{"id":43570,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/securities-purchase-agreement-at-home-corp-hftp-investment.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"securities-purchase-agreement-at-home-corp-hftp-investment","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/planning\/securities-purchase-agreement-at-home-corp-hftp-investment.html","title":{"rendered":"Securities Purchase Agreement &#8211; At Home Corp., HFTP Investment L.L.C., Gaia Offshore Master Fund, Ltd. and Leonardo, L.P."},"content":{"rendered":"<pre>\n                         SECURITIES PURCHASE AGREEMENT\n\n     SECURITIES PURCHASE AGREEMENT (the \"Agreement\"), dated as of June 8, 2001,\nby and among At Home Corporation, a Delaware corporation, with headquarters\nlocated at 450 Broadway Street, Redwood City, California 94063 (the \"Company\"),\nand the investors listed on the Schedule of Buyers attached hereto\n(individually, a \"Buyer\" and collectively, the \"Buyers\").\n\n     WHEREAS:\n\n     A.  The Company and the Buyers are executing and delivering this Agreement\nin reliance upon the exemption from securities registration afforded by Rule 506\nof Regulation D (\"Regulation D\") as promulgated by the United States Securities\nand Exchange Commission (the \"SEC\") under the Securities Act of 1933, as amended\n(the \"1933 Act\").\n\n     B.  The Company has authorized convertible notes of the Company in the form\nattached as Exhibit A (together with any convertible notes issued in replacement\n            ---------                                                           \nthereof in accordance with the terms thereof (the \"Convertible Notes\"), which\nshall be convertible into shares of the Company's Series A common stock, par\nvalue $0.01 per share (the \"Common Stock\") (as converted, the \"Conversion\nShares\"), in accordance with the terms of the Convertible Notes, which\nConvertible Notes shall not bear interest except upon the failure of the Company\nto comply with certain obligations thereunder as specified therein.\n\n     C.  The Buyers wish to purchase, upon the terms and conditions stated in\nthis Agreement, notes in an aggregate principal amount of up to $100,000,000 in\nthe respective amounts set forth opposite each Buyer's name on the Schedule of\nBuyers (the \"Notes\").\n\n     D.  Contemporaneously with the execution and delivery of this Agreement,\nthe parties hereto are executing and delivering a Registration Rights Agreement\nsubstantially in the form attached as Exhibit B (the \"Registration Rights\n                                      ---------                          \nAgreement\") pursuant to which the Company has agreed to provide certain\nregistration rights under the 1933 Act, the rules and regulations promulgated\nthereunder, and applicable state securities laws.\n\n     E.  Contemporaneously with the execution and delivery of this Agreement,\nthe parties hereto are executing and delivering a Security Agreement\nsubstantially in the form attached as Exhibit C (the \"Security Agreement\")\n                                      ---------                           \npursuant to which the Company has agreed to provide the Buyers with a security\ninterest in the assets of Company.\n\n     NOW THEREFORE, the Company and the Buyers hereby agree as follows:\n\n     1.  PURCHASE AND SALE OF NOTES.\n         -------------------------- \n\n         a.  Purchase of Notes.  Subject to the satisfaction (or waiver) of the\n             -----------------                                                 \nconditions set forth in Sections 6 and 7 below, the Company shall issue and sell\nto each Buyer \n\n \nand each Buyer severally agrees to purchase from the Company the Notes in the\nprincipal amount set forth opposite such Buyer's name on the Schedule of Buyers\n(the \"Closing\"). The purchase price (the \"Purchase Price\") of the Notes at the\nClosing shall be equal to $1.00 for each $1.00 of principal amount of the Notes\npurchased (not to exceed an aggregate principal amount of $100,000,000).\n\"Business Days\" means any day other than Saturday, Sunday or other day on which\ncommercial banks in the city of New York are authorized or required by law to\nremain closed.\n\n          b.   The Closing Date. The date and time of the Closing (the \"Closing\n               ----------------                                                 \nDate\") shall be 10:00 a.m. Central Time, on the date of this Agreement, subject\nto the satisfaction (or waiver) of the conditions to the Closing set forth in\nSections 6 and 7 (or such later date as is mutually agreed to by the Company and\nthe Buyers).  The Closing shall occur on the Closing Date at the offices of\nKatten Muchin Zavis, 525 West Monroe Street, Suite 1600, Chicago, Illinois\n60661-3693.\n\n          c.   Form of Payment. On the Closing Date, (A) each Buyer shall pay\n               ---------------\nthe Purchase Price to the Company for the Notes to be issued and sold to such\nBuyer by wire transfer of immediately available funds in accordance with the\nCompany's written wire instructions, and (B) the Company shall deliver to each\nBuyer, Notes (in the principal amounts as such Buyer shall request) (the \"Note\nCertificates\") representing such principal amount of the Notes which such Buyer\nis then purchasing hereunder, duly executed on behalf of the Company and\nregistered in the name of such Buyer or its designee.\n\n     2.   BUYER'S REPRESENTATIONS AND WARRANTIES.\n          -------------------------------------- \n\n          Each Buyer represents and warrants to the Company with respect to only\nitself that, as of the date hereof and at the time of the Closing:\n\n          a.   Investment Purpose. Such Buyer (i) is acquiring the Notes and\n               ------------------\n(ii) upon conversion of the Notes, will acquire the Conversion Shares then\nissuable (the Notes and the Conversion Shares collectively are referred to\nherein as the \"Securities\"), for its own account for investment only and not\nwith a view towards, or for resale in connection with, the public sale or\ndistribution thereof, except pursuant to sales (i) which are registered under\nthe 1933 Act or (ii) which are exempted under the 1933 Act and which do not\nimpair or negate the ability of the Company to rely on the exemption from\nregistration afforded by Rule 506 of Regulation D under the 1933 Act; provided,\nhowever, that by making the representations herein, such Buyer does not agree to\nhold any of the Securities for any minimum or other specific term and reserves\nthe right to dispose of the Securities at any time in accordance with or\npursuant to a registration statement or an exemption under the 1933 Act.\n\n          b.   Accredited Investor Status. Such Buyer is an \"accredited \n               --------------------------                                \ninvestor\" as that term is defined in Rule 501(a)(3) of Regulation D under the\n1933 Act, and was not formed for the specific purpose of acquiring the\nSecurities.\n\n          c.   Reliance on Exemptions. Such Buyer understands that the\n               ----------------------\nSecurities are being offered and sold to it in reliance on specific exemptions\nfrom the registration requirements of the United States federal and state\nsecurities laws and that the Company is relying in part upon\n\n                                       2\n\n \nthe truth and accuracy of, and such Buyer's compliance with, the\nrepresentations, warranties, agreements, acknowledgments and understandings of\nsuch Buyer set forth herein in order to determine the availability of such\nexemptions and the eligibility of such Buyer to acquire the Securities.\n\n         d.  Information.  Such Buyer and its advisors, if any, have had \n             -----------                                                 \naccess to the SEC Documents (as defined in Section 3(f) below) and to all other\nmaterials relating to the business, finances and operations of the Company and\nmaterials relating to the offer and sale of the Securities which have been\nrequested by such Buyer. Such Buyer and its advisors, if any, have been afforded\nthe opportunity to ask questions of the Company. Neither such inquiries nor any\nother due diligence investigations conducted by such Buyer or its advisors, if\nany, or its representatives shall modify, amend or affect such Buyer's right to\nrely on the Company's representations and warranties contained in Sections 3 and\n9(l) below. Such Buyer understands that its investment in the Securities\ninvolves a high degree of risk. Such Buyer has sought such accounting, legal and\ntax advice as it has considered necessary to make an informed investment\ndecision with respect to its acquisition of the Securities.\n\n         e.  No Governmental Review.  Such Buyer understands that no United \n             ----------------------                                         \nStates federal or state agency or any other government or governmental agency\nhas passed on or made any recommendation or endorsement of the Securities or the\nfairness or suitability of the investment in the Securities nor have such\nauthorities passed upon or endorsed the merits of the offering of the\nSecurities.\n\n         f.  Transfer or Resale. While such Buyer has not agreed to hold the\n             ------------------                                             \nSecurities for any minimum or other specific term, such Buyer understands that\nexcept as provided in the Registration Rights Agreement: (i) the Securities have\nnot been and are not being registered under the 1933 Act or any state securities\nlaws, and may not be offered for sale, sold, assigned or transferred unless (A)\nsubsequently registered thereunder, (B) such Buyer shall have delivered to the\nCompany an opinion of counsel, reasonably acceptable to the Company, to the\neffect that such Securities to be sold, assigned or transferred may be sold,\nassigned or transferred pursuant to an exemption from such registration, or (C)\nsuch Buyer provides the Company with reasonable assurance that such Securities\ncan be sold, assigned or transferred pursuant to Rule 144 promulgated under the\n1933 Act (or a successor rule thereto) (\"Rule 144\") or can be sold, assigned or\ntransferred pursuant to Rule 144(k) under the 1933 Act; (ii) any sale of the\nSecurities made in reliance on Rule 144 may be made only in accordance with the\nterms of Rule 144 and further, if Rule 144 is not applicable, any resale of the\nSecurities under circumstances in which the seller (or the person through whom\nthe sale is made) may be deemed to be an underwriter (as that term is defined in\nthe 1933 Act) may require compliance with some other exemption under the 1933\nAct or the rules and regulations of the SEC thereunder; and (iii) neither the\nCompany nor any other person is under any obligation to register the Securities\nunder the 1933 Act or any state securities laws or to comply with the terms and\nconditions of any exemption thereunder.  Notwithstanding the foregoing but\nsubject to Section 4(j), the Securities may be pledged in connection with a bona\nfide margin account or other loan or other financing transaction secured by the\nSecurities.\n\n                                       3\n\n \n         g.  Legends.  Such Buyer understands that the certificates or other\n             -------                                                        \ninstruments representing the Notes and, until such time as the sale of the\nConversion Shares have been registered under the 1933 Act as contemplated by the\nRegistration Rights Agreement, the stock certificates representing the\nConversion Shares, except as set forth below, shall bear a restrictive legend in\nsubstantially the following form (and a stop-transfer order may be placed\nagainst transfer of such stock certificates):\n\n     THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN\n     REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR\n     APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE\n     OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE\n     ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE\n     SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND\n     QUALIFICATION UNDER ANY APPLICABLE STATE SECURITIES LAWS OR\n     (B) AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE\n     COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR\n     APPLICABLE STATE SECURITIES LAWS OR (II) UNLESS SOLD\n     PURSUANT TO RULE 144 UNDER SAID ACT. NOTWITHSTANDING THE\n     FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH\n     A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR OTHER FINANCING\n     ARRANGEMENT SECURED BY THE SECURITIES.\n\nThe legend set forth above shall be removed and the Company shall issue a\ncertificate without such legend to the holder of the Securities upon which it is\nstamped, if, unless otherwise required by state securities laws, (i) such\nSecurities are resold pursuant to an effective registration statement under the\n1933 Act in accordance with applicable prospectus delivery requirements under\nthe 1933 Act, (ii) such Securities are registered for resale under the 1933 Act\nand such Buyer provides the Company with reasonable assurances that such\nSecurities will be resold pursuant to an effective registration statement under\nthe 1933 Act and in accordance with applicable prospectus delivery requirements\nunder the 1933 Act, (iii) in connection with a sale transaction, such holder\nprovides the Company with an opinion of counsel, reasonably satisfactory to the\nCompany, to the effect that a public sale, assignment or transfer of the\nSecurities may be made without registration under the 1933 Act, or (iv) such\nholder provides the Company with reasonable assurances (including, if requested\nby the Company, delivering such reasonable assurances to the Company's counsel\nin connection with such counsel rendering an opinion on the validity of a sale\nby such Buyer pursuant to Rule 144) that the Securities can be sold pursuant to\nRule 144 without any restriction as to the number of securities offered as of a\nparticular date.\n\n         h.  Authorization; Enforcement; Validity.  This Agreement and the\n             ------------------------------------                         \nRegistration Rights Agreement have been duly and validly authorized, executed\nand delivered on behalf of such Buyer and are valid and binding agreements of\nsuch Buyer enforceable against such Buyer in accordance with their terms,\nsubject as to enforceability to general principles of equity and to applicable\nbankruptcy, insolvency, reorganization, moratorium, liquidation and other\nsimilar laws relating to, or affecting generally, the enforcement of applicable\ncreditors' rights and remedies.\n\n                                       4\n\n \n          i.   Residency.  Such Buyer is a resident of that country specified \n               ---------                                                      \nin its address on the Schedule of Buyers.\n\n          j.   No Related Parties.  Such Buyer is not an affiliate (as defined \n               ------------------                                              \nbelow) of the Company. Based on a review of the current list of investors in\nsuch Buyer, such Buyer does not have any actual knowledge of any affiliate (as\ndefined below) of the Company being an investor in such Buyer or an owner of all\nor a part of such Buyer. Solely for purposes of this Section 2(j), \"affiliate\"\nshall have the meaning ascribed thereto under Rule 144(a)(i) of the 1933 Act and\nshall include, without limitation, (i) AT&amp;T Corp., (ii) any affiliate of AT&amp;T\nCorp. whose name makes it obvious that it is an affiliate of AT&amp;T Corp. and\n(iii) directors and executive officers of the Company.\n\n     3.   REPRESENTATIONS AND WARRANTIES OF THE COMPANY.\n          --------------------------------------------- \n\n          The Company represents and warrants to each of the Buyers that as of\nthe date hereof and as of the Closing:\n\n          a.   Organization and Qualification.  The Company and its \"Material\n               ------------------------------                                \nSubsidiaries\" (which for purposes of this Agreement means any significant\nsubsidiary as defined in Rule 1-02(w) of Regulation S-X under the 1933 Act) are\ncorporations duly organized and validly existing in good standing under the laws\nof the jurisdiction in which they are incorporated, and have the requisite\ncorporate power and authorization to own their properties and to carry on their\nbusiness as now being conducted.  Each of the Company and its Material\nSubsidiaries is duly qualified as a foreign corporation to do business and is in\ngood standing in every jurisdiction in which its ownership of property or the\nnature of the business conducted by it makes such qualification necessary,\nexcept to the extent that the failure to be so qualified or be in good standing\nwould not have a Material Adverse Effect.  As used in this Agreement, \"Material\nAdverse Effect\" means any material adverse effect on the business, properties,\nassets, operations, results of operations or financial condition of the Company\nand its Material Subsidiaries taken as a whole, or on the transactions\ncontemplated hereby or by the agreements and instruments to be entered into in\nconnection herewith, or on the authority or ability of the Company to perform\nits obligations under the Transaction Documents (as defined below).  A complete\nlist of the Company's Material Subsidiaries as of the date of this Agreement is\nset forth on Schedule 3(a).\n             ------------- \n\n          b.   Authorization; Enforcement; Validity.  The Company has the \n               ------------------------------------                       \nrequisite corporate power and authority to enter into and perform its\nobligations under this Agreement, the Registration Rights Agreement, the\nIrrevocable Transfer Agent Instructions (as defined in Section 5), the Notes,\nthe Security Agreement and each of the other agreements entered into by the\nparties hereto in connection with the transactions contemplated by this\nAgreement (collectively, the \"Transaction Documents\"), and to issue the\nSecurities in accordance with the terms hereof and thereof. The execution and\ndelivery of the Transaction Documents by the Company and the consummation by it\nof the transactions contemplated hereby and thereby, including without\nlimitation the issuance of the Notes and the reservation for issuance and the\nissuance of the Conversion Shares issuable upon conversion thereof, have been\nduly authorized by the Company's Board of Directors and no further consent or\nauthorization is required by the \n\n                                       5\n\n \nCompany, its Board of Directors or its stockholders (except to the extent that\nstockholder approval may be required pursuant to the rules of the Nasdaq\nNational Market for the issuance of a number of Conversion Shares greater than\n19.99% of the number of shares of Common Stock outstanding immediately prior to\nthe Closing Date (the \"Nasdaq 19.99% Rule\")). The Transaction Documents have\nbeen duly executed and delivered by the Company. The Transaction Documents\nconstitute the valid and binding obligations of the Company enforceable against\nthe Company in accordance with their terms, except as such enforceability may be\nlimited by general principles of equity or applicable bankruptcy, insolvency,\nreorganization, moratorium, liquidation or similar laws relating to, or\naffecting generally, the enforcement of creditors' rights and remedies.\n\n          c.   Capitalization.  As of the date hereof, the authorized capital \n               --------------                                                 \nstock of the Company consists of (i) 1,000,000,000 shares of Series A common\nstock, of which as of June 1, 2001, 321,900,704 shares were issued and\noutstanding and 92,582,099 shares were reserved for issuance pursuant to the\nCompany's stock option and purchase plans, 86,595,578 shares were reserved for\nissuance pursuant to conversion of the Company's Series B common stock and\n169,266,279 shares were issuable and reserved for issuance pursuant to\nsecurities (other than the Notes, stock option and purchase plans and the\nCompany's Series B common stock) exercisable or exchangeable for, or convertible\ninto, shares of Common Stock, (ii) 110,000,000 shares of Series B common stock,\nof which as of the date hereof 86,595,578 shares are issued and outstanding,\n(iii) 10,673.549 shares of Series A preferred stock, of which as of the date\nhereof, 5,567.098 are issued and outstanding, (iv) 1,006.29 shares of Series B\npreferred stock, of which as of the date hereof, none are issued and\noutstanding, (v) 1,279.065 shares of Series C preferred stock, of which as of\nthe date hereof, 650.727 are issued and outstanding and (vi) 9,637,041.096\nshares of undesignated preferred stock, none of which is outstanding as of the\ndate hereof. As of the date of this Agreement, since June 1, 2001 the Company\nhas not issued or reserved for issuance any shares of Common Stock in excess of\n100,000 shares, except pursuant to the exercise of options for which shares of\nCommon Stock were reserved as of June 1, 2001 and which are reflected in the\nnumber of reserved shares set forth in clause (i) of the immediately preceding\nsentence. All of such outstanding shares have been, or upon issuance will be,\nvalidly issued and are fully paid and nonassessable. Except as disclosed in\nSchedule 3(c), (A) no shares of the Company's capital stock are subject to \n-------------                      \npreemptive rights or any other similar rights (arising under Delaware law, the\nCompany's Certificate of Incorporation or By-laws or any agreement or instrument\nto which the Company is a party) or any liens or encumbrances granted or created\nby the Company; (B) there are no outstanding securities or instruments of the\nCompany or any of its Material Subsidiaries which contain any redemption or\nsimilar provisions, and there are no contracts, commitments, understandings or\narrangements by which the Company or any of its Material Subsidiaries is or may\nbecome bound to redeem a security of the Company or any of its Material\nSubsidiaries; (C) there are no securities or instruments containing anti-\ndilution or similar provisions that will be triggered by the issuance of the\nSecurities as described in this Agreement; and (D) the Company does not have any\nstock appreciation rights or \"phantom stock\" plans or agreements or any similar\nplan or agreement. Except as disclosed in Schedule 3(c), or in the SEC Documents\n                                          ------------- \nwhich were filed with the SEC at least five (5) days prior to the date hereof,\n(I) there are no outstanding debt securities issued by the Company; (II) there\nare no outstanding options, warrants, scrip, rights to subscribe to, calls or\ncommitments of any character whatsoever relating to, or securities or rights\nconvertible into, any shares of capital stock of the Company or any of its\nMaterial Subsidiaries, or contracts, \n\n                                       6\n\n \ncommitments, understandings or arrangements by which the Company or any of its\nMaterial Subsidiaries is or may become bound to issue additional shares of\ncapital stock of the Company or any of its Material Subsidiaries or options,\nwarrants, scrip, rights to subscribe to, calls or commitments of any character\nwhatsoever relating to, or securities or rights convertible into, any shares of\ncapital stock of the Company or any of its Material Subsidiaries; and (III)\nthere are no agreements or arrangements under which the Company or any of its\nMaterial Subsidiaries is obligated to register the sale of any of their\nsecurities under the 1933 Act (except the Registration Rights Agreement). The\nCompany has furnished to each Buyer (or has specifically identified to each such\nBuyer, in writing or by email, where such document is available on the EDGAR\nSystem) true and correct copies of the Company's Certificate of Incorporation,\nas amended and as in effect on the date hereof (the \"Certificate of\nIncorporation\"), and the Company's By-laws, as amended and as in effect on the\ndate hereof (the \"By-laws\"), and the terms of all securities convertible into or\nexercisable or exchangeable for Common Stock (other than individual stock\noptions and warrants issued under an Approved Stock Plan (as defined in the\nNotes)) and the material rights of the holders thereof in respect thereto.\n\n          d.   Issuance of Securities.  The Notes are duly authorized and, upon\n               ----------------------                                          \nissuance in accordance with the terms hereof, shall be free from all taxes,\nliens and charges with respect to the issuance thereof and entitled to the\nrights set forth in the Notes.  As of the Closing, such number of shares of\nCommon Stock as are issuable at the Conversion Rate (as defined in the Notes),\ncalculated using the Fixed Conversion Price (as defined in the Notes) as of the\nClosing Date, (subject to adjustment pursuant to the Company's covenant set\nforth in Section 4(f) below) will have been duly authorized and reserved for\nissuance upon conversion of the Notes.  Upon conversion in accordance with the\nNotes, the Conversion Shares will be validly issued, fully paid and\nnonassessable and free from all taxes, liens and charges with respect to the\nissue thereof, with the holders being entitled to all rights accorded to a\nholder of Common Stock.  The issuance by the Company of the Securities is exempt\nfrom registration under the 1933 Act. That certain Loan and Security Agreement,\ndated September 24, 1997, by and between the Company and Silicon Valley Bank, as\namended by that  certain Loan Modification Agreement, dated October 19, 1998 by\nthe same parties, has been terminated by the parties thereto.\n\n          e.   No Conflicts.  The execution, delivery and performance of the\n               ------------                                                 \nTransaction Documents by the Company and the consummation by the Company of the\ntransactions contemplated hereby and thereby (including, without limitation, the\nreservation for issuance and issuance of the Conversion Shares) will not (i)\nresult in a violation of the Certificate of Incorporation or the By-laws; (ii)\nconflict with, or constitute a default (or an event which with notice or lapse\nof time or both would become a default) under, or give to others any rights of\ntermination, amendment, acceleration or cancellation of, any material agreement,\nindenture or instrument to which the Company or any of its Material Subsidiaries\nis a party; (iii) result in a violation of any law, rule, regulation, order,\njudgment or decree (including federal and state securities laws and regulations\nand the rules and regulations of the Principal Market (as defined below))\napplicable to the Company or any of its Material Subsidiaries or by which any\nproperty or asset of the Company or any of its Material Subsidiaries is bound or\naffected.  The Company is not in violation of any term of its Certificate of\nIncorporation or its By-laws.  No Material Subsidiary is in violation of any\nterm of their organizational charter or by-laws, respectively, which would have,\neither individually or in the aggregate, a Material Adverse Effect.  Except as\ndisclosed in Schedule 3(e), neither the Company or any of its Material\n             -------------                                            \nSubsidiaries is in violation \n\n                                       7\n\n \nof any term of or in default under any contract, agreement, mortgage,\nindebtedness, indenture, instrument, judgment, decree or order or any statute,\nrule or regulation applicable to the Company or its Material Subsidiaries,\nexcept where such violations and defaults would not result, either individually\nor in the aggregate, in a Material Adverse Effect. The business of the Company\nand its Material Subsidiaries is not being conducted, and shall not be\nconducted, in violation of any law, ordinance or regulation of any governmental\nentity, except where such violations would not result, either individually or in\nthe aggregate, in a Material Adverse Effect. Except as specifically contemplated\nby this Agreement and as required under the 1933 Act, and except for the Nasdaq\n19.99% Rule, the Company is not required to obtain any consent, authorization or\norder of, or make any filing or registration with, any court or governmental\nagency or any regulatory or self-regulatory agency in order for it to execute,\ndeliver or perform any of its obligations under or contemplated by the\nTransaction Documents in accordance with the terms hereof or thereof. Except as\ndisclosed in Schedule 3(e), all consents, authorizations, orders, filings and \n             -------------     \nregistrations which the Company is required to obtain pursuant to the preceding\nsentence have been obtained or effected on or prior to the date hereof. The\nCompany is not in violation of the listing requirements of the Principal Market.\n\n          f.   SEC Documents; Financial Statements.  Since December 31, 1999, \n               -----------------------------------                            \nthe Company has filed all reports, schedules, forms, statements and other\ndocuments required to be filed by it with the SEC pursuant to the reporting\nrequirements of the Securities Exchange Act of 1934, as amended (the \"1934 Act\")\n(all of the foregoing filed prior to the date hereof (including all exhibits\nincluded therein and financial statements and schedules thereto and documents\nincorporated by reference therein) being hereinafter referred to as the \"SEC\nDocuments\"). As of the dates thereof, the SEC Documents, as they may have been\nsubsequently amended or superseded by filings made by the Company with the SEC\nprior to the date hereof, complied in all material respects with the\nrequirements of the 1934 Act and the rules and regulations of the SEC\npromulgated thereunder applicable to the SEC Documents. The SEC Documents, as of\nthe dates thereof and as they may have been subsequently amended or superseded\nby filings made by the Company with the SEC prior to the date hereof, did not\ncontain any untrue statement of a material fact or omitted to state a material\nfact required to be stated therein or necessary in order to make the statements\ntherein, in light of the circumstances under which they were made, not\nmisleading. As of their respective dates, the financial statements of the\nCompany included in the SEC Documents complied as to form in all material\nrespects with applicable accounting requirements and the published rules and\nregulations of the SEC with respect thereto. Such financial statements have been\nprepared in accordance with generally accepted accounting principles,\nconsistently applied, during the periods involved (except (i) as may be\notherwise indicated in such financial statements or the notes thereto, or (ii)\nin the case of unaudited interim statements, to the extent they may exclude\nfootnotes or may be condensed or summary statements) and fairly present in all\nmaterial respects the financial position of the Company as of the dates thereof\nand the results of its operations and cash flows for the periods then ended\n(subject, in the case of unaudited statements, to normal year-end audit\nadjustments). No other information provided by or on behalf of the Company to\nthe Buyers which is not included in the SEC Documents, including, without\nlimitation, information referred to in Section 2(d), but excluding any\nprojections or forecasts, contains any untrue statement of a material fact or\nomits to state any material fact necessary in order to make the statements\ntherein, in the light of the circumstance under which they are or were made, not\nmisleading. Neither the Company nor any of its Material Subsidiaries nor any of\ntheir officers, directors, employees or agents have \n\n                                       8\n\n \nprovided the Buyers with any material, nonpublic information other than as set\nforth in the Schedules delivered as part of this Agreement which Schedules are\nbeing filed by the Company along with the exhibits to the Form 8-K referred to\nin Section 4(h). As of the date hereof, the Company meets the requirements for\nuse of Form S-3 for registration of the resale of Registrable Securities (as\ndefined in the Registration Rights Agreement). The Company is not required to\nfile and will not be required to file any agreement, note, lease, mortgage, deed\nor other instrument entered into prior to the date hereof and to which the\nCompany is a party or by which the Company is bound which has not been\npreviously filed as an exhibit to its reports filed with the SEC under the 1934\nAct.\n\n          g.   Absence of Certain Changes.  Except as disclosed in any SEC \n               --------------------------                                  \nDocuments which were filed with the SEC at least five (5) days prior to the date\nhereof, since December 31, 2000, there has been no change or development that\nhas had or could reasonably be expected to have a Material Adverse Effect. The\nCompany has not taken any steps, and does not currently expect to take any\nsteps, to seek protection pursuant to any bankruptcy law nor does the Company or\nany of its Material Subsidiaries have any knowledge or reason to believe that\nits creditors intend to initiate involuntary bankruptcy proceedings or any\nactual knowledge of any fact which would reasonably lead a creditor to do so.\nSince December 31, 2000, the Company has not declared or paid any dividends,\nsold any assets, individually or in the aggregate, in excess of $5 million\noutside of the ordinary course of business.\n\n          h.   Absence of Litigation.  There is no action, suit, proceeding, \n               ---------------------                                         \ninquiry or investigation before or by any court, public board, government\nagency, self-regulatory organization or body pending or, to the knowledge of the\nCompany or any of its Material Subsidiaries, threatened against or affecting the\nCompany, the Common Stock or any of the Company's Material Subsidiaries or any\nof the Company's or the Company's Material Subsidiaries' officers or directors\nin their capacities as such, except where the same would not result, either\nindividually or in the aggregate, in a Material Adverse Effect, and except as\nexpressly set forth in the SEC Documents which were filed with the SEC at least\nfive (5) days prior to the date hereof. To the knowledge of the Company, none of\nthe directors or officers of the Company have been involved in securities\nrelated litigation during the past five years which was required to be disclosed\nin any SEC Documents other than as disclosed in any SEC Documents which was\nfiled at least five (5) days prior to the date hereof.\n\n          i.   Acknowledgment Regarding Buyer's Purchase of Notes.  The Company\n               --------------------------------------------------              \nacknowledges and agrees that each of the Buyers is acting solely in the capacity\nof an arm's length purchaser with respect to the Company in connection with the\nTransaction Documents and the transactions contemplated hereby and thereby.  The\nCompany further acknowledges that each Buyer is not acting as a financial\nadvisor or fiduciary of the Company (or in any similar capacity) with respect to\nthe Transaction Documents and the transactions contemplated hereby and thereby\nand any advice given by any of the Buyers or any of their respective\nrepresentatives or agents in connection with the Transaction Documents and the\ntransactions contemplated hereby and thereby is merely incidental to such\nBuyer's purchase of the Securities.  The Company further represents to each\nBuyer that the Company's decision to enter into the Transaction Documents has\nbeen based solely on the independent evaluation by the Company and its\nrepresentatives.\n\n                                       9\n\n \n          j.   No Undisclosed Events, Liabilities, Developments or \n               ---------------------------------------------------\nCircumstances. Except as disclosed in Schedule 3(j), other than the issuance of \n-------------\nthe Notes contemplated by this Agreement, no event, liability, development or\ncircumstance has occurred or exists, or is contemplated to occur, with respect\nto the Company or its Material Subsidiaries or their respective business,\nproperties, prospects, operations or financial condition, that would be required\nto be disclosed by the Company under its currently effective resale registration\nstatements on Form S-3, which has not been publicly disclosed.\n\n          k.   No General Solicitation.  Neither the Company, nor any of its\n               -----------------------                                      \naffiliates, nor any person acting on its or their behalf, has engaged in any\nform of general solicitation or general advertising (within the meaning of\nRegulation D under the 1933 Act) in connection with the offer or sale of the\nSecurities.\n\n          l.   No Integrated Offering.  Neither the Company, nor any of its\n               ----------------------                                      \naffiliates, nor any person acting on its or their behalf has, directly or\nindirectly, made any offers or sales of any security or solicited any offers to\nbuy any security, under circumstances that would require registration of the\nissuance by the Company of any of the Securities under the 1933 Act or cause\nthis offering of the Securities to be integrated with prior offerings by the\nCompany for purposes of the 1933 Act or any applicable stockholder approval\nprovisions, including, without limitation, under the rules and regulations of\nany exchange or automated quotation system on which any of the securities of the\nCompany are listed or designated, nor will the Company or any of its Material\nSubsidiaries take any action or steps that would require registration of the\nissuance by the Company of any of the Securities under the 1933 Act or cause the\noffering of the Securities to be integrated with other offerings.\n\n          m.   Employee Relations. Neither the Company nor any of its Material\n               ------------------                                             \nSubsidiaries is involved in any union labor dispute nor, to the knowledge of the\nCompany or any of its Material Subsidiaries, is any such dispute threatened. No\nmaterial number of employees of  the Company or its Material Subsidiaries is a\nmember of a union which relates to such employee's relationship with the\nCompany, neither the Company nor any of its Material Subsidiaries is a party to\na material collective bargaining agreement, and the Company and its Material\nSubsidiaries believe that their relations with their employees are generally\ngood. Neither the Company's current chairperson and chief executive officer nor\nits current chief financial officer has notified the Company that such officer\nintends to leave the Company or otherwise terminate such officer's employment\nwith the Company.  No executive officer, to the knowledge of the Company, is in\nviolation of any material term of any employment contract, confidentiality,\ndisclosure or proprietary information agreement, non-competition agreement, or\nany other contract or agreement or any restrictive covenant, and the continued\nemployment of each such executive officer does not subject the Company or any of\nits Material Subsidiaries to any liability with respect to any of the foregoing\nmatters.\n\n          n.   Intellectual Property Rights. The Company and its Material \n               ----------------------------                               \nSubsidiaries own or possess or can acquire on reasonable terms adequate rights\nor licenses to use all trademarks, trade names, service marks, patents,\ncopyrights, trade secrets and other intellectual property rights necessary to\nconduct their respective businesses as now conducted, except where the absence\nto own or possess the same would not result, either individually or in the\naggregate, in a Material Adverse Effect. To the Company's knowledge, none of the\nCompany's trademark \n\n                                       10\n\n \nregistrations, service mark registrations, patents, copyrights, or other\nintellectual property rights have expired or terminated, or are expected to\nexpire or terminate within two years from the date of this Agreement, except\nwhere such expiration or termination would not result, either individually or in\nthe aggregate, in a Material Adverse Effect. The Company and its Material\nSubsidiaries do not have any knowledge of any infringement by the Company or its\nMaterial Subsidiaries of trademarks, trade names, service marks, patents,\ncopyrights, trade secrets or other intellectual property rights of others,\nexcept where such infringement would not result, either individually or in the\naggregate, in a Material Adverse Effect. There is no claim, action or proceeding\nbeing made or brought against the Company or its Material Subsidiaries regarding\nits trademarks, trade names, service marks, patents, copyrights, trade secrets,\nor infringement of other intellectual property rights, except where such claim,\naction, proceeding or infringement would not result either individually or in\nthe aggregate in a Material Adverse Effect. To the Company's knowledge there is\nno claim, action or proceeding being overtly threatened against, but which has\nnot been made or brought against, the Company or its Material Subsidiaries\nregarding its trademarks, trade names, service marks, patents, copyrights, trade\nsecrets, or infringement of other intellectual property rights which could\nreasonably be expected to have, either individually or in the aggregate, a\nMaterial Adverse Effect. The Company and its Material Subsidiaries have taken\nreasonable security measures to protect the secrecy, confidentiality and value\nof all of their intellectual property.\n\n          o.   Title.  The Company and its Material Subsidiaries have good and\n               -----                                                          \nmarketable title in fee simple to all real property and good and marketable\ntitle to all personal property owned by them which is material to the business\nof the Company and its Material Subsidiaries, in each case free and clear of all\nliens, encumbrances and defects except such as are described in the SEC\nDocuments filed with the SEC at least five (5) days prior to the date hereof, or\nsuch as do not materially affect the value of such property and do not interfere\nwith the use made and proposed to be made of such property by the Company and\nany of its Material Subsidiaries.  Any real property and facilities held under\nlease by the Company and any of its Material Subsidiaries are held by them under\nvalid, subsisting and enforceable leases with such exceptions as are not\nmaterial and do not interfere with the use made and proposed to be made of such\nproperty and facilities by the Company and its Material Subsidiaries.\n\n          p.   Insurance.  The Company and each of its Material Subsidiaries are\n               ---------                                                        \ninsured by insurers of recognized financial responsibility against such losses\nand risks and in such amounts as management of the Company believes to be\nprudent and customary in the businesses in which the Company and its Material\nSubsidiaries are engaged.  Neither the Company nor any such Material Subsidiary\nhas any reason to believe that it will not be able to renew its existing\ninsurance coverage as and when such coverage expires or to obtain similar\ncoverage from similar insurers as may be necessary to continue its business at a\ncost that would not have a Material Adverse Effect, taken as a whole.\n\n          q.  Regulatory Permits. Except for Permits (as defined below) the \n              ------------------                                            \nabsence of which would not result, either individually or in the aggregate, in a\nMaterial Adverse Effect, the Company and its Material Subsidiaries possess all\ncertificates, authorizations and permits issued by the appropriate federal,\nstate or foreign regulatory authorities necessary to conduct their respective\nbusinesses (the \"Permits\"), and neither the Company nor any such Material\n\n                                       11\n\n \nSubsidiary has received any notice of proceedings relating to the revocation or\nmodification of any such Permit.\n\n          r.   Internal Accounting Controls.  The Company and each of its \n               ----------------------------                               \nMaterial Subsidiaries maintain a system of internal accounting controls\nsufficient to provide reasonable assurance that (i) transactions are executed in\naccordance with management's general or specific authorizations, (ii)\ntransactions are recorded as necessary to permit preparation of financial\nstatements in conformity with generally accepted accounting principles and to\nmaintain asset accountability and (iii) assets are amortized and depreciated, as\napplicable, in accordance with generally accepted accounting principles.\n\n          s.   Tax Status.  The Company and each of its Material Subsidiaries \n               ----------                                                     \n(i) has made or filed all federal and state income and all other material tax\nreturns, reports and declarations required by any jurisdiction to which it is\nsubject (unless and only to the extent that the Company and each of its Material\nSubsidiaries has set aside on its books provisions reasonably adequate for the\npayment of all unpaid and unreported taxes), (ii) has paid all taxes and other\ngovernmental assessments and charges that are material in amount, shown or\ndetermined to be due on such returns, reports and declarations, except those\nbeing contested in good faith and for which the Company has made appropriate\nreserves for on its books, and (iii) has set aside on its books provisions\nreasonably adequate for the payment of all taxes for periods subsequent to the\nperiods to which such returns, reports or declarations (referred to in clause\n(i) above) apply. There are no unpaid taxes in any material amount claimed to be\ndue by the taxing authority of any jurisdiction.\n\n          t.   Transactions With Affiliates.  Except as set forth on \n               ----------------------------                          \nSchedule 3(t) or in the SEC Documents filed at least five (5) days prior to the\n-------------\ndate hereof, and other than the grant of stock options disclosed on Schedule\n                                                                    --------\n3(c), none of the executive officers or directors of the Company is presently a \n-----                          \nparty to any material transaction with the Company or any of its Material\nSubsidiaries (other than for services as employees, officers and directors),\nincluding any material contract, agreement or other arrangement providing for\nthe furnishing of services to or by, providing for rental of real or personal\nproperty to or from, or otherwise requiring material payments to or from any\nsuch officer, director or employee or, to the knowledge of the Company, any\ncorporation, partnership, trust or other entity in which any such officer,\ndirector, or employee has a substantial interest or is an officer, director,\ntrustee or partner.\n\n          u.   Application of Takeover Protections.  The Company and its board \n               -----------------------------------                             \nof directors have taken all necessary action, if any, in order to render\ninapplicable any control share acquisition, business combination, poison pill\n(including any distribution under a rights agreement) or other similar anti-\ntakeover provision under the Certificate of Incorporation or the laws of the\nstate of its incorporation which is or could become applicable to the Buyers as\na result of the transactions contemplated by this Agreement, including, without\nlimitation, the Company's issuance of the Securities and the Buyers' ownership\nof the Securities.\n\n          v.   Rights Agreement.  The Company has not adopted a shareholder \n               ----------------                                             \nrights plan or similar arrangement relating to accumulations of beneficial\nownership of Common Stock or a change in control of the Company.\n\n                                       12\n\n \n          w.   No Other Agreements.  The Company has not, directly or \n               -------------------                                    \nindirectly, made any agreements with any Buyers relating to the terms or\nconditions of the transactions contemplated by the Transaction Documents except\nas set forth in the Transaction Documents.\n\n          x.   Seniority.  Payments of principal and other payments due under \n               ---------                                                      \nthe Notes rank senior to the Company's Convertible Subordinated Debentures due\n2018 and the Company's 4% Convertible Subordinated Notes due 2006 and any other\nunsecured obligation that is ranked pari passu with either of the foregoing.\n\n          y.   Exclusivity Extension.  The extension granted by the Company (the\n               ---------------------                                            \n\"Extension Agreement\") to each of Comcast Corporation (\"Comcast\") and Cox\nCommunications, Inc. (\"Cox\"), is as follows: [Cox\/Comcast] shall have the right\nto terminate the mutual exclusivity provisions of the Master Distribution\nAgreement dated May 1997 (\"1997 Agreement\") effective December 4, 2001 by giving\nthe Company notice of termination of the exclusivity provisions prior to 11:59\np.m., Monday June 18, 2001.  Neither Comcast nor Cox has the right, other than\nfor breach, to terminate the 1997 Agreement, or the letter agreement between\nAT&amp;T Corp., Comcast and Cox dated March 28, 2000 (the \"March 28, 2000 Letter\nAgreement\") as of an effective date prior to June 4, 2002, except as set forth\nin Section 1 of Annex C of the March 28 Letter Agreement or as otherwise\nprovided in the 1997 Agreement. The Extension Agreement does not by its terms\nchange or amend the Transition Service Level Plan.\n\n     4.   COVENANTS.\n          --------- \n\n          a.   All Reasonable Efforts.  Each party shall use all reasonable \n               ----------------------                                       \nefforts to timely satisfy each of the conditions to be satisfied by it as\nprovided in Sections 6 and 7 of this Agreement.\n\n          b.   Form D and Blue Sky.  The Company agrees to file a Form D with \n               -------------------                                            \nrespect to the Securities as required under Regulation D and to provide a copy\nthereof to each Buyer promptly after such filing. The Company shall, on or\nbefore the Closing Date, take such action as the Company shall reasonably\ndetermine is necessary in order to obtain an exemption for or to qualify the\nSecurities for, sale to the Buyers at the Closing pursuant to this Agreement\nunder applicable securities or \"Blue Sky\" laws of the states of the United\nStates, and shall provide evidence of any such action so taken to the Buyers on\nor prior to the Closing Date. The Company shall make all filings and reports\nrelating to the offer and sale of the Securities required under applicable\nsecurities or \"Blue Sky\" laws of the states of the United States following the\nClosing Date.\n\n          c.   Reporting Status.  Until the later of (i) the date as of which \n               ----------------                                               \nthe Investors (as that term is defined in the Registration Rights Agreement) may\nsell all of the Conversion Shares without restriction pursuant to Rule 144(k)\npromulgated under the 1933 Act (or successor thereto) and (ii) the last date on\nwhich any Notes remain outstanding (the \"Reporting Period\"), the Company shall\nfile all reports required to be filed with the SEC pursuant to the 1934 Act, and\nthe Company shall not terminate its status as an issuer required to file reports\nunder the 1934 Act even if the 1934 Act or the rules and regulations thereunder\nwould otherwise permit such termination, other than as a result of merger or\nconsolidation in which the Company is not the \n\n                                       13\n\n \nsurviving entity and with respect to which the Company is in compliance with\nSection 4 of the Notes and Section 4(i) of this Agreement.\n\n          d.   Use of Proceeds.  The Company will use the proceeds from the \n               ---------------                                              \nsale of the Note for substantially the same purposes and in substantially the\nsame amounts as indicated in Schedule 4(d). The Company shall not use the\n                             -------------\nproceeds from the sale of the Notes in violation of any applicable law.\n\n          e.   Financial Information.  The Company agrees to send the following \n               ---------------------                                            \nto each Investor (as that term is defined in the Registration Rights Agreement)\nduring the Reporting Period: (i) within two (2) days after the filing thereof\nwith the SEC, a copy of its Annual Reports on Form 10-K, its Quarterly Reports\non Form 10-Q, any Current Reports on Form 8-K and any registration statements\n(other than on Form S-8) or amendments filed pursuant to the 1933 Act, provided\nthat if any such report is filed with the SEC through EDGAR then the Company\nshall be deemed to have satisfied its obligation under this clause (i) by such\nfiling, (ii) on the same day as the release thereof, facsimile copies of all\nmaterial press releases issued by the Company or any of its Material\nSubsidiaries, provided that if any such press release is filed with the SEC\nthrough a Current Report on Form 8-K through EDGAR then the Company shall be\ndeemed to have satisfied its obligations under this clause (ii) by such filing;\nand (iii) copies of any notices and other information made available or given to\nthe stockholders of the Company generally, contemporaneously with the making\navailable or giving thereof to the stockholders.\n\n          f.   Reservation of Shares.  The Company shall take all action \n               ---------------------                                     \nnecessary to at all times have authorized, and reserved for the purpose of\nissuance, no less than 100% of the number of shares of Common Stock needed to\nprovide for the issuance of the shares of Common Stock upon conversion of all\noutstanding Notes (without regard to any limitations on conversions).\n\n          g.   Listing.  The Company shall promptly secure the listing of all \n               -------                                                        \nof the Registrable Securities (as defined in the Registration Rights Agreement)\nupon each national securities exchange and automated quotation system, if any,\nupon which shares of Common Stock are then listed (subject to official notice of\nissuance, as required by each such national securities exchange and automated\nquotation system) and shall maintain, so long as any other shares of Common\nStock shall be so listed, such listing of all Registrable Securities from time\nto time issuable under the terms of the Transaction Documents. The Company shall\nuse all reasonable efforts to maintain the Common Stock's authorization for\nquotation on the Nasdaq National Market (\"NASDAQ\") or listing on The New York\nStock Exchange, Inc. (\"NYSE\") (as applicable, the \"Principal Market\"). Neither\nthe Company nor any of its Material Subsidiaries shall take any action which\nwould be reasonably expected to result in the delisting or suspension of the\nCommon Stock from the Principal Market. The Company shall pay all fees and\nexpenses in connection with satisfying its obligations under this Section 4(g).\n\n          h.   Filing of Form 8-K.  Before 9:00 am Eastern Time, on June 11, \n               ------------------                                           \n2001, but in no event later than the first time the Company issues a press \nrelease disclosing the transactions contemplated by this Agreement, the Company\nshall file a Current Report on Form 8-K with the SEC describing the terms of the\ntransactions contemplated by the Transaction Documents and including as exhibits\nto such Current Report on Form 8-K a form of each of this Agreement (including\nthe disclosure\n\n                                       14\n\n \nschedules to the Agreement), the Notes, the Registration Rights Agreement and\nthe Security Agreement, in the form required by the 1934 Act.\n\n     i.  Corporate Existence.  For so long as a Buyer beneficially owns any\n         -------------------                                               \nNotes, if the Company fails to maintain its corporate existence or sells all or\nsubstantially all of the Company's assets (except in the event of a merger or\nconsolidation or sale of all or substantially all of the Company's assets, where\nthe surviving or successor entity in such transaction (i) assumes the Company's\nobligations hereunder and under the agreements and instruments entered into in\nconnection herewith, and (ii) is either (A) a publicly traded corporation whose\ncommon stock is listed for trading on Nasdaq, NYSE or AMEX or (B) is a\nsubsidiary of a corporation described in the immediately preceding clause (B)\nand upon the consummation of such transaction the Notes shall be convertible\ninto the common stock of such publicly traded corporation which is listed for\ntrading on Nasdaq, NYSE or AMEX) (each a \"Corporate Termination Event\"), no\nsooner than twenty (20) Business Days nor later than ten (10) Business Days\nprior to the consummation of such Corporate Termination Event, the Company shall\ndeliver written notice thereof (\"Corporate Termination Notice\") via facsimile\nand overnight courier to each Buyer and, at the election of the Buyer, the\nCompany shall redeem any Notes held by such Buyer at a price equal to the\nCorporate Termination Redemption Price (as defined below) simultaneously with\nthe consummation of the Corporate Termination Event.  The Buyer shall exercise\nits right to require the Company to redeem outstanding Notes pursuant to the\nforegoing sentence of this Section 4(i) by delivering written notice to the\nCompany within ten (10) Business Days after the Buyer's receipt of the Corporate\nTermination Notice.  Payments for such redemption shall have priority to the\npayments to stockholders of the Company in connection with such Corporate\nTermination Event.  The \"Corporate Termination Price\" shall mean (A) with\nrespect to a Corporate Termination Event during the period beginning on the date\nhereof and ending on and including the date which is one (1) year after the\nClosing Date, 135% of the Conversion Amount (as defined in the Notes), (B) with\nrespect to a Corporate Termination Event during the period beginning on but\nexcluding the date which is one (1) year after the Closing Date and ending on\nand including the date which is two (2) years after the Closing Date, 125% of\nthe Conversion Amount, and (C) with respect to a Corporate Termination Event on\nor after the day after the date which is two (2) years after the Closing Date,\n100% of the Conversion Amount.\n\n     j.  Pledge of Securities.  The Company acknowledges and agrees that the\n         --------------------                                               \nSecurities may be pledged by an Investor (as defined in the Registration Rights\nAgreement) in connection with a bona fide margin agreement or other loan secured\nby the Securities.  The pledge of Securities shall not be deemed to be a\ntransfer, sale or assignment of the Securities hereunder, and no Investor\neffecting any such pledge of Securities shall be required to provide the Company\nwith any notice thereof or otherwise make any delivery to the Company pursuant\nto this Agreement or any other Transaction Document, including without\nlimitation, Section 2(f) of this Agreement; provided that an Investor and its\npledgee shall be required to comply with the provisions of Section 2(f) hereof\nin order to effect a sale, transfer or assignment of Securities to such pledgee.\nThe Company hereby agrees to execute and deliver such documentation as a pledgee\nof the Securities may reasonably request in connection with a pledge of the\nSecurities to such pledgee by an Investor, provided that such documentation does\nnot expand the nature of the Company's obligations under any Transaction\nDocument\n\n                                       15\n\n \n     k.  UCC-1 Financing Statements.  On or before June 11, 2001 the Company\n         --------------------------                                         \nwill deliver to Katten Muchin Zavis, to the attention of Robert J. Brantman, on\nbehalf of HFTP Investments L.L.C. (a Buyer) and Gaia Offshore Master Fund, Ltd.\n(a Buyer) and to Akin, Gump, Strauss, Hauer &amp; Feld, L.L.P., to the attention of\nRobert S. Matlin, on behalf of Leonardo, L.P. (a Buyer) separate executed UCC-1\nfinancing statements in the name of each such Buyer for each jurisdiction listed\non Schedule II to the Security Agreement and in a form reasonably satisfactory\nto such Buyer.\n\n     l.  Security Interest Opinion.  On or prior to July 20, 2001, the Company\n         -------------------------                                            \nshall cause to be delivered to each Buyer the opinion of Fenwick &amp; West LLP in\nits customary form, dated as of a then current date, which opinion shall be a\nDelaware UCC opinion as to the perfection under Delaware law of the security\ninterest in the Collateral (as defined in the Security Agreement) after giving\neffect to the revised Article 9 of the UCC.\n\n\n  5. TRANSFER AGENT INSTRUCTIONS.\n     --------------------------- \n\n     The Company shall issue irrevocable instructions to its transfer agent in\nthe form attached hereto as Exhibit D (the \"Irrevocable Transfer Agent\n                            ---------                                 \nInstructions\"), and any subsequent transfer agent, to issue certificates,\nregistered in the name of each Buyer or its respective nominee(s), for the\nConversion Shares in such amounts as specified from time to time by each Buyer\nto the Company upon conversion of the Notes. Prior to registration of the\nConversion Shares under the 1933 Act, all such certificates shall bear the\nrestrictive legend specified in Section 2(g) of this Agreement.  The Company\nwarrants that no instruction inconsistent with Section 2(f) hereof or this\nSection 5 will be given by the Company to its transfer agent and that the\nSecurities shall otherwise be freely transferable on the books and records of\nthe Company as and to the extent provided in this Agreement and the Registration\nRights Agreement.  If a Buyer provides the Company with an opinion of counsel\nreasonably acceptable to the Company to the effect that a public sale,\nassignment or transfer of Securities may be made without registration under the\n1933 Act or the Buyer provides the Company with reasonable assurances that the\nSecurities can be sold, assigned or transferred  pursuant to Rule 144 or can be\nsold, assigned or transferred pursuant to Rule 144(k) under the 1933 Act, the\nCompany shall permit the transfer, and, in the case of the Conversion Shares,\npromptly instruct its transfer agent to issue one or more certificates in such\nname and in such denominations as specified by such Buyer and without any\nrestrictive legend.  The Company acknowledges that a breach by it of its\nobligations hereunder will cause irreparable harm to the Buyers by vitiating the\nintent and purpose of the transaction contemplated hereby.  Accordingly, the\nCompany acknowledges that the remedy at law for a breach of its obligations\nunder this Section 5 will be inadequate and agrees, in the event of a breach or\nthreatened breach by the Company of the provisions of this Section 5, that the\nBuyers shall be entitled, in addition to all other available remedies, to an\norder and\/or injunction restraining any breach and requiring immediate issuance\nand transfer, without the necessity of showing economic loss and without any\nbond or other security being required.\n\n                                       16\n\n \n  6. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.\n     ---------------------------------------------- \n\n     The obligation of the Company to issue and sell the Notes to each Buyer at\nthe Closing is subject to the satisfaction, at or before the Closing Date, of\neach of the following conditions, provided that these conditions are for the\nCompany's sole benefit and may be waived by the Company at any time in its sole\ndiscretion by providing each Buyer with prior written notice thereof:\n\n          (a) Each Buyer shall have executed each of the Transaction Documents\n     to which it is a party and delivered the same to the Company.\n\n          (b) Each Buyer shall have delivered to the Company the Purchase Price\n     for the Notes being purchased by such Buyer at the Closing by wire transfer\n     of immediately available funds pursuant to the wire instructions provided\n     by the Company.\n\n          (c) The representations and warranties of each Buyer shall be true and\n     correct as of the date when made and as of the Closing Date as though made\n     at that time (except for representations and warranties that speak as of a\n     specific date), and such Buyer shall have performed, satisfied and complied\n     with the covenants, agreements and conditions required by the Transaction\n     Documents to be performed, satisfied or complied with by such Buyer at or\n     prior to the Closing Date.\n\n  7. CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE.\n     ------------------------------------------------- \n\n     The obligation of each Buyer hereunder to purchase the Notes from the\nCompany at the Closing is subject to the satisfaction, at or before the Closing\nDate, of each of the following conditions, provided that these conditions are\nfor each Buyer's sole benefit and may be waived by such Buyer at any time in its\nsole discretion by providing the Company with prior written notice thereof:\n\n          (a) The Company shall have executed each of the Transaction Documents\n     and delivered the same to such Buyer.\n\n          (b) The Common Stock (x) shall be designated for quotation or listed\n     on the Principal Market and (y) shall not have been suspended by the SEC or\n     the Principal Market from trading on the Principal Market nor shall\n     suspension by the SEC or the Principal Market be threatened either (A) in\n     writing by the SEC or the Principal Market or (B) by falling below the\n     minimum listing maintenance requirements of the Principal Market; and the\n     Conversion Shares issuable upon conversion of the Notes shall be listed\n     upon the Principal Market.\n\n     (c) The representations and warranties of the Company shall be true and\n     correct as of the date when made and as of the Closing Date as though made\n     at that time (except for representations and warranties that speak as of a\n     specific date) and the Company shall have performed, satisfied and complied\n     with the covenants, agreements and conditions required by the Transaction\n     Documents to be performed, satisfied or complied with by the Company at or\n     prior to the Closing Date. Such Buyer shall have\n\n                                       17\n\n \n     received a certificate, executed by the Chief Financial Officer of the\n     Company, dated as of the Closing Date, to the foregoing effect and as to\n     such other matters as may be reasonably requested by such Buyer, including,\n     without limitation, an update as of the Closing Date regarding the\n     representation contained in Section 3(c) above.\n\n          (d) Such Buyer shall have received the opinion of Fenwick &amp; West LLP,\n     dated as of the Closing Date, in the form of Exhibit E, attached hereto.\n                                                  ---------                  \n\n          (e) The Company shall have executed and delivered to such Buyer the\n     Note Certificates (in such principal amounts as such Buyer shall request)\n     for the Notes being purchased by such Buyer at the Closing.\n\n          (f) The Board of Directors of the Company shall have adopted\n     resolutions consistent with Section 3(b) above and in a form reasonably\n     acceptable to such Buyer (the \"Resolutions\").\n\n          (g) As of the Closing Date, the Company shall have reserved out of its\n     authorized and unissued Common Stock, solely for the purpose of effecting\n     the conversion of the Notes, such number of shares of Common Stock as are\n     issuable at the Conversion Rate (as defined in the Note), as calculated\n     using the Fixed Conversion Price (as defined in the Notes) as of the\n     Closing Date.\n\n          (h) The Irrevocable Transfer Agent Instructions, in the form of\n     Exhibit D attached hereto, shall have been delivered to and acknowledged in\n     ---------\n     writing by the Company's transfer agent.\n\n          (i) The Company shall have delivered to such Buyer a certificate\n     evidencing the incorporation and good standing of the Company in the State\n     of Delaware issued by the Secretary of State of the State of Delaware and a\n     certificate evidencing the qualification and good standing of the Company\n     in the State of California issued by the Secretary of State of the State of\n     California as of a date within ten days of the Closing Date.\n\n          (j) The Company shall have delivered to such Buyer a certified copy of\n     the Certificate of Incorporation as certified by the Secretary of State of\n     the State of Delaware as of a date within ten days of the Closing Date.\n \n          (k) The Company shall have delivered to such Buyer a secretary's\n     certificate, dated as of the Closing Date, certifying as to (A) the\n     Resolutions, (B) the Certificate of Incorporation and (C) the By-laws, each\n     as in effect at the Closing.\n\n          (l) The Company shall have made all filings under all applicable\n     federal and state securities laws necessary to consummate the issuance of\n     the Securities pursuant to this Agreement in compliance with such laws.\n\n                                       18\n\n \n          (m) The Company shall have delivered to such Buyer a letter from the\n     Company's transfer agent certifying the number of shares of Common Stock\n     outstanding as of a date within five days of the Closing Date.\n\n          (n) The Company shall have delivered to the Buyers such other\n     documents relating to the transactions contemplated by the Transaction\n     Documents as the Buyers or their counsel may reasonably request.\n\n  8. INDEMNIFICATION.  In consideration of each Buyer's execution and\n     ---------------                                                 \ndelivery of the Transaction Documents and acquiring the Securities thereunder\nand in addition to all of the Company's other obligations under the Transaction\nDocuments, the Company shall defend, protect, indemnify and hold harmless each\nBuyer and each other holder of the Securities and all of their stockholders,\nofficers, directors, employees and direct or indirect investors and any of the\nforegoing persons' agents or other representatives (including, without\nlimitation, those retained in connection with the transactions contemplated by\nthis Agreement) (collectively, the \"Indemnitees\") from and against any and all\nactions, causes of action, suits, claims, losses, costs, penalties, fees,\nliabilities and damages, and expenses in connection therewith (irrespective of\nwhether any such Indemnitee is a party to the action for which indemnification\nhereunder is sought), and including reasonable attorneys' fees and disbursements\n(the \"Indemnified Liabilities\"), incurred by any Indemnitee as a result of, or\narising out of, (a) any misrepresentation or breach of any representation or\nwarranty made by the Company in the Transaction Documents, (b) any breach of any\ncovenant, agreement or obligation of the Company contained in the Transaction\nDocuments, (c) any cause of action, suit or claim brought or made against such\nIndemnitee (other than a cause of action, suit or claim which is (x) brought or\nmade by the Company and (y) is not a shareholder derivative suit) and arising\nout of or resulting from  the misrepresentation or alleged misrepresentation or\nbreach or alleged breach of any representation or warranty made by the Company\nin the Transaction Documents, or the breach or alleged breach of any covenant,\nagreement or obligation of the Company contained in the Transaction Documents.\nTo the extent that the foregoing undertaking by the Company may be unenforceable\nfor any reason, the Company shall make the maximum contribution to the payment\nand satisfaction of each of the Indemnified Liabilities which is permissible\nunder applicable law.  Except as otherwise set forth herein, the mechanics and\nprocedures with respect to the rights and obligations under this Section 8 shall\nbe the same as those set forth in Sections 6(a) and (d) of the Registration\nRights Agreement, including, without limitation, those procedures with respect\nto the settlement of claims and the Company's rights to assume the defense of\nclaims.\n\n  9. MISCELLANEOUS.\n     ------------- \n\n     a.  Governing Law; Jurisdiction; Jury Trial.  All questions concerning the\n         ---------------------------------------                               \nconstruction, validity, enforcement and interpretation of this Agreement shall\nbe governed by the internal laws of the State of New York, without giving effect\nto any choice of law or conflict of law provision or rule (whether of the State\nof New York or any other jurisdiction) that would cause the application of the\nlaws of any jurisdiction other than the State of New York.  Each party hereby\nirrevocably submits to the non-exclusive jurisdiction of the state and federal\ncourts sitting in the City of New York, borough of Manhattan, for the\nadjudication of any dispute hereunder or in connection herewith or with any\ntransaction contemplated hereby or discussed \n\n                                       19\n\n \nherein, and hereby irrevocably waives, and agrees not to assert in any suit,\naction or proceeding, any claim that it is not personally subject to the\njurisdiction of any such court, that such suit, action or proceeding is brought\nin an inconvenient forum or that the venue of such suit, action or proceeding is\nimproper. Each party hereby irrevocably waives personal service of process and\nconsents to process being served in any such suit, action or proceeding by\nmailing a copy thereof to such party at the address for such notices to it under\nthis Agreement and agrees that such service shall constitute good and sufficient\nservice of process and notice thereof. Such service shall be deemed effective\nfive (5) Business Days after mailing. Nothing contained herein shall be deemed\nto limit in any way any right to serve process in any manner permitted by law.\nEACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO\nREQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN\nCONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION\nCONTEMPLATED HEREBY.\n\n     b.  Counterparts.  This Agreement may be executed in two or more identical\n         ------------                                                          \ncounterparts, all of which shall be considered one and the same agreement and\nshall become effective when counterparts have been signed by each party and\ndelivered to the other party; provided that a facsimile signature shall be\nconsidered due execution and shall be binding upon the signatory thereto with\nthe same force and effect as if the signature were an original, not a facsimile\nsignature.\n\n     c.  Headings.  The headings of this Agreement are for convenience of\n         --------                                                        \nreference and shall not form part of, or affect the interpretation of, this\nAgreement.\n\n     d.  Severability.  If any provision of this Agreement shall be invalid or\n         ------------                                                         \nunenforceable in any jurisdiction, such invalidity or unenforceability shall not\naffect the validity or enforceability of the remainder of this Agreement in that\njurisdiction or the validity or enforceability of any provision of this\nAgreement in any other jurisdiction.\n\n     e.  Entire Agreement; Amendments.  This Agreement supersedes all other\n         ----------------------------                                      \nprior oral or written agreements between each Buyer, the Company, their\naffiliates and persons acting on their behalf with respect to the matters\ndiscussed herein, and this Agreement and the instruments referenced herein\ncontain the entire understanding of the parties with respect to the matters\ncovered herein and therein and, except as specifically set forth herein or\ntherein, neither the Company nor any Buyer makes any representation, warranty,\ncovenant or undertaking with respect to such matters.  No provision of this\nAgreement may be amended or waived other than by an instrument in writing signed\nby the Company and the Buyers which purchased at least two-thirds (2\/3) of the\naggregate principal amount the Notes on the Closing Date.  Any such amendment\nshall bind all holders of the Notes.  No such amendment shall be effective to\nthe extent that it applies to less than all of the holders of the Notes then\noutstanding.  No consideration shall be offered or paid to any person to amend\nor consent to a waiver or modification of any provision of any of the\nTransaction Documents unless the same consideration also is offered to all of\nthe parties to the Transaction Documents or holders of the Notes, as the case\nmay be.\n\n                                       20\n\n \n     f.  Notices.  Except as otherwise specifically provided in this Agreement,\n         -------                                                               \nany notices, consents, waivers or other communications required or permitted to\nbe given under the terms of this Agreement must be in writing and will be deemed\nto have been delivered: (i) upon receipt, when delivered personally; (ii) upon\nreceipt, when sent by facsimile (provided confirmation of transmission is\nmechanically or electronically generated and kept on file by the sending party);\nor (iii) one (1) Business Day after deposit with a nationally recognized\novernight delivery service, in each case properly addressed to the party to\nreceive the same.  The addresses and facsimile numbers for such communications\nshall be:\n\n  If to the Company:\n\n     At Home Corporation\n     450 Broadway Street\n     Redwood City, California 94063\n     Telephone: (650) 556-5000\n     Facsimile: (650) 556-3430\n     Attention: General Counsel\n \n  With a copy to:\n \n     Fenwick &amp; West LLP\n     Two Palo Alto Square\n     Palo Alto, CA 94306\n     Telephone: (650) 494-0600\n     Facsimile: (650) 494-1417\n     Attention: Gordon Davidson, T.J. Hall and David Michaels\n \n  If to the Transfer Agent:\n \n     Equiserve Trust Company\n     150 Royall Street\n     Canton, MA 02021\n     Telephone: (781) 575-3120\n     Facsimile: (781) 575-2804\n     Attention: Mr. Jim Walsh\n\n  If to a Buyer, to it at the address and facsimile number set forth on the\nSchedule of Buyers, with copies to such Buyer's representatives as set forth on\nthe Schedule of Buyers, or at such other address and\/or facsimile number and\/or\nto the attention of such other person as the recipient party has specified by\nwritten notice given to each other party five (5) days prior to the\neffectiveness of such change.  The Company may modify its notice information or\nthe notice information for the Transfer Agent specified above by providing\nwritten notice to each other party of such other address and\/or facsimile number\nand\/or such other person  whose attention a notice should be directed, five (5)\ndays prior to the effectiveness of such change.  Written confirmation of receipt\n(A) given by the recipient of such notice, consent, waiver or other\ncommunication, (B) mechanically or electronically generated by the sender's\nfacsimile machine containing the time, date, recipient facsimile number and an\nimage of the first page of such \n\n                                       21\n\n \ntransmission or (C) provided by a nationally recognized overnight delivery\nservice shall be rebuttable evidence of personal service, receipt by facsimile\nor receipt from a nationally recognized overnight delivery service in accordance\nwith clause (i), (ii) or (iii) above, respectively.\n\n     g.  Successors and Assigns. This Agreement shall be binding upon and inure\n         ----------------------                                           \nto the benefit of the parties and their respective successors and assigns,\nincluding any purchasers of the Notes. The Company shall not assign this\nAgreement or any rights or obligations hereunder without the prior written\nconsent of the holders of Notes representing at least two-thirds (2\/3) of the\naggregate principal amount of the Notes then outstanding, including by merger or\nconsolidation, except pursuant to a Change of Control (as defined in Section\n4(b) of the Note) with respect to which the Company is in compliance with\nSection 4 of the Notes and Section 4(i) of this Agreement. A Buyer may assign\nsome or all of its rights hereunder without the consent of the Company,\nprovided, however, that the transferee has agreed in writing to be bound by the\napplicable provisions of this Agreement. Notwithstanding anything to the\ncontrary contained in the Transaction Documents but subject to Section 4(j), the\nBuyers shall be entitled to pledge the Securities in connection with a bona fide\nmargin account or other loan or other financing arrangement secured by the\nSecurities.\n\n     h.  No Third Party Beneficiaries. This Agreement is intended for the\n         ----------------------------                                     \nbenefit of the parties hereto and their respective permitted successors and\nassigns, and is not for the benefit of, nor may any provision hereof be enforced\nby, any other person.\n\n     i.  Survival. The representations and warranties of the Company and the\n         --------                                                        \nBuyers contained in Sections 2 and 3, the agreements and covenants set forth in\nSections 4, 5 and 9, and the indemnification provisions set forth in Section 8,\nshall survive the Closing. Each Buyer shall be responsible only for its own\nrepresentations, warranties, agreements and covenants hereunder.\n\n     j.  Publicity.  The Company and each Buyer shall have the right to\n         ---------                                                     \napprove before issuance any press releases or any other public statements with\nrespect to the transactions contemplated hereby; provided, however, that the\nCompany shall be entitled, without the prior approval of any Buyer, to make any\npress release or other public disclosure with respect to such transactions as is\nrequired by applicable law and regulations (although each Buyer shall be\nprovided with a copy of any such disclosure and by consulted with by the Company\nprior to its release other than disclosures in SEC filings that are\nsubstantially similar to other disclosures previously made by the Company with\nsuch prior consultation).\n\n     k.  Further Assurances. Each party shall do and perform, or cause to be\n         ------------------                                               \ndone and performed, all such further acts and things, and shall execute and\ndeliver all such other agreements, certificates, instruments and documents, as\nthe other party may reasonably request in order to carry out the intent and\naccomplish the purposes of this Agreement and the consummation of the\ntransactions contemplated hereby.\n\n     l.  Placement Agent. The Company agrees and acknowledges that it shall be\n         ---------------                                              \nresponsible for the payment of any placement agent's fees, financial advisory\nfees, or brokers' commissions relating to or arising out of the transactions\ncontemplated hereby. The Company\n\n                                       22\n\n \nshall pay, and hold each Buyer harmless against, any liability, loss or expense\n(including, without limitation, attorney's fees and out-of-pocket expenses)\narising in connection with any such claim.\n\n     m.  No Strict Construction.  The language used in this Agreement will\n         ----------------------                                           \nbe deemed to be the language chosen by the parties to express their mutual\nintent, and no rules of strict construction will be applied against any party.\n\n     n.  Remedies.  Each Buyer and each holder of the Securities shall\n         --------                                                     \nhave all rights and remedies set forth in the Transaction Documents and all\nrights and remedies which such holders have been granted at any time under any\nother agreement or contract and all of the rights which such holders have under\nany law.  Any person having any rights under any provision of this Agreement\nshall be entitled to enforce such rights specifically (without posting a bond or\nother security), to recover damages by reason of any breach of any provision of\nthis Agreement and to exercise all other rights granted by law.\n\n     o.  Payment Set Aside. To the extent that the Company makes a payment or\n         -----------------                                         \npayments to any Buyer hereunder or pursuant to the Registration Rights Agreement\nor the Notes or the Buyers enforce or exercise their rights hereunder or\nthereunder, and such payment or payments or the proceeds of such enforcement or\nexercise or any part thereof are subsequently invalidated, declared to be\nfraudulent or preferential, set aside, recovered from, disgorged by or are\nrequired to be refunded, repaid or otherwise restored to the Company by a\ntrustee, receiver or any other person under any law (including, without\nlimitation, any bankruptcy law, state or federal law, common law or equitable\ncause of action), then to the extent of any such restoration the obligation or\npart thereof originally intended to be satisfied shall be revived and continued\nin full force and effect as if such payment had not been made or such\nenforcement or setoff had not occurred.\n\n                                  * * * * * *\n\n \n     IN WITNESS WHEREOF, the Buyers and the Company have caused this Securities\nPurchase Agreement to be duly executed as of the date first written above.\n\nCOMPANY:                            BUYERS:\n\nAT HOME CORPORATION                 HFTP INVESTMENT L.L.C.\n                                    By:  Promethean Asset Management, L.L.C.\n                                    Its: Investment Manager\n\nBy:________________________\n   Name:___________________\n   Title:__________________         By:_________________________\n                                       Name:____________________\n                                       Title:___________________\n\n\n                                    GAIA OFFSHORE MASTER FUND, LTD.\n \n                                    By: Promethean Asset Management L.L.C\n                                    Its: Investment Manager\n\n                                    By:_________________________\n                                       Name:____________________\n                                       Title:___________________\n\n\n                                    LEONARDO, L.P.\n \n                                    By:  Angelo, Gordon &amp; Co., L.P.\n                                    Its:  General Partner\n\n\n                                    By:_________________________\n                                       Name:____________________\n                                       Title:___________________\n\n               [Signature Page to Securities Purchase Agreement]\n                              SCHEDULE OF BUYERS\n\n \n<\/pre>\n<table>\n<caption>\n                                         Buyer Address                  Principal        Buyers Representatives&#8217; Address<br \/>\n     Buyer Name                       and Facsimile Number           Amount of Notes           and Facsimile Number<br \/>\n&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;-        &#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;-  &#8212;&#8212;&#8212;&#8212;&#8212;    &#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;-<br \/>\n<s>                           <c>                                    <c>                <c><br \/>\nHFTP Investment L.L.C.        Promethean Asset Management, L.L.C.      $30,000,000      Promethean Investment Group, L.L.C.<br \/>\n                              750 Lexington Avenue, 22\/nd\/ Floor                        750 Lexington Ave., 22\/nd\/ Floor<br \/>\n                              New York, NY 10022                                        New York, NY 10022<br \/>\n                              Attn:  James F. O&#8217;Brien, Jr.                              Attn:  James F. O&#8217;Brien, Jr.<br \/>\n                              John Floegel                                              John Floegel<br \/>\n                              Telephone: (212) 702-5200                                 Telephone: (212) 702-5200<br \/>\n                              Facsimile: (212) 758-9334                                 Facsimile: (212) 758-9334<br \/>\n                              Residence: New York<br \/>\n                                                                                        Katten Muchin Zavis<br \/>\n                                                                                        525 W. Monroe, Suite 1600<br \/>\n                                                                                        Chicago, Illinois  60661-3693<br \/>\n                                                                                        Attn:  Robert J. Brantman, Esq.<br \/>\n                                                                                        Telephone: (312) 902-5200<br \/>\n                                                                                        Facsimile: (312) 902-1061<br \/>\nGaia Offshore Master          Promethean Asset Management L.L.C.       $20,000,000     Promethean Investment Group, L.L.C.<br \/>\n Fund, Ltd.                   750 Lexington Avenue, 22\/nd\/ Floor                        750 Lexington Ave., 22\/nd\/ Floor<br \/>\n                              New York, NY 10022                                        New York, NY 10022<br \/>\n                              Attention:  James F. O&#8217;Brien, Jr.                         Attn: James F. O&#8217;Brien, Jr.<br \/>\n                              John Floegel                                              John Floegel<br \/>\n                              Telephone: (212) 702-5200                                 Telephone: 212-702-5200<br \/>\n                              Facsimile: (212) 758-9334                                 Facsimile: 212-758-9334<br \/>\n                              Residence: New York<br \/>\n                                                                                        Katten Muchin Zavis<br \/>\n                                                                                        525 W. Monroe Street<br \/>\n                                                                                        Chicago, Illinois 60661-3693<br \/>\n                                                                                        Attention: Robert J. Brantman, Esq.<br \/>\n                                                                                        Telephone: (312) 902-5200<br \/>\n                                                                                        Facsimile: (312) 902-1061<br \/>\nLeonardo, L.P.                c\/o Angelo, Gordon &amp; Co., L.P.            $50,000,000     Akin, Gump, Strauss, Hauer &amp; Feld, L.L.P.<br \/>\n                              245 Park Avenue &#8211; 26\/th\/ Floor                            590 Madison Avenue<br \/>\n                              New York, New York 10167                                  New York, New York 10022<br \/>\n                              Attention:   Gary Wolf                                    Attention: Robert S. Matlin, Esq.<br \/>\n                              Telephone: (212) 692-2058                                 Telephone: (212) 872-1000<br \/>\n                              Facsimile: (212) 867-6449                                 Facsimile: (212) 872-1002<br \/>\n                              Residence: Caymen Islands<br \/>\n<\/c><\/c><\/c><\/s><\/caption>\n<\/table>\n<p>                                   SCHEDULES<br \/>\n                                   &#8212;&#8212;&#8212;<\/p>\n<p>Schedule 3(a)   &#8211;   Material Subsidiaries<br \/>\nSchedule 3(c)   &#8211;   Capitalization<br \/>\nSchedule 3(e)   &#8211;   Conflicts<br \/>\nSchedule 3(f)   &#8211;   SEC Documents<br \/>\nSchedule 3(j)   &#8211;   Undisclosed Events<br \/>\nSchedule 3(t)   &#8211;   Transactions with Affiliates<br \/>\nSchedule 4(d)   &#8211;   Use of Proceeds<\/p>\n<p>                                   EXHIBITS<br \/>\n                                   &#8212;&#8212;&#8211;<\/p>\n<p>Exhibit A   &#8211;   Form of Note<br \/>\nExhibit B   &#8211;   Form of Registration Rights Agreement<br \/>\nExhibit C   &#8211;   Form of Security Agreement<br \/>\nExhibit D   &#8211;   Form of Irrevocable Transfer Agent Instructions<br \/>\nExhibit E   &#8211;   Form of Company Counsel Opinion<\/p>\n<p>                              AT HOME CORPORATION<\/p>\n<p>                             DISCLOSURE LETTER TO<br \/>\n                         SECURITIES PURCHASE AGREEMENT<\/p>\n<p>     This Disclosure Letter (this &#8220;Letter&#8221;) is made with reference to the<br \/>\nSecurities Purchase Agreement dated June 8, 2001 (the &#8220;Agreement&#8221;), by and among<br \/>\nAt Home Corporation, a Delaware corporation (the &#8220;Company&#8221;) and the investors<br \/>\nlisted on the Schedule of Buyers attached thereto.  Unless otherwise defined<br \/>\nherein, any capitalized terms in this Letter shall have the same meanings<br \/>\nassigned to such terms in the Agreement.  The disclosures in this Letter are<br \/>\nqualified in their entirety by reference to specific provisions of the<br \/>\nAgreement, and are not intended to be construed as nor shall they be construed<br \/>\nas constituting representations or warranties of the Company except as and to<br \/>\nthe extent provided for in the Agreement.<\/p>\n<p>     Inclusion of information herein shall not be construed as: (1) an<br \/>\nadmission that such information is material to the operations or financial<br \/>\ncondition of the Company; (2) an admission of any liability or obligation of the<br \/>\nCompany to any third party; or (3) an admission to any third party against the<br \/>\nCompany&#8217;s interests.  Any disclosure made under the heading of one section of<br \/>\nthis Letter may apply to and\/or qualify disclosures made under one or more other<br \/>\nsections provided that such disclosure is cross-referenced elsewhere as<br \/>\napplicable or unless it is reasonably apparent from the express disclosure made<br \/>\nthat an exception is being made to other representations or warranties.  Section<br \/>\nand subsection headings are provided for convenience only, and section and<br \/>\nsubsection numbers and letters relate and coincide to corresponding numbers and<br \/>\nletters in the Agreement.<\/p>\n<p>Schedule 3(a) &#8211; Organization and Qualification<br \/>\n&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;-<\/p>\n<p>     1.   As the Company&#8217;s services are available in multiple states and foreign<br \/>\n          countries, such jurisdictions may claim that it is required to qualify<br \/>\n          to do business as a foreign corporation in these states and foreign<br \/>\n          countries.  The Company and its Material Subsidiaries are qualified to<br \/>\n          do business in a limited number of states, and their failure to<br \/>\n          qualify as a foreign corporation in a jurisdiction where it is<br \/>\n          required to do so could subject the Company to taxes and penalties.<br \/>\n          The application of the laws and regulations discussed above to the<br \/>\n          business of the Company and its Material Subsidiaries is unclear.  The<br \/>\n          Company believes that if it is required to so qualify, it will be able<br \/>\n          to do so.<\/p>\n<p>     2.   List of Material Subsidiaries    State of Incorporation<br \/>\n          &#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8211;    &#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;-<br \/>\n          Classifieds2000, Inc.                     CA<br \/>\n          DataInsight, Inc.                         CO<br \/>\n          iMall, Inc.                               NV<br \/>\n          Kendara, Inc.                             DE<br \/>\n          Netbot, Inc.                              DE<br \/>\n          MatchLogic, Inc.                          DE<br \/>\n          Webshots Corporation                      CA<br \/>\n          Worldprints.com International, Inc.       CO<\/p>\n<p>                                      -1-<\/p>\n<p>Schedule 3(c) &#8211; Capitalization<br \/>\n&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;<\/p>\n<p>     1.   The number of shares of Series A Common Stock reserved for issuance<br \/>\n          pursuant to the Company&#8217;s stock option and purchase plans includes<br \/>\n          amendments to the Company&#8217;s 1997 Equity Incentive Plan to increase the<br \/>\n          number of shares authorized for issuance thereunder by 13,500,000<br \/>\n          shares, and to the Company&#8217;s 1997 Employee Stock Purchase Plan to<br \/>\n          increase the number of shares authorized for issuance thereunder by<br \/>\n          1,500,000 shares.  Both amendments are subject to approval by the<br \/>\n          Company&#8217;s stockholders at its 2001 annual meeting of stockholders.<\/p>\n<p>     2.   Pursuant to Section 8.1 of the Company&#8217;s Amended and Restated<br \/>\n          Stockholders&#8217; Agreement dated as of July 16, 1997 (the &#8220;Stockholders<br \/>\n          Agreement&#8221;), certain stockholders of the Company will have the right<br \/>\n          to purchase their pro rata portion of securities with like terms to<br \/>\n          the Securities, as well as future securities issued by the Company.<\/p>\n<p>     3.   The Company currently has the following debt securities outstanding<br \/>\n          which have not been filed by the Company with the SEC:<\/p>\n<p>          Promissory notes in the aggregate amount of $5,000,000 payable to<br \/>\n          Itochu Corporation and affiliated entities (the &#8220;Itochu Promissory<br \/>\n          Notes&#8221;), $2,500,000 of which is payable to Itochu Corporation,<br \/>\n          $2,040,000 of which is payable to Itochu Techno-Science Corporation,<br \/>\n          and $460,000 of which is payable to Dai Nippon Printing Co., Ltd.<\/p>\n<p>     4.   The following instruments contain redemption provisions:<\/p>\n<p>          (a)   Convertible Subordinated Notes due 2006<br \/>\n          (b)   Convertible Subordinated Debentures due 2018.<br \/>\n          (c)   Itochu Promissory Notes.<\/p>\n<p>     5.   The Company currently has the following outstanding options, warrants<br \/>\n          and other obligations to issue capital stock:<\/p>\n<p>          (a)  The Company currently has options to purchase an aggregate of<br \/>\n               70,252,544 shares of its Series A Common Stock outstanding,<br \/>\n               issued pursuant to its 2000 Equity Incentive Plan, 1997 Equity<br \/>\n               Incentive Plan (and succeeded plans), and assumed in connection<br \/>\n               with acquisitions of other companies.<\/p>\n<p>          (b)  The Company currently has warrants to purchase an aggregate of<br \/>\n               120,487,159 shares of its Series A Common Stock and a warrant to<br \/>\n               purchase an aggregate of 27,897,789 shares of its Series B Common<br \/>\n               Stock outstanding, issued to cable companies, joint venture<br \/>\n               partners, a strategic <\/p>\n<p>                                      -2-<\/p>\n<p>               investor, a commercial partner and a real estate lessor, and<br \/>\n               assumed in connection with acquisitions of other companies.<\/p>\n<p>          (c)  The Itochu Promissory Notes are convertible at maturity into the<br \/>\n               number of shares having an aggregate market value equal to the<br \/>\n               amount outstanding under the Itochu Promissory Notes, calculated<br \/>\n               based on the average closing price for the 30 trading day period<br \/>\n               ending on the date of conversion.<\/p>\n<p>          (d)  The Company&#8217;s currently outstanding shares of Preferred Stock are<br \/>\n               convertible into shares of Series A Common Stock.<\/p>\n<p>          (e)  The Company may be obligated to issue additional warrants to<br \/>\n               purchase shares of Series A Common Stock or Series B Common Stock<br \/>\n               to AT&amp;T Corp., Comcast Corporation or Cox Communications, Inc.<br \/>\n               (the &#8220;Principal Cable Partners&#8221;) pursuant to the terms of the<br \/>\n               Letter Agreement dated March 28, 2000 between the Company and the<br \/>\n               Principal Cable Partners (the &#8220;March 28, 2000 Letter Agreement&#8221;),<br \/>\n               if any of the Principal Cable Partners increase the number of<br \/>\n               &#8220;homes passed&#8221; by their cable systems and cause such homes passed<br \/>\n               to come into compliance with the terms of the March 28, 2000<br \/>\n               Letter Agreement.<\/p>\n<p>          (f)  The Company is obligated to issue additional shares of its Series<br \/>\n               A Common Stock pursuant to the terms of its 1997 Employee Stock<br \/>\n               Purchase Plan in connection with each &#8220;purchase&#8221; under that plan.<\/p>\n<p>          (g)  The Company has entered into a commercial agreement with SurePay,<br \/>\n               LP that commits the Company, subject to Board approval, to grant<br \/>\n               to SurePay, LP a warrant to purchase 200,000 shares of Series A<br \/>\n               Common Stock at a price per share equal to the market price on<br \/>\n               the date the warrant grant is approved by the Board of Directors,<br \/>\n               subject to vesting based on SurePay&#8217;s performance under the<br \/>\n               agreement.<\/p>\n<p>     6.   The Company is currently obligated to register the sale of its<br \/>\n          securities under the 1933 Act under the following arrangements:<\/p>\n<p>          (a)  The Company has provided demand, piggyback and S-3 registration<br \/>\n               rights under the Third Amended and Restated Registration Rights<br \/>\n               Agreement, dated April 11, 1997, between the Company and certain<br \/>\n               stockholders of the Company (the &#8220;Stockholder Registration Rights<br \/>\n               Agreement&#8221;).<\/p>\n<p>          (b)  The Company is obligated to register the resale of shares issued<br \/>\n               upon the exercise of warrants issued to the Principal Cable<br \/>\n               Partners pursuant to the terms of the March 28, 2000 Letter<br \/>\n               Agreement.<\/p>\n<p>                                      -3-<\/p>\n<p>          (c)  The Company is currently obligated to maintain the effectiveness<br \/>\n               of S-3 registration statements currently effective and on file<br \/>\n               with the Securities and Exchange Commission with respect to<br \/>\n               shares of Series A Common Stock issuable upon conversion of its<br \/>\n               Convertible Subordinated Notes due 2006, and shares issued in<br \/>\n               connection with its acquisitions of DataInsight, Inc. and Join<br \/>\n               Systems, Inc. (and currently maintains registration statements on<br \/>\n               Form S-3 with respect to shares issued in connection with several<br \/>\n               other acquisitions).<\/p>\n<p>          (d)  The Company is obligated to register the resale of shares issued<br \/>\n               upon conversion of the Itochu Promissory Notes.<\/p>\n<p>     7.   The Company has not furnished copies of the following warrants to the<br \/>\n          Buyers because the final forms of such warrants have not been<br \/>\n          negotiated:<\/p>\n<p>          (a)  Warrants granted to AT&amp;T Corp. to purchase 27,897,789 shares of<br \/>\n               Series A Common Stock and 27,897,789 shares of Series B Common<br \/>\n               Stock at $29.54 per share pursuant to the terms of the March 28,<br \/>\n               2000 Letter Agreement.<\/p>\n<p>          (b)  Warrants granted to Comcast Corporation to purchase 25,502,222<br \/>\n               shares of Series A Common Stock at $29.54 per share pursuant to<br \/>\n               the terms of the March 28, 2000 Letter Agreement.<\/p>\n<p>          (c)  Warrants granted to Cox Communications, Inc. to purchase<br \/>\n               19,158,774 shares of Series A Common Stock at $29.54 per share<br \/>\n               pursuant to the terms of the March 28, 2000 Letter Agreement.<\/p>\n<p>          (d)  Warrants granted to Intermedia\/Insight\/AT&amp;T to purchase 1,592,400<br \/>\n               shares of Series A Common Stock at $5.25 per share.<\/p>\n<p>Schedule 3(e) &#8211; No Conflicts<br \/>\n&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;-<\/p>\n<p>     1.   The issuance of the Securities is subject to the preemptive rights<br \/>\n          provided by Section 8.1 of the Stockholders Agreement.<\/p>\n<p>     2.   The execution of the Registration Rights Agreement and the performance<br \/>\n          of the Company&#8217;s obligations under that Agreement do not comply with<br \/>\n          Section 4(d) of the Stockholder Registration Rights Agreement.<\/p>\n<p>     3.   The Company is in compliance with the Nasdaq Listing Requirements as<br \/>\n          set forth in the interim rules described in SEC Release No. 34-44243<br \/>\n          issued on May 1, 2001.<\/p>\n<p>     The identification of any agreement under any other schedule hereof shall<br \/>\nnot be deemed to be disclosed under this Schedule 3(e) unless specifically<br \/>\nreferenced hereunder.<\/p>\n<p>                                      -4-<\/p>\n<p>Schedule 3(f) &#8211; SEC Documents; Financial Statements<br \/>\n&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;<\/p>\n<p>     As of the date hereof, the Company had entered into the following<br \/>\n     agreements which have not previously been filed as an exhibit to the<br \/>\n     Company&#8217;s reports filed with the SEC:<\/p>\n<p>     (a) Separation and Release Agreement with George Bell, dated April 23,<br \/>\n         2001.<br \/>\n     (b) Letter Agreements with each of Comcast and Cox, dated June 1, 2001.<\/p>\n<p>Schedule 3(j) &#8211; No Undisclosed Events, Liabilities, Developments or<br \/>\n&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;-<br \/>\nCircumstances<br \/>\n&#8212;&#8212;&#8212;&#8212;-<\/p>\n<p>     1.   In April 2001, the Company entered into a non-binding letter agreement<br \/>\n          with AT&amp;T to outsource its engineering and operations services, as<br \/>\n          well as replace its backbone capacity agreement with AT&amp;T. In the<br \/>\n          course of negotiating toward definitive agreements, the Company and<br \/>\n          AT&amp;T determined that certain of the benefits of the proposed agreement<br \/>\n          could be achieved by negotiating a simpler transaction under which the<br \/>\n          Company and AT&amp;T would develop and design an enhanced network<br \/>\n          performance plan. If successfully negotiated, AT&amp;T would, pursuant to<br \/>\n          a multi-month consulting and support services agreement, on<br \/>\n          commercially reasonable, arms-length terms, assist the Company in<br \/>\n          implementing an updated network plan to augment performance levels in<br \/>\n          the Company&#8217;s network, instead of the outsourcing arrangement<br \/>\n          contemplated in the letter agreement. In addition, the Company and<br \/>\n          AT&amp;T will continue to separately negotiate in good faith a<br \/>\n          restructured backbone capacity agreement that would provide the<br \/>\n          Company at least $75 million in financing. There can be no assurance<br \/>\n          that the Company and AT&amp;T will be successful in completing the<br \/>\n          definitive agreements with respect to the arrangements described<br \/>\n          above.<\/p>\n<p>     2.   The Company has previously announced its intent to explore the<br \/>\n          potential sale or restructuring of its media operations that do not<br \/>\n          directly support its broadband strategy.  The Company has been in<br \/>\n          negotiations with several companies regarding potential sales of<br \/>\n          portions of its media operations.  The Company has not entered into<br \/>\n          any formal agreements regarding any of these potential transactions.<br \/>\n          There can be no assurance that the Company will be successful in<br \/>\n          completing sale or restructuring of media operations.<\/p>\n<p>     3.   On June 5, 2001, the Company announced that Matt Jones has been named<br \/>\n          chief operating officer, a newly created position for Excite@Home.  On<br \/>\n          the same date the Company announced that Byron Smith, Executive Vice<br \/>\n          President, Excite Network and Mark O&#8217;Leary, Executive Vice President,<br \/>\n          Broadband Services have resigned and will leave the Company in July to<br \/>\n          pursue other opportunities, pending completion of projects.<\/p>\n<p>4.        Excite@Home announced that it is in discussions with Comcast<br \/>\n          Corporation and Cox Communications, Inc. to explore a restructuring of<br \/>\n          its commercial relationships with these companies.  Under the terms of<br \/>\n          the March 28, 2000 letter agreement between these companies, Comcast<br \/>\n          and\/or Cox may provide six months notice of intent to terminate their<br \/>\n          exclusivity obligations or their entire relationships with the Company<br \/>\n          on each June 4 and December 4.  Excite@Home has agreed to extend until<br \/>\n          June 18, 2001 the time for Cox and Comcast to decide whether to give<br \/>\n          notice to terminate the mutual exclusivity provisions effective<br \/>\n          December 4, 2001. There can be no assurance that the parties will<br \/>\n          reach agreement on a restructured relationship.<\/p>\n<p>                                      -5-<\/p>\n<p>     5.   On May 30, 2001, the Board approved a change, subject to stockholder<br \/>\n          approval, in the Company&#8217;s independent public accountants effective<br \/>\n          during the third quarter of 2001 after a transition period with the<br \/>\n          new independent accountants.  The Company intends to engage<br \/>\n          PricewaterhouseCoopers LLP as its new independent auditors to perform<br \/>\n          the audit of the Company&#8217;s consolidated financial statements for 2001.<\/p>\n<p>     6.   On June 1, 2001, the Company entered into service level agreements<br \/>\n          with each of Comcast and Cox.  Under these agreements, the Company has<br \/>\n          agreed that its network must meet specified performance levels, and<br \/>\n          that it will pay each of Comcast and Cox preset liquidated damages for<br \/>\n          failure to achieve these network performance levels during each<br \/>\n          reporting period.<\/p>\n<p>Schedule 3(t) &#8211; Transactions With Affiliates<br \/>\n&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8211;<\/p>\n<p>     See Section 3(f).<\/p>\n<p>Schedule 4(d) &#8211; Use of Proceeds<br \/>\n&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;-<\/p>\n<p>     The Company will use the net proceeds from the sale of the Notes for<br \/>\n     working capital and general corporate purposes.<\/p>\n<p>                                      -6-<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6782],"corporate_contracts_industries":[9510],"corporate_contracts_types":[9622,9627],"class_list":["post-43570","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-at-home-corp","corporate_contracts_industries-technology__programming","corporate_contracts_types-planning","corporate_contracts_types-planning__purchase"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43570","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43570"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43570"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43570"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43570"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}