Document:

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                                                                   EXHIBIT 10.57

                             EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (the "Agreement"), dated as of October 20, 2000,
                                     ---------
is by and between FirstWorld Communications, Inc., a Delaware corporation (the

"Company") and J. Thomas McGrath ("Executive") (collectively, the "Parties").
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                                   RECITALS

     The Company desires to employ Executive, effective as of November 6, 2000
(the "Commencement Date"), on the terms and conditions set forth in this
      -----------------
Agreement, and Executive desires to be so employed.

                                   AGREEMENT

     IN CONSIDERATION of the premises and the mutual covenants set forth below,
the parties hereby agree as follows:

     1.  Employment.  The Company hereby agrees to employ Executive as President
         ----------
and Chief Executive Officer of the Company, and Executive hereby accepts such
employment, on the terms and conditions hereinafter set forth. Executive
acknowledges that he may be employed by a subsidiary of the Company, however,
the Company will remain liable for all obligations contained in this Agreement.

     2.  Term.  The period of employment of Executive by the Company hereunder
         ----
(the "Employment Period") shall commence at the Commencement Date and shall
      -----------------
continue through November 6, 2002. The Employment Period may be sooner
terminated by either party in accordance with Section 5 of this Agreement.

     3.  Position and Duties.  During the Employment Period, Executive shall
         -------------------
serve as President and Chief Executive Officer, of the Company. Executive shall
devote such time, attention and energies to Company affairs as are necessary to
fully perform his duties (other than absences due to illness or vacation) for
the Company. During the Employment Period, Executive shall not, directly or
indirectly, render services to any other organization, entity or person, as an
employee, independent contractor, consultant or otherwise, with or without
compensation, without the prior written consent of the Board of Directors of the
Company (the "Board").
              -----

     4.  Compensation and Related Matters.
         --------------------------------

         (a)  Equalization Payment.  To compensate Executive for certain
benefits that he may lose or forfeit as a result of his termination of
employment with his former employer, and commencement of employment with the
Company, the Company shall pay Executive a payment in the amount of Two Hundred
Fifty Thousand and 00/Dollars ($250,000.00), less all applicable withholdings
(the "Equalization Payment") payable with Executive's first regularly
      --------------------
scheduled paycheck, provided, however, that if Company terminates Executive's
                    --------  -------
employment with Cause or if

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Executive terminates employment without Good Reason, Executive shall, as of the
Date of Termination of employment, reimburse the Company a prorated amount of
the Equalization Payment based on the number of days employed compared to one
full year of employment. By way of example, if Executive's employment is so
terminated six months from the Commencement Date, the calculation would be as
follows: $250,000/365 = $685 x 182.5 (days Executive employed) = $125,012;
$250,000 - $125,012 = $124,988 due to Company from Executive. Executive
authorizes the Company to withhold an amount sufficient to satisfy such
reimbursement obligation from any sums otherwise due the Executive under this
Agreement or otherwise.

          (b)  Salary.  During the Employment Period, the Company shall pay
Executive an annual base salary of Three Hundred Thousand and 00/Dollars
($300,000.00) per year ("Base Salary"). Executive's Base Salary shall be paid in
                         -----------
approximately equal installments in accordance with the Company's customary
payroll schedule and practices. Executive's Base Salary shall be subject to
annual reviews commencing November 6, 2001, and each year thereafter. If
Executive's Base Salary is increased by the Company, such increased Base Salary
shall then constitute the Base Salary for all purposes of this Agreement. All
compensation paid to Executive shall be subject to withholding and other
employment taxes imposed by applicable law.

          (c)  Annual Bonus.  The Board's Compensation Committee (the
"Compensation Committee") or its delegate shall review Executive's performance
 ----------------------
at least once quarterly during each year of the Employment Period to review the
Executive's performance pursuant to the procedures and terms of Company's
Quarterly Bonus Plan ("Bonus Plan"), as in effect from time to time. The
percentage of Executive's Salary to be used for calculations under the Bonus
Plan shall be an amount equal to 100% of the Executive's Base Salary. The
Executive's Bonus shall be paid pursuant to the terms and conditions of the
Bonus Plan.

          (d)  Stock Options.

               (i)  Stock Option Agreement:

                    a.  Executive shall be awarded a stock option (the "Stock
                                                                        -----
     Option") effective as of November 6, 2000 ("Option Grant Date") to purchase
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     One Million (1,000,000) shares of the Company's Series B Common Stock, par
     value $.0001 per share (the "Common Stock"). The shares of Common Stock
                                  ------------
     subject to the Stock Option shall vest in increments of Four Hundred
     Thousand (400,000) shares on the first anniversary of the Option Grant
     Date; Three Hundred Thousand (300,000) shares on the second anniversary of
     the Option Grant Date; and Three Hundred Thousand (300,000) shares on the
     third anniversary of the Option Grant Date. The Purchase Price for the
     Common Stock covered by the Option shall be equal to the fair market value
     of the Common Stock as measured by the closing price of a share of Common
     Stock on NASDAQ on the Option Grant Date. The Stock Option will be granted
     under the 1999 Equity Incentive Plan of FirstWorld Communications, Inc.
     (the "Plan") and the terms and conditions of the Stock Option will be
           ----
     determined in accordance with the Plan; provided however, to the extent
     such terms of the Plan or the Stock Option agreement conflict with the
     terms of the Employment Agreement, the terms of the Employment Agreement
     will control. To the extent permissible under applicable law and the Plan,
     the Stock Option granted will be granted as incentive stock options.

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                    b.  the Option Agreement shall contain a provision relating
     to the expiration of the right to exercise vested Stock Options, which
     shall read as follows:

          If the Optionee's employment is terminated by the Company without
          Cause or by the Optionee for Good Reason, pursuant to Optionee's
          Employment Agreement, the Executive shall have the right to exercise
          the Options vested at the time of such termination upon the later to
          occur of: (i) November 6, 2002, or (ii) ninety (90) days from the Date
          of Termination of Employment.

                    c.  The Option Agreement shall contain a provision related
     to Change of Control and Accelerated Vesting as follows:

          Notwithstanding any terms in the Plan to the contrary, this Option
          Agreement, the Employment Agreement, or otherwise, all of the Options
          granted hereunder shall become vested and exercisable immediately
          prior to such transaction in the event of the sale of all or
          substantially all of the Company's assets or a merger or consolidation
          in which the Company is not the surviving entity, or the Company's
          stockholders prior to the transaction own less than 50% of the voting
          power of the Company's outstanding securities immediately following
          the transaction. In addition, upon termination of Executive's
          employment by the Company without Cause or by the Executive for Good
          Reason prior to the expiration of the Employment Period, those Options
          granted hereunder that would otherwise become vested on or before
          November 6, 2002, shall become vested and exercisable.

          (e)  Expenses.  The Company shall promptly reimburse Executive for all
reasonable business expenses upon the presentation of reasonably itemized
statements of such expenses in accordance with the Company's policies and
procedures now in force or as such policies and procedures may be modified with
respect to all senior executive officers of the Company.

          (f)  Relocation Expenses.  The Company requires Executive to relocate
to the Denver, Colorado metropolitan area and Executive agrees that he will so
relocate. The Company will reimburse Executive 100% of reasonable relocation
expenses (e.g., temporary living expenses, house-hunting trips, transport of
household goods, temporary storage of household goods, and any costs incurred as
a result of selling a home in your current location and buying a home in your
new location) ("Relocation Payment") upon the presentation of itemized
                ------------------
statements of such expenses in accordance with the Company's policies and
procedures now in force or as such policies and procedures may be modified with
respect to all senior executive officers of the Company, provided, however, that
                                                         -----------------
if Company terminates Executive's employment with Cause or if Executive
terminates employment without Good Reason, Executive shall, as of the Date of
Termination of employment, reimburse the Company a prorated amount of the
Relocation Payment based on the number of days employed compared to one full
year of employment. By way of example, if Executive's employment is so
terminated six months from the Commencement Date and the Relocation Payment was
$5,000, the calculation would be as follows: $5,000/365 = $14 x 182.5 (days
Executive employed) = $2,555; $5,000 - $2,555 = $2,445 due to Company from
Executive. Executive

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authorizes the Company to withhold an amount sufficient to satisfy such
reimbursement obligation from any sums otherwise due the Executive under this
Agreement or otherwise.

                    (g)  Welfare and Other Plans.  In addition to Executive's
Base Salary and any incentive compensation and bonuses awarded to Executive
hereunder, he (and his family) shall be entitled to participate, to the extent
that he is (and they are) eligible under the terms and conditions thereof, in
any 401k plan, retirement, hospitalization, insurance, disability or medical
service plan generally available to the executive officers of the Company that
may be in effect from time to time during the Employment Period. The Company
shall be under no obligation to institute or continue the existence of any such
employee benefit plan. Executive is entitled to four (4) weeks vacation per
calendar year.

                    (h)  Additional Options: On or about early January 2002, the
Compensation Committee or its delegate(s) shall meet with the Executive and
discuss whether to grant Executive additional stock options.

     5.  Termination.  Executive's employment hereunder may be terminated during
         -----------
the Employment Period under the following circumstances:

         (a)  Death.  Executive's employment hereunder shall terminate upon his
death.

         (b)  Disability.  If, as a result of Executive's incapacity due to
physical or mental illness, Executive shall have been substantially unable to
perform his duties hereunder for an entire period of thirty (30) consecutive
days, and within thirty (30) days after written Notice of Termination (as
defined in Section 6(a)) is given after such thirty (30) day period, Executive
shall not have returned to the substantial performance of his duties on a full-
time basis, the Company shall have the right to terminate Executive's employment
hereunder for "Disability," and such termination in and of itself shall not be,
nor shall it be deemed to be, a breach of this Agreement.

         (c)  Cause.  The Company shall have the right to terminate Executive's
employment for Cause (as defined), and such termination in and of itself shall
not be, nor shall it be deemed to be, a breach of this Agreement. For purposes
of this Agreement, the Company shall have "Cause" to terminate Executive's
employment upon Executive's:

              (i)   conviction of, or plea of guilty or nolo contendere to, any
     crime constituting a felony;

              (ii)  commission of a material act of dishonesty, fraud,
     misrepresentation or other act of moral turpitude that would, in the
     Board's reasonable judgment, prevent the effective performance of his
     duties hereunder;

              (iii) continued failure to substantially perform his duties
     hereunder to the reasonable satisfaction of the Board (other than such
     failure resulting from Executive's incapacity due to physical or mental
     illness) after demand for substantial performance is delivered by the Board
     in writing that specifically identifies the manner in which the Board
     believes Executive has not used reasonable best efforts to substantially
     perform his duties; or

                                      -4-
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              (iv) willful misconduct (including, but not limited to, a willful
     breach of the provisions of Section 8) that is, in the Board's reasonable
     judgment, injurious to the Company or to any entity in control of,
     controlled by or under common control with the Company ("Affiliate").
                                                              ---------

     For purposes of this Section 5(c), no act, or failure to act, by Executive
shall be considered "willful" unless committed in bad faith and without a
reasonable belief that the act or omission was in the best interests of the
Company or any Affiliates thereof; provided, however, that the requirements
                                   --------  -------
outlined in paragraphs (iii) or (iv) above shall be deemed to have occurred if
Executive's action or non-action continues for more than ten (10) days after
Executive has received written notice of the inappropriate action or non-action.
This Section 5(c) shall not prevent Executive from challenging the Board's
determination that Cause exists or that Executive has failed to cure any act (or
failure to act) that purportedly formed the basis for the Board's determination,
under the arbitration procedures set forth in Section 10 below.

          (d)  Good Reason.  Executive may terminate his employment for "Good
Reason" within thirty (30) days after Executive has actual knowledge of the
occurrence, without the written consent of Executive, of one of the following
events that has not been cured within thirty (30) days after written notice
thereof has been given by Executive to the Company (provided, that with
                                                    --------
respect to this Section 5(d), the Company shall have the right to challenge
Executive's determination that he has the right to terminate his employment for
"Good Reason" under the arbitration procedures set forth in Section 10 below):

               (i)   a reduction by the Company in Executive's Base Salary or a
     failure by the Company to pay any such amounts when due;

               (ii)  the Company's failure to provide the Stock Option
     referenced in paragraph 4(d)1, or the Company's material breach of one or
     more of the stock option agreements pursuant to which the Stock Option was
     issued to Executive;

               (iii) the Company's failure to substantially provide any material
     employee benefits due to be provided to Executive; or

               (iv)  the Company's failure to provide in all material respects
     the indemnification set forth in the agreement referenced in Section 9 of
     this Agreement.

     Executive's continued employment during the thirty (30) day period referred
to above in this paragraph (d) shall not constitute Executive's consent to, or a
waiver of rights with respect to, any act or failure to act constituting Good
Reason hereunder.

          (e)  Without Good Reason or Cause. Executive shall have the right to
terminate his employment hereunder without Good Reason and the Company shall
have the right to terminate Executive's employment hereunder without Cause by
providing the other with a Notice of Termination, and such termination shall not
in and of itself be, nor shall it be deemed to be, a breach of this Agreement.

                                      -5-
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     6.  Termination Procedure.
         ---------------------

         (a)  Notice of Termination.  Any termination of Executive's employment
by the Company or by Executive during the Employment Period (other than
termination pursuant to Section 5(a)) shall be communicated by written Notice of
Termination (as defined below) to the other party hereto in accordance with
Section 12 below. For purposes of this Agreement, a "Notice of Termination"
shall mean a notice which shall indicate the specific termination provision in
this Agreement relied upon and shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of Executive's
employment under the provision so indicated.

         (b)  Date of Termination.  "Date of Termination" shall mean (i) if
Executive's employment is terminated by his death, the date of his death, (ii)
if Executive's employment is terminated pursuant to Section 5(b), thirty (30)
days after Notice of Termination (provided that Executive shall not have
returned to the substantial performance of his duties on a full-time basis
during such thirty (30) day period) and (iii) if Executive's employment is
terminated for any other reason, the date on which a Notice of Termination is
given or any later date (within thirty (30) days after the giving of such
notice) set forth in such Notice of Termination.

     7.  Compensation upon Termination or During Disability.  In the event
         --------------------------------------------------
Executive is disabled or his employment terminates during the Employment Period,
the Company shall provide Executive with the payments and benefits set forth
below. Executive acknowledges and agrees that the payments set forth in this
Section 7 constitute liquidated damages for termination of his employment during
the Employment Period.

         (a)  Termination by Company without Cause or by Executive for Good
Reason. If Executive's employment is terminated by the Company without Cause or
by Executive for Good Reason:

              (i)   Within thirty (30) days following the Date of Termination,
     the Company shall pay to Executive a severance payment equal to the greater
     of the amount of Base Salary Executive would have received under the
     Agreement if Executive had remained employed throughout the Employment
     Period stated in Section 2, or the amount of Base Salary Executive is
     entitled to receive for twelve (12) months, plus accrued vacation;

              (ii)  Within thirty (30) days following the Date of Termination,
     the Company shall reimburse Executive pursuant to Section 4(e) for
     reasonable expenses incurred, but not paid prior to such termination of
     employment; and

              (iii) Executive shall be entitled to any other rights,
     compensation and/or benefits as may be due to Executive as of the Date of
     Termination, in accordance with the terms and provisions of any agreements,
     plans or programs of the Company.

          (b) Termination by Company for Cause or by Executive without Good
Reason. If Executive's employment is terminated by the Company for Cause or by
Executive (other than for Good Reason):

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               (i)   the Company shall pay Executive his Base Salary and, to the
     extent required by law or the Company's vacation policy, his accrued
     vacation pay through the Date of Termination, as soon as practicable
     following the Date of Termination;

               (ii)  the Company shall reimburse Executive pursuant to Section
     4(e) for reasonable expenses incurred, but not paid prior to such
     termination of employment, unless such termination resulted from a
     misappropriation of Company funds; and

               (iii) Executive shall be entitled to any other rights,
     compensation and/or benefits as may be due to Executive as of the Date of
     Termination in accordance with the terms and provisions of any agreements,
     plans or programs of the Company.

          (c)  Disability.  During any period that Executive fails to perform
his duties hereunder as a result of incapacity due to physical or mental
illness, Executive shall continue to receive his full Base Salary set forth in
Section 4(b) until his employment is terminated pursuant to Section 5(b). In the
event Executive's employment is terminated for Disability pursuant to Section
5(b):

               (i)   Within 30 days following the Date of Termination, the
     Company shall pay to Executive his Base Salary and accrued vacation pay
     through the Date of Termination;

               (ii)  the Company shall reimburse Executive pursuant to Section
     4(e) for reasonable expenses incurred, but not paid prior to such
     termination of employment; and

               (iii) Executive shall be entitled to any other rights,
     compensation and/or benefits as may be due to Executive as of the Date of
     Termination, in accordance with the terms and provisions of any agreements,
     plans or programs of the Company.

          (d)  Death.  If Executive's employment is terminated by his death:

               (i)   the Company shall pay in a lump sum to Executive's
     beneficiary, legal representatives or estate, as the case may be,
     Executive's Base Salary through the Date of Termination;

               (ii)  the Company shall reimburse Executive's beneficiary, legal
     representatives, or estate, as the case may be, pursuant to Section 4(e)
     for reasonable expenses incurred, but not paid prior to such termination of
     employment; and

               (iii) Executive's beneficiary, legal representatives or estate,
     as the case may be, shall be entitled to any other rights, compensation and
     benefits as of the Date of Termination, as may be due to any such persons
     or estate in accordance with the terms and provisions of any agreements,
     plans or programs of the Company.

     8.  Confidential Information, Ownership of Documents, Non-Competition.
         -----------------------------------------------------------------

         (a)  Confidential Information.  Executive shall hold in a fiduciary
capacity for the benefit of the Company all Confidential Information (as defined
below) relating to the Company and

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<PAGE>

its businesses and investments, which shall have been obtained by Executive
during Executive's employment by the Company and which is not generally
available public knowledge (other than by acts of Executive in violation of this
Agreement). Except as may be required or appropriate in connection with his
carrying out his duties under this Agreement, Executive shall not, without the
prior written consent of the Company or as may otherwise be required by law or
any legal process, or as is necessary in connection with any adversarial
proceeding against the Company (in which case Executive shall use his reasonable
best efforts in cooperating with the Company in obtaining a protective order
against disclosure by a court of competent jurisdiction), communicate or divulge
any such Confidential Information relating to the Company to anyone other than
the Company and those designated by the Company or on behalf of the Company in
the furtherance of its business or to perform duties hereunder.

     For the purposes hereof, the term "Confidential Information" means, with
respect to any person, any information concerning such person or its business,
products, financial condition, prospects and affairs that is not generally
available to the public.  The term Confidential Information shall not include
information that: (i) is already known to the recipient and was properly
obtained by the recipient prior to the date of this Agreement; (ii) is in the
public domain other than through a negligent act or omission or willful
misconduct of the recipient; (iii) is acquired in good faith from a third party
and, at the time of the acquisition, the recipient had no knowledge or reason to
believe that such information was wrongfully obtained or disclosed by the third
party; (iv) is independently developed by the recipient from information not
defined as "Confidential Information" in this Agreement, as evidenced by the
recipient's written records; (v) is disclosed to third parties by the disclosing
party without restriction; (vi) is required to be disclosed under applicable law
or by a valid subpoena or other court or governmental order, decree, regulation
or rule; provided, however, that if disclosure is required under this provision
         --------  -------
the recipient shall advise the disclosing party of the requirement to disclose
the Confidential Information prior to such disclosure and as soon as reasonably
practicable after the recipient becomes aware of such required disclosure; and

further provided that upon the request of the disclosing party, the recipient
------- -------- ----
agrees to cooperate in good faith with any reasonable and lawful actions which
the disclosing party takes to resist such disclosure, limit the information to
be disclosed or limit the extent to which the information so disclosed may be
used or made available to third parties, at the cost of the disclosing party.

          (b)  Removal of Documents; Rights to Products. All records, files,
drawings, documents, models, equipment, and the like relating to the Company's
business, which Executive has control over shall not be removed from the
Company's premises by Executive without the Board's written consent, unless such
removal is in the furtherance of the Company's business or is in connection with
Executive's carrying out his duties under this Agreement and, if so removed by
Executive, shall be returned to the Company promptly after termination of
Executive's employment hereunder, or otherwise promptly after removal if such
removal occurs following termination of employment. Executive shall assign to
the Company all rights to trade secrets and other products relating to the
Company's business developed by him alone or in conjunction with others at any
time while employed by the Company.

          (c)  Non-Compete.  During the Employment Period and until the first
anniversary of Executive's Date of Termination, in the event Executive is
terminated by the Company for Cause, Executive terminates employment without
Good Reason, or Executive is terminated by the Company for Disability, the
Executive will not (i) engage, anywhere within the geographical areas in which
the Company or any of its controlled Affiliates (the "Designated Entities") are
                                                      -------------------
conducting their business operations or providing services as of the Date of

                                      -8-
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Termination, in any business which is being engaged in by the Designated
Entities as of the Date of Termination or pursue or attempt to develop any
project known to Executive and which the Designated Entities are pursuing,
developing or attempting to develop as of the Date of Termination (a "Project"),
                                                                      -------
unless such Project has been inactive for over nine (9) months, directly or
indirectly, alone, in association with or as a stockholder, principal, agent,
partner, officer, director, employee or consultant of any other organization,
(ii) divert to any entity which is engaged in any business conducted by the
Designated Entities in the same geographic area as the Designated Entities, any
Project or any customer of any of the Designated Entities or (iii) solicit any
officer, employee (other than secretarial staff) or consultant of any of the
Designated Entities to leave the employ of any of the Designated Entities.
Notwithstanding the preceding sentence, Executive shall not be prohibited from
owning less than five (5%) percent of any publicly traded corporation, whether
or not such corporation is in competition with the Company. If, at any time, the
provisions of this Section 8(c) shall be determined to be invalid or
unenforceable, by reason of being vague or unreasonable as to area, duration or
scope of activity, this Section 8(c) shall be considered divisible and shall
become and be immediately amended to only such area, duration and scope of
activity as shall be determined to be reasonable and enforceable by the court or
other body having jurisdiction over the matter; and Executive agrees that this
Section 8(c) as so amended shall be valid and binding as though any invalid or
unenforceable provision had not been included herein.

          (d)  Continuing Operation. Except as specifically provided in this
Section 8, the termination of Executive's employment or of this Agreement shall
have no effect on the continuing operation of this Section 8.

     9.   Indemnification.
          ---------------

          (a)  Upon the Commencement Date, Executive will enter into the
Company's standard directors and officers indemnification agreement.

          (b)  Upon the Commencement Date, the Company will ensure that
Executive is added as an insured on its directors and officers liability
insurance policy. In the event that Executive's employment relationship with the
Company is severed, for any reason, the Company will provide that Executive
shall continue to be an insured under the Company's directors and officers
liability insurance policy for as long as the Company retains such coverage, and
if the Company discontinues such coverage, Executive and/or his heirs or
personal or legal representative shall be given the opportunity to purchase
continuation coverage in accordance with the terms of the applicable policy.

     10.  Arbitration.  Any controversy between Executive and the Company
          -----------
involving the construction or application of any of the terms, provisions or
conditions of this Agreement, including, without limitation, the determination
of whether "Cause" or "Good Reason" exists under Section 5(c) or Section 5(d)
hereof and claims involving specific performance, shall on the written request
of either party served on the other in accordance with Section 12 below be
submitted to binding arbitration. EACH PARTY, BY SIGNING THIS AGREEMENT,
VOLUNTARILY, KNOWINGLY AND INTELLIGENTLY WAIVES ANY RIGHTS SUCH PARTY MAY
OTHERWISE HAVE TO SEEK REMEDIES IN COURT OR OTHER FORUMS, INCLUDING

                                      -9-
<PAGE>

THE RIGHT TO A JURY TRIAL. Arbitration shall comply with and be governed in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association (the "AAA").  The arbitration will be conducted only in Denver,
                  ---
Colorado, before a single arbitrator selected by the parties or, if they are
unable to agree on an arbitrator, before an arbitrator selected by the AAA.  The
arbitrator shall have full authority to order specific performance and award
damages and other relief available under this Agreement or applicable law, but
shall have no authority to add to, detract from, change or amend the terms of
this Agreement or existing law.  All arbitration proceedings, including
settlements and awards, shall be confidential.  The decision of the arbitrator
will be final and binding, and judgment on the award by the arbitrator may be
entered in any court of competent jurisdiction.  THIS SUBMISSION AND AGREEMENT
TO ARBITRATE WILL BE SPECIFICALLY ENFORCEABLE.  The arbitrator will have no
power to award punitive or exemplary damages, to ignore or vary the terms of
this Agreement and any other agreement between Executive and the Company and
will be bound to apply controlling law.  The prevailing party in any such
arbitration shall be entitled to receive the costs of arbitration, including
reasonable attorneys' fees and costs, from the losing party.

     11.  Successors, Binding Agreement.
          -----------------------------

          (a)  Company's Successors.  No rights or obligations of the Company
under this Agreement may be assigned or transferred, except that the Company
will require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company to expressly assume and agree to perform this Agreement in
the same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place. As used in this Agreement,
"Company" shall mean the Company as herein before defined and any successor to
its business and/or assets (by merger, purchase or otherwise) which executes and
delivers the agreement provided for in this Section 11 or which otherwise
becomes bound by all the terms and provisions of this Agreement by operation of
law.

          (b)  Executive's Successors.  No rights or obligations of Executive
under this Agreement may be assigned or transferred by Executive other than his
rights to payments or benefits hereunder, which may be transferred only by will
or the laws of descent and distribution. Upon Executive's death, this Agreement
and all rights of Executive hereunder shall inure to the benefit of and be
enforceable by Executive's beneficiary or beneficiaries, personal or legal
representatives or estate, to the extent any such person succeeds to Executive's
interests under this Agreement. Executive shall be entitled to select and change
a beneficiary or beneficiaries to receive any benefit or compensation payable
hereunder following Executive's death by giving the Company written notice
thereof. In the event of Executive's death or a judicial determination of his
incompetence, reference in this Agreement to Executive shall be deemed, where
appropriate, to refer to his beneficiary(ies), estate or other legal
representative(s). If Executive should die following his Date of Termination
while any amounts would still be payable to him hereunder if he had continued to
live, all such amounts unless otherwise provided herein shall be paid in
accordance with the terms of this Agreement to such person or persons so
appointed in writing by Executive, or otherwise to his legal representatives or
estate.

     12.  Notice.  For the purposes of this Agreement, notices, demands and all
          ------
other communications provided for in this Agreement shall be in writing and
shall be deemed to have been

                                      -10-
<PAGE>

duly given when delivered either personally or by United States certified or
registered mail, return receipt requested, postage prepaid, addressed as
follows:

         If to Executive:     J. Thomas McGrath
                              6528 Twin Oaks Drive
                              Plano, TX 75024
                              Facsimile: (972) 625-5030

         If to the Company:   FirstWorld Communications, Inc.
                              8390 East Crescent Parkway, Suite 300
                              Greenwood Village, CO 80111
                              Attn: General Counsel
                              Facsimile: (303) 874-2461

or to such other address as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.

     13.  Waiver.  No provisions of this Agreement may be amended, modified, or
          ------
waived unless such amendment or modification is agreed to in a writing signed by
Executive and by a duly authorized officer of the Company, and such waiver is
set forth in writing and signed by the party to be charged.  No waiver by either
party hereto at any time of any breach by the other party hereto of any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time.

     14.  Survival.  Except as otherwise expressly set forth herein, the
          --------
respective rights and obligations of the parties under this Agreement shall
survive Executive's termination of employment and the termination of this
Agreement to the extent necessary for the intended preservation of such rights
and obligations.

     15.  Choice of Law.  The validity, interpretation, construction and
          -------------
performance of this Agreement shall be governed by the laws of the State of
Colorado without regard to its conflicts of law principles.

     16.  Validity.  The invalidity or unenforceability of any provision or
          --------
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.

     17.  Counterparts.  This Agreement may be executed in one or more
          ------------
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument. Facsimile signatures will
be deemed to be effective originals hereunder.

     18.  Entire Agreement.  This Agreement sets forth the entire agreement of
          ----------------
the parties hereto in respect of the subject matter contained herein and
supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto in respect of such
subject matter. Any prior agreement of the parties hereto in respect of the
subject matter contained herein is hereby terminated and canceled.

                                      -11-
<PAGE>

     19.  Withholding.  All payments hereunder shall be subject to any required
          -----------
withholding of Federal, state and local taxes pursuant to any applicable law or
regulation.

     20.  Section Headings.  The section headings in this Agreement are for
          ---------------
convenience of reference only, and they form no part of this Agreement and shall
not affect its interpretation.

     IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the
date first above written.

FIRSTWORLD COMMUNICATIONS, INC.,
a Delaware corporation

By:  /s/ Donald L. Sturm                     /s/ J. Thomas McGrath     10/20/00
     -------------------------               ----------------------------------
Name:  Donald L. Sturm                       J. Thomas McGrath
Title: Acting President and
       Chief Executive Officer

                                      -12-<PAGE>

                                                                    Exhibit 10.1

                  SERIES B PREFERRED STOCK PURCHASE AGREEMENT

     This Series B Preferred Stock Purchase Agreement (this "Agreement") is made
and entered into as of July 12, 2000 by and among At Home Network Solutions,
Inc., a Delaware corporation (the "Company"), and the parties listed on the
Schedule of Investors attached to this Agreement as Exhibit A (each hereinafter
individually referred to as an "Investor" and collectively referred to as the
"Investors").

     Whereas, the Company desires to sell to the Investors, and the Investors
desire to purchase from the Company, shares of the Company's Series B Preferred
Stock on the terms and conditions set forth in this Agreement;

     Now, therefore, the parties hereby agree as follows:

     1.  AGREEMENT TO PURCHASE AND SELL STOCK.

         1.1  Authorization.  As of the Closing (as defined below) the Company
will have authorized the issuance, pursuant to the terms and conditions of this
Agreement, of up to 1,500,000 shares of the Company's Series B Preferred Stock,
par value $0.001 per share (the "Series B Stock"), having the rights,
preferences, privileges and restrictions set forth in the Company's Restated
Certificate of Incorporation attached to this Agreement as Exhibit B (the
"Restated Certificate").

         1.2  Agreement to Purchase and Sell.  The Company agrees to sell to
each Investor at the Closing, and each Investor agrees, severally and not
jointly, to purchase from the Company at the Closing, the number of shares of
Series B Stock set forth beside such Investor's name on Exhibit A, at a purchase
price of $31.69 per share. The shares of Series B Stock purchased and sold
pursuant to this Agreement will be collectively hereinafter referred to as the
"Purchased Shares" and the shares of Common Stock issuable upon conversion of
the Purchased Shares will be collectively hereinafter referred to as the
"Conversion Shares".

     2.  CLOSING.

         2.1  The Closing.  The purchase and sale of the Purchased Shares will
take place at the offices of Fenwick & West LLP, 275 Battery Street, San
Francisco, California, at 11:00 a.m. Pacific Time, on July 12, 2000 or at such
other time and place as the Company and Investors who have agreed to purchase a
majority of the Purchased Shares listed on Exhibit A mutually agree upon (which
time and place are referred to in this Agreement as the "Closing"). At the
Closing, the Company will deliver to each Investor a certificate representing
the number of Purchased Shares that such Investor has agreed to purchase
hereunder as shown on Exhibit A against delivery to the Company by such Investor
of the full purchase price of such Purchased Shares, paid by (a) a check payable
to the Company's order, (b) wire transfer of funds to the Company or (c) any
combination of the foregoing.
<PAGE>

         2.2  Additional Closing(s).

              (a)  Conditions of Additional Closing(s).  At any time and from
time to time during the sixty (60) day period immediately following the Closing,
the Company may, at one or more additional closings (each an "Additional
Closing"), without obtaining the signature, consent or permission of any of the
Investors, offer and sell to other investors ("New Investors"), at a price of
$31.69 per share, up to that number of shares of Series B Stock that is equal to
the total number of shares of Series B Stock authorized by the Restated
Certificate less the number of shares of Series B Stock actually issued and sold
by the Company at the Closing.

              (b)  Amendments.  The Company and the New Investors purchasing
Series B Stock at each Additional Closing will execute counterpart signature
pages to this Agreement and each of the other Transaction Documents (as defined
in Section 3.1), and such New Investors will, upon delivery to the Company of
such signature pages, become parties to, and bound by, this Agreement and the
other Transaction Documents, each to the same extent as if they had been
Investors at the Closing. Immediately after each Additional Closing, Exhibit A
to this Agreement will be amended to list the New Investors purchasing shares of
Series B Stock hereunder and the number of shares of Series B Stock purchased by
each New Investor under this Agreement at each such Additional Closing. The
Company will promptly furnish to each Investor copies of the amendments to
Exhibit A referred to in the preceding sentence.

         (c)  Status of New Investors.  Upon the completion of each Additional
Closing as provided in this Section 2, each New Investor will be deemed to be an
"Investor" for all purposes of this Agreement and each of the other Transaction
Documents.

     3.  REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  The Company hereby
represents and warrants to each Investor that, except as set forth in the
Schedule of Exceptions ("Schedule of Exceptions") attached to this Agreement as
Exhibit C specifically identifying the relevant subparagraph hereof (which
Schedule of Exceptions shall be deemed to be representations and warranties to
the Investors by the Company under this Section 3), the statements in the
following paragraphs of this Section 3 are all true and complete:

         3.1  Organization, Good Standing and Qualification.  The Company has
been duly incorporated and organized, and is validly existing in good standing,
under the laws of the State of Delaware. The Company has the corporate power and
authority to enter into and perform its obligations under this Agreement, the
Amended and Restated Investor Rights Agreement attached to this Agreement as
Exhibit D, the Amended and Restated Security Holders Agreement attached to this
Agreement as Exhibit E and the Amended and Restated Merger Agreement attached to
this Agreement as Exhibit F (collectively the "Transaction Documents"), to own
and operate it properties and assets and to carry on its business as currently
conducted and as presently proposed to be conducted. The Company is duly
qualified to transact business as a foreign corporation in good standing in the
State of California.

         3.2  Capitalization.  The capitalization of the Company immediately
prior to the Closing consists of the following:

              (a)  Preferred Stock.  A total of 2,651,515 authorized shares of
preferred stock, par value $0.001 per share, consisting of 151,515 shares
designated as Series A Preferred

                                       2
<PAGE>

Stock ("Series A Stock"), all of which will be issued and outstanding, 1,500,000
shares designated as Series B Stock, none of which will be issued and
outstanding, and 1,000,000 undesignated shares, none of which will be issued and
outstanding. Upon the Closing, the rights, preferences and privileges of the
Series A Stock and Series B Stock will be as stated in the Restated Certificate
and as provided by law.

              (b)  Common Stock.  A total of 15,354,545 authorized shares of
common stock, par value $0.001 per share (the "Common Stock"), 400,000 shares of
which will be issued and outstanding.

              (c)  Options, Warrants, Reserved Shares.  Except for (i) the
conversion privileges of the Series A Stock and Series B Stock, (ii) the rights
to purchase additional securities of the Company granted to certain investors
under Sections 2 and 4 of that certain Investor Rights Agreement dated May 24,
1999 by and among the Company and such investors (the "Existing Rights
Agreement"), (iii) the right to acquire additional shares of Common Stock
granted to At Home Corporation ("At Home") under Section 1.3 of that certain
Common Stock Purchase Agreement dated March 31, 1999 by and between the Company
and At Home, and (iv) warrants to purchase 212,074 shares of Common Stock, there
is no outstanding option, warrant, right (including conversion rights,
preemptive rights or rights of first refusal) or agreement for the purchase or
acquisition from the Company of any shares of its capital stock or any
securities convertible into or ultimately exchangeable or exercisable for any
shares of the Company's capital stock. Apart from the exceptions noted in this
Section 3.2(c), and except for (i) the redemption rights granted to certain
investors under Section 3 of the Existing Rights Agreement, (ii) the options
granted to certain investors under Sections 3 and 4 of that certain Security
Holders Agreement dated May 24, 1999 by and among the Company and such investors
(the "Existing Security Holders Agreement"), and (iii) the option granted to At
Home under Section 1 of that certain Buyout Option Agreement dated May 24, 1999
by and between the Company and At Home, no shares of the Company's outstanding
capital stock are subject to any preemptive rights, rights of first refusal or
other rights to purchase such stock (whether in favor of the Company or any
other person) pursuant to any agreement or commitment of the Company.

         3.3  Subsidiaries.  The Company does not presently own or control,
directly or indirectly, any interest in any other corporation, partnership,
trust, joint venture, association, or other entity.

         3.4  Due Authorization.  All corporate action on the part of the
Company's directors, officers and stockholders necessary for the authorization,
execution, delivery of, and the performance of all obligations of the Company
under, the Transaction Documents, the authorization, issuance, reservation for
issuance and delivery of all of the Purchased Shares being sold under this
Agreement and of the Conversion Shares and the filing of the Restated
Certificate has been taken or will be taken prior to the Closing, and the
Transaction Documents constitute valid and legally binding obligations of the
Company, enforceable in accordance with their respective terms, except as may be
limited by (i) applicable bankruptcy, insolvency, reorganization or others laws
of general application relating to or affecting the enforcement of creditors'
rights generally and (ii) the effect of rules of law governing the availability
of equitable remedies.

                                       3
<PAGE>

         3.5  Valid Issuance of Stock.

              (a)  The Purchased Shares, when issued and paid for as provided in
this Agreement will be duly authorized and validly issued, fully paid and
nonassessable. The Conversion Shares have been duly and validly reserved for
issuance upon conversion thereof and, when issued upon such conversion in
accordance with the Restated Certificate (assuming no change in the Restated
Certificate or in applicable law), will be duly authorized and validly issued,
fully paid and nonassessable.

              (b)  Based in part on the representations made by the Investors in
Section 4 hereof, the offer and sale of the Purchased Shares solely to the
Investors in accordance with this Agreement (and assuming no change in currently
applicable law or the Restated Certificate, no transfer of Purchased Shares by a
holder thereof and no commission or other remuneration is paid or given,
directly or indirectly, for soliciting the issuance of Conversion Shares upon
conversion of the Purchased Shares), are exempt from the registration and
prospectus delivery requirements of the U.S. Securities Act of 1933, as amended
(the "1933 Act") and the securities registration and qualification requirements
of the currently effective provisions of the securities laws of the States in
which the Investors are resident based upon their addresses set forth on the
Schedule of Investors attached hereto as Exhibit A.

         3.6  Governmental Consents.  No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on
the part of the Company in order to enable the Company to execute, deliver and
perform its obligations under this Agreement except for such qualifications or
filings under applicable securities laws as may be required in connection with
the transactions contemplated by this Agreement. All such qualifications and
filings will, in the case of qualifications, be effective on the Closing and
will, in the case of filings, be made within the time prescribed by law.

         3.7  Litigation.  There is no action, suit, proceeding, claim,
arbitration or investigation pending (or, to the Company's knowledge, currently
threatened) against the Company, its activities, properties or assets or, to the
Company's knowledge, against any officer, director or employee of the Company in
connection with such officer's, director's or employee's relationship with, or
actions taken on behalf of, the Company. There is no action, suit, proceeding,
claim, arbitration or investigation currently pending by the Company against any
third party and the Company has no present intention to initiate any such
action, suit, proceeding, claim, arbitration or investigation.

         3.8  Proprietary Information and Invention Agreements.  Each officer
and employee of the Company with access to the Company's proprietary information
has executed a Proprietary Information and Inventions Agreement in substantially
the form provided to Investors.

         3.9  Employees.  Neither the execution nor delivery of this Agreement
nor the carrying on of the Company's business by the employees nor the conduct
of the Company's business as proposed will, to the best of 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 the Company's employees are obligated. The

                                       4
<PAGE>

Company does not believe it is or will be necessary to use any inventions of any
of its employees (or persons it currently intends to hire) made prior to their
employment by the Company.

         3.10  Status of Proprietary Assets.

               (a)  Status.  The Company has full title and ownership of, or is
duly licensed under or otherwise authorized to use, all patents, patent
applications, trademarks, service marks, trade names, copyrights, mask works,
trade secrets, confidential and proprietary information, designs and proprietary
rights (all of the foregoing collectively hereinafter referred to as the
"Proprietary Assets"), necessary to enable it to carry on its business as
proposed to be conducted without any known conflict with or infringement of the
rights of others. The Company is not aware of any infringement of its
Proprietary Assets by any other person.

               (b)  Licenses; Other Agreements.  The Company has not granted,
and, to the Company's knowledge, there are not outstanding, any options,
licenses or agreements of any kind relating to any Proprietary Asset of the
Company, nor is the Company bound by or a party to any option, license or
agreement of any kind with respect to any of its Proprietary Assets. The Company
is not obligated to pay any royalties or other payments to third parties with
respect to the marketing, sale, distribution, manufacture, license or use of any
Proprietary Asset or any other property or rights.

         3.11  Compliance with Law and Documents.  The Company is not in
violation or default of any provision of any mortgage, indenture or other
agreement to which it is a party or by which it is bound, any provision of its
Certificate of Incorporation or Bylaws, both as amended, and to the Company's
knowledge, except for any violations that individually and in the aggregate
would have no material adverse impact on the Company's business, the Company is
in compliance with all applicable statutes, laws, regulations and executive
orders of the United States of America and all states, foreign countries or
other governmental bodies and agencies having jurisdiction over the Company's
business or properties. The Company has not received any notice of any violation
of any such statute, law, regulation or order which has not been remedied prior
to the date hereof. The execution, delivery and performance of this Agreement
and the other Transaction Documents and the consummation of the transactions
contemplated hereby and thereby will not result in any such violation or
default, or be in conflict with or result in a violation or breach of, with or
without the passage of time or the giving of notice or both, any provision of
any mortgage, indenture or other agreement to which it is a party or by which it
is bound, or any provision of the Restated Certificate or the Company's Bylaws,
any judgment, order or decree of any court or arbitrator to which the Company is
a party or is subject, any agreement or contract of the Company, or, to the
Company's knowledge, a violation of any statute, law, regulation or order, or an
event which results in the creation of any lien, charge or encumbrance upon any
asset of the Company.

         3.12  Registration Rights.  Except as provided in the Existing
Security Holders Agreement, the Company is not under any obligation and has not
granted any rights to register under the 1933 Act any of its currently
outstanding securities or any securities issuable upon exercise or conversion of
its currently outstanding securities nor is the Company obligated to register or
qualify any such securities under any state securities or blue sky laws.

         3.13  Title to Property and Assets.  The properties and assets the
Company owns are owned by the Company free and clear of all mortgages, deeds of
trust, liens,

                                       5
<PAGE>

encumbrances and security interests except for statutory liens for the payment
of current taxes that are not yet delinquent and liens, encumbrances and
security interests which arise in the ordinary course of business and which do
not affect material properties and assets of the Company. With respect to the
property and assets it leases, the Company is in material compliance with such
leases, and to the knowledge of the Company, the other parties to such leases
are in compliance therewith, and the Company holds a valid leasehold interest
free of any liens, claims or encumbrances.

         3.14  Certain Actions.  Since December 31, 1999, the Company has not:
(i) declared or paid any dividends, or authorized or made any distribution upon
or with respect to any class or series of its capital stock; (ii) incurred any
indebtedness for money borrowed or incurred any other liabilities individually
in excess of $25,000 or in excess of $50,000 in the aggregate; (iii) made any
loans or advances to any person, other than ordinary advances for travel
expenses; (iv) sold, exchanged or otherwise disposed of any material assets or
rights other than the sale of inventory in the ordinary course of its business;
or (v) entered into any material transactions with any of its officers,
directors or employees or any entity controlled by any of such individuals.

         3.15  Activities.  Since December 31, 1999, there has not been:

               (a)  any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the assets, properties, financial
condition, operating results, prospects or business of the Company (as presently
conducted and as presently proposed to be conducted);

               (b)  any waiver by the Company of a valuable right or of a
material debt owed to it;

               (c)  any material contract or arrangement entered into by the
Company by which the Company or any of its assets or properties is bound or
subject;

               (d)  any sale, assignment or transfer of any patents, trademarks,
copyrights, trade secrets, or other intangible assets;

               (e)  any mortgage, pledge, transfer of a security interest in or
a lien created by the Company, with respect to any of its assets or properties;

               (f)  any loans or guarantees made by the Company to or for the
benefit of its employees, officers or directors or any member of their immediate
families;

               (g)  any resignations or termination of employment of any key
officer of the Company; and the Company, to the best of its knowledge, does not
know of the impending resignation or termination of employment of any such
officer; or

               (h)  to the Company's knowledge, any other event or condition of
any character which would materially and adversely affect the assets,
properties, financial condition, operating results or business of the Company.

                                       6
<PAGE>

         3.16  ERISA Plans.  The Company does not have any Employee Pension
Benefit Plan as defined in Section 3 of the Employee Retirement Income Security
Act of 1974, as amended.

         3.17  Insurance.  The Company was recently formed and has no insurance
policies.

         3.18  Tax Returns and Payments.  The Company has timely filed all tax
returns and reports required by law and has never been audited by any state or
federal taxing authority.  All tax returns and reports of the Company are true
and correct in all material respects.  The Company has paid all taxes and other
assessments due, except those, if any, currently being contested by it in good
faith which are listed in the Schedule of Exceptions.

         3.19  Labor Agreements and Actions.  The Company is not bound by or
subject to any contract, commitment or arrangement with any labor union, and to
the Company's best knowledge, no labor union has requested, sought or attempted
to represent any employees, representatives or agents of the Company.  There is
no strike or other labor dispute involving the Company pending nor, to the
Company's best knowledge, threatened, nor is the Company aware of any labor
organization activity involving its employees.

         3.20  Real Property Holding Corporation Status.  Since its
incorporation, the Company has not been a "United States real property holding
corporation", as defined in Section 897(c)(2) of the U.S. Internal Revenue Code
of 1986, as amended, and the Treasury Regulations issued thereunder.

         3.21  Permits.  The Company has all franchises, permits, licenses, and
any similar authority necessary for the conduct of its business as now conducted
and as proposed to be conducted, the lack of which could materially and
adversely affect the business, properties, prospects of financial condition of
the Company.

         3.22  Disclosure.  The Company has provided each Investor with all the
information reasonably available to it without undue expense that such Investor
has requested for deciding whether to buy the Purchase Shares.  Neither this
Agreement nor any other agreement, written statement or certificate made or
delivered in connection herewith contains any untrue statement of a material
fact or omits to state a material fact necessary to make the statements herein
not misleading.

     4.  REPRESENTATIONS, WARRANTIES AND CERTAIN AGREEMENTS OF INVESTORS.  Each
Investor hereby represents and warrants to, and agrees with, the Company,
severally and not jointly, that:

         4.1  Authorization.  This Agreement constitutes such Investor's valid
and legally binding obligation, enforceable in accordance with its terms except
as may be limited by (i) applicable bankruptcy, insolvency, reorganization or
other laws of general application relating to or affecting the enforcement of
creditors' rights generally and (ii) the effect of rules of law governing the
availability of equitable remedies.  Each Investor represents that such Investor
has full power and authority to enter into this Agreement.

                                       7
<PAGE>

         4.2  Purchase for Own Account.  The Purchased Shares to be purchased by
such Investor hereunder will be acquired for investment for such Investor's own
account, not as a nominee or agent, and not with a view to the public resale or
distribution thereof within the meaning of the 1933 Act, and such Investor has
no present intention of selling, granting any participation in, or otherwise
distributing the same. If not an individual, such Investor also represents that
such Investor has not been formed for the specific purpose of acquiring
Purchased Shares.

         4.3  Disclosure of Information.  Such Investor has received or has had
full access to all the information it considers necessary or appropriate to make
an informed investment decision with respect to the Purchased Shares to be
purchased by such Investor under this Agreement.  Such Investor further has had
an opportunity to ask questions and receive answers from the Company regarding
the terms and conditions of the offering of the Purchased Shares and to obtain
additional information (to the extent the Company possessed such information or
could acquire it without unreasonable effort or expense) necessary to verify any
information furnished to such Investor or to which such Investor had access.
The foregoing, however, does not in any way limit or modify the representations
and warranties made by the Company in Section 3.

         4.4  Investment Experience.  Such Investor understands that the
purchase of the Purchased Shares involves substantial risk. Such Investor: (i)
has experience as an investor in securities of companies in the development
stage and acknowledges that such Investor is able to fend for itself, can bear
the economic risk of such Investor's investment in the Purchased Shares and has
such knowledge and experience in financial or business matters that such
Investor is capable of evaluating the merits and risks of this investment in the
Purchased Shares and protecting its own interests in connection with this
investment and/or (ii) has a preexisting personal or business relationship with
the Company and certain of its officers, directors or controlling persons of a
nature and duration that enables such Investor to be aware of the character,
business acumen and financial circumstances of such persons.

         4.5  Accredited Investor Status.  Unless otherwise expressly indicated
on Exhibit A to this Agreement, such Investor is an "accredited investor" within
the meaning of Regulation D promulgated under the 1933 Act.

         4.6  Restricted Securities.  Such Investor understands that the
Purchased Shares are characterized as "restricted securities" under the 1933 Act
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under the 1933 Act and applicable
regulations thereunder such securities may be resold without registration under
the 1933 Act only in certain limited circumstances. In this connection, such
Investor represents that such Investor is familiar with Rule 144 of the U.S.
Securities and Exchange Commission (the "SEC"), as presently in effect, and
understands the resale limitations imposed thereby and by the 1933 Act. Such
Investor understands that, except as provided in the Amended and Restated
Security Holders Agreement attached to this Agreement as Exhibit E, the Company
is under no obligation to register any of the securities sold hereunder. Such
Investor understands that no public market now exists for any of the Purchased
Shares and that it is uncertain whether a public market will ever exist for the
Purchased Shares or the Conversion Shares.

                                       8
<PAGE>

         4.7  Further Limitations on Disposition.  Without in any way limiting
the representations set forth above, such Investor further agrees not to make
any disposition of all or any portion of the Purchased Shares or the Conversion
Shares unless and until:

              (a)  there is then in effect a registration statement under the
1933 Act covering such proposed disposition and such disposition is made in
accordance with such registration statement; or

              (b)  such Investor shall have notified the Company of the proposed
disposition and shall have furnished the Company with a statement of the
circumstances surrounding the proposed disposition, and, at the expense of such
Investor or its transferee, with an opinion of counsel, reasonably satisfactory
to the Company, that such disposition will not require registration of such
securities under the 1933 Act.

Notwithstanding the provisions of paragraphs (a) and (b) above, no such
registration statement or opinion of counsel shall be required: (i) for any
transfer of any Purchased Shares or Conversion Shares in compliance with SEC
Rule 144 or Rule 144A, or (ii) for any transfer of Purchased Shares or
Conversion Shares by an Investor that is a partnership or a corporation to (A) a
partner of such partnership or a subsidiary, parent or 50% shareholder of such
corporation, (B) a retired partner of such partnership who retires after the
date hereof, (C) the estate of any such partner or stockholder, or (iii) for the
transfer by gift, will or intestate succession by any Investor to his or her
spouse or lineal descendants or ancestors or any trust for any of the foregoing;
provided that in each of the foregoing cases the transferee agrees in writing to
be subject to the terms of this Section 4 (other than Section 4.5) to the same
extent as if the transferee were an original Investor hereunder.

         4.8  Legends.  It is understood that the certificates evidencing the
Purchased Shares and the Conversion Shares will bear the legends set forth
below:

              (a)  The securities represented hereby have not been registered
     under the Securities Act of 1933, as amended (the "Act"), or under the
     securities laws of certain states. These securities are subject to
     restrictions on transferability and resale and may not be transferred or
     resold except as permitted under the Act and the applicable state
     securities laws, pursuant to registration or exemption therefrom. investors
     should be aware that they may be required to bear the financial risks of
     this investment for an indefinite period of time. The issuer of these
     securities may require an opinion of counsel in form and substance
     satisfactory to the issuer to the effect that any proposed transfer or
     resale is in compliance with the Act and any applicable state securities
     laws.

              (b)  Any legend required by the laws of the State of Delaware or
any other state securities laws, including a legend substantially in the form of
the following:

     The shares evidenced by this certificate are convertible into shares of
     common stock of the Company at the option of the holder at any time
     pursuant to and upon the terms and conditions specified in the Company's
     Certificate of Incorporation.  A copy of such Certificate of Incorporation
     may be obtained, without charge, at the Company's principal office.

                                       9
<PAGE>

The legend set forth in (a) above shall be removed by the Company from any
certificate evidencing Purchased Shares or Conversion Shares upon delivery to
the Company of an opinion by counsel, reasonably satisfactory to the Company,
that a registration statement under the 1933 Act is at that time in effect with
respect to the legended security or that such security can be freely transferred
in a public sale without such a registration statement being in effect and that
such transfer will not jeopardize the exemption or exemptions from registration
pursuant to which the Company issued the Purchased Shares or Conversion Shares.

     5.  CONDITIONS TO INVESTORS' OBLIGATIONS AT CLOSING.  The obligations of
each Investor under Section 1.2 of this Agreement are subject to the fulfillment
or waiver, on or before the Closing, of each of the following conditions, the
waiver of which shall not be effective against any Investor who does not consent
in writing to such waiver:

         5.1  Representations and Warranties True.  Each of the representations
and warranties of the Company contained in Section 3 shall be true and complete
on and as of the Closing with the same effect as though such representations and
warranties had been made on and as of the date of the Closing.

         5.2  Performance.  The Company shall have performed and complied with
all agreements, obligations and conditions contained in this Agreement that are
required to be performed or complied with by it on or before the Closing and
shall have obtained all approvals, consents and qualifications necessary to
complete the purchase and sale described herein.

         5.3  Restated Certificate Effective.  The Restated Certificate shall
have been duly adopted by the Company by all necessary corporate action of its
Board of Directors and stockholders, and shall have been duly filed with and
accepted by the Secretary of State of the State of Delaware.

         5.4  Compliance Certificate.  The Company shall have delivered to each
Investor at the Closing a certificate signed on its behalf by its President,
Chief Executive Officer, or Chief Financial Officer certifying that the
conditions specified in Sections 5.1, 5.2 and 5.3 have been fulfilled and
stating that there shall have been no material adverse change in the business,
affairs, prospects, operations, properties, assets or condition of the Company
not previously disclosed to the Investors in writing.

         5.5  Securities Exemptions.  The offer and sale of the Purchased Shares
to the Investors pursuant to this Agreement shall be exempt from the
registration requirements of the 1933 Act and the registration and/or
qualification requirements of all applicable state securities laws.

         5.6  Proceedings and Documents.  All corporate and other proceedings in
connection with the transactions contemplated at the Closing and all documents
incident thereto (including the Transaction Documents) shall be reasonably
satisfactory in form and substance to each Investor and to the Investors'
counsel, and they shall each have received all such counterpart originals and
certified or other copies of such documents as they may reasonably request. Such
documents shall include (but not be limited to) the following:

                                       10
<PAGE>

              (a)  Certified Charter Documents.  A copy of the Restated
     Certificate (as amended through the date of the Closing), certified by the
     Secretary of the Company as true and correct copies thereof as of the
     Closing.

              (b)  Corporate Actions.  A copy of the resolutions of the Board of
     Directors and, if required, the stockholders of the Company evidencing the
     amendment to the Company's Certificate of Incorporation providing for the
     authorization of the Series B Stock, the approval of this Agreement, the
     issuance of the Purchased Shares and the other matters contemplated hereby,
     and a copy of the Bylaws of the Company, certified by the Secretary of the
     Company to be true, complete and correct.

         5.7  No Material Change.  There shall have been no material adverse
change in the business, affairs, prospects, operations, properties, assets or
condition of the Company.

         5.8  Opinion of Company Counsel.  Each Investor shall have received an
opinion from Fenwick & West LLP, counsel for the Company, dated as of the date
of the Closing, in the form attached hereto as Exhibit G.

     6.  CONDITIONS TO THE COMPANY'S OBLIGATIONS AT CLOSING.  The obligations of
the Company to each Investor under this Agreement are subject to the fulfillment
or waiver on or before the Closing of each of the following conditions by such
Investor:

         6.1  Representations and Warranties.  The representations and
warranties of such Investor contained in Section 4 shall be true and complete on
the date of the Closing with the same effect as though such representations and
warranties had been made on and as of the Closing.

         6.2  Payment of Purchase Price.  Each Investor shall have delivered to
the Company the purchase price specified for such Investor on Exhibit A in
accordance with the provisions of Section 2.

         6.3  Restated Certificate Effective.  The Restated Certificate shall
have been duly adopted by the Company by all necessary corporate action of its
Board of Directors and stockholders, and shall have been duly filed with and
accepted by the Secretary of State of the State of Delaware.

         6.4  Securities Exemptions.  The offer and sale of the Purchased
Shares to the Investors pursuant to this Agreement shall be exempt from the
registration requirements of the 1933 Act and the registration and/or
qualification requirements of all applicable state securities laws.

         6.5  Proceedings and Documents.  All corporate and other proceedings
in connection with the transactions contemplated at the Closing and all
documents incident thereto (including the Transaction Documents) shall be
reasonably satisfactory in form and substance to the Company and to the
Company's legal counsel, and the Company shall have received all such
counterpart originals and certified or other copies of such documents as it may
reasonably request.

                                       11
<PAGE>

     7.  GENERAL PROVISIONS.

         7.1  Survival of Warranties.  The representations, warranties and
covenants of the Company and the Investors contained in or made pursuant to this
Agreement shall survive the execution and delivery of this Agreement and the
Closing and shall in no way be affected by any investigation of the subject
matter thereof made by or on behalf of any of the Investors, their counsel or
the Company, as the case may be.

         7.2  Successors and Assigns.  The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties.

         7.3  Governing Law.  This Agreement shall be governed by and construed
under the internal laws of the State of California as applied to agreements
among California residents entered into and to be performed entirely within
California, without reference to principles of conflict of laws or choice of
laws.

         7.4  Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.

         7.5  Headings.  The headings and captions used in this Agreement are
used for convenience only and are not to be considered in construing or
interpreting this Agreement.  All references in this Agreement to sections,
paragraphs, exhibits and schedules shall, unless otherwise provided, refer to
sections and paragraphs hereof and exhibits and schedules attached hereto, all
of which exhibits and schedules are incorporated herein by this reference.

         7.6  Notices.  Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or upon
deposit with the United States Post Office, by registered or certified mail,
postage prepaid and addressed to the party to be notified at the address set
forth below such party's signature on the signature page hereto or, in the case
of the Company, to At Home Network Solutions, Inc. at 425 Broadway, Redwood
City, California 94063, Attention: David G. Pine, Esq., with a copy to Fenwick &
West LLP, Two Palo Alto Square, Palo Alto, California 94306, Attention: Gordon
K. Davidson, Esq., or at such other address as any party or the Company may
designate by giving ten (10) days advance written notice to all other parties.

         7.7  No Finder's Fees.  Each party represents that it neither is nor
will be obligated for any finder's or broker's fee or commission in connection
with this transaction.  Each Investor agrees to indemnify and to hold harmless
the Company from any liability for any commission or compensation in the nature
of a finders' or broker's fee (and any asserted liability) for which the
Investor or any of its officers, partners, employees, or representatives is
responsible.  The Company agrees to indemnify and hold harmless each Investor
from any liability for any commission or compensation in the nature of a
finder's or broker's fee (and any asserted liability) for which the Company or
any of its officers, employees or representatives is responsible.

         7.8  Costs, Expenses.  Each party will bear its own legal fees and
expenses in connection with the preparation, execution and delivery of this
Agreement, the issuance of the Purchased Shares and the transactions
contemplated by this Agreement.

                                       12
<PAGE>

         7.9   Amendments and Waivers.  Except as specified in Section 2.2, any
term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and the holders of Purchased Shares and/or Conversion Shares representing at
least a majority of the aggregate number of shares of Common Stock into which
the Purchased Shares then are convertible and/or have been converted (excluding
any of such shares that have been sold to the public or pursuant to SEC Rule
144).  Any amendment or waiver effected in accordance with this Section shall be
binding upon each holder of any Purchased Shares and/or Conversion Shares at the
time outstanding, each future holder of such securities, and the Company;
provided, however, that no condition set forth in Section 5 may be waived with
respect to any Investor who does not consent thereto, and provided further that
no amendment or waiver which would materially and adversely affect any of the
rights or obligations of an Investor hereunder will be binding upon any such
Investor who does not consent thereto.

         7.10  Severability.  If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision(s) shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision(s) were so excluded and shall be enforceable in
accordance with its terms.

         7.11  Entire Agreement.  This Agreement, together with all exhibits
and schedules hereto, constitutes the entire agreement and understanding of the
parties with respect to the subject matter hereof and supersedes any and all
prior negotiations, correspondence, agreements, understandings duties or
obligations between the parties with respect to the subject matter hereof.

         7.12  Further Assurances.  From and after the date of this Agreement,
upon the request of any Investor or the Company, the Company and the Investors
shall execute and deliver such instruments, documents or other writings as may
be reasonably necessary or desirable to confirm and carry out and to effectuate
fully the intent and purposes of this Agreement.

               [Remainder of this page intentionally left blank]

                                       13
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.

THE COMPANY:
-----------

AT HOME NETWORK SOLUTIONS, INC.

By:____________________________

Name:__________________________

Title:_________________________

  [Counterpart Signature Page to Series B Preferred Stock Purchase Agreement]

                                       14
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.

                                        INVESTOR:

                                        RATHM, INC.

                                        By:_____________________________________

                                        Name:___________________________________

                                        Title:__________________________________

                                        Address:  9100 East Mineral Circle
                                                  Englewood, CO 80112
                                                  Attn: Jay Braukman,
                                                        Chief Financial Officer
                                                  Tel:  (303) 476-4200
                                                  Fax:  (303) 476-5700

                                        Notices should also be sent to:

                                        John L. Ruppert, Esq.
                                        Brownstein Hyatt & Farber, P.C.
                                        410 17th Street, 22nd Floor
                                        Denver, CO  80202-4437
                                        Tel:   (303) 223-1170
                                        Fax:  (303) 223-0970

  [Counterpart Signature Page to Series B Preferred Stock Purchase Agreement]

                                       15
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.

                                        INVESTOR:

                                        REDBACK NETWORKS, INC.

                                        By:_____________________________________

                                        Name:___________________________________

                                        Title:__________________________________

                                        Address:  1195 Borregas Avenue
                                                  Sunnyvale, CA 94089
                                                  Tel:  (408) 571-5200
                                                  Fax:  (408) 541-0570

  [Counterpart Signature Page to Series B Preferred Stock Purchase Agreement]

                                       16
<PAGE>

                  SERIES A PREFERRED STOCK PURCHASE AGREEMENT

                               LIST OF EXHIBITS
                               ----------------

Exhibit A   -   Schedule of Investors

Exhibit B   -   Restated Certificate of Incorporation

Exhibit C   -   Schedule of Exceptions

Exhibit D   -   Amended and Restated Investor Rights Agreement

Exhibit E   -   Amended and Restated Security Holders Agreement

Exhibit F   -   Amended and Restated Merger Agreement

Exhibit G   -   Opinion of Company Counsel

Exhibit H   -   Buyout Option Agreement

<PAGE>

                                   EXHIBIT A

                             Schedule of Investors
                             ---------------------

                                        Shares of Series B
Investor                                  Stock Purchased       Purchase Price
--------                                ------------------      --------------

RATHM, Inc.                                   473,335           $14,999,986.15
9100 East Mineral Circle
Englewood, Colorado 80112

Redback Networks, Inc.                        157,778           $ 4,999,984.82
1195 Borregas Avenue
Sunnyvale, California 94089

TOTAL:                                        631,113           $19,999,970.97
                                              =======           ==============
<PAGE>

                                   EXHIBIT B

                     Restated Certificate of Incorporation
                     -------------------------------------

<PAGE>

                                   EXHIBIT C

                            Schedule of Exceptions
                            ----------------------

    Unless otherwise defined, any capitalized terms in this Exhibit shall have
the same meanings assigned to such terms in the Series B Preferred Stock
Purchase Agreement to which this schedule is an exhibit.  Nothing in this
Schedule of Exceptions constitutes an admission of any liability or obligation
of the Company to any third party, nor an admission against the Company's
interests.

Exceptions to Section 3.2
-------------------------

    The Company has agreed to issue warrants to purchase shares of Common Stock
to certain cable system operators in consideration of such cable system
operators entering into exclusive distribution agreements with the Company.

    The Company has agreed to issue warrants to purchase up to 5,250,000 shares
of Common Stock to RATHM, Inc. in connection with and upon the completion of
RATHM's attainment of certain subscriber-based milestones.

Exceptions to Section 3.10
--------------------------

    The Company intends to use certain trade names and trademarks owned by At
Home Corporation pursuant to that certain Trade Name and Trademark License dated
April 16, 1999 by and between the Company and At Home Corporation.

    The Company has been permitted to qualify to transact business as a foreign
corporation in the State of California under the corporate name "At Home Network
Solutions, Inc." with the permission of At Home Corporation as set forth in a
certain letter dated April 1, 1999 to the Company from At Home Corporation.

Exceptions to Section 3.12
--------------------------

    Concurrently with the execution of this Agreement, the Company and certain
stockholders of the Company will amend and restate the Existing Security Holders
Agreement to extend the existing registration rights contained therein to the
Investors.

Exceptions to Section 3.21
--------------------------

    The Company has not yet obtained a business license from the city of Redwood
City, California.
<PAGE>

                                   EXHIBIT D

                Amended and Restated Investor Rights Agreement
                ----------------------------------------------

<PAGE>

                                   EXHIBIT E

                Amended and Restated Security Holders Agreement
                -----------------------------------------------

<PAGE>

                                   EXHIBIT F

                     Amended and Restated Merger Agreement
                     -------------------------------------

<PAGE>

                                   EXHIBIT G

                          Opinion of Company Counsel
                          --------------------------

<PAGE>

                                   EXHIBIT H

                            Buyout Option Agreement
                            -----------------------

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