservations; and
          (c)  Customer shall provide its own customer service personnel and
               access.

     7.7  MCI shall provide to Customer: (i) generic branding for inbound
     conference calls; and (ii) customized branding for inbound calls for
     reservation services.  However, MCI shall not provide billing services to
     Customer's end-users.

8.   Credits and Additional Discounts.
     ---------------------------------

8.1  MCI Private Line Discount.  During each monthly period of the Service Term
     in which Customer meets its Monthly Commitment, Customer will receive a
     discount on that months IOC charges for MCI domestic interstate Private
     Line Services relating to usage of domestic interstate T-1 and DS-3
     circuits as set forth in Section 2.3 of this Attachment 1, net of access
     charges, taxes and tax-related surcharges ("Monthly Private Line Revenue").
     This discount will be a percentage of Customer's Monthly Private Line
     Revenue, as determined by the following schedule:


               Monthly Private
               Line Revenue       Discount
               ------------       --------
               [*]                [*]
 

8.2  Installation Credit.

     Customer shall receive a credit of up to [*] which shall be applied to the
     one-time installation and other non-recurring MCI Tariff charges (not
     including local exchange carrier or other third party access provider
     charges) associated with the implementation of DS-0, TDS 1.5 and TDS-45
     Private Line Service. Customer will be entitled to the credits specified in
     this paragraph, provided that (i) the credits shall only apply to circuits
     ordered and installed during the Service Term of this Agreement; and (ii)
     each circuit must remain in service 

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL

                                      -25-
<PAGE>
 
     with MCI for at least twelve (12) months after the date of initial
     installation, unless terminated to be replaced by another circuit with MCI
     of equal or greater length. Customer shall reimburse MCI for the prorated
     portion of any credits received for any such circuits terminated and not
     replaced by another circuit with MCI of equal or greater length.

8.3  MCI Private Line Discount.  All MCI OC-3 or OC-12 point to point
     Private Line circuits provided to Customer under this Agreement will
     receive any applicable standard Tariff discounts.

                                      -26-
<PAGE>
 
                                   EXHIBIT AA

                                   LEC GROUPS
                                   ----------
                                        

                               MCI CONFIDENTIAL
                                      A-1
<PAGE>
 
                                   EXHIBIT A

                          Prism I International Rates
    Customer will receive the following rates based on total monthly usage.

                                        
--------------------------------
COUNTRY                  [*]*
Angola
Anguilla
Antigua
Argentina
Aruba
Australia
Austria
Bahamas
Bahrain
Bangladesh
Barbados
Belgium
Belize
Benin
Bermuda
Bolivia
Brazil
British Virgin Islands
Cambodia
Cameroon
Canada
Cayman Islands
Chile
China
Colombia
Costa Rica
Croatia
Cyprus
Czech Republic
Denmark
Dominica
Dominican Republic
Ecuador
Egypt
El Salvador
Ethiopia
Finland
France
-------------------------------

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL
                                      A-2
<PAGE>
 
-------------------------------
Gambia                    [*]*
Germany
Ghana
Greece
Grenada
Guadeloupe
Guam
Guatemala
Guinea
Guyana
Haiti
Honduras
Hong Kong
Hungary
Iceland
India
Indonesia
Iran
Iraq
Ireland
Israel
Italy
Ivory Coast
Jamaica
Japan
Jordan
Kenya
Korea, South
Kuwait
Lebanon
Liberia
Luxembourg
Malaysia
Mexico Band 1 Day
Mexico Band 1 Night
Mexico Band 2 Day
Mexico Band 2 Night
Mexico Band 3 Day
Mexico Band 3 Night
Mexico Band 4 Day
Mexico Band 4 Night
Mexico Band 5 Day
Mexico Band 5 Night
Mexico Band 6 Day
Mexico Band 6 Night
-------------------------------

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL
                                      A-3
<PAGE>
 
-------------------------------------------
Mexico Band 7 Day                     [*]*
Mexico Band 7 Night
Mexico Band 8 Day
Mexico Band 8 Night
Morocco
Mozambique
Myanmar
Netherlands
Netherlands Antilles
New Caledonia
New Zealand
Nicaragua
Nigeria
Norway
Oman
Pakistan
Panama
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russia
Sao Tome And Principe
Saudi Arabia
Senegal
Sierra Leone
Singapore
South Africa
Spain
Sri Lanka
St. Kitts
St. Lucia
St. Vincent And Grenadines
Suriname
Sweden
Switzerland
Syria
Taiwan
Tanzania
Thailand
Togo
Trinidad And Tobago
---------------------------------------

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL
                                      A-4
<PAGE>
 
-------------------------------------------
Tunisia                               [*]*
Turkey
Turks And Caicos Islands
Uganda
Ukraine
United Arab Emirates
United Kingdom
Uruguay
Venezuela
Vietnam
Yemen
Zaire
Zambia
Zimbabwe
-------------------------------------------

[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL
                                      A-5
<PAGE>
 
                                   EXHIBIT B

                         MCI FEATURE CARD SERVICE AND
                     ASSOCIATED FEATURE SERVICES DISCOUNT

A.   MCI Feature Card Service (Option T).

     When used under this Paragraph A, MCI Feature Card Service shall refer to
     such service only as accessed by dialing the unique 800 access number
     assigned by MCI to the MCI Feature Card Service.

     1)  For domestic (i.e., within the U.S., but excluding ECC Locations)
     interstate usage of MCI Feature Card (exclusive of monthly recurring
     charges, taxes, surcharges, installation charges, MCI Feature Card
     surcharges, Directory Assistance charges, charges for local access/egress
     services or facilities, and enhanced feature charges associated with MCI
     Feature Card Service), Customer shall pay a postalized rate of $[*]* per
     minute.

     2)  (a)  For domestic intrastate usage of MCI Feature Card (exclusive of
     monthly recurring charges, taxes, surcharges, installation charges, MCI
     Feature Card surcharges, Directory Assistance charges, charges for local
     access/egress services or facilities, and enhanced feature charges
     associated with MCI Feature Card Service), Customer shall pay standard
     tariff rates for MCI Feature Card Service in each applicable MCI state
     tariff.

         (b)  Customer shall receive a credit for domestic intrastate usage of
     MCI Feature Card Service, which when combined with the rates identified in
     2(a) above, shall yield the postalized rate of $[*] per minute (exclusive
     of monthly recurring charges, taxes, surcharges, installation charges, MCI
     Feature Card surcharges, Directory Assistance charges, charges for local
     access/egress services or facilities, and enhanced feature charges
     associated with MCI Feature Card Service).

         (c)  The credit amount in 2(b) above shall be applied to Customer's
     domestic interstate monthly usage charges (exclusive of monthly recurring
     charges, taxes, surcharges, installation charges, MCI Feature Card
     surcharges, Directory Assistance charges, charges for local access/egress
     services or facilities and enhanced feature charges associated with the MCI
     Feature Card Service). The credit amount in any month shall not exceed such
     interstate monthly usage charges and shall not be carried forward to any
     subsequent month.

         3)  During each month of the Service Term, Customer shall receive a
     credit calculated by multiplying [*] times Customer's domestic interstate,
     intrastate (after application of the credit described in Paragraph 2(b)
     above) and international usage charges of MCI Feature Card Service
     (exclusive of monthly recurring charges, taxes, surcharges, installation
     charges, MCI Feature Card surcharges, Directory Assistance charges, charges
     for local access/egress services or facilities, and enhanced feature
     charges associated with MCI Feature Card Service). The credit amount shall
     be applied to Customer's domestic interstate monthly usage charges
     (exclusive of monthly recurring charges, taxes, surcharges, installation
     charges, MCI Feature Card surcharges, Directory Assistance charges, charges
     for local access/egress services or facilities and enhanced feature charges
     associated with the MCI Feature Card Service). The credit amount in any
     month shall not exceed such interstate monthly usage charges and shall not
     be carried forward to any subsequent month.

         4)  The following MCI Feature Card surcharges shall be charged
     according to the following schedule:

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL
                                      -1-
<PAGE>
 
<TABLE> 
<CAPTION>

                 FROM                                            TO                          Direct
                 ----                                            --                          ------
                                                                                             Dial
                                                                                             ------
<S>                                       <C>                                                <C>
United States ("U.S")                     U.S.                                                 [*]*
 
U.S.                                      U.S., within the same State(domestic intrastate)
 
U.S.                                      ECC Locations
 
ECC Locations                             U.S.
 
ECC Locations                             Canada
 
ECC Locations                             International Locations (other than Canada)
 
Canada                                    ECC Locations
 
Canada                                    International Locations
</TABLE>

        5)  The above discounts for MCI Feature Card Service are in lieu of any
     Tariff discounts including, without limitation, the discounts for MCI
     Feature Card Service available under MCI VIP, MCI VIP Plus, MCI MOD and MCI
     CAS Service.

        6)  For MCI Feature Card Service,  if Customer elects to use MCI for
     fulfillment, Customer shall pay MCI the fulfillment costs associated with
     Customer's usage of MCI Feature Card Service plus an administrative charge
     for handling fulfillment in an amount equal to fifteen percent (15%) of the
     fulfillment costs.

        7)  For MCI Feature Card Service,  MCI shall provide the fraud detection
     procedures set forth in the Attachment to Exhibit B attached hereto, and
     incorporated herein by reference.  Customer shall be responsible for all
     fraud associated with its usage of MCI Feature Card Service, except as set
     forth in the Attachment to Exhibit B.

B.  Discounts on Non-Tariffed Feature Services.

        1)  Customer will be entitled to the following applicable incremental
     discounts on Customer's usage of non-tariffed Feature Card Services (MCI
     Messenger Service, *3 Flexible Routing for Voice Mail, Voice News Network
     and Speed Dialing) as determined by Customer's Non-Tariffed Feature
     Services Monthly Usage (as defined below):

                        Non-Tariffed
                        Feature Services
                        Monthly Usage           Discount
                        ----------------        --------

                        [*]
 
     The above discounts shall apply only to Customer's usage of non-tariffed
     Feature Services provided pursuant to MCI's standard terms and conditions
     for such services, but not to charges for installation, taxes or

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL
                                      -2-
<PAGE>
 
     surcharges, and charges for local access/egress services or facilities
     associated with non-tariffed Feature Services.

        2)  Non-Tariffed Feature Services Monthly Usage shall mean Customer's
     monthly combined recurring and usage charges for non-tariffed Feature
     Services at standard pricing but not including taxes (and gross receipts
     taxes), surcharges, and any charges for MCI Tariff or state tariff
     services.

C.   Discounts on Tariffed Feature Services.

        1)  Customer will be entitled to the following applicable incremental
     discounts on Customer's usage of tariffed Feature Card Services (i.e.,
     conference calling) as determined by Customer's Tariffed Feature Services
     Monthly Usage (as defined below):

                     Tariffed
                     Feature Services
                     Monthly Usage      Discount
                     -------------      --------
                     [*]*

     The above discounts shall apply only to Customer's usage of tariffed
     Feature Services provided pursuant to MCI's standard terms and conditions
     for such services, but not to charges for installation, taxes or
     surcharges, and charges for local access/egress services or facilities
     associated with tariffed Feature Services.

        2)  Tariffed Feature Services Monthly Usage shall mean Customer's
     monthly combined recurring and usage charges for tariffed Feature Services
     at standard pricing but not including taxes (and gross receipts taxes),
     surcharges, and any charges for MCI Tariff or state tariff services.

_______________________
[*] Certain information in this exhibit has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               MCI CONFIDENTIAL
                                      -3-
<PAGE>
 
                            ATTACHMENT TO EXHIBIT B
                                        
                  MCI FEATURE CARD FRAUD DETECTION PROCEDURES
                  -------------------------------------------
                                        

All calling card calls will be validated by MCI to permit only those calls
authorized or facilitated by Customer or legitimate card holders.  MCI will, at
the direction of Customer, preclude all calls utilizing expired or terminated
calling card numbers compared against an authorized list provided by Customer
and will be responsible for all fraudulent use, unauthorized use, misuse, or
abuse of calling cards occurring after MCI receives actual notice of the
expiration or termination of a calling card or receives specifically detailed
written notification concerning any card which has been lost, stolen,
compromised or which Customer has reason to believe is or may be used
fraudulently.  MCI will deactivate a calling card within four (4) hours of
receipt by MCI's Consumer Markets Fraud Detection of a request by Customer.

In addition, all calling card calls will be monitored by MCI for fraudulent use,
unauthorized use, misuse or abuse on a twenty four (24) hour a day, seven (7)
days a week basis.  MCI shall establish fraud prevention, detection and
minimization procedures so that fraudulent use arising from lost or stolen
calling cards and potential disruption to authorized card holders will be
minimized.

MCI will not hold the Customer responsible for "service fraud" associated with
the unauthorized use of an MCI calling card.  "Service fraud" can best be
described as unauthorized use of an MCI calling card following the involuntary
theft or loss of a card which was not intentionally facilitated or impliedly
authorized by Customer or an authorized user.  "Service fraud" often follows the
theft of a wallet, purse or briefcase, or sometimes is the result of "shoulder
surfing" (thieves observing/recording authorization codes) which occurs at
payphones located in airports, bus terminals, train stations and the like.  MCI
shall not be responsible for losses caused by fraudulent information submitted
by a card holder in subscribing for calling card services or for usage which was
intentionally facilitated or impliedly authorized by an authorized user.

In the event that MCI is unable to contact Customer of suspected abuse of the
calling card, in order to minimize potential abuse, MCI will deactivate any
calling card which has exceeded established fraud detection parameters or which
MCI has reason to believe is or may be used fraudulently.

                               MCI CONFIDENTIAL
                                      B-1
<PAGE>
 
                                  ATTACHMENT 2
                                        
                                 LETTER OF AGENCY
                                 ----------------


ATTENTION:  Concerned Local Operating Companies, AT&T and other Common Carriers
and All Equipment Vendors

The undersigned appoints MCI Telecommunications Corporation or any of its
affiliated companies ("MCI") as agent for the purpose of ordering, in connection
with MCI's provision of service to the undersigned, changes in and/or
maintenance on specific telecommunications service that you provide to the
undersigned including, without limitation, removing, adding to or rearranging
such telecommunications service.

You are hereby released from any and all liability for making pertinent
information available to MCI and for following MCI's instructions with respect
to any changes to or maintenance on the undersigned's telecommunications
service.  You may deal directly with MCI on all matters pertaining to
telecommunications service and should follow instructions with respect thereto.
This authorization will remain in effect until modified or rescinded in writing
by the undersigned.

Signed this _______ day of ___________, 1998.

CONCENTRIC NETWORK CORPORATION


By:
   --------------------------
Authorized Customer Signature


----------------------------- 
Name/Title


----------------------------- 
Date


                               MCI CONFIDENTIAL
                                      I-1
<PAGE>

 
                                  LEC Exhibit


                                      [*]




------------
*       Certain information in this exhibit has been omitted and filed 
separately with the Securities and Exchange Commission. A total of 25 pages has 
been omitted. Confidential treatment has been requested with respect to the 
omitted portions.