<PAGE>

                                                                   EXHIBIT 10.42
 
                        CONCENTRIC NETWORK CORPORATION

                  COMMON STOCK AND WARRANT PURCHASE AGREEMENT

                                 JULY 25, 1997
<PAGE>
 
                               TABLE OF CONTENTS
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                                                                               PAGE
                                                                               ----
<C>   <S>                                                                      <C>
1.   AGREEMENT TO SELL AND PURCHASE........................................       1
                                                                                   
     1.1  Authorization Of Shares..........................................       1
     1.2  Sale And Purchase Of Common Stock................................       1
     1.3  Sale and Purchase of Preferred Stock.............................       2
     1.4  Warrant Coverage.................................................       2
     1.5  Hart-Scott-Rodino Compliance.....................................       2
                                                                                   
2.   CLOSING, DELIVERY AND PAYMENt.........................................       2
                                                                                   
3.   REPRESENTATIONS AND WARRANTIES OF THE COMPANY.........................       3
                                                                                   
     3.1  Organization, Good Standing And Qualification....................       3
     3.2  Authorization; Binding Obligations...............................       3
     3.3  Compliance With Other Instruments................................       3
     3.4  Securities Exemption.............................................       4
     3.5  Full Disclosure..................................................       4
     3.6  Valid Issuance of Shares.........................................       4
     3.7  Litigation, Etc..................................................       5
     3.8  Governmental Consent, etc........................................       5
     3.9  Termination of Employment........................................       5
     3.10 Intellectual Property Rights.....................................       5
     3.11 Proprietary Information Agreements...............................       5
     3.12 Lock-up Agreements...............................................       6
                                                                                   
4.   REPRESENTATIONS AND WARRANTIES OF PURCHASER...........................       6
                                                                                   
     4.1  Requisite Power And Authority....................................       6
     4.2  Consents.........................................................       7
     4.3  Investment Representations.......................................       7
                                                                                   
          (a)  Purchaser Is An Accredited Investor.........................       7
          (b)  Purchaser Bears Economic Risk...............................       7
          (c)  Acquisition For Own Account.................................       7
          (d)  Purchaser Can Protect Its Interest..........................       7
          (e)  Company Information.........................................       7
                                                                                   
     4.4  Legends..........................................................       7
     4.5  Removal of Legend and Transfer Restrictions......................       8 
</TABLE>

                                      -i-
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                               TABLE OF CONTENTS
                                  (continued)
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<C>   <S>                                                                          <C> 
5.   CONDITIONS TO CLOSING.....................................................       8
                                                                                       
     5.1  Conditions To Purchaser's Obligations At The Closing.................       8
                                                                                       
          (a)  Concurrent Closing of Financing Event...........................       8
          (b)  Other Investor Participation....................................       8
          (c)  Representations And Warranties True; Performance Of Obligations.       9
          (d)  Legal Investment................................................       9
          (e)  Consents, Permits, And Waivers..................................       9
          (f)  Certificate Of Status...........................................       9
          (g)  Copies..........................................................       9
          (h)  Proceedings and Documents.......................................       9
          (i)  Outstanding Preferred Stock.....................................       9
          (j)  Compliance Certificate..........................................       9
          (k)  Legal Opinion...................................................      10
                                                                                       
     5.2  Conditions To Obligations Of The Company.............................      10
                                                                                       
          (a)  Concurrent Closing of the Financing Event.......................      10
          (b)  Representations And Warranties True.............................      10
          (c)  Performance Of Obligations......................................      10
                                                                                       
6.   COVENANTS OF THE COMPANY..................................................      10
                                                                                       
     6.1  Board Seat...........................................................      10
     6.2  Notice of Acquisition Offer..........................................      10
     6.3  Rule 144 Reporting...................................................      10
                                                                                       
7.   MISCELLANEOUS.............................................................      11
                                                                                       
     7.1  Governing Law........................................................      11
     7.2  Survival.............................................................      11
     7.3  Successors And Assigns...............................................      11
     7.4  Separability.........................................................      11
     7.5  Amendment And Waiver.................................................      11
     7.6  Notices..............................................................      12
     7.7  Expenses.............................................................      12
     7.8  Attorneys' Fees......................................................      12
     7.9  Titles And Subtitles.................................................      12
     7.10 Counterparts.........................................................      12 
</TABLE>

                                     -ii-
<PAGE>
 
                               TABLE OF CONTENTS
                                  (continued)
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<C>   <S>                                                                          <C>
     7.11 Broker's Fees........................................................      12
     7.12 Termination..........................................................      13
     7.13 Subsequent Consents, Permits and Waivers.............................      13 
</TABLE>

                                     -iii-
<PAGE>
 
                        CONCENTRIC NETWORK CORPORATION

                  COMMON STOCK AND WARRANT PURCHASE AGREEMENT


     THIS COMMON STOCK AND WARRANT PURCHASE AGREEMENT (THE "AGREEMENT") IS
ENTERED INTO AS OF JULY 25, 1997, BY AND BETWEEN CONCENTRIC NETWORK CORPORATION,
A FLORIDA CORPORATION (THE "COMPANY") AND WILLIAMS COMMUNICATIONS GROUP, INC., A
DELAWARE CORPORATION ("PURCHASER").


                                   RECITALS

     WHEREAS, the Company intends to reincorporate in Delaware by merger into
Concentric Network Corporation, a Delaware corporation that was formed for the
purpose of the reincorporation and that will be the surviving entity (the
"Company" as used in this Agreement refers to, prior to such merger, the Florida
corporation and, after such merger, the Delaware Corporation); and

     WHEREAS, Purchaser desires to purchase shares of the Company's common stock
("Common Stock"), such purchase to be made in a private placement to close
concurrently with, but not before, the closing of the initial public offering of
the Company having an aggregate price to the public of $40 million (the "IPO")
pursuant to the registration statement filed on Form S-1 (File No. 333-27241)
with the Securities and Exchange Commission (the "Commission") (such
registration statement, as amended, shall be referred to herein as the
"Registration Statement"); and

     WHEREAS, the Company desires to issue and sell the Shares (as defined
below) to Purchaser on the terms and conditions set forth herein.

     NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises hereinafter set forth, the parties hereto agree as follows:

1.   AGREEMENT TO SELL AND PURCHASE.

     1.1  AUTHORIZATION OF SHARES.  On or prior to the Closing (as defined in
Section 2 below), the Company shall have authorized the sale and issuance to
Purchaser of the Shares. Prior to the Closing the Company will have adopted and
filed a Certificate of Incorporation (the "Certificate of Incorporation") with
the Secretary of State of the State of Delaware authorizing sufficient shares of
Common Stock to cover the sale and issuance of the Shares to be purchased
hereunder.

     1.2 SALE AND PURCHASE OF COMMON STOCK. Subject to the terms and conditions
hereof, the Company hereby agrees to issue and sell to Purchaser and Purchaser
agrees to purchase from the Company, at the Closing, a number of shares of
Common Stock of the Company equal to the Purchase Price (as hereafter defined)
divided by the Price to Public per share set forth on the cover

<PAGE>
 
page of the final Prospectus (as defined in Section 3.5 below), at an aggregate
purchase price of Eleven Million Nine Hundred Fifty Thousand Dollars
($11,950,000) (the "Purchase Price"). The shares of Common Stock to be purchased
hereunder are referred to as the "Shares." For purposes of this Agreement, the
$40 million aggregate price to the public of the IPO shall include: (i) the
$11,950,000 to be invested by Purchaser as provided in this Agreement, (ii) the
$3,000,000 principal amount of that certain note issued to the Purchaser by the
Company (the "Note"), and (iii) the value of certain services to be provided by
the Purchaser to the Company after Closing which will be valued for purposes of
this Agreement at $2,000,000.

     1.3  SALE AND PURCHASE OF PREFERRED STOCK.  In the event that an IPO does
not close prior to October 31, 1997, Purchaser agrees, in lieu of and not in
addition to its obligations under Section 1.2 above, to purchase $11,950,000 of
Preferred Stock in the Preferred Financing (as defined below) pursuant to a
separate purchase agreement according to terms negotiated by the lead investor
in the Preferred Financing which must be reasonably satisfactory to the
Purchaser.  For purposes of this Agreement, the term "Preferred Financing" shall
mean the next Preferred Stock financing of the Company if any, after the date
hereof, but to be completed no later than October 31, 1997, in which at least
$40,000,000 is invested in such Preferred Stock (including:  (i) the $11,950,000
to be invested by Purchaser as provided in this Agreement, (ii) the $3,000,000
principal amount of that certain note issued to the Purchaser by the Company and
(iii) the value of certain services to be provided by the Purchaser to the
Company which will be valued for purposes of this Agreement at $2,000,000).  For
purposes of this Agreement, the IPO and the Preferred Financing shall be
referred to alternatively as the "Financing Event."

     1.4  WARRANT COVERAGE.  As an inducement to the Purchaser to participate in
the Financing Event, the Company shall issue at the closing to the Purchaser a
warrant to purchase up to the number of shares of Common Stock of the Company
set forth in the Common Stock Purchase Warrant in substantially the form
attached hereto as Exhibit A (the "Warrant").

     1.5  HART-SCOTT-RODINO COMPLIANCE.  Notwithstanding anything else in this
Agreement, if the sale and issuance of the Shares is subject to the premerger
notification requirements of the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the "HSR Act"), it shall be a condition to the Closing that
any waiting period under the HSR Act applicable to the purchase of the Shares
shall have expired or been terminated and any approvals required thereunder
shall have been obtained, and each of the parties hereby agree to cooperate in
promptly filing premerger reports and in taking all steps reasonably necessary
to obtain early termination of any applicable HSR Act waiting periods.  If any
such waiting period shall not have expired or been subject to early termination
on or before the date ninety (90) days from the date of this Agreement, either
party may terminate this Agreement by giving written notice to the other.

2.   CLOSING, DELIVERY AND PAYMENT.

     Subject to the terms of Section 5, the closing of the sale and purchase of
the Shares under this Agreement (the "Closing") shall take place concurrently
with, but not before, the closing of the IPO at the offices of Wilson Sonsini
Goodrich & Rosati, Professional Corporation, 650 Page Mill Road, 

                                      -2-
<PAGE>
 
Palo Alto, California 94304. The date of the Closing is referred to as the
"Closing Date." At the Closing, subject to the terms and conditions hereof, the
Company will deliver to Purchaser a certificate representing the number of
Shares to be purchased at the Closing against payment by or on behalf of
Purchaser of the Purchase Price therefor by cash, wire transfer, or by such
other means as shall be mutually agreeable to Purchaser and the Company.

3.   REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

     Except as set forth in the Schedule of Exceptions attached hereto as Annex
1 or as otherwise disclosed in the Registration Statement on Form S-1 (File No.
333-27241) filed with the Securities and Exchange Commission (the "Registration
Statement"), the Company hereby represents and warrants to Purchaser as follows:

     3.1  ORGANIZATION, GOOD STANDING AND QUALIFICATION.  The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Florida, and will, as of the Closing Date, be a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.  The Company has full power and authority to own and operate its
properties and assets, and to carry on its business as presently conducted.  The
Company is duly qualified, is authorized to do business and is in good standing
as a foreign corporation in all jurisdictions in which the nature of its
activities and of its properties (both owned and leased) makes such
qualification necessary, except for those jurisdictions, in the aggregate, in
which failure to do so would not have a material adverse effect on the Company
or its business.

     3.2  AUTHORIZATION; BINDING OBLIGATIONS.  All corporate action on the part
of the Company, its officers, directors and shareholders necessary for the
authorization, execution and delivery of this Agreement and the Certificate of
Incorporation, for the sale and issuance of the Shares pursuant hereto and for
the performance of the Company's obligations hereunder has been taken or will be
taken prior to the Closing.  This Agreement, when executed and delivered, will
be a valid and binding obligation of the Company enforceable in accordance with
its terms.  The sale of the Shares is not and will not be subject to any
preemptive rights or rights of first refusal that have not been properly waived
or complied with.  When issued in compliance with the provisions of this
Agreement and the Certificate of Incorporation, the Shares will be validly
issued, fully paid and nonassessable, and will be free of any liens or
encumbrances; provided, however, that the Shares may be subject to restrictions
on transfer under state and/or federal securities laws as set forth herein or as
otherwise required by such laws at the time a transfer is proposed.

     3.3  COMPLIANCE WITH OTHER INSTRUMENTS.  The execution, delivery and
performance of and compliance with this Agreement and the issuance and sale of
the Shares pursuant hereto will not (i) materially conflict with, or result in a
material breach or violation of, or constitute a material default under, or
result in the creation or imposition of any material lien, (ii) violate,
conflict with or result in the breach of any material terms of, or result in the
material modification of, any material contract or otherwise give any other
contracting party the right to terminate a material contract, or constitute (or
with notice or lapse of time both constitute) a material default under any
material contract to which the Company is a party or by or to which it or any of
its assets or properties may 

                                      -3-
<PAGE>
 
be bound or subject or (iii) result in any violation, or be in conflict with or
constitute a default under any term, of its charter or bylaws..

     3.4  SECURITIES EXEMPTION.  Assuming the accuracy of the representations
and warranties of the Purchaser contained in Section 4.3 hereof, the offer, sale
and issuance of the Shares will be exempt from the registration requirements of
the Securities Act of 1933, as amended (the "Securities Act"), and will have
been registered or qualified (or are exempt from registration and qualification)
under the registration, permit or qualification requirements of all applicable
state securities laws.

      3.5 FULL DISCLOSURE.

          (a)  The Company has delivered to Purchaser a draft of the
Registration Statement substantially in the form to be filed with the
Commission.

          (b)  The Company shall deliver the finalized text of the preliminary
prospectus included in a pre-effective amendment to the Registration Statement
that is to be printed by the Company for distribution to prospective purchasers
(the "Preliminary Prospectus"). When so delivered, the Preliminary Prospectus
shall be appended to this Agreement as Exhibit B and incorporated herein as if
delivered at the time this Agreement was executed. The Preliminary Prospectus
will contain all statements that are required to be stated therein in accordance
with, and will comply as to form in all material respects with, the Securities
Act and will not include any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading.

          (c)  When the Registration Statement becomes effective, and at all
times subsequent thereto, up to the Closing Date, (1) the Registration Statement
and the Prospectus (as hereinafter defined) and any amendments or supplements
thereto will contain substantially all statements that are required to be stated
therein in accordance with the Securities Act and will comply as to form in all
material respects with to the requirements of the Securities Act, and (2)
neither the Registration Statement nor the Prospectus, nor any amendment or
supplement thereto, will include any untrue statement of a material fact or will
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading.

     For purposes of this Agreement, "Prospectus" means the prospectus, as
amended, on file with the Commission at the time the Registration Statement
becomes effective, including the information deemed to be part of the
Registration Statement at the time of effectiveness pursuant to Rule 430A, if
applicable, except that if the Prospectus filed by the Company pursuant to Rule
424(b) differs from the prospectus on file at the time the Registration
Statement becomes effective, the term "Prospectus" shall refer to the Rule
424(b) Prospectus from and after the time it was filed with the Commission or
transmitted to the Commission for filing.

     3.6  VALID ISSUANCE OF SHARES. The Shares which will be purchased by
Purchaser hereunder, when issued, sold and delivered in accordance with the
terms hereof for the consideration expressed herein, will be duly and validly
authorized and issued, fully paid and nonassessable.

                                      -4-
<PAGE>
 
     3.7  LITIGATION, ETC. There is no action, suit, proceeding nor, to the best
of the Company's knowledge, any investigation pending or currently threatened
against the Company, that questions the validity of this Agreement or the right
of the Company to enter into such agreements, or which might result, either
individually or in the aggregate, in any material adverse change in the assets,
condition, affairs or prospects of the Company, financial or otherwise.

     3.8  GOVERNMENTAL CONSENT, ETC.  No consent, approval or authorization of,
or designation, declaration or filing with, any governmental authority on the
part of the Company is required in connection with the valid execution,
delivery, and performance of this Agreement or the offer, sale or issuance of
the Shares, or the consummation of any other transaction contemplated by this
Agreement except certain filings as may be required under the Securities Act and
state securities laws and regulations, which filings will be made timely in
accordance with the applicable law or regulation.

     3.9  TERMINATION OF EMPLOYMENT.  The Company is not aware that any officer
or key employee, or that any group of key employees, intends to terminate their
employment with the Company, nor does the Company have a present intention to
terminate the employment of any of the foregoing.  The employment of each
officer and employee of the Company is terminable at the will of the Company.

     3.10 INTELLECTUAL PROPERTY RIGHTS.  The Company (a) owns or has the right
to use, free and clear of all rights, liens, claims and restrictions, all
patents, trademarks, service marks, trade names, copyrights and other intangible
or intellectual property rights (and licenses with respect to the foregoing)
needed for or used in the conduct of its business as now conducted and as
proposed to be conducted without infringing upon or otherwise acting adversely
to the right or claimed right of any person under or with respect to any of the
foregoing and (b) does not and will not infringe any patents, copyrights,
trademarks or other intellectual property rights (including trade secrets),
privacy or similar rights of any third party, nor has any material claim
(whether embodied in an action, past or present) of such infringement been, to
the Company's knowledge, threatened or asserted nor is such a claim pending
against the Company.  The Company owns or has the unrestricted right to use all
trade secrets, including know-how, inventions, designs, processes, and technical
data required for or incident to the development, manufacture, operation and
sale of all products and services sold or proposed to be sold by the Company and
all of the patents, trademarks, service marks, trade names, copyrights and trade
secrets of the Company are held by the Company free and clear of any rights,
liens or claims of others, including, without limitation, current and former
employees, former employers of all current and former employees, consultants,
officers, directors and shareholders of the Company.  The Company has not
received any communications alleging that the Company has violated or, by
conducting its business as now conducted and as proposed to be conducted would
violate any of the patents, trademarks, service marks, trade names, copyrights
or trade secrets or other proprietary rights of any other person or entity.

     3.11 PROPRIETARY INFORMATION AGREEMENTS. All employees and consultants whom
the Company considers to be key technical employees or consultants are parties
to a written agreement ("Proprietary Information and Inventions Agreement")
under which each such employee or consultant

                                      -5-
<PAGE>
 
(i) is obligated to disclose and transfer to the Company, without the receipt by
such person of any additional value therefor (other than normal salary or fees
for consulting services), all inventions, developments and discoveries which,
during the period of employment with or performance of services for the Company,
he or she makes or conceives of either solely or jointly with others, that
relate to any subject matter which his or her work for the Company may be
concerned, or relate to or are connected with the business, products or projects
of the Company, or involve the use of the time, material or facilities of the
Company, and (ii) is obligated to maintain the confidentiality of proprietary
information of the Company. To the Company's knowledge, no Company employee or
consultant is in violation of the Proprietary Information and Inventions
Agreement to which such employee or consultant is a party. To the Company's
knowledge, no Company employee or consultant is obligated under any contract
(including licenses, covenants or commitments of any nature) or other agreement,
or subject to any judgment, decree or order of any court or administrative
agency, that would conflict with their obligation to use their best efforts to
promote the interests of the Company or that would conflict with the Company's
business as conducted or as proposed to be conducted. Neither the execution nor
delivery of this Agreement nor the carrying on of the Company's business by the
employees and consultants of the Company, nor the conduct of the Company's
business as proposed, will, to the Company's knowledge, conflict with or result
in a breach of the terms, conditions or provisions of, or constitute a default
under, any contract, covenant or instrument under which any of such employees
and consultants is now obligated. The Company does not believe it is or will be
necessary to utilize any inventions of any of its employees and consultants (or
people it currently intends to hire) made prior to their employment by the
Company.

     3.12 LOCK-UP AGREEMENTS. GS Capital Partners, L.P., Kleiner Perkins
Caufield & Byers VII, KPCB VII Founders Fund, KPCB Information Sciences Zaibatsu
Fund II and TMI Telemedia International Ltd. and the executive officers of the
Company have entered into 360 day lock-up agreements with the Company and/or the
underwriters of the IPO in substantially similar form to that entered into by
Purchaser and Racal Datacom Inc. will be, prior to the effectiveness of the
Registration Statement, subject to a 180 day lock-up restriction.

4.   REPRESENTATIONS AND WARRANTIES OF PURCHASER

     Except as set forth in the Williams Holdings of Delaware, Inc.'s annual
report on Form 10-K for the year ended December 31, 1996 and its quarterly
report on Form 10-Q for the quarter ended March 31, 1997, Purchaser hereby
represents and warrants to the Company as follows (such representations and
warranties do not lessen or obviate the representations and warranties of the
Company set forth in this Agreement):

     4.1  REQUISITE POWER AND AUTHORITY. Purchaser has all necessary power and
authority under all applicable provisions of law to execute and deliver this
Agreement and to carry out the provisions of this Agreement. All action on
Purchaser's part required for the lawful execution and delivery of this
Agreement has been or will be effectively taken prior to the Closing. This
Agreement, when executed and delivered, will be a valid and binding obligation
of Purchaser, enforceable in accordance with its terms, except (i) as limited by
applicable bankruptcy, insolvency, reorganization,

                                      -6-
<PAGE>
 
moratorium or other laws of general application affecting enforcement of
creditors' rights and (ii) general principles of equity that restrict the
availability of equitable remedies.

     4.2  CONSENTS. All consents, approvals, orders, authorizations,
registrations, qualifications, designations, declarations or filings with any
governmental or banking authority on the part of Purchaser required in
connection with the consummation of the transactions contemplated in this
Agreement have been or shall have been obtained prior to and be effective as of
the Closing.

     4.3  INVESTMENT REPRESENTATIONS.  Purchaser understands that the Shares
have not been registered under the Securities Act.  Purchaser also understands
that the Shares are being offered and sold pursuant to an exemption from
registration contained in the Securities Act based in part upon Purchaser's
representations contained in the Agreement.  Purchaser hereby represents and
warrants as follows:

          (a)  PURCHASER IS AN ACCREDITED INVESTOR.  Purchaser represents that
Purchaser is an Accredited Investor within the meaning of Rule 501(a) of
Regulation D under the Securities Act.

          (b)  PURCHASER BEARS ECONOMIC RISK. Purchaser understands that it must
bear the economic risk of this investment indefinitely unless the Shares are
registered pursuant to the Securities Act, or an exemption from registration is
available. Purchaser understands that it has no registration rights with respect
to the Shares. Purchaser also understands that there is no assurance that any
exemption from registration under the Securities Act will be available and that,
even if available, such exemption may not allow Purchaser to transfer all or any
portion of the Shares under the circumstances, in the amounts or at the times
Purchaser might propose.

          (c)  ACQUISITION FOR OWN ACCOUNT. Purchaser is acquiring the Shares
for Purchaser's own account for investment only, and not with a view towards
their distribution within the meaning of the Securities Act.

          (d)  PURCHASER CAN PROTECT ITS INTEREST. Purchaser represents that by
reason of its, or of its management's, business or financial experience,
Purchaser has the capacity to protect its own interests in connection with the
transactions contemplated in this Agreement. Purchaser is not a corporation,
trust or partnership specifically formed for the purpose of consummating these
transactions.

          (e)  COMPANY INFORMATION. Purchaser has had an opportunity to discuss
the Company's business, management and financial affairs with directors,
officers and management of the Company and has had the opportunity to review the
Company's operations and facilities. Purchaser has also had the opportunity to
ask questions of and receive answers from, the Company and its management
regarding the terms and conditions of this investment.

     4.4  LEGENDS.  Each certificate representing the Shares may be endorsed
with the following legends:

                                      -7-
<PAGE>
 
          (a)  "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
          REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
          AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED
          UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR
          OTHERWISE DISTRIBUTED EXCEPT (I) IN CONJUNCTION WITH AN EFFECTIVE
          REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT, OR (II) IN
          COMPLIANCE WITH RULE 144 OR (III) PURSUANT TO AN OPINION OF COUNSEL TO
          THE CORPORATION THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED
          AS TO SUCH SALE, OFFER OR DISTRIBUTION."

          (b)  Any other legends required by applicable federal or state blue
sky or securities laws.

The Company need not register a transfer of any Shares, and may also instruct
its transfer agent not to register the transfer of the Shares, unless the
conditions specified in the foregoing legends are satisfied.

     4.5  REMOVAL OF LEGEND AND TRANSFER RESTRICTIONS.

          (a)  Any legend endorsed on a certificate pursuant to subsection
4.4(a) and the stop transfer instructions with respect to such Shares shall be
removed and the Company shall issue a certificate without such legend to the
holder thereof if such legend may be properly removed under the terms of Rule
144 promulgated under the Securities Act or if such holder provides the Company
with an opinion of counsel for such holder, reasonably satisfactory to legal
counsel for the Company, to the effect that a sale, transfer or assignment of
such Shares may be made without registration.

          (b)  Any legend endorsed on a certificate pursuant to subsection
4.4(b) and the stop transfer instructions with respect to such Shares shall be
removed upon receipt by the Company of an order of an appropriate state
securities authority authorizing such removal.

5.   CONDITIONS TO CLOSING.

     5.1  CONDITIONS TO PURCHASER'S OBLIGATIONS AT THE CLOSING. Purchaser's
obligation to purchase the Shares identified in Section 1.2 of the Agreement at
the Closing are subject to the satisfaction, at or prior to the Closing, of the
following conditions:

          (a)  CONCURRENT CLOSING OF FINANCING EVENT. The Closing shall occur
concurrently with, and not before, the closing of the IPO.

          (b)  OTHER INVESTOR PARTICIPATION. The Company will have a binding
commitment by other investors willing to purchase an additional $3 million of
the Company's Common Stock in connection with the investment by the Purchaser
hereunder, pursuant to terms and conditions no

                                      -8-
<PAGE>
 
more favorable to such investors than that offered to Purchaser. The closing of
this investment will occur concurrently with, and not before the closing of the
IPO.

          (c)  REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE OF OBLIGATIONS.
The representations and warranties made by the Company in Section 3 (excepting
Section 3.5(b)) hereof shall be true and correct in all material respects as of
the Closing with the same force and effect as if they had been made as of the
Closing, and the Company shall have performed and complied with all obligations
and conditions herein required to be performed or complied with by it on or
prior to the Closing; provided, that the foregoing limitation as to "material
respects" shall not apply to those representations and warranties already
subject to a materiality qualifier.

          (d)  LEGAL INVESTMENT. At the time of the Closing, the sale and
issuance of the Shares shall be legally permitted by all laws and regulations to
which Purchaser and the Company are subject.

          (e)  CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained
any and all authorizations, approvals, consents, permits and waivers necessary
or appropriate for consummation of the transactions contemplated by this
Agreement (except for such as may be properly obtained subsequent to the
Closing, and such items shall be effective on and as of the Closing).

          (f)  CERTIFICATE OF STATUS. The Company shall have obtained a
Certificate of Status from the Delaware Secretary of State dated as of a recent
date prior to the Closing.

          (g)  COPIES. The Company shall have delivered to Purchaser a true and
complete copy of the Registration Statement and any amendments thereto, of each
exhibit filed therewith and of the Preliminary Prospectus and final form of
Prospectus.

          (h)  PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in
connection with the transactions contemplated at the Closing and all documents
and instruments incident to such transactions shall be reasonably satisfactory
in form and substance to counsel to Purchaser, and counsel to Purchaser shall
have received all such counterpart originals or certified or other copies of
such documents as they may reasonably request.

          (i)  OUTSTANDING PREFERRED STOCK. The shares of Preferred Stock of the
Company, issued and outstanding as of the date of this Agreement, will convert
into shares of Common Stock in connection with the IPO.

          (j)  COMPLIANCE CERTIFICATE. The Company shall have delivered to
Purchaser a Compliance Certificate, executed by the President and the Chief
Financial Officer of the Company, dated the Closing Date, to the effect that the
conditions specified in subparagraphs (a) through (i) of this Section 5.1 have
been satisfied.

                                      -9-
<PAGE>
 
          (k)  LEGAL OPINION. The Company shall have delivered an opinion of
counsel to the Purchaser in substantially the form attached hereto as Exhibit C.

     5.2  CONDITIONS TO OBLIGATIONS OF THE COMPANY. The Company's obligation to
issue and sell the Shares at the Closing is subject to the satisfaction, on or
prior to the Closing, of the following conditions:

          (a)  CONCURRENT CLOSING OF THE FINANCING EVENT. The Closing shall
occur concurrently with, but not before, the closing of the Financing Event.

          (b)  REPRESENTATIONS AND WARRANTIES TRUE. The representations and
warranties made by Purchaser in Section 4 hereof shall be true and correct in
all material respects at the date of the Closing, with the same force and effect
as if they had been made on and as of said date.

          (c)  PERFORMANCE OF OBLIGATIONS. Purchaser shall have performed and
complied with all agreements and conditions herein required to be performed or
complied with by Purchaser on or before the Closing.

6.   COVENANTS OF THE COMPANY.

     6.1  BOARD SEAT. The Company will place a designee of the Purchaser on the
Board of Directors of the Company to fill the vacancy left by the resignation of
Randy Maslow, which resignation is to be effective as of the closing of the IPO,
and will nominate a designee of the Purchaser to sit on the Board of Directors
so long as Purchaser holds at least 5% of the issued and outstanding capital
stock of the Company.

     6.2  NOTICE OF ACQUISITION OFFER. The Company will provide a copy to
Purchaser of any notice delivered or required to be delivered to TMI Telemedia
International Ltd. ("TMI") pursuant to Section 1.0 of Annex 6 of that certain
Network Deployment, Services Distribution and Network Provision Agreement
between the Company and TMI immediately after such notice is delivered to TMI.

     6.3  RULE 144 REPORTING. With a view to making available to Purchaser the
benefits of certain rules and regulations of the SEC which may permit the sale
of the Shares to the public without registration, the Company agrees at all
times after ninety (90) days after the effective date of the Registration
Statement to:

          (a)  make and keep public information available, as those terms are
understood and defined in SEC Rule 144.

          (b)  file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Securities
Exchange Act of 1934, as amended (the "Exchange Act").

                                      -10-
<PAGE>
 
          (c)  So long as Purchaser owns any Shares, to furnish to Purchaser
within a reasonable time upon a written request by Purchaser, a written
statement by the Company as to its compliance with the reporting requirements of
said Rule 144 (at any time after ninety (90) days after the effective date of
the first registration statement filed by the Company for an offering of its
securities to the general public) and of the Exchange Act (at any time after it
has become subject to such reporting requirements), a copy of the most recent
annual or quarterly report of the Company, and such other reports and documents
so filed by the Company as Purchaser may reasonably request in complying with
any rule or regulation of the SEC allowing Purchaser to sell any such securities
without registration.

7.   MISCELLANEOUS

     7.1  GOVERNING LAW. This Agreement shall be governed in all respects by the
laws of the State of California.

     7.2  SURVIVAL. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by Purchaser and the closing of
the transactions contemplated hereby. All statements as to factual matters
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant hereto in connection with the transactions contemplated
hereby shall be deemed to be representations and warranties by the Company
hereunder solely as of the date of such certificate or instrument, except as
expressly provided otherwise in such certificate or instrument.

     7.3  SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided herein,
the provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto
and shall inure to the benefit of and be enforceable by each person who shall be
a holder of the Shares from time to time; provided, however, that prior to the
receipt by the Company of adequate written notice of the transfer of any Shares
specifying the full name and address of the transferee, the Company may deem and
treat the person listed as the holder of such Shares in its records as the
absolute owner and holder of such Shares for all purposes, including the payment
of any dividends or any redemption price.

     7.4  SEPARABILITY. In case any provision of the Agreement shall be invalid,
illegal or unenforceable, such provision shall, to the extent practicable, be
modified so as to make it valid, legal and enforceable and to maintain as nearly
as practicable the intent of the parties, and the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

     7.5  AMENDMENT AND WAIVER.

          (a)  This Agreement may be amended or modified only upon the written
consent of the parties hereto.

                                      -11-
<PAGE>
 
          (b)  The obligations of the Company and the rights of the holder of
the Shares under this Agreement may be waived only with the written consent of
the parties hereto.

          (c)  Except to the extent provided in this Section 7.5, neither this
Agreement nor any provision hereof may be changed, waived, discharged or
terminated, except by a statement in writing signed by the party against which
enforcement of the change, waiver, discharge or termination is sought.

          (d)  Any amendment or waiver effected in accordance with this Section
7.5 shall be binding upon any future holder of some or all of the Shares.

     7.6  NOTICES. All notices and other communications required or permitted
hereunder shall be in writing and shall be deemed effectively given and received
(a) upon personal delivery, (b) on the fifth day following mailing sent by
registered or certified mail, return receipt requested, postage prepaid, (c)
upon confirmed delivery by means of a nationally recognized overnight courier
service or (d) upon confirmed transmission of facsimile addressed: (i) if to
Purchaser, at Purchaser's address as set forth on the Company's records, or at
such other address as Purchaser shall have furnished to the Company in writing
or (ii) if to the Company, at its address as set forth at the end of this
Agreement, or at such other address as the Company shall have furnished to
Purchaser in writing.

     7.7  EXPENSES. The Company shall pay all costs and expenses that it incurs
with respect to the negotiation, execution, delivery and performance of the
Agreement, and Purchaser shall pay all costs and expenses that it incurs with
respect to the negotiation, execution, delivery and performance of this
Agreement.

     7.8  ATTORNEYS' FEES. If legal action is brought to enforce or interpret
this Agreement, the prevailing party shall be entitled to recover its reasonable
attorneys' fees and legal costs in connection therewith.

     7.9  TITLES AND SUBTITLES. The titles of the paragraphs and subparagraphs
of the Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.

     7.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one instrument.

     7.11 BROKER'S FEES. Each party hereto represents and warrants that no
agent, broker, investment banker, person or firm acting on behalf of or under
the authority of such party hereto is or will be entitled to any broker's or
finder's fee or any other commission directly or indirectly in connection with
the transactions contemplated herein. Each party hereto further agrees to
indemnify each other party for any claims, losses or expenses incurred by such
other party as a result of the representation in this Section 7.11 being untrue.

                                      -12-
<PAGE>
 
     7.12 TERMINATION. If the Registration Statement for the IPO has not become
effective or the Preferred Financing has not closed by October 31, 1997,
Purchaser in its discretion may elect to terminate this Agreement by providing
written notice to the Company by November 10, 1997.

     7.13 SUBSEQUENT CONSENTS, PERMITS AND WAIVERS. The Company shall obtain
promptly after the Closing all authorizations, approvals, consents, permits and
waivers that are necessary or applicable for consummation of the transactions
contemplated by this Agreement and that were not obtained prior to the Closing
because they may be properly obtained subsequent to the Closing.

                                      -13-
<PAGE>
 
     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date set forth in the first paragraph hereof.

COMPANY:

CONCENTRIC NETWORK CORPORATION
10590 N. Tantau Avenue
Cupertino, CA 95014


By: /s/ Henry R. Nothhaft
   --------------------------------------- 
     Henry R. Nothhaft
     President and Chief Executive Officer


PURCHASER:

WILLIAMS COMMUNICATIONS GROUP, INC.


By: /s/ S. Miller Williams
   ---------------------------------------
    S. Miller Williams

Its
   ---------------------------------------

                                      -14-