10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2013

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to             

Commission File Number 1-34243

tw telecom inc.

(Exact name of Registrant as specified in its charter)

Delaware	84-1500624
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
10475 Park Meadows Drive Littleton, Colorado	80124
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (303) 566-1000

 Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  ¨

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).    Yes  ý    No  ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	ý	Accelerated filer	¨
Non-accelerated filer	o (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  ý

The number of shares outstanding of tw telecom inc.’s common stock as of July 31, 2013 was 145,666,574 shares.

INDEX TO FORM 10-Q

		Page
Part I. Financial Information
Item 1.	Financial Statements:
	Condensed Consolidated Balance Sheets at June 30, 2013 (unaudited) and December 31, 2012	3
	Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2013 and 2012 (unaudited)	4
	Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2013 and 2012 (unaudited)	5
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2013 and 2012 (unaudited)	6
	Condensed Consolidated Statement of Changes in Stockholders’ Equity for the six months ended June 30, 2013 (unaudited)	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	45
Item 4.	Controls and Procedures	45
Part II. Other Information
Item 1.	Legal Proceedings	46
Item 1A.	Risk Factors	46
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 6.	Exhibits	47

2

Part I. Financial Information

Item 1. Financial Statements

tw telecom inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

	June 30, 2013			December 31, 2012
	(unaudited)
	(amounts in thousands, except per share amounts)
ASSETS
Current assets:
Cash and cash equivalents	$	420,265		$	806,728
Investments	194,155			167,564
Receivables, less allowances of $6,705 and $7,067, respectively	109,765			99,703
Prepaid expenses and other current assets	28,817			19,164
Deferred income taxes	76,160			76,160
Total current assets	829,162			1,169,319
Property, plant and equipment	4,421,375			4,247,868
Less accumulated depreciation	(2,874,081		)	(2,755,622		)
	1,547,294			1,492,246
Deferred income taxes	77,582			101,885
Goodwill	412,694			412,694
Intangible assets, net of accumulated amortization	14,557			17,578
Other assets, net	33,897			30,015
Total assets	$	2,915,186		$	3,223,737
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	61,321		$	55,857
Deferred revenue	47,501			45,471
Accrued taxes, franchise and other fees	57,747			60,844
Accrued interest	19,408			20,343
Accrued payroll and benefits	47,174			45,727
Accrued carrier costs	24,327			30,765
Current portion debt and capital lease obligations, net	203,902			374,969
Other current liabilities	37,571			29,163
Total current liabilities	498,951			663,139
Long-term debt and capital lease obligations, net	1,441,803			1,384,242
Long-term deferred revenue	21,615			23,177
Other long-term liabilities	44,203			41,240
Commitments and contingencies (Note 7)
Stockholders’ equity:
Preferred stock, $0.01 par value, 20,000 shares authorized, no shares issued and outstanding	—			—
Common stock, $0.01 par value, 439,800 shares authorized, 153,760 and 151,953 shares issued, respectively	1,538			1,520
Additional paid-in capital	1,783,334			1,843,126
Treasury stock, 6,142 and 556 shares, at cost, respectively	(166,783		)	(10,979		)
Accumulated deficit	(709,520		)	(721,793		)
Accumulated other comprehensive income	45			65
Total stockholders’ equity	908,614			1,111,939
Total liabilities and stockholders’ equity	$	2,915,186		$	3,223,737

See accompanying notes to condensed consolidated financial statements.

3

tw telecom inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(amounts in thousands, except per share amounts)
Revenue:
Data and Internet services	$	209,634		$	182,480		$	411,716		$	359,331
Voice services	93,080			91,008			185,435			180,629
Network services	78,487			83,009			157,350			167,813
Intercarrier compensation	8,282			8,006			16,191			15,655
Total revenue	389,483			364,503			770,692			723,428
Costs and expenses (a):
Operating (exclusive of depreciation, amortization and accretion shown separately below)	164,131			152,986			325,213			302,179
Selling, general and administrative	96,438			84,580			190,000			170,670
Depreciation, amortization and accretion	75,652			70,469			150,047			138,863
Total costs and expenses	336,221			308,035			665,260			611,712
Operating income	53,262			56,468			105,432			111,716
Interest expense	(21,544		)	(21,860		)	(49,884		)	(43,441		)
Debt extinguishment costs	(399		)	—			(399		)	—
Interest income	173			93			450			197
Income before income taxes	31,492			34,701			55,599			68,472
Income tax expense	14,145			15,382			25,108			29,821
Net income	$	17,347		$	19,319		$	30,491		$	38,651
Earnings per share:
Basic	$	0.12		$	0.13		$	0.20		$	0.26
Diluted	$	0.11		$	0.13		$	0.20		$	0.25
Weighted average shares outstanding:
Basic	147,071			147,497			148,095			147,232
Diluted	148,342			149,532			151,081			149,398

^(a) Includes non-cash stock-based employee compensation expense (Note 6):

Operating	$	545	$	455	$	1,128	$	955
Selling, general and administrative	$	7,869	$	6,594	$	16,748	$	14,222

See accompanying notes to condensed consolidated financial statements.

4

tw telecom inc.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(amounts in thousands)
Net income	$	17,347		$	19,319		$	30,491		$	38,651
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(28		)	(52		)	(20		)	(60		)
Other comprehensive loss, net of tax	(28		)	(52		)	(20		)	(60		)
Comprehensive income	$	17,319		$	19,267		$	30,471		$	38,591

See accompanying notes to condensed consolidated financial statements.

5

tw telecom inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Six Months Ended June 30,
	2013			2012
	(amounts in thousands)
Cash flows from operating activities:
Net income	$	30,491		$	38,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	150,047			138,863
Deferred income taxes	24,289			28,977
Stock-based compensation expense	17,876			15,177
Amortization of discount on debt and deferred debt issue costs and other	8,249			12,367
Changes in operating assets and liabilities:
Receivables, prepaid expenses and other assets	(14,046		)	(5,651		)
Accounts payable, deferred revenue and other liabilities	(10,346		)	(19,785		)
Net cash provided by operating activities	206,560			208,599
Cash flows from investing activities:
Capital expenditures	(187,509		)	(157,575		)
Purchases of investments	(157,523		)	(119,813		)
Proceeds from sale of investments	125,041			106,053
Other investing activities, net	(465		)	5,707
Net cash used in investing activities	(220,456		)	(165,628		)
Cash flows from financing activities:
Proceeds from issuance of common stock upon exercise of stock options	50,874			15,784
Taxes paid related to net share settlement of equity awards	(18,315		)	(9,956		)
Purchases of treasury stock	(197,310		)	(11,519		)
Excess tax benefits from stock-based compensation	944			716
Proceeds from modification of debt, net of financing costs	49,684			—
Retirement of convertible debt obligations	(256,348		)	—
Payment of debt and capital lease obligations	(2,096		)	(3,712		)
Net cash used in financing activities	(372,567		)	(8,687		)
(Decrease) increase in cash and cash equivalents	(386,463		)	34,284
Cash and cash equivalents at beginning of period	806,728			353,394
Cash and cash equivalents at end of period	$	420,265		$	387,678
Supplemental disclosures of cash flow information:
Cash paid for interest	$	43,540		$	31,850
Cash paid for income taxes, net of refunds	$	4,477		$	5,058
Addition of capital lease obligation	$	4,302		$	2,326

See accompanying notes to condensed consolidated financial statements.

6

tw telecom inc.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

Six months ended June 30, 2013

(Unaudited)

	Common Stock			Treasury Stock					Additional paid-in capital			Accumulated deficit			Accumulated other comprehensive (loss) income			Total stockholders’ equity
	Shares	Amount		Shares		Amount
	(amounts in thousands)
Balance at December 31, 2012	151,953	$	1,520	(556	)	$	(10,979	)	$	1,843,126		$	(721,793	)	$	65		$	1,111,939
Net income	—	—		—		—			—			30,491			—			30,491
Unrealized loss on available-for-sale securities, net of tax	—	—		—		—			—			—			(20		)	(20		)
Reacquisition of the equity component of convertible debentures	—	—		—		—			(78,776		)	—			—			(78,776		)
Purchases of treasury stock	—	—		(7,653	)	(205,455		)	—			—			—			(205,455		)
Exercise of stock options net of withholdings to satisfy employee tax obligations upon vesting of stock awards	1,309	13		1,782		44,855			(520		)	(11,789		)	—			32,559
Stock-based compensation	498	5		285		4,796			19,504			(6,429		)	—			17,876
Balance at June 30, 2013	153,760	$	1,538	(6,142	)	$	(166,783	)	$	1,783,334		$	(709,520	)	$	45		$	908,614

See accompanying notes to condensed consolidated financial statements.

7

tw telecom inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Summary of Significant Accounting Policies

Description of Business and Capital Structure

tw telecom inc. (together with its wholly-owned subsidiaries, the “Company”) is a leading national provider of managed network services, specializing in business Ethernet, data networking, converged, Internet Protocol ("IP") based virtual private network or "IP VPN", Internet access, voice, including voice over Internet Protocol or “VoIP”, and network security services to enterprise organizations, including public sector entities, and carriers throughout the United States, including their global locations.

The Company has one class of common stock outstanding with one vote per share. The Company also is authorized to issue shares of preferred stock. The Company’s Board of Directors has the authority to establish voting powers, preferences, and special rights for the preferred stock. No shares of preferred stock have been issued.

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. These condensed consolidated financial statements should therefore be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2012 filed with the SEC. The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and include all adjustments of a normal, recurring nature that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for an interim period are not necessarily indicative of the results of operations for a full fiscal year.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Recently Adopted Accounting Pronouncements

In February 2013, the Financial Accounting Standards Board (the "FASB") issued an accounting standard update that requires entities to provide information about the amounts reclassified out of accumulated other comprehensive income by component. Additionally, entities are required to present, either on the face of the financial statements or in the notes, significant amounts reclassified out of accumulated other comprehensive income and the respective income statement line items affected by the reclassification. The guidance does not change the current requirements for reporting net income or other comprehensive income. The accounting standard update is effective on a prospective basis for interim and annual periods beginning after December 15, 2012. The Company adopted this accounting standard update in the three months ended March 31, 2013. This update affected presentation and disclosure, but did not affect the Company's consolidated financial position, results of operations or cash flows. See "Accumulated Other Comprehensive Income" below.

Accumulated Other Comprehensive Income

The balance in accumulated other comprehensive income as of June 30, 2013 relates to the Company's investments that are classified as available-for-sale securities. The Company recognized no material changes in accumulated other comprehensive income for the three and six months ended June 30,2013. There were no significant items reclassified out of accumulated other comprehensive income for the three and six months ended June 30,2013.

8

tw telecom inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Revenue

The Company’s revenue is derived primarily from business communications services comprised of the following:

• Data and Internet services include services that enable customers to connect their internal computer networks and to access external networks, including Internet access at high speeds using Ethernet protocol, local and wide-area business Ethernet and IP VPN solutions. Data and Internet services also include a portfolio of managed services including the data and Internet components of converged services, which fully integrates a combination of certain communication applications including IP VPN, Internet, security and managed router service into a single managed IP solution, and the data and Internet components of integrated services, which enable customers to purchase a full array of access options that include Internet services.

• Voice services include traditional and next generation voice capabilities, including voice services provided as standalone and bundled services, long distance and toll free services. Voice services also include the voice components of converged and integrated services.

• Network services are point-to-point services that transmit voice, data and images using state-of-the-art fiber optics, and collocation services that provide secure space with controlled climate and power where customers can locate their equipment to connect to the Company’s network in facilities equipped for enterprise information technology environmental requirements.

The Company also generates revenue from intercarrier compensation. Intercarrier compensation is comprised of switched access services and reciprocal compensation. Switched access represents the compensation from another carrier for the delivery of traffic from a long distance carrier’s point of presence to an end-user’s premises provided through the Company’s switching facilities. The Federal Communications Commission ("FCC") and state public utility commissions regulate switched access rates in their respective jurisdictions. Reciprocal compensation represents compensation from local exchange carriers (“LECs”) for local exchange traffic originated on another LEC’s facilities and terminated on the Company’s facilities.

The Company’s customers include, among others, enterprise organizations in the financial services, technology and scientific, health care, distribution, manufacturing and professional services industries, data center providers, cloud services providers, public sector entities, system integrators and communications service providers, including incumbent local exchange carriers ("ILECs"), competitive local exchange carriers ("CLECs"), wireless communications companies and cable companies.

Revenue for network, data and Internet, and the majority of voice services is generally billed in advance on a monthly fixed rate basis and recognized over the period the services are provided. Revenue for the majority of intercarrier compensation and certain components of voice services, such as long distance, is generally billed on a transactional basis in arrears based on a customer’s actual usage; therefore, estimates are used to recognize revenue in the period earned.

The Company evaluates whether receivables are reasonably assured of collection based on certain factors, including the likelihood of billing being disputed by customers. If there is a billing dispute with a customer, revenue generally is not recognized until the dispute is resolved. The Company does not recognize revenue associated with contract termination charges until cash is received.

The Company classifies certain taxes and fees billed to customers and remitted to government authorities on a gross versus net basis in revenue and expense. In making this determination, the Company assesses, among other things, whether the Company is the primary obligor or principal taxpayer for the taxes and fees assessed in each jurisdiction where the Company does business. In jurisdictions where the Company determines that it is the principal taxpayer, the Company records the taxes and fees on a gross basis, including the taxes and fees in revenue and expense. In jurisdictions where the Company determines that it is merely a collection agent for the government authority, the Company records the taxes on a net basis. The total amounts classified as revenue, primarily included in voice services, associated with such taxes and fees were approximately $20.6 million and $19.8 million for the three months ended June 30,2013 and 2012, respectively, and approximately $41.2 million and $39.5 million for the six months ended June 30,2013 and 2012, respectively.

Significant Customers

The Company has substantial business relationships with a few large customers, including major telecommunications carriers. The Company’s 10 largest customers accounted for an aggregate of 18% and 19% of the Company’s total revenue in the six months ended June 30,2013 and 2012, respectively. No customer accounted for 5% or more of total revenue for the six months ended June 30,2013 or 2012.

9

tw telecom inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

2. Earnings per Common Share and Potential Common Share

Basic earnings per common share (“EPS”) is measured as the income allocated to common stockholders divided by the weighted average outstanding common shares for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (such as convertible securities and stock options) as if they had been converted to shares at the beginning of the period presented. Potential common shares that have an anti-dilutive effect (e.g., those that increase income per share) are excluded from diluted EPS.

The following is a reconciliation of the numerators and denominators used in the basic and diluted EPS computations:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(amounts in thousands, except per share amounts)
Numerator
Net income	$	17,347		$	19,319		$	30,491		$	38,651
Allocation of net income to unvested restricted stock awards	(331		)	(404		)	(587		)	(808		)
Net income allocated to common stockholders, basic	$	17,016		$	18,915		$	29,904		$	37,843
Net income allocated to common stockholders, diluted	$	17,016		$	18,915		$	29,904		$	37,843
Denominator
Basic weighted average shares outstanding	147,071			147,497			148,095			147,232
Dilutive potential common shares:
Stock options	886			1,566			1,180			1,544
Unvested restricted stock	385			469			1,806			622
Diluted weighted average shares outstanding	148,342			149,532			151,081			149,398
Basic earnings per share	$	0.12		$	0.13		$	0.20		$	0.26
Diluted earnings per share	$	0.11		$	0.13		$	0.20		$	0.25

Options to purchase shares of the Company’s common stock and restricted stock awards and restricted stock units to be settled in common stock upon vesting, which were excluded from the computation of diluted weighted average shares outstanding because their inclusion would be anti-dilutive, totaled 2.9 million shares and no shares for the three and six months ended June 30, 2013, respectively. Shares of common stock subject to issuance upon conversion of the Company’s 2³/₈% Convertible Senior Debentures due 2026 (the “Convertible Debentures”), options to purchase shares of the Company’s common stock and restricted stock awards and restricted stock units to be settled in common stock upon vesting, which were excluded from the computation of diluted weighted average shares outstanding because their inclusion would be anti-dilutive, totaled 23.9 million shares in each of the three and six months ended June 30, 2012.

10

tw telecom inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

3. Investments

The Company’s investments at June 30, 2013 and December 31, 2012 are summarized as follows:

	June 30, 2013		December 31, 2012
	(amounts in thousands)
Cash equivalents:
Prime money market mutual funds	$	302,366	$	425,165
U.S. Treasury money market mutual funds	66,044		262,967
Commercial paper	6,695		30,692
Certificates of deposit	—		8,000
Debt securities issued by U.S. Government agencies	—		4,999
Total cash equivalents	375,105		731,823
Investments:
Debt securities issued by the U.S. Treasury	100,350		89,870
Commercial paper	59,976		32,480
Debt securities issued by U.S. Government agencies	29,079		45,214
Certificates of deposit	4,750		—
Total investments	194,155		167,564
Total cash equivalents and investments	$	569,260	$	899,387

At June 30, 2013 and December 31, 2012, the carrying values of investments included in cash and cash equivalents approximated fair value. The aggregate fair value of available-for-sale securities by major security type is included in Note 5. The amortized cost basis of the available-for-sale securities was not materially different from the aggregate fair value. The contractual maturities of the Company’s available-for-sale securities are all within one year.

Proceeds from the sale and maturity of available-for-sale securities were $91.1 million and $69.6 million during the three months ended June 30,2013 and 2012, respectively, and $125.0 million and $106.1 million during the six months ended June 30,2013 and 2012, respectively. Gains and losses on investments are calculated using the specific identification method and are recognized during the period the investment is sold. The Company recognized no material unrealized or realized net gains or losses during the three and six months ended June 30,2013 and 2012.

4. Long-Term Debt and Capital Lease Obligations

The components of long-term debt and capital lease obligations at June 30, 2013 and December 31, 2012 were as follows:

	June 30, 2013			December 31, 2012
	(amounts in thousands)
Term Loan B - extended tranche, due 2016	$	—		$	463,019
8% Senior Notes, due 2018	430,000			430,000
Term Loan B, due 2020	520,000			—
53/8% Senior Notes, due 2022	480,000			480,000
23/8% Convertible Senior Debentures, due 2026 (1)	196,497			373,743
Capital lease obligations	23,536			20,091
Total obligations	1,650,033			1,766,853
Unamortized discounts	(4,328		)	(7,642		)
Current portion	(203,902		)	(374,969		)
Total long-term debt and capital lease obligations	$	1,441,803		$	1,384,242

⁽¹⁾  Subsequent to June 30, 2013, the remaining outstanding amount of Convertible Debentures were retired. See "Retirement of Convertible Debentures including Subsequent Event" below.

11

tw telecom inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

As of June 30, 2013, tw telecom inc. and its wholly-owned subsidiary, tw telecom holdings inc. ("Holdings"), were in compliance with all of their debt covenants.

Modification of Term Loan and Revolver

As of December 31, 2012, Holdings had a senior secured credit facility consisting of an $463.0 million outstanding principal amount Term Loan B (the "Term Loan") due December 2016 and an undrawn $80 million Revolving Credit Facility (the "Revolver") expiring December 2014. In April 2013, Holdings entered into a Second Amended and Restated Credit Agreement ("Amendment and Restatement") to increase the Term Loan to $520 million and extend the maturity date to April 2020. The Term Loan was issued at an offering price of 99.5% of the principal amount. Additionally, the Amendment and Restatement increased the Revolver, which remains undrawn, to $100 million and extended the maturity date to April 2018. Components of the Amendment and Restatement are detailed below:

•The Term Loan is a secured obligation, on a first lien basis, of Holdings. The Term Loan is guaranteed by the Company and Holdings' subsidiaries. Repayments of the Term Loan are due quarterly in an amount equal to 1/4 of 1% of the aggregate principal amount on the last day of each quarter commencing September 30, 2013. Interest on the Term Loan is computed based on a specified Eurodollar rate plus 2.5%. Interest is reset periodically and payable at least quarterly. Based on the Eurodollar rate in effect at June 30, 2013, the effective interest rate was 2.70%. In accordance with applicable accounting guidance, the amended and restated Term Loan agreement was accounted for as a modification of the existing debt. The fees paid to the lenders of $4.6 million were added to the existing deferred debt issuance costs and will be amortized through the maturity date of the Term Loan.

•The Revolver is secured and guaranteed in the same manner as the Term Loan. Interest on outstanding Revolver amounts, if any, will be computed based on a specified Eurodollar rate plus 1.75%-2.75%, depending on the Company's consolidated total leverage ratio, as defined in the Revolver, and will be reset periodically and payable quarterly. The Company is required to pay a commitment fee on the undrawn commitment amounts on a quarterly basis of 0.375%-0.5% per annum. The Amendment and Restatement contains customary affirmative and negative covenants. Most of the Revolver covenants apply whether or not the Company draws on that facility. In addition, if the Revolver were drawn, certain financial maintenance covenants would apply. The fees paid to the lenders of $1.4 million were added to existing debt issuance costs and will be amortized through the expiration date.

Retirement of Convertible Debentures including Subsequent Event

As of December 31, 2012, the Company had outstanding $373.7 million principal amount of Convertible Debentures. In the three months ended June 30, 2013, the Company cash settled approximately $255.8 million on $177.2 million principal amount of the Convertible Debentures as a result of repurchases by the Company and conversions by holders of the Convertible Debentures, resulting in $196.5 million outstanding principal amount as of June 30, 2013.

The Convertible Debentures were redeemable in whole or in part at the Company’s option at any time on or after April 6, 2013 at a redemption price equal to 100% of the principal amount of the debentures to be redeemed, plus accrued and unpaid interest. On May 29, 2013, the Company called for redemption all of the remaining outstanding Convertible Debentures. Holders of the Convertible Debentures had the option to require the Company to purchase all or part of the Convertible Debentures on April 1, 2013, at 100% of the principal and unpaid interest, or at any time prior to April 1, 2026, to convert the debentures into shares of the Company’s common stock. Upon conversion, the Company had the right to deliver, in lieu of shares of common stock, cash or a combination of cash and shares of common stock. The Company elected to settle its conversion obligation entirely in cash. On July 3, 2013, the remaining $196.5 million outstanding principal amount of the Convertible Debentures was settled in cash for approximately $296.9 million as a result of conversions by holders of the Convertible Debentures in connection with the redemption.

5. Fair Value Measurements

Fair value, as defined by relevant accounting standards, is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would complete a transaction and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions and risk of nonperformance.

12

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Fair Value Hierarchy

Relevant accounting standards set forth a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Relevant accounting standards establish three levels of inputs that may be used to measure fair value:

• Level 1—Quoted prices in active markets for identical assets or liabilities. Level 1 assets that are measured at fair value on a recurring basis consist of the Company’s investments in prime money market mutual funds and U.S. Treasury money market mutual funds that are traded in an active market with sufficient volume and frequency of transactions, and are included as a component of cash and cash equivalents in the condensed consolidated balance sheets.

• Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets that are measured at fair value on a recurring basis consist of the Company’s investments in certificates of deposit, commercial paper and debt securities issued by the U.S. Treasury and other U.S. government agencies using observable inputs in less active markets and are included as a component of cash and cash equivalents and investments in the condensed consolidated balance sheets. Level 2 liabilities that are measured, but not carried, at fair value on a recurring basis include the Company’s long-term debt. The Company’s long-term debt has not been listed on any securities exchange or quoted on an inter-dealer automated quotation system. The Company has estimated the fair value of its long-term debt based on indicative pricing published by certain investment banks or trading levels in our long-term debt.

• Level 3—Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities. The Company did not have any Level 3 assets or liabilities that were measured at fair value at June 30, 2013 and December 31, 2012.

The following table reflects assets and liabilities that are measured and carried at fair value on a recurring basis at June 30, 2013 and December 31, 2012:

	Fair Value Measurements At June 30, 2013						Assets at Fair Value
	Level 1		Level 2		Level 3
	(amounts in thousands)
Assets
Prime money market mutual funds	$	302,366	$	—	$	—	$	302,366
U.S. Treasury money market mutual funds	66,044		—		—		66,044
Commercial paper	—		6,695		—		6,695
Investments included in cash and cash equivalents	$	368,410	$	6,695	$	—	$	375,105
Debt securities issued by the U.S. Treasury	—		100,350		—		100,350
Commercial paper	—		59,976		—		59,976
Debt securities issued by U.S. Government agencies	—		29,079		—		29,079
Certificates of deposit	—		4,750		—		4,750
Short-term investments	$	—	$	194,155	$	—	$	194,155
Total assets	$	368,410	$	200,850	$	—	$	569,260

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

	Fair Value Measurements At December 31, 2012						Assets at Fair Value
	Level 1		Level 2		Level 3
	(amounts in thousands)
Assets
Prime money market mutual funds	$	425,165	$	—	$	—	$	425,165
U.S. Treasury money market mutual funds	262,967		—		—		262,967
Commercial paper	—		30,692		—		30,692
Certificates of deposit	—		8,000		—		8,000
Debt securities issued by U.S. Government agencies	—		4,999		—		4,999
Investments included in cash and cash equivalents	$	688,132	$	43,691	$	—	$	731,823
Debt securities issued by the U.S. Treasury	—		89,870		—		89,870
Debt securities issued by U.S. Government agencies	—		45,214		—		45,214
Commercial paper	—		32,480		—		32,480
Short-term investments	$	—	$	167,564	$	—	$	167,564
Total assets	$	688,132	$	211,255	$	—	$	899,387

The following table summarizes the carrying amounts and estimated fair values of the Company’s long-term debt, including the current portion, at June 30, 2013 and December 31, 2012:

	June 30, 2013				December 31, 2012
	Carrying Value		Fair Value Level 2		Carrying Value		Fair Value Level 2
	(amounts in thousands)
Term Loan B - Extended tranche, due 2016	$	—	$	—	$	463,019	$	465,334
8% Senior Notes, net of discount	428,195		456,875		428,001		470,850
Term Loan B, net of discount	517,477		520,650		—		—
53/8% Senior Notes	480,000		478,800		480,000		505,200
23/8% Convertible Senior Debentures, net of discount	196,497		298,125		368,100		512,159
Total debt	$	1,622,169	$	1,754,450	$	1,739,120	$	1,953,543

6. Stock-Based Compensation

During the six months ended June 30,2013, the Company granted restricted stock awards and restricted stock units with respect to 1.4 million shares and no stock options. As of June 30, 2013, the Company had 4.2 million restricted stock awards and restricted stock units that were unvested and 1.8 million stock options outstanding, of which 1.6 million were exercisable.

As of June 30, 2013, there was $75.4 million of total unrecognized compensation expense related to unvested restricted stock awards and restricted stock units, which is expected to be recognized over a weighted-average period of 2.5 years, and $0.7 million of total unrecognized compensation expense related to unvested stock options, which is expected to be recognized over a weighted-average period of 0.6 years.

7. Commitments and Contingencies

Management routinely reviews the Company’s exposure to liabilities incurred in the normal course of its business operations. Where a probable contingency exists and the amount of the loss can be reasonably estimated, the Company records the estimated liability. Considerable judgment is required in analyzing and recording such liabilities and actual results may vary from the estimates.

The Company’s pending legal proceedings are limited to litigation incidental to its business. In the opinion of management, the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial statements.

14

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

8. Supplemental Guarantor Information

The 8% Senior Notes due 2018 (the “2018 Notes”) and 5³/₈% Senior Notes due 2022 (the "2022 Notes") are unsecured obligations of Holdings ("Issuer") and are guaranteed by the Company (“Parent Guarantor”) and substantially all of the Issuer’s subsidiaries (“Combined Subsidiary Guarantors”). The guarantees are joint and several. A significant amount of the Issuer’s cash flow is generated by the Combined Subsidiary Guarantors. As a result, funds necessary to meet the Issuer’s debt service obligations are provided in large part by distributions or advances from the Combined Subsidiary Guarantors. The 2018 Notes and 2022 Notes are governed by an indenture that contains certain restrictive covenants. These restrictions affect, and in many respects limit or prohibit, among other things, the ability of the Parent Guarantor, the Issuer and its subsidiaries to incur indebtedness, make prepayments of certain indebtedness, pay dividends, make investments, engage in transactions with stockholders and affiliates, issue capital stock of subsidiaries, create liens, sell assets and engage in mergers and consolidations.

The following information sets forth the Company’s Condensed Consolidating Balance Sheets as of June 30, 2013 and December 31, 2012, Condensed Consolidating Statements of Operations for the three and six months ended June 30,2013 and 2012, Condensed Consolidating Statements of Comprehensive Income for the three and six months ended June 30,2013 and 2012, and Condensed Consolidating Statements of Cash Flows for the six months ended June 30,2013 and 2012.

15

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING BALANCE SHEET

June 30, 2013

(unaudited)

	Parent Guarantor		Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	24,544	$	395,721		$	—		$	—		$	420,265
Investments	—		194,155			—			—			194,155
Receivables, net	—		—			109,765			—			109,765
Prepaid expenses and other current assets	—		19,599			9,218			—			28,817
Deferred income taxes	—		76,140			20			—			76,160
Intercompany receivable	1,407,656		969,335			—			(2,376,991		)	—
Total current assets	1,432,200		1,654,950			119,003			(2,376,991		)	829,162
Property, plant and equipment, net	—		57,949			1,489,345			—			1,547,294
Deferred income taxes	—		77,098			484			—			77,582
Goodwill	—		—			412,694			—			412,694
Intangible and other assets, net	—		25,181			23,273			—			48,454
Total assets	$	1,432,200	$	1,815,178		$	2,044,799		$	(2,376,991	)	$	2,915,186
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—	$	8,996		$	52,325		$	—		$	61,321
Current portion debt and capital lease obligations	196,497		5,782			1,623			—			203,902
Other current liabilities	1,180		82,055			150,493			—			233,728
Intercompany payable	—		—			2,376,991			(2,376,991		)	—
Total current liabilities	197,677		96,833			2,581,432			(2,376,991		)	498,951
Losses in subsidiary in excess of investment	325,940		858,775			—			(1,184,715		)	—
Long-term debt and capital lease obligations, net	—		1,420,566			21,237			—			1,441,803
Long-term deferred revenue	—		—			21,615			—			21,615
Other long-term liabilities	—		7,392			36,811			—			44,203
Stockholders’ equity (deficit)	908,583		(568,388		)	(616,296		)	1,184,715			908,614
Total liabilities and stockholders’ equity	$	1,432,200	$	1,815,178		$	2,044,799		$	(2,376,991	)	$	2,915,186

16

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2012

	Parent Guarantor		Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	24,544	$	782,184		$	—		$	—		$	806,728
Investments	—		167,564			—			—			167,564
Receivables, net	—		—			99,703			—			99,703
Prepaid expenses and other current assets	—		11,270			7,894			—			19,164
Deferred income taxes	—		76,140			20			—			76,160
Intercompany receivable	1,864,694		506,610			—			(2,371,304		)	—
Total current assets	1,889,238		1,543,768			107,617			(2,371,304		)	1,169,319
Property, plant and equipment, net	—		48,686			1,443,560			—			1,492,246
Deferred income taxes	—		101,401			484			—			101,885
Goodwill	—		—			412,694			—			412,694
Intangible and other assets, net	275		20,634			26,684			—			47,593
Total assets	$	1,889,513	$	1,714,489		$	1,991,039		$	(2,371,304	)	$	3,223,737
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—	$	7,141		$	48,716		$	—		$	55,857
Current portion debt and capital lease obligations, net	368,100		5,475			1,394			—			374,969
Other current liabilities	2,219		64,564			165,530			—			232,313
Intercompany payable	—		—			2,371,304			(2,371,304		)	—
Total current liabilities	370,319		77,180			2,586,944			(2,371,304		)	663,139
Losses in subsidiary in excess of investment	407,286		862,681			—			(1,269,967		)	—
Long-term debt and capital lease obligations, net	—		1,366,463			17,779			—			1,384,242
Long-term deferred revenue	—		—			23,177			—			23,177
Other long-term liabilities	—		7,024			34,216			—			41,240
Stockholders’ equity (deficit)	1,111,908		(598,859		)	(671,077		)	1,269,967			1,111,939
Total liabilities and stockholders’ equity (deficit)	$	1,889,513	$	1,714,489		$	1,991,039		$	(2,371,304	)	$	3,223,737

17

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Three Months Ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	389,483		$	—		$	389,483
Costs and expenses:
Operating, selling, general and administrative	—			67,167			193,402			—			260,569
Depreciation, amortization and accretion	—			6,707			68,945			—			75,652
Corporate expense allocation	—			(73,874		)	73,874			—			—
Total costs and expenses	—			—			336,221			—			336,221
Operating income	—			—			53,262			—			53,262
Interest expense, net	(1,569		)	(17,942		)	(1,860		)	—			(21,371		)
Debt extinguishment costs	(327		)	(72		)	—			—			(399		)
Interest expense allocation	1,896			18,014			(19,910		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			31,492			—			31,492
Income tax expense	—			13,672			473			—			14,145
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(13,672		)	31,019			—			17,347
Equity in undistributed earnings of subsidiaries	17,347			31,019			—			(48,366		)	—
Net income	$	17,347		$	17,347		$	31,019		$	(48,366	)	$	17,347

18

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Three Months Ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	364,503		$	—		$	364,503
Costs and expenses:
Operating, selling, general and administrative	—			52,422			185,144			—			237,566
Depreciation, amortization and accretion	—			6,677			63,792			—			70,469
Corporate expense allocation	—			(59,099		)	59,099			—			—
Total costs and expenses	—			—			308,035			—			308,035
Operating income	—			—			56,468			—			56,468
Interest expense, net	(7,789		)	(12,075		)	(1,903		)	—			(21,767		)
Interest expense allocation	7,789			12,075			(19,864		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			34,701			—			34,701
Income tax expense	—			14,947			435			—			15,382
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(14,947		)	34,266			—			19,319
Equity in undistributed earnings of subsidiaries	19,319			34,266			—			(53,585		)	—
Net income	$	19,319		$	19,319		$	34,266		$	(53,585	)	$	19,319

19

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	770,692		$	—		$	770,692
Costs and expenses:
Operating, selling, general and administrative	—			131,974			383,239			—			515,213
Depreciation, amortization and accretion	—			13,286			136,761			—			150,047
Corporate expense allocation	—			(145,260		)	145,260			—			—
Total costs and expenses	—			—			665,260			—			665,260
Operating income	—			—			105,432			—			105,432
Interest expense, net	(9,705		)	(35,820		)	(3,909		)	—			(49,434		)
Debt extinguishment costs	(327		)	(72		)	—			—			(399		)
Interest expense allocation	10,032			35,892			(45,924		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			55,599			—			55,599
Income tax expense	—			24,289			819			—			25,108
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(24,289		)	54,780			—			30,491
Equity in undistributed earnings of subsidiaries	30,491			54,780			—			(85,271		)	—
Net income	$	30,491		$	30,491		$	54,780		$	(85,271	)	$	30,491

20

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	723,428		$	—		$	723,428
Costs and expenses:
Operating, selling, general and administrative	—			105,426			367,423			—			472,849
Depreciation, amortization and accretion	—			11,469			127,394			—			138,863
Corporate expense allocation	—			(116,895		)	116,895			—			—
Total costs and expenses	—			—			611,712			—			611,712
Operating income	—			—			111,716			—			111,716
Interest expense, net	(15,467		)	(24,087		)	(3,690		)	—			(43,244		)
Interest expense allocation	15,467			24,087			(39,554		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			68,472			—			68,472
Income tax expense	—			28,977			844			—			29,821
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(28,977		)	67,628			—			38,651
Equity in undistributed earnings of subsidiaries	38,651			67,628			—			(106,279		)	—
Net income	$	38,651		$	38,651		$	67,628		$	(106,279	)	$	38,651

21

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Three Months Ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	17,347		$	17,347		$	31,019	$	(48,366	)	$	17,347
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(28		)	(28		)	—		28			(28		)
Other comprehensive loss, net of tax	(28		)	(28		)	—		28			(28		)
Comprehensive income	$	17,319		$	17,319		$	31,019	$	(48,338	)	$	17,319

22

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Three Months Ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	19,319		$	19,319		$	34,266	$	(53,585	)	$	19,319
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(52		)	(52		)	—		52			(52		)
Other comprehensive loss, net of tax	(52		)	(52		)	—		52			(52		)
Comprehensive income	$	19,267		$	19,267		$	34,266	$	(53,533	)	$	19,267

23

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	30,491		$	30,491		$	54,780	$	(85,271	)	$	30,491
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(20		)	(20		)	—		20			(20		)
Other comprehensive loss, net of tax	(20		)	(20		)	—		20			(20		)
Comprehensive income	$	30,471		$	30,471		$	54,780	$	(85,251	)	$	30,471

24

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	38,651		$	38,651		$	67,628	$	(106,279	)	$	38,651
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(60		)	(60		)	—		60			(60		)
Other comprehensive loss, net of tax	(60		)	(60		)	—		60			(60		)
Comprehensive income	$	38,591		$	38,591		$	67,628	$	(106,219	)	$	38,591

25

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Cash flows from operating activities:
Net income	$	30,491		$	30,491		$	54,780		$	(85,271	)	$	30,491
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	—			13,286			136,761			—			150,047
Deferred income taxes	—			24,289			—			—			24,289
Stock-based compensation expense	—			—			17,876			—			17,876
Amortization of discount on debt and deferred debt issue costs and other	6,244			2,005			—			—			8,249
Intercompany and equity investment changes	385,403			(466,631		)	(4,043		)	85,271			—
Changes in operating assets and liabilities	(1,039		)	15,973			(39,326		)	—			(24,392		)
Net cash provided by (used in) operating activities	421,099			(380,587		)	166,048			—			206,560
Cash flows from investing activities:
Capital expenditures	—			(22,465		)	(165,044		)	—			(187,509		)
Purchases of investments	—			(157,523		)	—			—			(157,523		)
Proceeds from sale of investments	—			125,041			—			—			125,041
Other investing activities, net	—			(83		)	(382		)	—			(465		)
Net cash used in investing activities	—			(55,030		)	(165,426		)	—			(220,456		)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	32,559			—			—			—			32,559
Purchases of treasury stock	(197,310		)	—			—			—			(197,310		)
Excess tax benefits from stock-based compensation	—			944			—			—			944
Net proceeds from modification of debt, net of debt issuance costs	—			49,684			—			—			49,684
Retirement of convertible debt obligations	(256,348		)	—			—			—			(256,348		)
Payment of debt and capital lease obligations	—			(1,474		)	(622		)	—			(2,096		)
Net cash (used in) provided by financing activities	(421,099		)	49,154			(622		)	—			(372,567		)
Decrease in cash and cash equivalents	—			(386,463		)	—			—			(386,463		)
Cash and cash equivalents at beginning of period	24,544			782,184			—			—			806,728
Cash and cash equivalents at end of period	$	24,544		$	395,721		$	—		$	—		$	420,265

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Cash flows from operating activities:
Net income	$	38,651		$	38,651		$	67,628		$	(106,279	)	$	38,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	—			11,469			127,394			—			138,863
Deferred income taxes	—			28,977			—			—			28,977
Stock-based compensation expense	—			—			15,177			—			15,177
Amortization of discount on debt and deferred debt issue costs and other	11,029			1,338			—			—			12,367
Intercompany and equity investment changes	(43,989		)	(15,137		)	(47,153		)	106,279			—
Changes in operating assets and liabilities	—			(9,986		)	(15,450		)	—			(25,436		)
Net cash provided by operating activities	5,691			55,312			147,596			—			208,599
Cash flows from investing activities:
Capital expenditures	—			(6,067		)	(151,508		)	—			(157,575		)
Purchases of investments	—			(119,813		)	—			—			(119,813		)
Proceeds from sale of investments	—			106,053			—			—			106,053
Proceeds from sale of assets and other investing activities, net	—			1,310			4,397			—			5,707
Net cash used in investing activities	—			(18,517		)	(147,111		)	—			(165,628		)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	5,828			—			—			—			5,828
Purchases of treasury stock	(11,519		)	—			—			—			(11,519		)
Excess tax benefits from stock-based compensation	—			716			—			—			716
Payment of debt and capital lease obligations	—			(3,227		)	(485		)	—			(3,712		)
Net cash used in financing activities	(5,691		)	(2,511		)	(485		)	—			(8,687		)
Increase in cash and cash equivalents	—			34,284			—			—			34,284
Cash and cash equivalents at beginning of period	24,543			328,851			—			—			353,394
Cash and cash equivalents at end of period	$	24,543		$	363,135		$	—		$	—		$	387,678

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis provides information regarding the results of operations and financial condition of the Company and should be read in conjunction with the accompanying condensed consolidated financial statements and notes thereto. This discussion and analysis also should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and the consolidated financial statements included in Part II of our Annual Report on Form 10-K for the year ended December 31, 2012. References in this item to “we,” “our,” or “us” are to the Company and its subsidiaries on a consolidated basis unless the context otherwise requires.

In order to assist the reader in understanding certain terms relating to the telecommunications business that are used in this Quarterly Report on Form 10-Q, we refer you to the glossary included following Part III of our Annual Report on Form 10-K for the year ended December 31, 2012.

Cautions Concerning Forward-Looking Statements

This document contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, including statements regarding, among other items, our expected financial position, expected capital expenditures, business trends and fluctuations, expected revenue mix, expected revenue changes, the impact of regulatory changes, future tax benefits and expense, expense trends, growth initiatives, future liquidity and capital resources, product plans, share repurchases, debt retirement, future cash balances, growth or stability from particular customer segments, anticipated customer disconnections and customer and revenue churn, Modified EBITDA and margin trends, expected network expansion and business and financing plans. These forward-looking statements are based on management’s current expectations and are naturally subject to risks, uncertainties, and changes in circumstances, certain of which are beyond our control. Actual results may differ materially from those expressed or implied by such forward-looking statements.

The words “believe,” “plan,” “target,” “expect,” “intend,” and “anticipate,” and expressions of similar substance identify forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that those expectations will prove to be correct. Important factors that could cause actual results to differ materially from the expectations described in this report are set forth under “Risk Factors” in Item 1A and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2012 and elsewhere in this report. In addition, actual results may differ from our expectations due to, among other things, the timing of disconnections and service installations which may affect the extent to which those factors impact our results in a particular period, an acceleration of customer disconnections, increased competition and pricing pressures, inability to obtain rights to build networks into commercial buildings, economic downturns, which may adversely affect our revenue growth, net income or Modified EBITDA, delays in launching new products that our customers desire, growth initiatives that may not result in the intended revenue growth acceleration, decreased demand for our products, industry consolidation and other industry conditions, significant increases or decreases in the market prices of our common stock, an ownership change that results in limitations on our use of net operating loss carryforwards ("NOLs") under Section 382 of the Internal Revenue Code, increases in the prices we pay for use of facilities of ILECs, increased costs from healthcare reform and higher taxes or further deregulation of the ILECs or other factors that may adversely affect the cost and availability of ILEC facilities that we use to reach certain customer locations, and adverse regulatory rulings or legislative developments. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

We are a leading national provider of managed network services, specializing in business Ethernet, data networking, converged, IP VPN, Internet access, voice, including VoIP, and network security services to enterprise organizations, including public sector entities, and carriers throughout the U.S., including their global locations. Our revenue is derived from business communication services, including data, high-speed Internet access, network and voice services. Our customers include, among others, enterprise organizations in the financial services, technology and scientific, health care, distribution, manufacturing and professional services industries, data center providers, cloud services providers, public sector entities, system integrators and communications service providers, including ILECs, CLECs, wireless communications companies and cable companies.

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Through our subsidiaries, we serve 75 metropolitan markets with local fiber networks that are connected to our regional fiber facilities and national IP backbone. As of June 30, 2013, our fiber network spanned over 29,000 route miles (including approximately 23,000 metropolitan route miles) connecting to 19,082 buildings served directly by our local fiber facilities including approximately 450 third party data centers across the country where customers deploy their own equipment or connect to cloud service providers. We continue to extend our fiber footprint within our existing markets by connecting our network into additional locations and to expand our data, voice and IP networking capabilities between our markets, supporting secure end-to-end business Ethernet, IP VPN and converged solutions for customers.

Our revenue is derived from business communications services, including data, high-speed Internet access, voice and network services. Although we analyze revenue by customer type, we present our financial results as one segment across the U.S. because our business is centrally managed.

Business Strategy

Our objective is to be the leading national provider of high quality, business network solutions leveraging our integrated network, operational capabilities, dedicated people, local presence, personalized customer experience and advanced support systems to meet the complex and evolving needs of our customers and increase stockholder value. The key elements of our business strategy include:

• Focusing our service offerings on meeting our customers' complex evolving needs, emphasizing business Ethernet and IP VPN services (which we refer to as strategic services), Internet-based services and converged service offerings and developing our advanced service capabilities, which we refer to as the "Intelligent Network". We launched the initial phase of the Intelligent Network, Enhanced Management, in June 2012 for IP VPN, converged and Ethernet services, and the second phase, Dynamic Capacity, which allows customers to manage or schedule bandwidth, in August 2012, and have added enhancements to those capabilities as described below.

• Enabling enterprise cloud computing and other developing customer information technology ("IT") and business strategies by leveraging our fiber network, data services portfolio, Intelligent Network capabilities and the numerous third party and customer data centers connected to our network;

• Delivering a differentiated customer care strategy by engaging all of our employees and continually incorporating customer feedback and increasing automation to provide the best possible customer service;

• Leveraging our local fiber assets and national IP backbone and integrating and managing other carriers’ facilities to enable our customers to connect any of their locations with our network solutions, and using our local presence and local sales, sales engineering, customer support and operational resources, backed by a national organization, to provide personalized service and customized solutions for our customers;

• Enhancing our multi-channel sales strategy through expanding our sales personnel for both our direct and indirect channels;

• Employing a capital allocation strategy that includes investments for growth in our business in the near and long term, maintenance of a strong balance sheet and returning value to stockholders through share repurchases or other means; and

• Investing in our people to drive the execution of our strategies.

New Services

We launched the following new services and enhancements during the first six months of 2013:

• Alert-Driven Dynamic Capacity, which enhances our Dynamic Capacity offerings by allowing customers to automatically increase their bandwidth based on pre-set parameters and the capability to increase that bandwidth up to 10 Gigabits;

• Enhanced Management Thresholds and Alerts that provides customers proactive notification of information regarding their networks based on customer-established parameters;

• Advanced Session Initiation Protocol or "SIP" trunking services, a managed solution for customized large enterprise voice applications

• Distributed Denial of Service security offering that mitigates attacks on customers' Internet service and addresses unwanted traffic and data on their networks; and

• Both 40 and 100 Gigabit metro Ethernet service that provides a higher speed, fully managed large capacity service for larger and more complex customer networks and which complements our existing 2.5 and 10 Gigabit Ethernet offerings.

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We expect to launch additional new services in the second half of 2013, including additions to our managed services portfolio.

Revenue Trends

Total Revenue

Our revenue has grown for the past 35 consecutive quarters through June 30, 2013, including throughout the various economic cycles. We expect our future revenue growth to be driven in part by the increasingly web-based economy and developing IT strategies such as cloud computing, collaboration, data center connectivity and disaster recovery, all of which require the reliable connectivity and network capacity that we provide. We also expect that our advanced service capabilities will drive more demand for our existing Ethernet and VPN product suite and enhance our future data services revenue growth. Our national footprint and continuously evolving service capabilities enable us to serve customers with multi-point, multi-city locations. Our annual year-over-year revenue growth rate increased over each of the years ended December 31, 2010, 2011 and 2012 and was 5.1%, 7.4% and 7.6%, respectively. These higher year-over-year revenue growth rates were primarily due to increased demand, low revenue churn and an increase in certain taxes and fees that are reported on a gross versus net basis in revenue and expense. We also believe that our new and enhanced services, our customer experience initiatives to increase customer loyalty and retention and improved economic conditions contributed to our growing revenue.

In 2012, our service installations increased year-over-year, although at a growth rate lower than our total overall revenue growth rate for 2012. As a result, beginning in the three months ended March 31, 2012, we experienced a trend of lower quarterly year-over-year revenue growth rates, including 6.9% for the three months ended June 30, 2013, compared to 7.7% for the same period in 2012, and expect this trend to continue in 2013. We believe that increasing our rate of revenue growth will be dependent on higher sales and service installations to keep pace with the growing total base of revenue, retaining revenue from existing customers and a stronger economy. In 2013, we are implementing several initiatives focused on increasing sales to capture growing market demand and share that we expect to contribute to an accelerating growth rate over the long term (see "Modified EBITDA Trends and Growth Initiatives" below). Our year-over-year revenue growth rate was 6.9% for the three months ended June 30, 2013 compared to 6.2% for the three months ended March 31, 2013, primarily due to strong sales in the fourth quarter of 2012 and higher intercarrier compensation settlements and revenue rather than the impact of the growth initiatives. We also expect that a large carrier disconnection order that we received in July 2013 will pressure our revenue growth rate in the third quarter of 2013.

Revenue for data and Internet, network and the majority of our voice services is generally billed in advance on a monthly fixed-rate basis and recognized over the period the services are provided. Revenue for the majority of intercarrier compensation and certain components of voice services, such as certain components of long distance, is generally billed on a transactional basis in arrears based on a customer’s actual usage; therefore, we use estimates to recognize revenue in the period earned. Due to the time required to obtain or build necessary facilities, obtain rights to install equipment in multi-tenant buildings and other factors related to service installation, some of which are not within our control, there is often a time lag between the time that a sale, or “booking” (i.e., signed contract) is made, and the time revenue commences. Our installation intervals are generally longer for the more complex solutions delivered to our customers. In some situations, the timing of service installations may be subject to factors that our customers control, such as their readiness for us to install equipment on their premises or the readiness of their equipment. Due to all of these factors, installation intervals may range between two weeks for single-site, less complex services to 6 to 12 months or longer for the more complex solutions.

Enterprise Customer Revenue

Revenue from enterprise customers has increased for the past 44 consecutive quarters through June 30, 2013 and increased 8.7% and 8.4% for the three and six months ended June 30, 2013, respectively, as compared to the same periods in 2012, primarily due to increased installations of our data and Internet services such as business Ethernet and VPN and other services. Revenue from our enterprise customers represented 80% of our total revenue in each of the three and six months ended June 30, 2013. We expect our future revenue growth to come primarily from our enterprise customer base, largely due to our advanced network capabilities and new services portfolio.

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Carrier Customer Revenue

Our carrier revenue represented 18% of our total revenue in each of the three and six months ended June 30, 2013. For the quarter ended June 30, 2013, carrier revenue decreased $0.2 million over the quarter ended June 30, 2012, primarily due to churn (see "Revenue and Customer Churn" below) and repricing for contract renewals, largely offset by growth in Ethernet services.

Carrier revenue has been gradually declining as a percentage of revenue due to the higher contribution from enterprise customer revenue coupled with continued disconnections and repricing of carrier contracts upon renewals somewhat offset by installed sales of Ethernet services to carriers to serve their end users’ needs. Carrier revenue from wireless providers represented 29% of total carrier revenue for each of the three and six months ended June 30, 2013. While we expect some contribution to carrier revenue as we expand our data service offerings to our wholesale customer base, our carrier revenue historically has been impacted by pricing declines in connection with carrier customer contract renewals, disconnections resulting from price competition from other carriers, network grooming and carrier consolidation. We expect these impacts on our carrier revenue to continue.

Intercarrier Compensation Revenue

Intercarrier compensation revenue, which consists of switched access services and reciprocal compensation, represented 2% of our total revenue in each of the three and six months ended June 30, 2013, and is expected to decline in the future as a percentage of total revenue due to federal and state mandated rate reductions and changes in the regulatory regime for intercarrier compensation. We lowered the rates we charge other carriers to terminate traffic on our network in July 2012 to comply with a 2011 FCC order. The FCC order mandates another rate decrease in July 2013. As a result of the FCC order, we expect to lose approximately $4.0 million in intercarrier compensation revenue in the year ended December 31, 2013 compared to the year ended December 31, 2012. The order mandates further rate declines on terminating traffic through 2018, when carriers will be required to exchange terminating traffic on a "bill and keep" basis, meaning that the exchange of traffic will not be compensatory. We expect that intercarrier compensation revenue also will fluctuate based on variations from period to period in minutes of use originating and terminating on our network and fluctuations in customer settlements.

Revenue and Customer Churn

Revenue churn, defined as the average lost recurring monthly billing for the period from a customer’s partial or complete disconnection of services (excluding pricing declines upon contract renewals and lost usage revenue) compared to reported revenue, is a measure used by management to evaluate revenue retention. Customer and service disconnections occur as part of the normal course of business and are primarily associated with price competition from other providers, customers moving facilities to other locations and network grooming, business contractions, financial difficulties and consolidation, among other reasons. After higher churn beginning in late 2007 and continuing through 2009, revenue churn improved in the year ended December 31, 2010 to pre-recession levels of 1.0% of monthly revenue and further improved to 0.9% in each of the years ended December 31, 2011 and 2012 and 0.9% and 0.8% for the three and six months ended June 30, 2013, respectively. We believe that the improvement in revenue churn is a result of improved economic conditions as well as our service portfolio, measures we put in place to increase revenue retention and our customer experience initiatives. As a component of revenue churn, revenue lost from customers fully disconnecting services was 0.2% for the years ended December 31, 2011 and 2012 and for each of the three and six months ended June 30, 2013. We continue our initiatives to maintain revenue churn that is low relative to our industry, but do not expect contribution to our revenue growth rate from a lower revenue churn rate. If our revenue churn were to increase, our revenue growth would likely be negatively impacted. We cannot predict the total impact on revenue from future customer disconnections or the timing of such disconnections or whether these favorable churn trends will continue.

Customer churn, defined as the average monthly customer turnover for the period compared to the average monthly customer count for the period, was 0.9% in each of the three and six months ended June 30, 2013 compared with 1.1%, 1.0% and 1.0% for the years ended December 31, 2010, 2011 and 2012, respectively. The majority of this churn came from our smaller customers, which we expect will continue.

Pricing

We experience significant price competition across our service categories that impacts our revenue. We also believe that technology advancements over the years in the telecommunications industry have resulted in lower unit costs for some electronics and equipment that drives customer demand for higher bandwidth at the same or lower prices.

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In our industry, service agreements typically range from two to five years, with fixed pricing for the contract term. When contracts are renewed with no changes to the services, pricing is frequently reduced to current market levels as a renewal incentive. The impact of those price reductions on our revenue may fluctuate from quarter to quarter. In addition, during the terms of agreements, customers often purchase additional services or increase or decrease the capacity of existing services, subject to applicable early termination charges, depending on their business needs. In some cases, the impact of re-pricing is mitigated by customers' purchase of additional services.

Expenses and Modified EBITDA Trends

Pricing of Special Access Services

We purchase a substantial amount of special access services primarily from ILECs to expand the reach of our network and also provide special access services to customers over our fiber facilities in competition with ILECs. The ILECs have argued before the FCC that the high capacity telecommunications services that they sell, including special access services we buy from them, should no longer be subject to regulations governing price and quality of service. We have advocated that the FCC modify certain of its special access pricing flexibility rules to return these services to price-cap regulation to protect against unreasonable price increases for carriers such as us. The FCC is reviewing its regulation of special access pricing in a pending proceeding commenced in 2005 that has not yet resulted in proposed rules. In 2012, the FCC suspended the operation of the pricing flexibility triggers, which means that ILECs cannot expand the geographic scope of their capability to raise prices, pending further FCC review. We cannot predict when the FCC will act on interstate special access pricing regulation or the impact of any such action.

If the special access services we buy from the ILECs were to be further deregulated, ILECs would have a greater ability to increase the price and reduce the service quality of special access services they sell to us. As the prices we must pay for special access services increase, our margins are pressured.

In addition, the FCC has granted ILEC requests for forbearance from regulation of certain Ethernet and OC-n high capacity services offered by the ILECs as special access, with the result that prices we would pay for those services are no longer price regulated and could increase. We are advocating reversal of these forbearance requests since a growing portion of the services we buy are Ethernet enabled and not subject to regulation. We also continue to pursue and implement commercial arrangements with the ILECs and cable companies for these services on acceptable terms and conditions.

Bad Debt Expense Trends

Due to the quality of our customer base, successful collection efforts, internal controls, bad debt recoveries and our revenue recognition policies, including recognition of contract termination charges upon cash receipt, our bad debt expense was less than 1% of our total revenue in each of the three and six months ended June 30,2013, comparable to the years ended December 31, 2012, 2011 and 2010. We cannot assure that we will be able to maintain bad debt expense at this low level.

Modified EBITDA Trends and Growth Initiatives

We have implemented initiatives to expand our revenue growth, margins and cash flow that require both capital and operating investments. During the three years ended December 31, 2012, these operating investments included expansion of our sales and sales support staff as well as IT and technical personnel and contract labor to support our growing customer base and new service and technology investments to provide future capabilities that differentiate our services from the competition. Our capital spending investments during these periods consisted of incremental expenditures linked to increased sales, including sales to wireless providers, new service portfolio enhancements, including our expanded Ethernet service portfolio and our Intelligent Network capabilities, strategic market expansion through fiber purchases to extend our network reach and corporate and IT initiatives that support the evolution of our services, enable our customer experience and drive increased scale and efficiency. We believe that these initiatives resulted in expansion of our revenue growth, margins and cash flows during the three years ended December 31, 2012.

Modified EBITDA (see Note 2 to the table under “Three Months Ended June 30, 2013 Compared to Three Months Ended June 30, 2012--Operating Income and Net Income” for a definition of Modified EBITDA) grew 6.2%, 7.4% and 8.6% in the years ended December 31, 2010, 2011 and 2012, respectively, each compared to the prior year, and further grew 2.5% and 2.9% in the three and six months ended June 30,2013, respectively, compared to the same period last year. Modified EBITDA margin was 36.4%, 36.4% and 36.8% for the years ended December 31, 2010, 2011 and 2012, respectively, and 35.3% and 35.5% for the three and six months ended June 30,2013, respectively. These margins included the absorption of increased costs for network access due to higher prices and greater reach and costs associated with further expansion of our sales and support staff and IT and technical personnel and were impacted by the dilutive effect of certain taxes and fees that are reported

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on a gross versus net basis in revenue and expense (see “Revenue” in Note 1 to the unaudited interim condensed consolidated financial statements).

The initiatives that we are implementing in 2013 are designed to reverse the recent trend of lower quarterly year-over-year revenue growth rates and include further increasing investments in our sales and support staff to expand our market penetration. We believe that increasing our sales and support staff to leverage our service offerings and support our increasingly complex solutions will enable us to attract new customers, sell more services to existing customers and retain customers. We are also making capital investments in new technologies to deliver new innovative capabilities to further drive sales of our strategic data and Internet services, in further automation of network functionality to enable more dynamic customer network capacity and connections and in continuing the expansion of our network in existing and adjacent markets to reach more customers.

In the three and six months ended June 30, 2013, our Modified EBITDA margin was impacted by costs associated with our growth initiatives. We expect that the higher investments and expense associated with the growth initiatives discussed above will continue to dampen our Modified EBITDA margin and cash flow in the near term until we can achieve higher service installations and an expansion in our rate of revenue growth that we expect will absorb the cost of the growth initiatives. While these initiatives are designed to increase sales in the longer term to enable us to accelerate our future revenue growth rate, we cannot assure that these and other initiatives will be sufficient to achieve our objectives of increased revenue growth, margins and cash flow or the timing of such anticipated benefits.

We believe that future margin expansion will come from higher service installations, further leveraging our on-network facilities and increasing the network density of our less mature markets, since over the long term we have generally experienced margin improvement and increased cash flow from our less dense markets as those markets are expanded through on-net building additions and other network expansions. Our continued cost efficiency efforts are also intended to contribute to our overall margins.

The expected reductions in intercarrier compensation revenue discussed above under "Revenue Trends" are also expected to pressure our margins because of the relatively high margins associated with that revenue. Our revenue and margins may also be impacted by, among other risks, competitive pressures, higher special access costs, fuel and energy costs, fluctuations in certain taxes and fees and any future inflationary pressures.

Seasonality and Fluctuations

We continue to expect business fluctuations to impact sequential quarterly trends in revenue, margins and cash flow. This includes the timing, as well as any seasonality, of sales and service installations, usage, rate changes, disputes, settlements, repricing for contract renewals and fluctuations in revenue churn, expenses, capital expenditures and certain taxes and fees. Historically, our expense in the first quarter has been impacted by the resetting of payroll taxes in the new year. Our past experience with quarterly fluctuations may not necessarily be indicative of future results.

Because we generally do not recognize revenue subject to billing disputes until the dispute is resolved, the timing of dispute resolutions and settlements may positively or negatively affect our revenue in a particular quarter. The timing of disconnections may also impact our results in a particular quarter, with disconnections early in the quarter generally having a greater impact. The timing of capital and other expenditures may affect our margins or cash flow. The convergence of any of these or other factors such as fluctuations in usage, increases or decreases in certain taxes and fees or pricing declines upon contract renewals in a particular quarter may result in our revenue growing more or less than previous trends, may impact our margins and other financial results and may not be indicative of future financial performance.

Critical Accounting Policies and Estimates

For a description of our critical accounting policies and estimates, see Item 7 in our Annual Report on Form 10-K for the year ended December 31, 2012, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

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Results of Operations

The following discussion provides analysis of our results of operations and should be read together with our unaudited interim condensed consolidated financial statements, including the notes thereto, appearing elsewhere in this report:

Three Months Ended June 30, 2013 Compared to Three Months Ended June 30, 2012

Revenue

Revenue by line of business was as follows:

	Three Months Ended June 30,
(dollars in thousands)	2013		2012		$ Change			% Change
Revenue (1):
Data and Internet services	$	209,634	$	182,480	$	27,154		14.9	%
Voice services	93,080		91,008		2,072			2.3	%
Network services	78,487		83,009		(4,522		)	(5.4	)%
Intercarrier compensation	8,282		8,006		276			3.4	%
Total revenue	$	389,483	$	364,503	$	24,980		6.9	%

___________________

⁽¹⁾  We classify certain taxes and fees billed to customers and remitted to government authorities on a gross versus net basis in revenue and expense. The total amounts classified as revenue, primarily included in voice services, associated with such taxes and fees were approximately $20.6 million and $19.8 million for the three months ended June 30,2013 and 2012, respectively. This has no impact on Modified EBITDA or net income but is dilutive to Modified EBITDA margin.

The primary driver of total revenue growth was increased data and Internet services revenue from installed services to enterprise customers. The increase in data and Internet services revenue primarily resulted from installations of strategic Ethernet and VPN-based services and other services to enterprise customers, partially offset by revenue churn and re-pricing of renewed customer contracts at lower rates. Strategic services, which includes Ethernet and IP VPN services, comprised 54.9% of data and Internet services revenue for the three months ended June 30,2013 compared to 52.9% for the three months ended June 30,2012, representing 19.3% period over period growth in revenue from these services.

Voice services revenue increased primarily as a result of installations of converged and other voice services and certain taxes and fees remitted to government authorities that we classify on a gross versus net basis in revenue and expense, partially offset by revenue churn. Revenue based on the minutes of service used by customers included in voice services was 3% of our total revenue for both the three months ended June 30,2013 and 2012.

Network services revenue decreased primarily due to revenue churn and re-pricing of renewed customer contracts at lower rates, somewhat offset by growth in high capacity and collocation services.

Intercarrier compensation revenue grew primarily as a result of dispute settlements and an increase in minutes of use originating and terminating on our network that offset the impact of an FCC-mandated rate reduction in July 2012.

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Costs and Expenses

The major components of costs and expenses were as follows:

	Three Months Ended June 30,
(dollars in thousands)	2013			2012			$ Change		% Change
Costs and expenses:
Operating (exclusive of depreciation, amortization and accretion shown separately below) (1)	$	164,131		$	152,986		$	11,145	7.3	%
Operating expenses as percentage of total revenue	42.1		%	42.0		%
Selling, general and administrative (1)	96,438			84,580			11,858		14.0	%
Selling, general and administrative expenses as percentage of total revenue	24.8		%	23.2		%
Depreciation, amortization and accretion	75,652			70,469			5,183		7.4	%
Total costs and expenses	$	336,221		$	308,035		$	28,186	9.2	%
(1)  Includes the following non-cash stock-based employee compensation expense:
Operating	$	545		$	455		$	90	19.8	%
Selling, general and administrative	$	7,869		$	6,594		$	1,275	19.3	%

Operating Expenses. Our operating expenses consist of costs directly related to the operation and maintenance of our network and the provisioning of our services. These costs, which are net of capitalized labor and overhead costs on capital projects, include the salaries and related expenses of customer care, provisioning, network maintenance, technical field and network operations and engineering personnel, costs to repair and maintain our network, and costs paid to other carriers for access to their facilities, interconnection, and facilities leased and associated utilities. We carry a significant portion of our traffic on our own fiber infrastructure, which enhances our ability to minimize and control access costs, which are the costs to purchase network services from other carriers. The increase in operating expenses primarily related to higher network access costs largely as a result of revenue growth as well as higher employee-related and network maintenance costs associated both with revenue growth and our growth initiatives (as discussed under "Modified EBITDA Trends and Growth Initiatives"), partially offset by capitalized expenses.

Selling, General and Administrative Expenses. Selling, general and administrative expenses consist of salaries and related costs for employees and other expenses related to sales and marketing, bad debt, IT, billing, regulatory, administrative and legal functions. The increase in these expenses primarily related to higher employee-related costs resulting from incentive-based compensation due to expansion of our indirect sales channel and increased customer installations of service, expansion of our sales and sales support personnel and IT personnel associated both with revenue growth and our growth initiatives, annual merit-based salary increases and higher non-cash stock-based compensation expense.

Depreciation, Amortization and Accretion Expense. The increase in depreciation, amortization and accretion expense was attributable to property, plant and equipment additions during 2012 and 2013 net of fully depreciated assets.

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Operating Income and Net Income

The following table provides the components from operating income to net income for purposes of the discussions that follow:

	Three Months Ended June 30,
(dollars in thousands, except per share amounts)	2013			2012			$ Change			% Change
Operating income	$	53,262		$	56,468		$	(3,206	)	(5.7	)%
Interest expense	(21,544		)	(21,860		)	(316		)	(1.4	)%
Debt extinguishment costs	(399		)	—			399			NM
Interest income	173			93			80			86.0	%
Income before income taxes	31,492			34,701			(3,209		)	(9.2	)%
Income tax expense	14,145			15,382			(1,237		)	(8.0	)%
Net income	$	17,347		$	19,319		$	(1,972	)	(10.2	)%
Basic income per common share	$	0.12		$	0.13		(0.01		)	(7.7	)%
Diluted income per common share	$	0.11		$	0.13		(0.02		)	(15.4	)%
Modified EBITDA (1)(2)	$	137,328		$	133,986		$	3,342		2.5	%
Modified EBITDA margin (1)(2)(3)	35.3		%	36.8		%

___________________

NM - Not meaningful

⁽¹⁾  See Note 1 under "Revenue" above.

⁽²⁾  “Modified EBITDA” is a non-GAAP financial measure and is defined by us as net income (loss) before depreciation, amortization and accretion expense, interest expense, interest income, debt extinguishment costs, other income (loss), impairment charges, income tax expense (benefit), cumulative effect of change in accounting principle, and non-cash stock-based employee compensation expense. Not all of the aforementioned items occur in each reporting period, but have been included in the definition based on historical activity. Modified EBITDA is not intended to replace operating income (loss), net income (loss), cash flow and other measures of financial performance and liquidity reported in accordance with accounting principles generally accepted in the United States. Rather, Modified EBITDA is a measure of operating performance and liquidity that investors may consider in addition to such measures. Our management believes that Modified EBITDA is a standard measure of operating performance and liquidity that is commonly reported and widely used by analysts, investors, and other interested parties in the telecommunications industry because it eliminates many differences in financial, capitalization, and tax structures, as well as non-cash and non-operating charges to earnings. We believe that Modified EBITDA trends are a valuable indicator of whether our operations are able to produce sufficient operating cash flow to fund working capital needs, service debt obligations and fund capital expenditures. We currently use Modified EBITDA for these purposes. Modified EBITDA also is used internally by our management to assess ongoing operations and is a measure used to test compliance with certain covenants of our senior notes, our Revolver and our Term Loan. The definition of EBITDA under our Revolver, our Term Loan and our senior notes differs, but not materially, from the definition of Modified EBITDA used in this table. Modified EBITDA as used in this document may not be comparable to similarly titled measures reported by other companies due to differences in accounting and disclosure policies. The reconciliation between net income and Modified EBITDA, as a performance measure, is as follows:

	Three Months Ended June 30,
(dollars in thousands)	2013			2012
Net income	17,347			19,319
Income tax expense	14,145			15,382
Interest income	(173		)	(93		)
Interest expense	21,544			21,860
Debt extinguishment costs	399			—
Depreciation, amortization and accretion	75,652			70,469
Non-cash stock-based compensation	8,414			7,049
Modified EBITDA	$	137,328		$	133,986

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The reconciliation between net cash provided by operations and Modified EBITDA, as a measure of liquidity, is as follows:

	Three Months Ended June 30,
(dollars in thousands)	2013			2012
Net cash provided by operations	124,960			114,238
Income tax expense	14,145			15,382
Deferred income taxes	(13,672		)	(14,947		)
Interest income	(173		)	(93		)
Interest expense	21,544			21,860
Discount on debt, amortization of deferred debt issue costs and other	(1,055		)	(6,246		)
Changes in operating assets and liabilities	(8,421		)	3,792
Modified EBITDA	$	137,328		$	133,986

⁽³⁾  Modified EBITDA margin represents Modified EBITDA as a percentage of revenue.

Interest Expense. The decrease in interest expense primarily related to the discount on the Convertible Debentures becoming fully accreted in the first quarter of 2013, partial retirement of the Convertible Debentures and the impact of the rate decrease on the Term Loan in connection with the 2013 refinancing, partially offset by interest attributable to the 2022 Notes issued in October 2012. We expect our interest expense to decrease approximately $2.0 million annually (based on the interest rate in effect as of June 30, 2013 and long-term debt as of such date) as a result of the Amendment and Restatement of our Term Loan (see "Liquidity and Capital Resources").

Debt Extinguishment Costs. Debt extinguishment costs for the three months ended June 30, 2013 resulted primarily from commissions paid on repurchases by us of the Convertible Debentures. There were no such costs for the three months ended June 30, 2012.

Income before Income Taxes. The decrease in income before income taxes resulted primarily from higher depreciation, amortization and accretion expense and non-cash stock-based compensation expense, partially offset by higher Modified EBITDA as discussed below.

Income Tax Expense. The decrease in income tax expense resulted from lower income before income taxes, partially offset by a higher effective tax rate as a result of discrete items related to stock-based compensation. Our effective tax rate in the year ended December 31, 2012 was 43%. We expect our effective tax rate for the year ended December 31, 2013 to be similar to that for the year ended December 31, 2012.

Net Income and Modified EBITDA. The decrease in net income resulted from a decrease in income before income taxes, partially offset by lower income tax expense, as discussed above. The increase in Modified EBITDA was primarily the result of revenue growth, partially offset by costs associated both with revenue growth and our growth initiatives, including increased network maintenance costs and employee-related expenses. Modified EBITDA margin declined largely due to costs associated with our growth initiatives incurred in advance of the expected future revenue growth. For the three months ended June 30, 2013 and 2012, Modified EBITDA, together with cash, cash equivalents and investments, has been sufficient to cover our capital expenditures and service our debt, and we expect to generate sufficient Modified EBITDA in the foreseeable future to cover our expected capital expenditures and debt service requirements, together with cash, cash equivalents and investments, and borrowing capacity under our existing Revolver. See Note 2 to the table under “Three Months Ended June 30, 2013 Compared to Three Months Ended June 30, 2012--Operating Income and Net Income” for a definition of Modified EBITDA and reconciliations of Modified EBITDA to net income, which is the most comparable GAAP measure for operating performance, and Modified EBITDA to net cash provided by operations, which is the most comparable GAAP measure for liquidity.

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Six Months Ended June 30, 2013 Compared to Six Months Ended June 30, 2012

Revenue

Revenue by line of business was as follows:

	Six Months Ended June 30,
(dollars in thousands)	2013		2012		$ Change			% Change
Revenue (1):
Data and Internet services	$	411,716	$	359,331	$	52,385		14.6	%
Voice services	185,435		180,629		4,806			2.7	%
Network services	157,350		167,813		(10,463		)	(6.2	)%
Intercarrier compensation	16,191		15,655		536			3.4	%
Total revenue	$	770,692	$	723,428	$	47,264		6.5	%

___________________

⁽¹⁾  We classify certain taxes and fees billed to customers and remitted to government authorities on a gross versus net basis in revenue and expense. The total amounts classified as revenue, primarily included in voice services, associated with such taxes and fees were approximately $41.2 million and $39.5 million for the six months ended June 30,2013 and 2012, respectively. This has no impact on Modified EBITDA or net income but is dilutive to Modified EBITDA margin.

The primary driver of total revenue growth was increased data and Internet services revenue from installed services to enterprise customers. The increase in data and Internet services revenue primarily resulted from installations of strategic Ethernet and VPN-based services and other services to enterprise customers, partially offset by revenue churn and re-pricing of renewed customer contracts at lower rates. Strategic services, which includes Ethernet and IP VPN services, represented 54.7% of data and Internet services revenue for the six months ended June 30,2013 compared to 52.5% for the six months ended June 30,2012, representing 19.4% period over period growth in revenue from these services.

Voice services revenue increased primarily as a result of installations of converged and other voice services and certain taxes and fees remitted to government authorities that we classify on a gross versus net basis in revenue and expense, partially offset by revenue churn. Revenue based on the minutes of service used by customers included in voice services was 3% of our total revenue for both the six months ended June 30,2013 and 2012.

Network services revenue decreased primarily due to revenue churn and re-pricing of renewed customer contracts at lower rates, somewhat offset by growth in high capacity and collocation services.

Intercarrier compensation revenue grew primarily as a result of dispute settlements and an increase in minutes of use originating and terminating on our network that offset the impact of the FCC-mandated rate reduction in July 2012.

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Costs and Expenses

The major components of costs and expenses were as follows:

	Six Months Ended June 30,
(dollars in thousands)	2013			2012			$ Change		% Change
Costs and expenses:
Operating (exclusive of depreciation, amortization and accretion shown separately below) (1)	$	325,213		$	302,179		$	23,034	7.6	%
Operating expenses as percentage of total revenue	42.2		%	41.8		%
Selling, general and administrative (1)	190,000			170,670			19,330		11.3	%
Selling, general and administrative expenses as percentage of total revenue	24.7		%	23.6		%
Depreciation, amortization and accretion	150,047			138,863			11,184		8.1	%
Total costs and expenses	$	665,260		$	611,712		$	53,548	8.8	%
(1)  Includes the following non-cash stock-based employee compensation expense:
Operating	$	1,128		$	955		$	173	18.1	%
Selling, general and administrative	$	16,748		$	14,222		$	2,526	17.8	%

Operating Expenses. The increase in operating expenses largely related to higher network access costs primarily as a result of revenue growth as well as higher network maintenance and employee-related costs associated both with revenue growth and our growth initiatives. Operating expenses as a percentage of revenue increased primarily as a result of higher network maintenance costs.

Selling, General and Administrative Expenses. The increase in these expenses primarily related to higher employee costs resulting from incentive-based compensation due to expansion of our indirect sales channel and increased customer installations of service, expansion of our sales and sales support personnel and IT personnel associated both with revenue growth and our growth initiatives, annual merit-based salary increases and higher non-cash stock-based compensation expense.

Depreciation, Amortization and Accretion Expense. The increase in depreciation, amortization and accretion expense was attributable to property, plant and equipment additions during 2012 and 2013 net of fully depreciated assets.

Operating Income and Net Income

The following table provides the components from operating income to net income for purposes of the discussions that follow:

	Six Months Ended June 30,
(dollars in thousands, except per share amounts)	2013			2012			$ Change			% Change
Operating income	$	105,432		$	111,716		$	(6,284	)	(5.6	)%
Interest expense	(49,884		)	(43,441		)	6,443			14.8	%
Debt extinguishment costs	(399		)	—			399			NM
Interest income	450			197			253			128.4	%
Income before income taxes	55,599			68,472			(12,873		)	(18.8	)%
Income tax expense	25,108			29,821			(4,713		)	(15.8	)%
Net income	$	30,491		$	38,651		$	(8,160	)	(21.1	)%
Basic income per common share	$	0.20		$	0.26		(0.06		)	(23.1	)%
Diluted income per common share	$	0.20		$	0.25		(0.05		)	(20.0	)%
Modified EBITDA (1)(2)	$	273,355		$	265,756		$	7,599		2.9	%
Modified EBITDA margin (1)(2)(3)	35.5		%	36.7		%

___________________

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NM - Not meaningful

⁽¹⁾ See Note 1 under "Revenue" above.

⁽²⁾ See Note 2 above under "Three Months Ended June 30, 2013 Compared to Three Months Ended June 30, 2012--Operating Income and Net Income" for a definition of Modified EBITDA. See below for reconciliations of Modified EBITDA to net income, which is the most comparable GAAP measure for operating performance, and Modified EBITDA to net cash provided by operations, which is the most comparable GAAP measure for liquidity. The reconciliation between net income and Modified EBITDA is as follows:

	Six Months Ended June 30,
(dollars in thousands)	2013			2012
Net income	$	30,491		$	38,651
Income tax expense	25,108			29,821
Interest income	(450		)	(197		)
Interest expense	49,884			43,441
Debt extinguishment costs	399			—
Depreciation, amortization and accretion	150,047			138,863
Non-cash stock-based compensation	17,876			15,177
Modified EBITDA	$	273,355		$	265,756

The reconciliation between net cash provided by operations and Modified EBITDA, as a measure of liquidity is as follows:

	Six Months Ended June 30,
(dollars in thousands)	2013			2012
Net cash provided by operations	206,560			208,599
Income tax expense	25,108			29,821
Deferred income taxes	(24,289		)	(28,977		)
Interest income	(450		)	(197		)
Interest expense	49,884			43,441
Discount on debt, amortization of deferred debt issue costs and other	(7,850		)	(12,367		)
Changes in operating assets and liabilities	24,392			25,436
Modified EBITDA	$	273,355		$	265,756

⁽³⁾ Modified EBITDA margin represents Modified EBITDA as a percentage of revenue.

Interest Expense. The increase in interest expense primarily related to the issuance of the 2022 Notes in October 2012, partially offset by the discount on the Convertible Debentures becoming fully accreted in the first quarter of 2013, partial retirement of the Convertible Debentures, a lower average balance on the Term Loan and the impact of the rate decrease on the Term Loan in connection with the 2013 refinancing.

Debt Extinguishment Costs. Debt extinguishment costs for the six months ended June 30, 2013 primarily resulted from commissions paid on repurchases of our Convertible Debentures. There were no such costs for the six months ended June 30, 2012.

Income before Income Taxes. The decrease in income before income taxes resulted primarily from higher depreciation, amortization and accretion expense, interest expense and non-cash stock-based compensation expense, partially offset by higher Modified EBITDA as discussed below.

Income Tax Expense. The decrease in income tax expense resulted from lower income before income taxes, partially offset by a higher effective tax rate as a result of discrete items related to stock-based compensation. Our effective tax rate in the year ended December 31, 2012 was 43%. We expect our effective tax rate for the year ended December 31, 2013 to be similar to that for the year ended December 31, 2012.

Net Income and Modified EBITDA. The decrease in net income resulted from a decrease in income before income taxes, partially offset by lower income tax expense, as discussed above. The increase in Modified EBITDA was primarily the result of revenue growth that was somewhat offset by costs associated with both revenue growth and our growth initiatives as discussed

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above. The decline in Modified EBITDA margin primarily resulted from higher network maintenance costs and employee costs as a percentage of revenue largely due to costs incurred for our growth initiatives in advance of the expected future revenue growth. For the six months ended June 30,2013 and 2012, Modified EBITDA, together with cash, cash equivalents and investments, has been sufficient to cover our capital expenditures and service our debt. See Note 2 to the table under “Three Months Ended June 30, 2013 Compared to Three Months Ended June 30, 2012--Operating Income and Net Income” for a definition of Modified EBITDA and reconciliations of Modified EBITDA to net income, which is the most comparable GAAP measure for operating performance, and Modified EBITDA to net cash provided by operations, which is the most comparable GAAP measure for liquidity.

Liquidity and Capital Resources

Historically, we have generated cash flow from operations consisting primarily of payments received from customers for the provision of business communications services offset by payments to other telecommunications carriers, payments to employees, and payments for interest and other operating, selling, general and administrative expenses. We have also generated cash from debt and equity financing activities and have used these funds and cash flows from operations to service or repay our debt obligations, make capital expenditures to expand our network and fund acquisitions.

On July 3, 2013, we completed the redemption of the Convertible Debentures, resulting in a total use of cash for the year to date through July 3, 2013 of $553.2 million, including $0.5 million of transaction costs, to settle $373.7 million principal amount of the Convertible Debentures. Additionally, we used $227.4 million of cash as of June 30, 2013 to repurchase our common stock under the $300 million repurchase program that our Board of Directors authorized in November 2011. As of August 6, 2013, we completed the entire $300 million of stock repurchases under that program. Accordingly, on August 6, 2013, our Board of Directors authorized a new $500 million multi-year common stock repurchase program (see "Possible Future Uses of Cash" below).

At June 30, 2013, we had approximately $1.6 billion of total debt and capital lease obligations and $614.4 million of cash, cash equivalents and short-term investments compared to approximately $1.8 billion of total debt and capital lease obligations and $974.3 million of cash, cash equivalents and short-term investments at December 31, 2012. Net debt (defined as total debt and capital lease obligations less cash, cash equivalents and short-term investments) increased $246.4 million from December 31, 2012 to June 30, 2013 primarily due to repurchases of our common stock, capital expenditures, reacquisition of the equity component of the Convertible Debentures upon retirement and the net impact of the Term Loan refinancing, partially offset by cash provided by operating activities resulting from higher Modified EBITDA and net proceeds from employee stock option exercises.

Working capital, defined as current assets less current liabilities, was $330.2 million as of June 30, 2013, a decrease of $176.0 million from December 31, 2012. The decrease in working capital is primarily a result of repurchases of our common stock, capital spending and the reacquisition of the equity component of the Convertible Debentures upon retirement, somewhat offset by cash provided by operations, net proceeds from the Term Loan refinancing and net proceeds from employee stock option exercises. Our working capital ratio, defined as current assets divided by current liabilities, was 1.66 as of June 30, 2013 compared to 1.76 as of December 31, 2012.

Cash Flow Activity

Cash and cash equivalents were $420.3 million and $387.7 million as of June 30, 2013 and 2012, respectively. In addition, we had investments of $194.2 million and $144.0 million as of June 30, 2013 and 2012, respectively, which were short-term in nature and generally available to fund our operations. The change in cash and cash equivalents during the periods presented was as follows:

	Six Months Ended June 30,
	2013			2012
	(amounts in thousands)
Cash provided by operating activities	$	206,560		$	208,599
Cash used in investing activities	(220,456		)	(165,628		)
Cash used in financing activities	(372,567		)	(8,687		)
Decrease in cash and cash equivalents	$	(386,463	)	$	34,284

Operations. The decrease in cash provided by operating activities in the six months ended June 30,2013 compared to the six months ended June 30,2012 primarily related to changes in working capital, which were largely due to higher interest payments and the timing of collection of receivables and payments to vendors, somewhat offset by higher Modified EBITDA.

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Investing. The change in cash used in investing activities in the six months ended June 30,2013 compared to the six months ended June 30,2012 was primarily a result of the net increase in cash used for the purchase and sale of investments in 2013 in addition to higher capital expenditures in 2013. Our balances of cash, cash equivalents and investments fluctuate over time based on our cash requirements and market interest yields. Cash used for capital expenditures for the six months ended June 30,2013 was $187.5 million, the majority of which was for success-based spending initiatives (see "Capital Expenditures and Requirements" below) compared to $157.6 million for the six months ended June 30,2012.

Financing. Cash used in financing activities for the six months ended June 30,2013 primarily consisted of repurchases and settlements of conversions of Convertible Debentures of $256.3 million (including $0.5 million of transaction costs), repurchases of $197.3 million of our common stock, withholding taxes paid by us on behalf of employees in net share settlements of restricted stock of $18.3 million and payments of $2.1 million on the Term Loan and capital lease obligations, partially offset by proceeds of $50.9 million from exercises of stock options and net proceeds of $49.7 million from the Term Loan refinancing. Cash used in financing activities for the six months ended June 30,2012 primarily consisted of repurchases of $11.5 million of our common stock, withholding taxes paid by us on behalf of employees in net share settlements of restricted stock of $10.0 million and payments of $3.7 million on the Term Loan and capital lease obligations, partially offset by proceeds of $15.8 million from exercises of stock options.

In April 2013, we refinanced our outstanding $461.8 million term loan due December 2016 and replaced an undrawn $80 million revolving credit facility expiring December 2014 with a new senior secured credit facility consisting of a $520 million Term Loan due April 2020 and an undrawn $100 million Revolver expiring April 2018. Interest and payments on the Term Loan and Revolver, if drawn, are as follows:

•Repayments of the Term Loan are due quarterly in an amount equal to 1/4 of 1% of the aggregate principal amount on the last day of each quarter commencing September 30, 2013. Interest on the Term Loan is computed based on a specified Eurodollar rate plus 2.5%. Interest is reset periodically and payable at least quarterly. Based on the Eurodollar rate in effect at June 30, 2013, the effective interest rate was 2.70%.

•Interest on outstanding amounts under the Revolver, if any, will be computed based on a specified Eurodollar rate plus 1.75%-2.75% and will be reset periodically and payable quarterly. The Company is required to pay a commitment fee on the undrawn commitment amounts on a quarterly basis of 0.375%-0.5% per annum. The new senior secured credit facility contains customary affirmative and negative covenants. Most of the Revolver covenants apply whether or not we draw on that facility. In addition, if the Revolver were drawn, certain financial maintenance covenants would apply.

During the six months ended June 30, 2013, we settled in cash $177.2 million principal amount of the $373.7 million outstanding principal amount of Convertible Debentures as of December 31, 2012 for $255.8 million as a result of our repurchases and conversions by holders of the Convertible Debentures. On July 3, 2013, we settled the remaining $196.5 million principal amount of the Convertible Debentures for approximately $296.9 million in cash as a result of conversions by holders of the Convertible Debentures. We also used $0.5 million in cash for transaction costs associated with the retirement of the Convertible Debentures.

As of June 30, 2013 and after giving effect to the retirement of the remaining outstanding Convertible Debentures on July 3, 2013, we had the following indebtedness outstanding or available:

Instrument	Principal Amount Outstanding		Aggregate Annual Estimated  Interest Payments
	(amounts in thousands)
8% Senior Notes due 2018	$	430,000	$	34,400
Term Loan, Eurodollar rate + 2.5% due 2020 (1)	520,000		14,040
5 3/8% Senior Notes due 2022	480,000		25,800
Undrawn $100 million Revolver expires 2018 (2)	—		—

⁽¹⁾  The aggregate annual estimated interest payments are based on the principal amount outstanding and the effective interest rate of 2.70% at June 30, 2013.

⁽²⁾  Interest on outstanding amounts, if any, will be computed on a specified Eurodollar rate plus 1.75%-2.75% and will be reset periodically. We are required to pay a commitment fee on the undrawn commitment amounts on a quarterly basis of 0.375%-0.5% per annum.

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The following diagram summarizes our corporate structure in relation to our outstanding indebtedness and credit facility, including our undrawn revolver, as of June 30, 2013 and after giving effect to the retirement of the remaining outstanding Convertible Debentures on July 3, 2013, which is not reflected on the condensed consolidated balance sheet as of June 30, 2013. The diagram does not depict all aspects of the ownership structure among the operating and holding entities, but rather summarizes the significant elements relative to our debt in order to provide a basic overview.

a TWTC and substantially all of these subsidiaries guarantee the 2018 and 2022 Notes on an unsecured basis and the Revolver and the Term Loan on a secured basis.

b The assets and equity interests of these subsidiaries are pledged to secure the Revolver and the Term Loan.

c The Term Loan matures in April 2020. The principal amount is reduced by quarterly principal payments.

Capital Expenditures and Requirements

Our total capital expenditures were $191.8 million for the six months ended June 30,2013 compared to $159.9 million for the same period in 2012, with the majority of capital expenditures in each period for what we deem success-based opportunities that were linked to new installations and capacity requirements. Success-based spending generally consists of short-to-medium length capital projects, in terms of anticipated time between capital spending and return on investment, driven by customer opportunities. The increase in capital expenditures over the prior year period primarily resulted from higher success-based spending for building entries and network capacity as well as an increase in investments to support our new service development and other technology initiatives.

In each of the years ended 2005 through 2012, over 75% of our total annual capital expenditures, excluding capital expenditures for integration and branding, were for success-based opportunities. This includes costs to connect to new customer locations with our fiber network and increase capacity in our network, IP backbone enhancements, collocation facility expansion and central office infrastructure to serve growing customer demands. These types of expenditures often fluctuate as our volume of sales and service installations increases or decreases.

For the full year 2013, we expect total capital expenditures of approximately $370 million to $380 million (see “Capital Resources” below for discussion of anticipated funding sources). We expect the majority of this amount to be related to success-based opportunities and the balance to be primarily for investments in new service development, other technology initiatives and network expansion. Included in our expected capital expenditures are amounts we must spend to replace older network components, especially electronics, that we expect will continue to grow over time. We expect quarterly fluctuations in our capital spending due to the timing of large projects and other external factors such as customer readiness, permitting and weather. We generally do not make long-term commitments for capital expenditures and have the ability to adjust our capital expenditures if our cash from operations is lower than anticipated or in response to a change in demand.

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Capital Resources

Based on current assumptions, we expect to generate sufficient cash from operations along with available cash on hand (including cash equivalents and investments) and borrowing capacity under our undrawn Revolver to provide sufficient funds to meet our expected capital expenditure and liquidity needs to operate our business and service our debt for the foreseeable future. However, if our assumptions prove incorrect or if there are other factors that negatively affect our cash position such as material unanticipated losses, a significant reduction in demand for our services, an acceleration of customer disconnections, or other adverse factors, or if we make acquisitions, enter into joint ventures or repurchase additional shares of our common stock, we may need to seek additional sources of funds through financing or other means. There is no assurance that other sources of financing on acceptable terms will be available in the future. Other risks, such as a rating downgrade on our debt or adverse debt market conditions, could further impact our potential access to or the cost of financing sources.

Our ability to draw upon the available commitments under our Revolver is subject to compliance with all of the covenants contained in the credit agreement and our continued ability to make certain representations and warranties. In the case of the Revolver, the covenants include financial maintenance covenants, such as leverage and interest coverage ratios and limitations on capital expenditures that are primarily derived from Modified EBITDA and debt levels. We are required to comply with these ratios as a condition to any borrowing under the Revolver and for as long as any loans are outstanding under the Revolver. The representations and warranties include the absence of liens on our properties other than certain permitted liens, the absence of litigation or other developments that have or could reasonably be expected to have a material adverse effect on us and our subsidiaries as a whole, and continued effectiveness of the documents granting security for the loans.

A lack of revenue growth or an inability to control costs could negatively impact Modified EBITDA and cause our failure to meet the required minimum ratios under the Revolver if we have loans outstanding under the Revolver or wish to draw on it. Although we currently believe that we will continue to be in compliance with the covenants, various factors, including deterioration of the economy, increased competition and pricing pressure and loss of revenue from significant customers, an acceleration of customer disconnections, a significant reduction in demand for our products without adequate reductions in capital expenditures and operating expenses or an uninsured catastrophic loss of physical assets or other risk factors could cause us to fail to meet our covenants. If our revenue growth is not sufficient to sustain the Modified EBITDA performance required to meet the debt covenants described above, and we have loans outstanding under the Revolver or wish to draw on it, we would have to consider cost cutting or other measures to maintain required Modified EBITDA levels or to enhance liquidity.

The Revolver, Term Loan, 2018 Notes and 2022 Notes limit our ability to declare cash dividends, incur indebtedness, incur liens on property and undertake acquisitions, among other things. The Revolver, Term Loan, 2018 Notes and 2022 Notes also include cross default provisions under which we are deemed to be in default if we default under any of the other material outstanding obligations. If we are in default under any of the covenants under the Term Loan and Revolver, we also could potentially be subject to an acceleration of the repayment date of the Term Loan and the Revolver if we have borrowed under that facility. Covenant defaults under the credit agreement for the Revolver and Term Loan also may constitute an event of default under the indenture for the 2018 Notes and 2022 Notes. In addition, the lenders under the Revolver may require prepayment of outstanding revolving loans if a change of control and ratings decline occurs as defined in the credit agreement. We are required to offer to prepay the 2018 Notes, 2022 Notes and the Term Loan on an individual basis if a change of control and a debt rating decline occur as defined in the indenture for the 2018 Notes, 2022 Notes and the Term Loan agreement. If we do not comply with the covenants under the Revolver, we would not be able to draw funds under the Revolver, outstanding revolving loans could be accelerated or the lenders could cancel the Revolver unless the respective lenders agree to further modify the covenants. As of June 30, 2013, we were in compliance with all of our debt covenants.

Possible Future Uses of Cash. In order to reduce future cash interest payments, as well as future amounts due at maturity or mandatory redemption and reduce our leverage, we or our affiliates may, from time to time, enter into interest rate swap agreements or purchase or redeem our outstanding 2018 Notes or 2022 Notes for cash in the open market or privately negotiated transactions or engage in other transactions to reduce the principal amount of outstanding 2018 Notes or 2022 Notes. Under the terms of our Revolver (as amended in April 2013), which is more restrictive than our Term Loan and the indenture for the 2018 Notes and 2022 Notes, we currently may repurchase a portion of our 2018 Notes or 2022 Notes if the sum of our cash and equivalents and availability under our Revolver is a minimum of $200 million after giving effect to the repurchase, we do not use the Revolver proceeds for this purpose and we meet certain other conditions.

In November 2011, our Board of Directors authorized a multi-year repurchase program of up to $300 million of our common stock, of which approximately $227.4 million was repurchased as of June 30, 2013. We repurchased an additional $72.6 million of our common stock subsequent to June 30, 2013 through August 6, 2013 for a total of $278.0 million repurchased year to date through August 6, 2013, completing the $300 million share repurchase program. On August 6, 2013, our Board of Directors authorized a new $500 million multi-year common stock repurchase program. This authorization does not have an expiration date, but can be withdrawn by the Board at any time. Our Revolver, as amended in April 2013, permits

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repurchases of our common stock up to $250 million from April 17, 2013 to December 31, 2013, and thereafter $250 million annually in the aggregate if after the transaction the sum of our cash and cash equivalents and availability under our Revolver is a minimum of $200 million, we have not used that basket for other permissible purposes, including dividend payments, and we meet certain other conditions. Up to $100 million of this permitted amount that remains unused in any fiscal year may be carried over and used in the immediately succeeding calendar year for permissible purposes. This test under the Revolver is more restrictive than our other debt agreements. For the full year 2013, the Revolver covenants permitted a maximum amount of $331.5 million in share repurchases, of which $53.5 million remained unused as of August 6, 2013.

We may consider repurchasing additional shares of our common stock in public or private transactions or may consider paying dividends to the extent permitted by our debt covenants. We may also consider merger and acquisition opportunities that could impact our cash usage. Additionally, we may increase our leverage for these purposes. We will evaluate any such transactions in light of market conditions, taking into account our liquidity and prospects for access to capital, benefits to us of any such transaction and contractual constraints. After giving pro forma effect to the common stock repurchases and settlement of the Convertible Debentures that occurred after June 30, 2013, cash, cash equivalents and short-term investments totaled $245 million. We generally expect to maintain approximately $300 million in cash, cash equivalents and short-term investments in order to provide ongoing liquidity and flexibility for other operating and strategic initiatives. The actual balance of cash, cash equivalents and short-term investments will depend on the timing of collections, disbursements, our business operations in general and any financing activities we may undertake and may fluctuate from quarter to quarter.

Risk Management. As of June 30, 2013, our cash, cash equivalents and short-term investments were held in financial institutions, prime money market mutual funds, U.S. Treasury money market mutual funds, certificates of deposit, commercial paper and debt securities issued by the U.S. Treasury and other U.S. government agencies. Although we actively monitor the depository institutions and the performance and quality of our investments and the mutual funds that hold our cash and cash equivalents, we are exposed to risks resulting from deterioration in the financial condition or failure of financial institutions holding our cash deposits, decisions of our investment advisors and the investment managers of the money market funds and defaults in securities underlying the funds and investments. We prioritize safety over investment return in choosing the investment vehicles for cash, cash equivalents and investments and have diversified these investments to the extent practical in an effort to minimize our exposure to any one investment vehicle or financial institution. We may change the nature of our cash, cash equivalent and short-term investments as market conditions change.

Off-Balance Sheet Arrangements. As of June 30, 2013, we did not have any off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of SEC Regulation S-K.

Commitments. Our long-term commitments have not materially changed from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2012, except for the increase in the principal amount of our Term Loan to $520 million, the extension of the maturity date for the Term Loan to April 2020 and retirement of the outstanding $373.7 million principal amount of our Convertible Debentures.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

For quantitative and qualitative disclosures about market risk, see Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in our Annual Report on Form 10-K for the year ended December 31, 2012. Our exposures to market risk have not changed materially since December 31, 2012.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 as of June 30, 2013 and concluded that our disclosure controls and procedures were effective as of that date. Management recognizes that any disclosure controls and procedures, no matter how well designed and operated, can only provide reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

There were no changes in our internal control over financial reporting that occurred during the three months ended June 30,2013 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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tw telecom inc.

Part II. Other Information

Item 1. Legal Proceedings

We are party to various claims and legal and regulatory proceedings in the ordinary course of business. We do not believe that these claims or proceedings, individually or in the aggregate, are material or will have a material adverse effect on our business, financial condition or results of operations.

Item 1A. Risk Factors

There have been no material changes to the risk factors contained in our Annual Report on Form 10-K for the year ended December 31, 2012, except for the following:

Claims of infringement of intellectual property and proprietary rights of others, primarily involving patent infringement claims, could prevent us from using technology necessary to provide services or subject us to expensive intellectual property litigation or monetary penalties, which could have an adverse effect on our business, financial condition or results of operations.

Some of our services use intellectual property that we have developed. Our network, services and back office also use equipment and software that we purchase or license from suppliers, which use their intellectual property. As is common in our industry, we and some of our suppliers have received, and may receive in the future, assertions and claims from third parties that the products or software that we or our suppliers use infringe on the patents or other intellectual property rights of these third parties. If technology that we use in the provision of our services were determined by a court to infringe a patent or other intellectual property right held by another party, we could be precluded from using that technology, be required to pay significant monetary damages or be required to pay significant royalties to such party to continue to use such technology in the future. We may have to incur substantial attorneys' fees and costs defending claims that may be asserted against us. 

Any litigation to determine the validity of claims that our services, network or processes infringe intellectual property rights of another, regardless of their merit or resolution, could be costly and divert the effort and attention of our management and technical personnel. Regardless of the merits of any specific claim, we may not prevail in litigation because of the complex technical issues and inherent uncertainties in intellectual property litigation. Although we generally seek to obtain indemnification agreements from vendors that provide us with technology, a claim of infringement may not be indemnified and we may not be able to recover all or any of our losses and costs under any available indemnity agreements. Further, if a claim involves technology that we developed, there may be no indemnification agreement that is applicable. A claim of infringement of intellectual property and proprietary rights of others that prevents us from using technology necessary to provide our services, or subjects us to expensive intellectual property litigation or monetary penalties, could have an adverse effect on our business, financial condition or results of operations.

We could repurchase shares of our common stock at price levels that could prove to be less advantageous than intended.

In November 2011, our Board of Directors authorized a share repurchase program, allowing us to repurchase up to $300 million of our common stock from time to time, using a variety of methods. As of August 6, 2013, we had completed the $300 million repurchase program at an average price per share of $26.84. On August 6, 2013, our Board of Directors authorized a new $500 million share repurchase program. Our new repurchase program does not have an expiration date, but can be withdrawn by our Board at any time. During 2013, we have been active in repurchasing shares of our common stock and may, depending on our capital allocation strategy, market conditions, and other factors, continue to repurchase shares of our common stock as we seek to return value to shareholders. The prices we pay for share repurchases are based on our best judgment of a variety of factors affecting valuation at the time of the repurchase, including, but not limited to, then current market conditions. However, market conditions and other factors outside of our control can change quickly, with the potential to cause the market price of our shares to decrease, possibly significantly. At any time we choose to repurchase our shares, there is a risk that the market price could decrease in the future. If the market price of our shares were to decrease below the average price that we paid to repurchase our shares during a particular period, it may appear in retrospect that the prices previously paid for our shares were disadvantageous, and the repurchases may prove to be a less efficient use of our capital than we originally anticipated.

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tw telecom inc.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table presents our purchases of equity securities reportable during the three months ended June 30,2013:

Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1)
April 1 - April 30, 2013	1,516,437	$	26.38	1,516,437	$	178,028,915
May 1 - May 31, 2013	1,455,561	28.17		1,455,561	137,028,936
June 1 - June 30, 2013	2,276,000	28.32		2,276,000	72,573,963
Total	5,247,998			5,247,998

_______________

^(1).  On November 16, 2011, our Board of Directors authorized a multi-year repurchase program of up to $300 million of our common stock from time to time using a variety of methods, including open market purchases, block trades and privately negotiated transactions. Our open market purchases may be carried out pursuant to a pre-established trading plan under Rule 10b5-1 under the Securities Exchange Act of 1934. The authorization has no time limit, and may be suspended or discontinued at any time. As of June 30, 2013, approximately $72.6 million remained available under the authorization, which was repurchased subsequent to June 30, 2013 through August 6, 2013 completing the $300 million share repurchase program. On August 6, 2013, our Board of Directors authorized a new $500 million multi-year common stock repurchase program. This authorization does not have an expiration date, but can be withdrawn by our Board of Directors at any time.

Item 6. Exhibits

The exhibits listed on the accompanying Exhibit Index are filed or incorporated by reference as part of this report and the Exhibit Index is incorporated herein by reference.

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Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	tw telecom inc.
Date: August 8, 2013	By:	/S/    JILL R. STUART
		Jill R. Stuart Sr. Vice President, Accounting and Finance and Chief Accounting Officer

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EXHIBIT INDEX

Exhibit Number	Description of Exhibit
3.1 –	Restated Certificate of Incorporation of the Company (filed as Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2007)*
3.2 –	Certificate of Amendment to Restated Certificate of Incorporation of the Company (filed as Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2008)*
3.3 –	Amended By-laws of the Company (filed as Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2012)*
4.1 –	Indenture dated March 17, 2010 among tw telecom holdings inc., tw telecom inc., the Subsidiary Guarantors parties thereto and Wells Fargo Bank, National Association, as Trustee for the 8% Senior Notes due 2018 (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated March 17, 2010)*
4.2 –	Indenture, dated as of October 2, 2012, among tw telecom holdings inc., tw telecom inc., the Subsidiary Guarantors parties thereto and Wells Fargo Bank, National Association, as Trustee, for the 5 3/8% Senior Notes due 2022 (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed October 4, 2012)*
4.3 –	Second Amended and Restated Credit Agreement dated as of April 17, 2013, among the Company, tw telecom holdings inc., the Subsidiary Guarantors parties thereto, the lenders parties thereto and Wells Fargo Bank, National Association, as administrative agent (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed April 18, 2013).*
4.4 –	Certification of Designations of Series A Junior Participating Preferred Stock of tw telecom inc. (filed as Exhibit 4.6 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009)*
4.5 –	Indenture dated March 29, 2006, between Time Warner Telecom Inc. and Wells Fargo Bank, National Association, as Trustee (filed as Exhibit 4.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006)*
4.6 –	First Supplemental Indenture dated March 29, 2006 between Time Warner Telecom Inc. and Wells Fargo Bank, National Association, creating 2.375% Convertible Senior Debentures due 2026 (filed as Exhibit 4.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006)*
10.1 –	Amended and Restated Employment Agreement, dated June 18, 2013, between the Company and Tina Davis
10.2 –	Second Amended and Restated Change of Control Employment Agreement, dated June 18, 2013, between the Company and Tina Davis
31.1 –	Certification of Chief Executive Officer pursuant to Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2 –	Certification of Chief Financial Officer pursuant to Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1 –	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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Exhibit Number	Description of Exhibit
32.2 –	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS –	XBRL Instance Document
101.SCH –	XBRL Taxonomy Extension Schema Document
101.CAL –	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF –	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB –	XBRL Taxonomy Extension Label Linkbase Document
101.PRE –	XBRL Taxonomy Extension Presentation Linkbase Document

* Incorporated by reference.

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EX-10.1

Exhibit 10.1

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

AMENDED AND RESTATED EMPLOYMENT AGREEMENT by and between tw telecom holdings inc., (the “Company”) and Tina Davis (the “Employee”), dated as of June 18, 2013 (the “Effective Date”);

WHEREAS, the Company and the Employee are party to an Employment Agreement (the “Prior Agreement”), dated as of September 1, 2007

WHEREAS, the Company desirous of continuing to employ the Employee and to change her position to Senior Vice President and General Counsel on the terms and conditions, and for the consideration, set forth in this Agreement, and the Employee is desirous of being employed by the Company on such terms and conditions and for such consideration;

NOW, THEREFORE, , the Prior Agreement is hereby amended and restated as if the date first written above as follows:

1.Term.

(a)Employment Period. The Company hereby agrees to continue to employ the Employee, and the Employee hereby agrees to continue to serve the Company, subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the three year anniversary thereof (the “Employment Period”); providedthat, on such three year anniversary of the Effective Date and each two-year anniversary of such date thereafter (such date and each annual anniversary thereof, the “Renewal Date”), unless previously terminated in accordance with the provisions of Section 3 hereof, the Employment Period shall be automatically extended so as to terminate two years from such Renewal Date, unless, at least sixty (60) days prior to the Renewal Date, the Company shall give notice to the Employee that the Employment Period shall not be so extended.

(b)Change of Control Employment Agreement. The Employee and the Company acknowledge that they have also entered into an Amended and Restated Change of Control Employment Agreement (“COC Agreement”) of even date herewith. Upon the occurrence of the Effective Date as defined in the COC Agreement, this Agreement will terminate and will be superseded by the COC Agreement, except that such termination will not relieve the Company of its obligation to pay any amount earned and payable prior to the termination of this Agreement.

2.Terms of Employment. (a) Position and Duties. (i) During the Employment Period, the Employee shall serve as Senior Vice President and, General Counselor in such other position as the Company shall determine, and will perform such duties and responsibilities as may be assigned to the Employee from time to time by the Company, and shall perform his or her services at the headquarters of the Company in the Denver, Colorado area, and shall travel for business purposes to the extent necessary or appropriate in the performance of such services.

(ii)During the Employment Period, and excluding any periods of vacation and sick leave to which the Employee is entitled, the Employee agrees to devote substantially all of his or her attention and time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Employee hereunder, to use the Employee’s reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period, it shall not be a violation of this Agreement for the Employee to serve on corporate, civic or charitable boards or committees, deliver lectures, fulfill speaking engagements or teach at educational institutions and manage personal investments, so long as such activities do not significantly interfere with the performance of the Employee’s responsibilities as an employee of the Company in accordance with this Agreement and the Employee complies with applicable provisions of the Company’s Code of Conduct and Code of Ethics.

(b)Compensation (i) Base Salary. During the Employment Period, the Employee shall receive an annual base salary (“Annual Base Salary”) of $265,000 payable at such intervals as the Company pays executive salaries generally. The Employee’s Annual Base Salary shall be reviewed at least annually by the Compensation Committee of the Board (the “Compensation Committee”) pursuant to its normal performance review policies for senior executives. Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation to the Employee under this Agreement. The Annual Base Salary shall not be reduced and the term “Annual Base Salary” as utilized in this Agreement shall refer to the Annual Base Salary as increased from time to time.

(ii)Annual Bonus. In addition to the Annual Base Salary, the Employee shall be eligible to be awarded, for each fiscal year of the Company or portion of a fiscal year ending during the Employment Period, an annual bonus (the “Annual Bonus”) pursuant to the terms of the Company’s Annual Incentive Plan, as in effect from time to time, based on a target percentage of the Annual Base Salary paid to the Employee during such fiscal year of 75% (the “Target Bonus”). The Employee acknowledges that his or her actual annual bonus will be at the sole discretion of the Compensation Committee and may vary and range from 0% to 200% of the target amount, depending on actual performance of the Company and the Employee. “Annual Bonus” for any given fiscal year shall mean the amount, if any, of annual bonus earned by the Employee with respect to the applicable fiscal year of the Company, including amounts deferred. Each such Annual Bonus shall be paid no later than 2½ months after the end of the fiscal year for which the Annual Bonus is awarded, unless the Employee shall elect to defer the receipt of such Annual Bonus pursuant to an arrangement that meets the requirements of Section 409A of the Code.

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(iii)Other Benefits. During the Employment Period: (A) the Employee shall be entitled to participate in incentive, savings and retirement plans, practices, policies and programs of the Company to the same extent as provided generally to similarly situated executives of the Company; and (B) the Employee and/or the Employee’s family, as the case may be, shall be eligible for participation in, and shall receive benefits under, welfare benefit plans, practices, policies and programs provided by the Company to the same extent as provided generally to similarly situated executives of the Company. The Company reserves the right to amend or cancel any such plan, practice, policy or program in its sole discretion, subject to the terms of such plan, practice, policy or program and applicable law.

(iv)Expenses. During the Employment Period, the Employee shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Employee in accordance with the Company’s policies.

3.Termination of Employment. (a) Death or Disability. The Employee’s employment shall terminate automatically upon the Employee’s death during the Employment Period. If the Company determines in good faith that the Disability (as defined below) of the Employee has occurred during the Employment Period, it may provide the Employee with written notice in accordance with Section 9(b) of this Agreement of its intention to terminate the Employee’s employment. In such event, the Employee’s employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Employee (the “Disability Effective Date”), provided that, within the thirty (30) days after such receipt, the Employee shall not have returned to full-time performance of the Employee’s duties. For purposes of this Agreement, “Disability” shall mean the absence of the Employee from the Employee’s duties with the Company on a full-time basis for one hundred and eighty (180) consecutive days or one hundred and eighty (180) days within any twelve month period as a result of incapacity due to mental or physical illness.

(b)Cause. The Company may terminate the Employee’s employment during the Employment Period either with or without Cause. For purposes of this Agreement, “Cause” shall mean:

(i)being convicted of, or pleading guilty or nolocontendere to, a charge of commission of a felony or a misdemeanor involving moral turpitude;

(ii)engaging in any theft, misappropriation, embezzlement or similar financial fraud or reckless or willful destruction of the Company’s property, or willful or reckless violation of the Company’s insider trading policy;

(iii)the willful and continued failure of the Employee to perform substantially the Employee’s duties (as contemplated by Section 2(a)) with the Company or its affiliated companies (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Employee by the Board or the Chief Executive Officer of the Company that specifically identifies the manner in which the Board or the Chief Executive Officer of the Company believes that the Employee has not substantially performed the Employee’s duties;

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(iv)the willful or reckless engaging by the Employee in illegal conduct or gross misconduct that is materially injurious to the Company’s business, financial condition or reputation;

(v)any willful or reckless breach of a statutory or common law duty of loyalty to the Company that is materially injurious to the Company’s business, financial condition or reputation;

(vi)any willful and material violation of the Company’s Code of Conduct; or

(vii)any material breach of the Employee’s obligations under this Agreement, including Section 7.

No act, or failure to act, shall be considered “willful” if it is done, or omitted to be done, based upon authority (A) given pursuant to a resolution duly adopted by the Board, (B) upon the instructions of the Chief Executive Officer of the Company or (C) based upon the advice of counsel for the Company. With respect to the conduct described in Sections 3(b)(ii) through 3(b)(vii) above, the Company shall provide the Employee with written notice setting forth the details of any claimed breach and in the case of the conduct described in Section 3(b)(iii) above, the Employee shall have a reasonable period of time (not less than thirty (30) days) to cure such claimed breach.

(c)Notice of Termination. Any termination by the Company for Cause shall be communicated by Notice of Termination (as defined below) to the other party hereto given in accordance with Section 9(b) of this Agreement. For purposes of this Agreement, a “Notice of Termination” shall mean a written notice that (i) indicates the termination provision in this Agreement relied upon and (ii) specifies the termination date (which date shall be not more than thirty (30) days after the giving of such notice) if the Date of Termination (as defined below) is other than the date of receipt of such notice. The failure by the Employee or the Company to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Cause shall not waive any right of the Employee or the Company, respectively, hereunder or preclude the Employee or the Company, respectively, from asserting such fact or circumstance in enforcing the Employee’s or the Company’s rights hereunder.

(d)Date of Termination. “Date of Termination” shall mean (i) if the Employee’s employment is terminated by the Company for Cause, the date of receipt of the Notice of Termination or any later date specified therein (which date shall not be more than thirty (30) days after the giving of such notice), as the case may be, (ii) if the Employee’s employment is terminated by the Company other than for Cause, death or Disability, the Date of Termination shall be the date on which the Company notifies the Employee of such termination, or such later date specified by the Company, (iii) if the Employee’s employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Employee or the Disability Effective Date, as the case may be, and (iv) if the Employee’s employment is terminated by the Employee for any reason, the date on which the Employee notifies the Company of such termination, or such later date as is mutually agreed by the Company and the Employee. Notwithstanding the foregoing, in no event shall the Date of Termination occur until the Employee experiences, and the Company and the Employee shall take all steps necessary (including with regard to any post-termination services by

4

the Employee) to ensure that any termination described in this Section 3 constitutes, a “separation from service” within the meaning of Section 409A of the Code, and notwithstanding anything contained herein to the contrary, the date on which such separation from service takes place shall be the “Date of Termination.”

4.Obligations of the Company upon Termination. (a) Other Than for Cause, Death or Disability. If, during the Employment Period, the Company shall terminate the Employee’s employment other than for Cause, death or Disability:

(i)the Company shall pay to the Employee the following amounts within thirty (30) days after the Date of Termination, or with respect to the amounts set forth in Sections 4(a)(i)(B) and 4(a)(i)(C), if later, within eight (8) days after the Employee’s execution and delivery (without revocation) of a “Waiver and Release” in substantially the form attached hereto as Exhibit A (the “Release”), which Release must be delivered (and not revoked) not later than twenty-one (21) days after the Date of Termination (or such longer period of time permitted by the Company or required by applicable law, but in no event later than the latest business day that is not more than two months after the end of the calendar year in which the Date of Termination occurs) (the “Release Deadline”):

(A)a lump sum in cash equal to the sum of (1) the Employee’s Annual Base Salary and any accrued vacation pay through the Date of Termination, (2) the Employee’s Annual Bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs (other than any portion of such Annual Bonus that was previously deferred, which portion shall instead be paid in accordance with the applicable deferral arrangement and any election thereunder) if such bonus has not been paid as of the Date of Termination, and (3) the Employee’s business expenses that have not been reimbursed by the Company as of the Date of Termination that were incurred by the Employee prior to the Date of Termination in accordance with the applicable Company policy, in the case of each of clauses (1) through (3), to the extent not theretofore paid (the sum of the amounts described in clauses (1) through (3) shall be hereinafter referred to as the “Accrued Obligations”); and

(B)subject to the Employee’s delivery (and non-revocation) of the Release not later than the Release Deadline, a lump sum in cash equal to 1.5 times the sum of (1) the Employee’s Annual Base Salary and (2) the Target Bonus; and

(C)subject to the Employee’s delivery (and non-revocation) of the Release not later than the Release Deadline, a lump sum in cash equal to eighteen (18) months of premiums based on the premium rate charged by the Company as in effect on the Date of Termination for the health care continuation coverage mandated by the Consolidated Omnibus Budget Reconciliation Act for the type of coverage for which the Employee is enrolled as of immediately prior to the Date of Termination less any employee contribution amount that the Employee would have otherwise paid if the Employee were actually employed by the Company or any of its affiliated companies during the eighteen (18) month period immediately following the Date

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of Termination (based on the employee contribution rates as in effect on the Date of Termination);

(ii)the Company shall, at its sole expense as incurred, provide the Employee with outplacement services, the scope and provider of which shall be selected by the Employee in the Employee’s sole discretion, provided that the cost of such outplacement shall not exceed $25,000; and provided, further, that such outplacement benefits shall end not later than one year following the Date of Termination;

(iii)to the extent not theretofore paid or provided, the Company shall timely pay or provide to the Employee any other amounts or benefits required to be paid or provided or that the Employee is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its affiliated companies through the Date of Termination (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”) in accordance with the terms of the underlying plans or agreements.

Notwithstanding the foregoing provisions of Section 4(a)(i), in the event that the Employee is a “specified employee” (within the meaning of Section 409A of the Code and with such classification to be determined in accordance with the methodology established by the applicable employer as in effect on the Date of Termination) (a “Specified Employee”), amounts that constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code that would otherwise be payable under Section 4(a)(i) during the six-month period immediately following the Date of Termination (other than the Accrued Obligations) shall instead be paid, with interest on any delayed payment at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Code (“Interest”) determined as of the Date of Termination, on the first business day after the date that is six months following the Employee’s “separation from service” within the meaning of Section 409A of the Code (the “409A Payment Date”).

(b)Death. If the Employee’s employment is terminated by reason of the Employee’s death during the Employment Period, this Agreement shall terminate without further obligations to the Employee’s legal representatives under this Agreement, other than (i) payment of Accrued Obligations, (ii) the timely payment or provision of Other Benefits in accordance with the terms of the underlying plans or agreements, (iii) an amount equal the product of (x) the Target Bonus and (y) a fraction, the numerator of which is the number of days in the fiscal year in which the Date of Termination occurs through the Date of Termination, and the denominator of which is 365 (the “Pro-rata Bonus”), and (iv) an amount equal to the Employee’s Annual Base Salary that would have otherwise been payable during the period commencing on the Date of Termination and ending on the date thirty (30) days following the Date of Termination (the “Supplemental Salary Payment”). Accrued Obligations, the Pro-rata Bonus and the Supplemental Salary Payment shall be paid to the Employee’s estate or beneficiary, as applicable, in a lump sum in cash within thirty (30) days of the Date of Termination. With respect to the provision of Other Benefits, the term “Other Benefits” as utilized in this Section 4(b) shall include death benefits as in effect on the date of the Employee’s death with respect to similarly situated executives of the Company and its affiliated companies and their beneficiaries.

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(c)Disability. If the Employee’s employment is terminated by reason of the Employee’s Disability during the Employment Period, the Company shall provide the Employee with (i) the Accrued Obligations, (ii) a lump sum cash payment equal to (x) 75% of the amount equal to (A) the sum of the Employee’s Annual Base Salary and Target Bonus, multiplied by (B) 1.5, less (y) an amount equal to the lump sum present value of any disability benefits estimated to be payable to the Employee under any disability plan, policy or program covering the Employee as reasonably determined by the Company and the Company’s disability insurance carrier(s) (the “Disability Lump Sum”) and (iii) the timely payment or delivery of the Other Benefits in accordance with the terms of the underlying plans or agreements, and shall have no other severance obligations under this Agreement. The Accrued Obligations and the Disability Lump Sum shall be paid to the Employee in a lump sum in cash within thirty (30) days of the Date of Termination; provided, that in the event that the Employee is a Specified Employee and if any payment that the Employee becomes entitled to under this Agreement is considered deferred compensation within the meaning of Section 409A of the Code, the Disability Lump Sum shall instead be paid, with Interest, to the Employee on the 409A Payment Date.

(d)Cause; By the Employee. If the Employee’s employment shall be terminated for Cause or the Employee’s employment shall be terminated by the Employee for any reason during the Employment Period, this Agreement shall terminate without further obligations to the Employee other than the obligation to pay to the Employee (i) the Accrued Obligations through the Date of Termination and (ii) Other Benefits in accordance with the terms of the underlying plans or agreements, in each case to the extent theretofore unpaid. Accrued Obligations shall be paid to the Employee in a lump sum in cash within thirty (30) days of the Date of Termination.

5.Non-exclusivity of Rights. Except as specifically provided, nothing in this Agreement shall prevent or limit the Employee’s continuing or future participation in any plan, program, policy or practice provided by the Company or any of its affiliated companies and for which the Employee qualifies pursuant to its terms, nor shall anything herein limit or otherwise affect such rights as the Employee may have under any contract or agreement with the Company or any of its affiliated companies. Amounts that are vested benefits or that the Employee is otherwise entitled to receive pursuant to the terms of any plan, program, policy or practice of or any contract or agreement with the Company or any of its affiliated companies at or subsequent to the Date of Termination shall be payable in accordance with such plan, program, policy or practice or contract or agreement except as explicitly modified by this Agreement.

6.No Mitigation; Legal Fees. In no event shall the Employee be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Employee under any of the provisions of this Agreement and such amounts shall not be reduced, regardless of whether the Employee obtains other employment. In the event that the Employee prevails on substantially all material issues in any contest by the Company, the Employee or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Employee about the amount of any payment pursuant to this Agreement) (each, a “Contest”), the Company agrees to pay, to the full extent permitted by law, all legal fees and expenses that the Employee may reasonably incur as a result of any Contest, plus, in each case, Interest, provided, that the Employee shall have

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submitted an invoice for such fees and expenses not later than thirty (30) days after the final resolution of such Contest, and the Company shall make such payment within ten (10) days following the Company’s receipt of an invoice from the Employee, but in no event later than 2½ months after the end of the calendar year in which such Contest is finally resolved.

7.Restrictive Covenants. (a) Confidential Information. The Employee shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company or any of its affiliated companies, and their respective businesses, that shall have been obtained by the Employee during the Employee’s employment by the Company or any of its affiliated companies and that shall not be or become public knowledge (other than by acts by the Employee or representatives of the Employee in violation of this Agreement). After termination of the Employee’s employment with the Company, the Employee shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company and those designated by it.

(b)Non-competition. During the period commencing on the Effective Date and ending on the 18-month anniversary of the Date of Termination (the “Covenant Period”), the Employee shall not, directly or indirectly or through another, be or become an officer, director, partner or employee of or consultant to or act in any managerial capacity with or own any equity interest in any Competitive Business Entity (as defined below); provided, however, that ownership of less than one percent (1%) of the outstanding equity securities of any entity listed on any national securities exchange or traded on the National Association of Securities Dealers Automated Quotation System shall not be prohibited hereby. A “Competitive Business Entity” is any Incumbent Local Exchange Carrier (as defined in the Telecommunications Act of 1996), emerging telecommunications provider or cable television or communication company that competes with the Company in the provision of voice, data , Internet or other services to customers in any state of the United States in which, as of the Date of Termination, the Company or its controlled affiliates engages or has publicly announced definitive plans to engage, in the ownership, operation or management of such a business.

(c)Non-solicitation of Employees. During the Covenant Period, the Employee shall not, directly or indirectly, (i) induce or attempt to induce any employee of the Company to leave the employ of the Company or in any way interfere with the relationship between the Company, on the one hand, and any employee thereof, on the other hand, (ii) hire any person who was an employee of the Company until six (6) months after such individual’s employment relationship with the Company has been terminated or (iii) induce or attempt to induce any customer, supplier, licensee or other business relation of the Company to cease doing business with the Company, or in any way interfere with the relationship between any such customer, supplier, licensee or business relation, on the one hand, and the Company, on the other hand; provided that solicitations incidental to general advertising or other general solicitations in the ordinary course not specifically targeted at such persons and employment of any person not otherwise solicited in violation hereof shall not be considered a violation of this Section 7(c).

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(d)Prior Notice Required. The Employee hereby agrees that, prior to accepting employment with any other person or entity during the Covenant Period, the Employee will provide such prospective employer with written notice of the provisions of this Agreement, with a copy of such notice delivered simultaneously to the General Counsel of the Company.

(e)     Documents; Conduct. The Employee hereby expressly covenants and agrees that:

(i)    following termination of the Employee’s employment with the Company for any reason or at any time upon the Company’s request, the Employee will promptly return to the Company all property of the Company in his or her possession or control (whether maintained at his or her office, home or elsewhere), including, without limitation, all copies of all management studies, business or strategic plans, budgets, notebooks and other printed, typed or written materials, documents, diaries, calendars and data of or relating to the Company or its personnel or affairs; and

(ii)    the Employee will not at any time publicly denigrate, ridicule or intentionally criticize the Company or any of its products, properties, employees, officers or directors, including, without limitation, by way of news interviews, or the expression of personal views, opinions or judgments to the news media; provided, however, nothing in this Section 7(e)(ii) shall prevent the Employee from making any truthful statement to the extent (A) necessary with respect to any Contest involving this Agreement or (B) required by law, subpoena or by any court, arbitrator, mediator or administrative or legislative body (including any committee thereof) with jurisdiction to order such person to disclose or make accessible such information.

(f)    Employee Covenants Generally.

(i)The Employee’s covenants as set forth in this Section 7 are from time to time referred to herein as the “Employee Covenants.” If any of the Employee Covenants is finally held to be invalid, illegal or unenforceable (whether in whole or in part), such Employee Covenant shall be deemed modified to the extent, but only to the extent, of such invalidity, illegality or unenforceability and the remaining Employee Covenants shall not be affected thereby; provided, however, that if any of the Employee Covenants is finally held to be invalid, illegal or unenforceable because it exceeds the maximum scope determined to be acceptable to permit such provision to be enforceable, such Employee Covenant will be deemed to be modified to the minimum extent necessary to modify such scope in order to make such provision enforceable hereunder.

(ii)The Employee understands that the foregoing restrictions may limit his or her ability to earn a livelihood in a business similar to the business of the Company and its controlled affiliates, but the Employee nevertheless believes that he or she has received and will receive sufficient consideration and other benefits as an employee of the Company and as otherwise provided hereunder to clearly justify such restrictions which, in any event (given his or her education, skills and ability), the Employee does not believe would prevent him or her from otherwise earning a living. The Employee has carefully

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considered the nature and extent of the restrictions place upon him or her by this Section 7, and hereby acknowledges and agrees that the same are reasonable in time and territory and do not confer a benefit upon the Company disproportionate to the detriment of the Employee.

(g)    Enforcement. Because the Employee’s services are unique and because the Employee has access to confidential information, the parties hereto agree that money damages would be an inadequate remedy for any breach of this Section 7. Therefore, in the event of a breach or threatened breach of this Section 7, the Company or its respective successors or assigns may, in addition to other rights and remedies existing in their favor at law or in equity, apply to any court of competent jurisdiction for specific performance and/or injunction relief in order to enforce, or prevent any violations of, the provision hereof (without posting a bond or other security) or require the Employee to account for and pay over to the Company all compensation, profits, moneys, accruals or other benefits derived from or received as a result of any transactions constituting a breach of the covenants contained herein, if and when final judgment of a court of competent jurisdiction is so entered against the Employee.

(h)     Interpretation. For purposes of this Section 7, references to “the Company” shall mean the Company as hereinbefore defined and any of its controlled affiliated companies.

8.Successors. (a) This Agreement is personal to the Employee and without the prior written consent of the Company shall not be assignable by the Employee otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Employee’s legal representatives.

(b)This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.

(c)The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law or otherwise. As used in this Agreement, the term “affiliated companies” shall include any company controlled by, controlling or under common control with the Company.

9.Miscellaneous. (a) This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

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(b)All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Employee: At the most recent address
on file at the Company.

If to the Company: tw telecom holdings inc.10475 Park Meadows Drive

Littleton, Colorado 80124
Attention: General CounselFacsimile: (303) 566-1011

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.

(c)    The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d)    The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e)    The Employee’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Employee or the Company may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

(f)    Any provision of this Agreement that by its terms continues after the expiration of the Employment Period or the termination of the Employee’s employment shall survive in accordance with its terms.

(g)    The Agreement is intended to comply with the requirements of Section 409A of the Code or an exemption or exclusion therefrom and shall in all respects be administered in accordance with Section 409A of the Code. Each payment under this Agreement shall be treated as a separate payment for purposes of Section 409A of the Code. In no event may the Employee, directly or indirectly, designate the calendar year of any payment to be made under this Agreement. If the Employee dies following the Date of Termination and prior to the payment of the any amounts delayed on account of Section 409A of the Code, such amounts shall be paid to the personal representative of the Employee’s estate within thirty (30) days after the date of the Employee’s death. All reimbursements and in-kind benefits provided under this Agreement that constitute deferred compensation within the meaning of Section 409A of the Code shall be made or provided in accordance with the requirements of Section 409A of the Code, including, without limitation, that (i) in no event shall reimbursements by the Company under this Agreement be made later than the end of the calendar year next following the calendar year in which the applicable fees and expenses were incurred, provided, that the Employee shall have submitted an invoice for such

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fees and expenses at least ten (10) days before the end of the calendar year next following the calendar year in which such fees and expenses were incurred; (ii) the amount of in-kind benefits that the Company is obligated to pay or provide in any given calendar year shall not affect the in-kind benefits that the Company is obligated to pay or provide in any other calendar year; (iii) the Employee’s right to have the Company pay or provide such reimbursements and in-kind benefits may not be liquidated or exchanged for any other benefit; and (iv) in no event shall the Company’s obligations to make such reimbursements or to provide such in-kind benefits that constitute deferred compensation apply later than the Employee’s remaining lifetime (or if longer, through the 20th anniversary of the Effective Date). Within the time period permitted by the applicable Treasury Regulations, the Company may, in consultation with the Employee, modify the Agreement in order to cause the provisions of the Agreement to comply with the requirements of Section 409A of the Code, so as to avoid the imposition of taxes and penalties on the Employee pursuant to Section 409A of the Code, while not substantially reducing the aggregate value to the Employee of the payments and benefits to, or otherwise adversely affecting the rights of, the Employee under this Agreement.

(h) This Agreement supersedes and replaces in whole the Prior Agreement between the Company and the Employee, and the Prior Agreement shall be of no further force and effect as of the date first written above.

IN WITNESS WHEREOF, the Employee has hereunto set the Employee’s hand and, pursuant to the authorization from its Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.

TINA DAVIS

/s/ Tina Davis    

tw telecom holdings inc.

By: /s/ Larissa Herda    Name: Larissa Herda
Title: Chairman, Chief Executive Officer and

President

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EXHIBIT A

RELEASE

Pursuant to the terms of the Amended and Restated Employment Agreement made effective as of June __, 2013 between tw telecom holdings inc. (the “Company”) and any successor and the undersigned (the “Agreement”), and in consideration of the payments made to me and other benefits to be received by me pursuant thereto, _____________________, being of lawful age, do hereby release and forever discharge the Company and its respective officers, shareholders, subsidiaries, agents, and employees, from any and all actions, causes of action, claims, or demands for general, special or punitive damages, attorneys’ fees, expenses, or other compensation, which in any way relate to or arise out of my employment with the Company or the termination of such employment, which I may now or hereafter have, including without limitation, any alleged violation of: Title VII of the Civil Rights Act of 1964, as amended; Sections 1981 through 1988 of Title 42 of the United States Code, as amended; The Employee Retirement Income Security Act of 1974, as amended (except for any vested benefits under any tax qualified benefit plan); The Immigration Reform and Control Act, as amended; The Americans With Disabilities Act of 1990, as amended; The Age Discrimination in Employment Act of 1967, as amended; The Workers Adjustment and Retraining Notification Act, as amended; The Fair Credit Reporting Act, as amended; The Occupational Safety and Health Act, as amended; The Colorado Anti-Discrimination Act – Colo. Rev. Stat. §24-34-301 et seq., as amended; The Colorado Equal Pay Law – Colo. Rev. Stat. §8-5-101 et seq., as amended; The Colorado Adoptive Parents Leave Act – Colo. Rev. Stat. §19-5-211, as amended; The Colorado Testimony Protection – Colo. Rev. Stat. §8-2.5-101, as amended; The Colorado Civil Rights Commissions’ Regulations – 3 CCR 708-1, as amended; The Colorado Wage Payment and Work Hour Laws; the Colorado Whistleblower Protection Law – Colo. Rev. Stat. §22-114-101 et seq., as amended; any other federal, state or local civil or human rights law or any other local, state or federal law, regulation, order or ordinance; any public policy, any Employer policy, plan, practice or arrangement, all common law rights and claims, such as a breach of contract (express or implied, oral or written), tort (negligent or intentional), wrongful discharge, promissory estoppel, and any claim for fraud, omission or misrepresentation, or any allegation for costs, fees,

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or other expenses including attorneys' fees incurred in these matters, through and including the date of this release, provided, however, that the execution of this Release shall not prevent the undersigned from bringing a lawsuit against the Company to enforce its obligations under the Agreement or to seek damages for the breach of the Agreement by the Company.

I AGREE THAT BY SIGNING THIS RELEASE I AM GIVING UP THE RIGHT TO SUE THE COMPANY FOR AGE DISCRIMINATION UNDER STATE AND FEDERAL LAWS, INCLUDING THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967 (ADEA). I HAVE BEEN ADVISED THAT I HAVE TWENTY-ONE (21) CALENDAR DAYS (OR SUCH LONGER TIME AS MAY BE REQUIRED BY APPLICABLE LAW) TO CONSIDER THIS RELEASE. I HAVE ALSO BEEN ADVISED TO CONSULT WITH AN ATTORNEY PRIOR TO MY SIGNING OF THIS RELEASE. I MAY RETURN THE RELEASE PRIOR TO THE EXPIRATION OF THE 21-DAY PERIOD BUT I AGREE THAT I HAVE NOT BEEN REQUIRED TO DO SO AND THAT I HAVE BEEN INFORMED OF MY RIGHT TO TAKE THE ENTIRE 21 DAYS (OR SUCH LONGER TIME AS MAY BE REQUIRED BY APPLICABLE LAW) TO CONSIDER THE RELEASE. I AGREE THAT ANY MODIFICATIONS, MATERIAL OR OTHERWISE, MADE TO THIS RELEASE DO NOT RESTART OR AFFECT IN ANY MANNER THE ORIGINAL TWENTY-ONE (21) CALENDAR DAY CONSIDERATION PERIOD (OR SUCH LONGER TIME AS MAY BE REQUIRED BY APPLICABLE LAW).

I agree that after I have signed and delivered this Release to the Company, this Release will not be effective or enforceable until the end of a seven-day revocation period beginning on the day that I deliver this Release to the Company. During this seven-day period, I may revoke this Release, without reason and in my sole judgment, but I may do so only by delivering a written statement of revocation to the Company. I understand that any revocation must be delivered personally or sent by registered or certified mail, postage prepaid, to Tina Davis, Sr. Vice President and Deputy General Counsel, Time Warner Telecom Inc., 10475 Park Meadows Drive, Littleton,

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CO 80124, or any other individual designated in writing by Company as authorized to receive the revocation. If the Company does not receive my written statement of revocation by the end of the revocation period, this Release will become legally enforceable and I may not thereafter revoke this Release. I further state that I have read this document and the Agreement referred to herein, that I know the contents of both and that I have executed the same as my own free act.

WITNESS my hand this _______ day of ____________________.

___________________________________

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EX-10.2

Exhibit 10.2

SECOND AMENDED AND RESTATED CHANGE OF CONTROL EMPLOYMENT AGREEMENT

This SECOND AMENDED AND RESTATED CHANGE OF CONTROL EMPLOYMENT AGREEMENT, dated as of June 18, 2013(this “Agreement”), is entered into by and between tw telecom inc., a Delawarecorporation (the “Company”), and Tina Davis (the “Employee”).

WHEREAS, the Company and the Employee entered into an Amended and Restated Change of Control Agreement dated as of January 30, 2013 (the “Original Agreement”);

WHEREAS, the Employee’s position has been changed to Senior Vice President and General Counsel, and in that connection the Company and the Employee wish to amend and restate Employee’s Original Agreement;

WHEREAS, the Board of Directors of the Company (the “Board”), has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication of the Employee, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined in Section 1(d)). The Board believes it is imperative to diminish the inevitable distraction of the Employee by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Employee’s full attention and dedication to the Company in the event of any threatened or pending Change of Control, and to provide the Employee with compensation and benefits arrangements upon a Change of Control that ensure that the compensation and benefits expectations of the Employee will be satisfied and that provide the Employee with compensation and benefits arrangements that are competitive with those of other corporations. Therefore, in order to accomplish these objectives, the Board has caused the Company to enter into this Agreement;

NOW, THEREFORE, this Agreement is hereby adopted as of the date first written above as follows:

Section 1. Certain Definitions. (a) “Effective Date” means the first date during the Change of Control Period (as defined in Section 1(b)) on which a Change of Control) occurs. Notwithstanding anything in this Agreement to the contrary, if (A) the Employee’s employment with the Company is terminated by the Company, (B) the Date of Termination is (x) prior to the date on which a Change of Control occurs and (y) following the date of public announcement of a transaction or event involving the Company which, if consummated, would constitute a Change of Control, and (C) if it is reasonably demonstrated by the Employee that such termination of employment was at the specific request of a third party that has taken steps reasonably calculated to effect such Change of Control, then “Effective Date” means the date immediately prior to such Date of Termination.

(b) “Change of Control Period” means the period commencing on June __ 28, 2013 (the “Employment Agreement Date”) and ending on the three-year anniversary of the Employment Agreement Date; provided, however, that, commencing on the date three years after the Employment Agreement Date, and on each two-year anniversary of such date (such date and

each two-year anniversary thereof, the “Renewal Date”), the Change of Control Period shall be automatically extended so as to terminate two years from such Renewal Date, unless, at least sixty (60) days prior to the Renewal Date, the Company shall give notice to the Employee that the Change of Control Period shall not be so extended; provided, however, that if during such sixty (60) day period prior to the Renewal Date, the Company has entered into a nondisclosure agreement with a third party for the purpose of conducting negotiations, and is in the process of conducting negotiations, with respect to a possible transaction, which, if consummated, would constitute a Change of Control, the Company may not give notice to the Employee of non-renewal unless Cause for termination exists within the meaning of Section 4(b) of this Agreement.

(c) “Affiliated Company” means any company controlled by, controlling or under common control with the Company.

(d) “Change of Control” means:

(1)Any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) becomes the beneficial owner (within the meaning of Rule 13d‑3 promulgated under the Exchange Act) of 25% or more of either (A) the then-outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (B) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that, for purposes of this Section 1(d), the following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any Affiliated Company or (iv) any acquisition pursuant to a transaction that complies with Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C);

(2)Any time at which individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;

(3)Consummation of a reorganization, merger, statutory share exchange or consolidation or similar transaction involving the Company or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or stock of another entity by the Company or any of its subsidiaries (each, a “Business Combination”), in each case unless, following such Business Combination:

(A)all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or

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indirectly, more than 50% of the then-outstanding shares of common stock (or, for a non-corporate entity, equivalent securities) and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors (or, for a non-corporate entity, equivalent governing body), as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be,

(B)no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 25% or more of, respectively, the then-outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such corporation, except to the extent that such ownership existed prior to the Business Combination, and

(C)at least a majority of the members of the board of directors (or, for a non-corporate entity, equivalent governing body) of the entity resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or

(4)Approval by the stockholdersof the Company of a complete liquidation or dissolution of the Company.

Section 2.Employment Period. The Company hereby agrees to continue the Employee in its employ, subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the 18-month anniversary of the Effective Date (the “Employment Period”). The Employment Period shall terminate upon the Employee’s termination of employment for any reason.

Section 3.Terms of Employment. (a) Position and Duties.

(1)During the Employment Period, (A) the Employee’s position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned at any time during the 120-day period immediately preceding the Effective Date and (B) the Employee’s services shall be performed at the office where the Employee was employed immediately preceding the Effective Date or at any other location less than 35 miles from such office.

(2)During the Employment Period, and excluding any periods of vacation and sick leave to which the Employee is entitled, the Employee agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company and, to the extent

3

necessary to discharge the responsibilities assigned to the Employee hereunder, to use the Employee’s reasonable best efforts to perform faithfully and efficiently such responsibilities. During the Employment Period, it shall not be a violation of this Agreement for the Employee to (A) serve on corporate, civic or charitable boards or committees, (B) deliver lectures, fulfill speaking engagements or teach at educational institutions and (C) manage personal investments, so long as such activities do not significantly interfere with the performance of the Employee’s responsibilities as an employee of the Company in accordance with this Agreement. It is expressly understood and agreed that, to the extent that any such activities have been conducted by the Employee prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Employee’s responsibilities to the Company.

(b)Compensation.

(1)Base Salary. During the Employment Period, the Employee shall receive an annual base salary (the “Annual Base Salary”) at an annual rate at least equal to 12 times the highest monthly base salary paid or payable, including any base salary that has been earned but deferred, to the Employee by the Company and the Affiliated Companies in respect of the 12-month period immediately preceding the month in which the Effective Date occurs. The Annual Base Salary shall be paid at such intervals as the Company pays employee salaries generally. During the Employment Period, the Annual Base Salary shall be reviewed at least annually, beginning no more than twelve (12) months after the last salary increase awarded to the Employee prior to the Effective Date. Any increase in the Annual Base Salary shall not serve to limit or reduce any other obligation to the Employee under this Agreement. The Annual Base Salary shall not be reduced after any such increase and the term “Annual Base Salary” shall refer to the Annual Base Salary as so increased.

(2)Annual Bonus. In addition to the Annual Base Salary, the Employee shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus (the “Annual Bonus”) in cash at least equal to the Employee’s target bonus opportunity under the Company’s Annual Incentive Plan, or any comparable bonus under any predecessor or successor plan (the “Annual Incentive Plan”) for the fiscal year in which the Effective Date occurs (or if, prior to the Effective Date, the target bonus opportunity for such year has not been established, the target bonus opportunity for the fiscal year ending immediately prior to the Effective Date), and in each case taking into account any increases in Annual Base Salary to the extent relevant (the “Target Bonus”). For each fiscal year ending during the Employment Period, (a) any performance goals or other criteria used to determine the actual Annual Bonus earned shall be substantially as favorable to the Employee as the performance goals or other criteria established with respect to the Employee’s Annual Bonus opportunity for the year in which the Effective Date occurs (or if, prior to the Effective Date, the performance goals or criteria for such year have not been established, the performance goals or criteria applicable for the fiscal year ending immediately prior to the Effective Date) and (b) to the extent permitted under the Annual Incentive Plans, the exercise of negative discretion under the Annual Incentive Plan shall be no greater than the exercise of such discretion for the year immediately preceding the year in which the Effective Date occurs. Each such Annual Bonus shall be paid no later than two and a half months after the end of the fiscal year for which the Annual Bonus is awarded, unless the Employee shall elect to defer the receipt of such Annual Bonus pursuant

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to an arrangement that meets the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the final regulations thereunder (the “Code”).

(3)Incentive, Savings and Retirement Plans. During the Employment Period, the Employee shall be entitled to participate in all cash incentive, equity incentive, savings and retirement plans, practices, policies, and programs applicable generally to other peer executives of the Company and the Affiliated Companies, but in no event shall such plans, practices, policies and programs provide the Employee with incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), savings opportunities and retirement benefit opportunities, in each case, less favorable, in the aggregate, than the most favorable of those provided by the Company and the Affiliated Companies for the Employee under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Employee, those provided generally at any time after the Effective Date to other peer executives of the Company and the Affiliated Companies.

(4)Welfare Benefit Plans. During the Employment Period, the Employee and/or the Employee’s family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company and the Affiliated Companies (including, without limitation, medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to other peer executives of the Company and the Affiliated Companies, but in no event shall such plans, practices, policies and programs provide the Employee with benefits that are less favorable, in the aggregate, than the most favorable of such plans, practices, policies and programs in effect for the Employee at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Employee, those provided generally at any time after the Effective Date to other peer executives of the Company and the Affiliated Companies.

(5)Expenses. During the Employment Period, the Employee shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by the Employee in accordance with the most favorable policies, practices and procedures of the Company and the Affiliated Companies in effect for the Employee at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Employee, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies.

(6)Fringe Benefits. During the Employment Period, the Employee shall be entitled to fringe benefits, including, without limitation, tax and financial planning services, payment of club dues, in accordance with the most favorable plans, practices, programs and policies of the Company and the Affiliated Companies in effect for the Employee at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Employee, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies.

(7)Office and Support Staff. During the Employment Period, the Employee shall be entitled to an office or offices of a size and with furnishings and other appointments, and to personal secretarial and other assistance, at least equal to the most favorable of the foregoing provided to the Employee by the Company and the Affiliated Companies at any time during the

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120-day period immediately preceding the Effective Date or, if more favorable to the Employee, as provided generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies.

(8)Vacation. During the Employment Period, the Employee shall be entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company and the Affiliated Companies as in effect for the Employee at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Employee, as in effect generally at any time thereafter with respect to other peer executives of the Company and the Affiliated Companies.

Section 4.Termination of Employment.

(a)Death or Disability. The Employee’s employment shall terminate automatically if the Employee dies during the Employment Period. If the Company determines in good faith that the Disability (as defined herein) of the Employee has occurred during the Employment Period (pursuant to the definition of “Disability”), it may give to the Employee written notice in accordance with Section 12(b) of its intention to terminate the Employee’s employment. In such event, the Employee’s employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Employee (the “Disability Effective Date”), provided that, within the thirty (30) days after such receipt, the Employee shall not have returned to full-time performance of the Employee’s duties. “Disability” means the absence of the Employee from the Employee’s duties with the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness that is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Employee or the Employee’s legal representative.

(b)Cause. The Company may terminate the Employee’s employment during the Employment Period with or without Cause. “Cause” means:

(1)being convicted of, or pleading guilty or nolocontendere to, a charge of commission of a felony or a misdemeanor involving moral turpitude;

(2)engaging in any theft, misappropriation, embezzlement or financial fraud relating to the Company, or reckless or willful destruction of the Company’s property, in any case that is materially and demonstrably injurious to the Company’s business, financial condition or reputation;

(3)the willful and continued failure of the Employee to perform substantially the Employee’s duties (as contemplated by Section 3(a)(1)(A)) with the Company or any Affiliated Company (other than any such failure resulting from incapacity due to physical or mental illness or following the Employee’s delivery of a Notice of Termination for Good Reason), after a written demand for substantial performance is delivered to the Employee by the Board or the Chief Executive Officer of the Company that specifically identifies the manner in which the Board or the Chief Executive Officer of the Company believes that the Employee has not substantially performed the Employee’s duties;

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(4)the willful or reckless engaging by the Employee in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company’s business, financial condition or reputation;

(5)any willful or reckless material breach of a statutory or common law duty of loyalty to the Company that is materially and demonstrably injurious to the Company’s business, financial condition or reputation;

(6)any material breach of the Employee’s obligations under this Agreement, including Section 9 and Section 10; or

(7)any material and willful breach of the provisions of the Company’s Code of Conduct covering the following matters (provided that the provision breached is no more restrictive than the comparable provision of the Company’s Code of Conduct as in effect at any time during the 120-day period immediately preceding the Effective Date): Drug-Free Workplace; Bribery and Fraud; False or Artificial Entries in Books and Records; or Insider Trading (other than failing to observe administrative requirements and blackout periods if no actual insider trading or tipping occurred), in each case, if such breach is materially and demonstrably injurious to the Company’s business, financial condition or reputation.

For purposes of this Section 4(b), no act, or failure to act, on the part of the Employee shall be considered “willful” unless it is done, or omitted to be done, by the Employee in bad faith or without reasonable belief that the Employee’s action or omission was in the best interests of the Company. Any act, or failure to act, (A) based upon authority given pursuant to a resolution duly adopted by the Board, or if the Company is not the ultimate parent corporation of the Affiliated Companies and is not publicly-traded, the board of directors of the ultimate parent of the Company (the “Applicable Board”), (B) based upon the instructions of the Chief Executive Officer of the Company or (C) based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Employee in good faith and in the best interests of the Company. With respect to the conduct described in Sections 4(b)(2) through 4(b)(7), the Company shall provide the Employee with written notice setting forth the details of any claimed breach and the Employee shall have a reasonable period of time (not less than thirty (30) days) to cure such claimed breach if the breach is curable. The cessation of employment of the Employee shall not be deemed to be for Cause unless and until there shall have been delivered to the Employee a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Applicable Board (excluding the Employee, if the Employee is a member of the Applicable Board) at a meeting of the Applicable Board called and held for such purpose (after reasonable notice is provided to the Employee and the Employee is given an opportunity, together with counsel for the Employee, to be heard before the Applicable Board), finding that, in the good faith opinion of the Applicable Board, the Employee is guilty of the conduct described in Section 4(b)(2) through 4(b)(7), and specifying the particulars thereof in detail.

(c)Good Reason. The Employee’s employment may be terminated by the Employee for Good Reason or by the Employee voluntarily without Good Reason. “Good Reason” means:

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(1)the assignment to the Employee of any duties substantively inconsistent (and excluding the assignment of insubstantial and isolated additional duties that are not substantively inconsistent) with the Employee’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 3(a), or any other diminution in such position, authority, duties or responsibilities (whether or not occurring solely as a result of the Company’s ceasing to be a publicly traded entity), excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Employee;

(2)any failure by the Company to comply with any of the provisions of Section 3(b), other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and that is remedied by the Company promptly after receipt of notice thereof given by the Employee;

(3)the Company’s requiring the Employee (i) to be based at any office or location other than as provided in Section 3(a)(1)(B), (ii) to be based at a location other than the principal offices of the Company if the Employee was employed at such location immediately preceding the Effective Date, or (iii) to travel on Company business to a substantially greater extent than required immediately prior to the Effective Date;

(4)any purported termination by the Company of the Employee’s employment otherwise than as expressly permitted by this Agreement; or

(5)any failure by the Company to comply with and satisfy Section 11(c).

For purposes of this Section 4(c), the determination of Good Reason shall be made by the Employee in good faith, and shall be described in reasonable detail in a written notice provided to the Company not later than thirty (30) days after the occurrence of the events deemed to constitute Good Reason. The Employee’s mental or physical incapacity following the occurrence of an event described above in clauses (1) through (5) shall not affect the Employee’s ability to terminate employment for Good Reason and the Employee’s death following delivery of a Notice of Termination for Good Reason shall not affect the Executive’s estate’s entitlement to severance payments provided hereunder upon a termination of employment for Good Reason.

(d)Notice of Termination. Any termination of employment by the Company for Cause, or by the Employee for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 12(b). “Notice of Termination” means a written notice that (1) indicates the specific termination provision in this Agreement relied upon, (2) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Employee’s employment under the provision so indicated, and (3) if the Date of Termination (as defined herein) is other than the date of receipt of such notice, specifies the Date of Termination (which Date of Termination shall be not more than thirty (30) days after the giving of such notice). The failure by the Employee or the Company to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of the Employee or the Company, respectively, hereunder or

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preclude the Employee or the Company, respectively, from asserting such fact or circumstance in enforcing the Employee’s or the Company’s respective rights hereunder.

(e)Date of Termination. “Date of Termination” means (1) if the Employee’s employment is terminated by the Company for Cause, or by the Employee for Good Reason, the date of receipt of the Notice of Termination or any later date specified in the Notice of Termination, as the case may be, (2) if the Employee’s employment is terminated by the Company other than for Cause, death or Disability, the date on which the Company notifies the Employee of such termination, (3) if the Employee resigns without Good Reason, the date on which the Employee notifies the Company of such termination, and (4) if the Employee’s employment is terminated by reason of death or Disability, the date of death of the Employee or the Disability Effective Date, as the case may be. Notwithstanding the foregoing, in no event shall the Date of Termination occur until the Employee experiences, and the Company and the Employee shall take all steps necessary (including with regard to any post-termination services by the Employee) to ensure that any termination described in this Section 4 constitutes, a “separation from service” within the meaning of Section 409A of the Code, and notwithstanding the foregoing, the date on which such separation from service takes place shall be the “Date of Termination.”

Section 5.Obligations of the Company upon Termination.

(a)Good Reason; Other Than for Cause, Death or Disability. If, during the Employment Period, the Company terminates the Employee’s employment other than for Cause, death or Disability or the Employee terminates employment for Good Reason:

(1)the Company shall pay to the Employee, in a lump sum in cash within thirty (30) days after the Date of Termination, the aggregate of the following amounts:

(A)the sum of (i) the Employee’s Annual Base Salary through the Date of Termination to the extent not theretofore paid, (ii) any accrued vacation pay to the extent not theretofore paid, (iii) the Employee’s Annual Bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs to the extent not previously paid as of the Date of Termination, and (iv) the Employee’s business expenses that have not been reimbursed by the Company as of the Date of Termination that were incurred by the Employee prior to the Date of Termination in accordance with the applicable Company policy (the sum of the amounts described in subclauses (i), (ii), (iii) and (iv), the “Accrued Obligations”); provided, that notwithstanding the foregoing, if the Employee has made an irrevocable election under any deferred compensation arrangement subject to Section 409A of the Code to defer any portion of the Annual Base Salary or Annual Bonus described in clause (i) or (iii) above, then for all purposes of this Section 5, such deferral election, and the terms of the applicable arrangement, shall continue to apply to such portions in clauses (i) and (iii), as applicable, and such portions shall not be considered as part of the “Accrued Obligations” but shall instead be an “Other Benefit” (as defined below);

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(B)the product of (i) the Target Bonus and (ii) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination and the denominator of which is 365 (the “Pro Rata Bonus”);

(C)the amount equal to the product of (i) two, and (ii) the sum of (x) the Employee’s Annual Base Salary and (y) the Target Bonus; and

(D)an amount equal to eighteen (18) months of premiums based on the premium rate charged by the Company as in effect on the Date of Termination for the health care continuation coverage mandated by the Consolidated Omnibus Budget Reconciliation Act for the type of coverage for which the Employee is enrolled as of immediately prior to the Date of Termination;

(2)the Company shall, (i) pay to the Employee, in a lump sum in cash within thirty (30) days after the Date of Termination, $25,000 in lieu of outplacement benefits, and (ii) provide automatic referral or automatic forwarding of incoming Company e-mails to the Employee for one year following the Date of Termination; and

(3)to the extent not theretofore paid or provided, the Company shall timely pay or provide to the Employee any Other Benefits (as defined in Section 6) in accordance with the terms of the underlying plans or agreements.

Notwithstanding the foregoing provisions of this Section 5(a), in the event that the Employee is a “specified employee” (within the meaning of Section 409A of the Code and with such classification to be determined in accordance with the methodology established by the applicable employer as in effect on the Date of Termination) (a “Specified Employee”), amounts that constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code that would otherwise be payable under Section 5(a) during the six-month period immediately following the Date of Termination shall instead be paid, with interest on any delayed payment at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Code (“Interest”) determined as of the Date of Termination, on the first business day after the date that is six (6) months following the Employee’s “separation from service” within the meaning of Section 409A of the Code (the “409A Payment Date”).

(b)Death. If the Employee’s employment is terminated by reason of the Employee’s death during the Employment Period, the Company shall provide the Employee’s estate or beneficiaries with (1) the Accrued Obligations, (2) the Pro Rata Bonus, (3) the timely payment or delivery of the Other Benefits in accordance with the terms of the underlying plans or agreements, and (4) an amount equal to the Employee’s Annual Base Salary that would have otherwise been payable if the Employee had remained employed during the period commencing on the Date of Termination and ending on the date thirty (30) days following the Date of Termination (the “Supplemental Salary Payment”), and the Company shall have no other severance obligations under this Agreement. The Accrued Obligations (subject to the proviso set forth in Section 5(a)(1)(A), to the extent applicable), the Pro Rata Bonus and the Supplemental Salary Payment shall be paid to the Employee’s estate or beneficiary, as applicable, in a lump sum in cash within thirty (30) days of the Date of Termination. With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 5(b) shall include, without limitation, and the Employee’s estate

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and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company and the Affiliated Companies to the estates and beneficiaries of peer executives of the Company and the Affiliated Companies under such plans, programs, practices and policies relating to death benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Employee’s estate and/or the Employee’s beneficiaries, as in effect on the date of the Employee’s death with respect to other peer executives of the Company and the Affiliated Companies and their beneficiaries.

(c)Disability. If the Employee’s employment is terminated by reason of the Employee’s Disability during the Employment Period, the Company shall provide the Employee with (1) the Accrued Obligations, (2) a lump sum cash payment equal to (A) 75% of the amount equal to (i) the sum of the Employee’s Annual Base Salary and Target Bonus, multiplied by (ii) 1.5, less (B) an amount equal to the lump sum present value of any disability benefits estimated to be payable to the Employee under any disability plan, policy or program covering the Employee as reasonably determined by the Company and the Company’s disability insurance carriers(s) (the “Disability Lump Sum”), and (3) the timely payment or delivery of the Other Benefits in accordance with the terms of the underlying plans or agreements, and shall have no other severance obligations under this Agreement. The Accrued Obligations (subject to the proviso set forth in Section 5(a)(1)(A), to the extent applicable) and the Disability Lump Sum shall be paid to the Employee in a lump sum in cash within thirty (30) days of the Date of Termination, provided, that in the event that the Employee is a Specified Employee, the Disability Lump Sum shall instead be paid, with Interest, to the Employee on the 409A Payment Date. With respect to the provision of the Other Benefits, the term “Other Benefits” as utilized in this Section 5(c) shall include, and the Employee shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company and the Affiliated Companies to disabled Employees and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Employee and/or the Employee’s family, as in effect at any time thereafter generally with respect to other peer executives of the Company and the Affiliated Companies and their families.

(d)Cause; Other Than for Good Reason. If the Employee’s employment is terminated for Cause during the Employment Period, the Company shall provide the Employee with the Accrued Obligations and the timely payment or delivery of the Other Benefits, and shall have no other severance obligations under this Agreement. If the Employee voluntarily terminates employment during the Employment Period, excluding a termination for Good Reason, the Company shall provide the Employee with (1) the Accrued Obligations, (2) the Pro Rata Bonus and (3) the timely payment or delivery of the Other Benefits in accordance with the terms of the underlying plans or agreements, and shall have no other severance obligations under this Agreement. The Accrued Obligations (subject to the proviso set forth in Section 5(a)(1)(A), to the extent applicable) and, if applicable, the Pro Rata Bonus shall be paid to the Employee in a lump sum in cash within thirty (30) days of the Date of Termination, provided, that in the event the Employee is a Specified Employee, the Pro Rata Bonus shall instead be paid, with Interest, to the Employee on the 409A Payment Date.

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Section 6.Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the Employee’s continuing or future participation in any plan, program, policy or practice provided by the Company or the Affiliated Companies and for which the Employee may qualify, nor, subject to Section 12(f), shall anything herein limit or otherwise affect such rights as the Employee may have under any other contract or agreement with the Company or the Affiliated Companies. Amounts that are vested benefits or that the Employee is otherwise entitled to receive under any plan, policy, practice or program of or any other contract or agreement with the Company or the Affiliated Companies (including, for the avoidance of doubt, the Employee’s rights to benefits and payments under any stock options, restricted stock, restricted stock units or other incentive awards or plans) at or subsequent to the Date of Termination (“Other Benefits”) shall be payable in accordance with such plan, policy, practice or program or contract or agreement, except as explicitly modified by this Agreement. Without limiting the generality of the foregoing, the Employee’s resignation under this Agreement with or without Good Reason, shall in no way affect the Employee’s ability to terminate employment by reason of the Employee’s “retirement” under any compensation and benefits plans, programs or arrangements of the Company or the Affiliated Companies, including without limitation any retirement or pension plans or arrangements or to be eligible to receive benefits under any compensation or benefit plans, programs or arrangements of the Company or the Affiliated Companies, including without limitation any retirement or pension plan or arrangement of the Company or the Affiliated Companies or substitute plans adopted by the Company, the Affiliated Companies or their respective successors, and any termination which otherwise qualifies as Good Reason shall be treated as such even if it is also a “retirement” for purposes of any such plan. Notwithstanding the foregoing, if the Employee receives payments and benefits pursuant to Section 5(a) of this Agreement, the Employee shall not be entitled to any severance pay or benefits under any severance plan, program or policy of the Company and the Affiliated Companies, unless otherwise specifically provided therein in a specific reference to this Agreement.

Section 7.Full Settlement. The payments and benefits provided for in this Agreement upon termination of the Employee’s employment are in full settlement of any and all claims by the Employee known as of the date hereof with respect to the circumstances of such termination of the Employee’s employment. The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense, or other claim, right or action that the Company may have against the Employee or others. In no event shall the Employee be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Employee under any of the provisions of this Agreement, and such amounts shall not be reduced whether or not the Employee obtains other employment. The Company agrees to pay as incurred (within ten (10) days following the Company’s receipt of an invoice from the Employee), all legal fees and expenses that the Employee may reasonably incur as a result of any contest by the Company, the Employee or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Employee about the amount of any payment pursuant to this Agreement) (each a “Contest”), plus, in each case, Interest; provided, that, in the case of a Contest initiated by the Employee, the Employee shall have commenced any legal action (whether or not including litigation) within eighteen (18) months of the Date of Termination; andprovided, further, that in the event the resolution of any such Contest includes a finding denying, in total, the Employee’s claims in such Contest, the

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Employee shall be required to reimburse the Company, over a period of twelve (12) months from the date of such resolution, for all sums paid to the Employee pursuant to this Section 7.

Section 8.Certain Reductions in Payments.

(a)Anything in this Agreement to the contrary notwithstanding, in the event that Ernst & Young LLP or such other nationally recognized accounting firm as shall be selected by the Employee and the Company (as it exists prior to the Effective Date) (the “Accounting Firm”), shall determine that receipt of all payments, benefits or distributions by the Company or its affiliates in the nature of compensation to or for the Employee’s benefit, whether paid or payable pursuant to this Agreement or otherwise (a “Payment”) would (after taking into account any value attributable to the non-competition covenant in Section 10(a)), subject the Employee to the excise tax under Section 4999 of the Code, the Accounting Firm shall determine whether it is necessary to reduce any of the Payments paid or payable pursuant to this Agreement (the “Agreement Payments”) to the Reduced Amount (as defined below). The Agreement Payments shall be reduced to the Reduced Amount only if the Accounting Firm determines that the Employee would have a greater Net After-Tax Receipt (as defined below) of aggregate Payments if the Employee’s Agreement Payments were reduced to the Reduced Amount. If such a determination is not made by the Accounting Firm, the Employee shall receive all Agreement Payments to which the Employee is entitled under this Agreement. Notwithstanding anything to the contrary, in no event shall the value (if any) attributable to the non-competition covenant in Section 10(a) be taken into account for purposes of the Accounting Firm’s determination if it would reduce the Agreement Payments to be paid to the Employee, it being understood that any such valuation is intended solely to reduce the amounts that are considered “parachute payments” and therefore any excise tax under Section 4999 of the Code. Any valuation of the non-competition covenant in Section 10(a) shall be determined by the Accounting Firm (or, if the Accounting Firm is not able to make such determination, an independent third-party valuation specialist, selected by the Employee), and the Company shall cooperate in good faith in connection with any such valuation process.

(b)If the Accounting Firm determines that aggregate Agreement Payments should be reduced to the Reduced Amount, the Company shall promptly give the Employee notice to that effect and a copy of the detailed calculation thereof. All determinations made by the Accounting Firm (or, with respect to the valuation of the non-competition covenant in Section 10(a), to the extent applicable, the independent third-party valuation specialist) under this Section 8 shall be binding upon the Company and the Employee and shall be made as soon as reasonably practicable and in no event later than fifteen (15) days following the Date of Termination. For purposes of reducing the Agreement Payments to the Reduced Amount, only amounts payable under this Agreement (and no other Payments) shall be reduced. The reduction of the Agreement Payments to the Reduced Amount, if applicable, shall be made by reducing the Agreement Payments under the following sections in the following order: (i) Section 5(a)(1)(C), (ii) Section 5(a)(1)(B), and (iii) Section 5(a)(1)(D). All fees and expenses of the Accounting Firm and the independent third-party valuation specialist (if any) shall be borne solely by the Company.

(c)As a result of the uncertainty in the application of Sections 280G and 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that amounts will have been paid or distributed by the Company to or for the benefit of the Employee pursuant to this Agreement which should not have been so paid or distributed (“Overpayment”) or

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that additional amounts which will have not been paid or distributed by the Company to or for the benefit of the Employee pursuant to this Agreement could have been so paid or distributed (“Underpayment”), in each case, consistent with the calculation of the Reduced Amount hereunder. In the event that the Accounting Firm, based upon the assertion of a deficiency by the Internal Revenue Service against either the Company or the Employee which the Accounting Firm believes has a high probability of success determines that an Overpayment has been made, the Employee shall pay any such Overpayment to the Company together with Interest; provided, however, that no amount shall be payable by the Employee to the Company if and to the extent such payment would not either reduce the amount on which the Employee is subject to tax under Sections 1 and 4999 of the Code or generate a refund of such taxes. In the event that the Accounting Firm, based upon controlling precedent or substantial authority, determines that an Underpayment has occurred, any such Underpayment shall be paid promptly (and in no event later than thirty (30) days following the date on which the Underpayment is determined) by the Company to or for the benefit of the Employee together with Interest.

(d)For purposes hereof, the following terms have the meanings set forth below:

(1)    “Reduced Amount” shall mean the greatest amount of Agreement Payments that can be paid that would not result in the imposition of the excise tax under Section 4999 of the Code if the Accounting Firm determines to reduce Agreement Payments pursuant to Section 8(a).

(2)    “Net After-Tax Receipt” shall mean the present value (as determined in accordance with Sections 280G(b)(2)(A)(ii) and 280G(d)(4) of the Code) of a Payment net of all taxes imposed on the Employee with respect thereto under Sections 1 and 4999 of the Code and under applicable state and local laws, determined by applying the highest marginal rate under Section 1 of the Code and under state and local laws which applied to the Employee’s taxable income for the immediately preceding taxable year, or such other rate(s) as the Employee certifies, in the Employee’s sole discretion, as likely to apply to him or her in the relevant tax year(s).

Section 9.Confidential Information. The Employee shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company or the Affiliated Companies, and their respective businesses, which information, knowledge or data shall have been obtained by the Employee during the Employee’s employment by the Company or the Affiliated Companies and which information, knowledge or data shall not be or become public knowledge (other than by acts by the Employee or representatives of the Employee in violation of this Agreement). After termination of the Employee’s employment with the Company, the Employee shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company and those persons designated by the Company. In no event shall an asserted violation of the provisions of this Section 9 constitute a basis for deferring or withholding any amounts otherwise payable to the Employee under this Agreement.

Section 10.Restrictive Covenants. (a) Non-competition. In consideration for the payments and benefits under this Agreement, during the period commencing on the Effective Date ending on the six-month anniversary of the Date of Termination, the Employee shall not directly or indirectly through another be or become an officer, director, partner or employee of or consultant

14

to or act in any managerial capacity with or own any equity interest in any Competitive Business Entity (as defined below); provided, however, that ownership of less than one percent (1%) of the outstanding equity securities of any entity listed on any national securities exchange or traded on the National Association of Securities Dealers Automated Quotation System shall not be prohibited hereby. A “Competitive Business Entity” is any Incumbent Local Exchange Carrier (as defined in the Telecommunications Act of 1996), emerging telecommunications provider or cable television or communication company that competes with the Company in the provision of voice, data, Internet or other services to customers in any state of the United States in which, as of the Date of Termination, the Company or its controlled affiliates engages or has publicly announced definitive plans to engage, in the ownership, operation or management of such a business.

(b)Non-solicitation. In consideration for the payments and benefits under this Agreement, during the period commencing on the Effective Date and ending on the first anniversary of the Date of Termination, the Employee shall not directly or indirectly, (1) induce or attempt to induce any employee of the Company to leave the employ of the Company or in any way interfere with the relationship between the Company, on the one hand, and any employee thereof, on the other hand, (2) hire any person who was an employee of the Company until six (6) months after such individual’s employment relationship with the Company has been terminated or (3) induce or attempt to induce any customer, supplier, licensee or other business relation of the Company to cease doing business with the Company, or in any way interfere with the relationship between any such customer, supplier, licensee or business relation, on the one hand, and the Company, on the other hand; provided, that, solicitations incidental to general advertising or other general solicitations in the ordinary course not specifically targeted at such persons and employment of any person not otherwise solicited in violation hereof shall not be considered a violation of this Section 10(b).

(c)    Acknowledgement; Reasonableness. The Employee understands that the foregoing restrictions may limit his or her ability to earn a livelihood in a business similar to the business of the Company, but the Employee nevertheless believes that he or she has received and will receive sufficient consideration and other benefits as an employee of the Company and as otherwise provided hereunder to clearly justify such restrictions which, in any event (given his or her education, skills and ability), the Employee does not believe would prevent him or her from otherwise earning a living. The Employee has carefully considered the nature and extent of the restrictions place upon him or her by this Section 10, and hereby acknowledges and agrees that the same are reasonable in time and territory and do not confer a benefit upon the Company disproportionate to the detriment of the Employee. Following the Effective Date, the covenants set forth in this Section 10 shall be the exclusive contractual covenants applicable to the Employee with respect to the subject matter therein and shall supersede and replace any and all similar covenants contained in any other agreement between the Company and the Employee or plan in which the Employee participates.

(d)    Enforcement. Because the Employee’s services are unique and because the Employee has access to confidential information, the parties hereto agree that money damages would be an inadequate remedy for any breach of this Section 10. Therefore, in the event of a breach or threatened breach of this Section 10, the Company or its respective successors or assigns may, in addition to other rights and remedies existing in their favor at law or in equity, apply to any court of competent jurisdiction for specific performance and/or injunction relief in order to enforce,

15

or prevent any violations of, the provision hereof (without posting a bond or other security) or require the Employee to account for and pay over to the Company all compensation, profits, moneys, accruals or other benefits derived from or received as a result of any transactions constituting a breach of the covenants contained herein, if and when final judgment of a court of competent jurisdiction is so entered against the Employee.

(e)    Interpretation. For purposes of this Section 10, references to “the Company” shall mean the Company as hereinbefore defined and any of its controlled affiliates.

Section 11.Successors. (a) This Agreement is personal to the Employee, and, without the prior written consent of the Company, shall not be assignable by the Employee other than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Employee’s legal representatives.

(b)This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. Except as provided in Section 11(c), without the prior written consent of the Employee this Agreement shall not be assignable by the Company.

(c)The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. “Company” means the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid that assumes and agrees to perform this Agreement by operation of law or otherwise.

Section 12.Miscellaneous. (a) This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified other than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

(b)All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

16

if to the Employee:

At the most recent address on file at the Company.

if to the Company:

tw telecom inc.

10475 Park Meadows Drive

Littleton, Colorado 80124

Attention: Assistant General Counsel

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.

(c)The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d)The Company may withhold from any amounts payable under this Agreement such United States federal, state or local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e)The Employee’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Employee or the Company may have hereunder, including, without limitation, the right of the Employee to terminate employment for Good Reason pursuant to Sections 4(c)(1) through 4(c)(5), shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

(f)The Employee and the Company acknowledge that, except as may otherwise be provided under any other written agreement between the Employee and the Company, the employment of the Employee by the Company is “at will” and, subject to Section 1(a), prior to the Effective Date, the Employee’s employment may be terminated by either the Employee or the Company, in which case the Employee shall have no further rights under this Agreement. From and after the Effective Date, except as specifically provided herein, this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof, including, without limitation, any prior change of control employment or employment agreement between the Company and/or tw telecom holdings inc. and the Employee (it being understood that each reference to the “COC Agreement” in the Employee’s Employment Agreement, dated as of December 12, 2008 and as amended and/or restated from time to time (the “Employment Agreement”), shall be deemed for purposes of such Employment Agreement to refer to this Agreement).

(g)The Agreement is intended to comply with the requirements of Section 409A of the Code or an exemption therefrom and shall in all respects be administered in accordance with

17

Section 409A of the Code. Each payment under this Agreement shall be treated as a separate payment for purposes of Section 409A of the Code. In no event may the Employee, directly or indirectly, designate the calendar year of any payment to be made under this Agreement. If the Employee dies following the Date of Termination and prior to the payment of any amounts delayed on account of Section 409A of the Code, such amounts shall be paid to the personal representative of the Employee’s estate within thirty (30) days after the date of the Employee’s death. All reimbursements and in-kind benefits provided under this Agreement that constitute deferred compensation within the meaning of Section 409A of the Code shall be made or provided in accordance with the requirements of Section 409A of the Code, including, without limitation, that (i) in no event shall reimbursements by the Company under this Agreement be made later than the end of the calendar year next following the calendar year in which the applicable fees and expenses were incurred, provided, that the Employee shall have submitted an invoice for such fees and expenses at least ten (10) days before the end of the calendar year next following the calendar year in which such fees and expenses were incurred; (ii) the amount of in-kind benefits that the Company is obligated to pay or provide in any given calendar year shall not affect the in-kind benefits that the Company is obligated to pay or provide in any other calendar year; (iii) the Employee’s right to have the Company pay or provide such reimbursements and in-kind benefits may not be liquidated or exchanged for any other benefit; and (iv) in no event shall the Company’s obligations to make such reimbursements or to provide such in-kind benefits apply later than the Employee’s remaining lifetime (or if longer, through the 20^th anniversary of the Effective Date). Prior to the Effective Date but within the time period permitted by the applicable Treasury Regulations, the Company may, in consultation with the Employee, modify the Agreement, in the least restrictive manner necessary and without any diminution in the value of the payments to the Employee, in order to cause the provisions of the Agreement to comply with the requirements of Section 409A of the Code, so as to avoid the imposition of taxes and penalties on the Employee pursuant to Section 409A of the Code.

18

IN WITNESS WHEREOF, the Employee has hereunto set the Employee’s hand and, pursuant to the authorization from the Board, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.

Tina Davis        

/s/ Tina Davis    

tw telecom inc.

By /s/ Larissa Herda            

Name: Larissa Herda          Title: Chairman, Chief Executive Officer and President

19

EX-31.1

Exhibit 31.1

Certification

I, Larissa L. Herda, certify that:

1. I have reviewed this quarterly report on Form 10-Q of tw telecom inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 8, 2013

By:	/s/ Larissa L. Herda
	Larissa L. Herda Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification

I, Mark A. Peters, certify that:

1. I have reviewed this quarterly report on Form 10-Q of tw telecom inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 8, 2013

By:	/s/ Mark A. Peters
	Mark A. Peters Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. 1350

(as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

In connection with the Quarterly Report of tw telecom inc. (the “Company”) on Form 10-Q for the period ended June 30, 2013 filed with the Securities and Exchange Commission (the “Report”), I, Larissa L. Herda, Chairman, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. Section 78m or 78o(d)); and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the period covered by the Report.

/s/ Larissa L. Herda

Name: Larissa L. Herda

Date: August 8, 2013

EX-32.2

Exhibit 32.2

Certification of Chief Financial Officer

Pursuant to 18 U.S.C. 1350

(as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

In connection with the Quarterly Report of tw telecom inc. (the “Company”) on Form 10-Q for the period ended June 30, 2013 filed with the Securities and Exchange Commission (the “Report”), I, Mark A. Peters, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. Section 78m or 78o(d)); and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the period covered by the Report.

/s/ Mark A. Peters

Name: Mark A. Peters

Date: August 8, 2013

XML

Organization and Summary Of Significant Accounting Policies (Policy)

6 Months Ended

Jun. 30, 2013

Organization And Summary Of Significant Accounting Policies [Abstract]

Description of Business and Capital Structure

Description of Business and Capital Structure

tw telecom inc. (together with its wholly-owned subsidiaries, the “Company”) is a leading national provider of managed network services, specializing in business Ethernet, data networking, converged, Internet Protocol ("IP") based virtual private network or "IP VPN", Internet access, voice, including voice over Internet Protocol or “VoIP”, and network security services to enterprise organizations, including public sector entities, and carriers throughout the United States, including their global locations.

The Company has one class of common stock outstanding with one vote per share. The Company also is authorized to issue shares of preferred stock. The Company’s Board of Directors has the authority to establish voting powers, preferences, and special rights for the preferred stock. No shares of preferred stock have been issued.

Basis of Presentation

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. These condensed consolidated financial statements should therefore be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2012 filed with the SEC. The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and include all adjustments of a normal, recurring nature that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for an interim period are not necessarily indicative of the results of operations for a full fiscal year.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Recently Adopted Accounting Pronouncemnts

Recently Adopted Accounting Pronouncements

In February 2013, the Financial Accounting Standards Board (the "FASB") issued an accounting standard update that requires entities to provide information about the amounts reclassified out of accumulated other comprehensive income by component. Additionally, entities are required to present, either on the face of the financial statements or in the notes, significant amounts reclassified out of accumulated other comprehensive income and the respective income statement line items affected by the reclassification. The guidance does not change the current requirements for reporting net income or other comprehensive income. The accounting standard update is effective on a prospective basis for interim and annual periods beginning after December 15, 2012. The Company adopted this accounting standard update in the three months ended March 31, 2013. This update affected presentation and disclosure, but did not affect the Company's consolidated financial position, results of operations or cash flows. See "Accumulated Other Comprehensive Income" below.

Revenue

Revenue

The Company’s revenue is derived primarily from business communications services comprised of the following:

• Data and Internet services include services that enable customers to connect their internal computer networks and to access external networks, including Internet access at high speeds using Ethernet protocol, local and wide-area business Ethernet and IP VPN solutions. Data and Internet services also include a portfolio of managed services including the data and Internet components of converged services, which fully integrates a combination of certain communication applications including IP VPN, Internet, security and managed router service into a single managed IP solution, and the data and Internet components of integrated services, which enable customers to purchase a full array of access options that include Internet services.

• Voice services include traditional and next generation voice capabilities, including voice services provided as standalone and bundled services, long distance and toll free services. Voice services also include the voice components of converged and integrated services.

• Network services are point-to-point services that transmit voice, data and images using state-of-the-art fiber optics, and collocation services that provide secure space with controlled climate and power where customers can locate their equipment to connect to the Company’s network in facilities equipped for enterprise information technology environmental requirements.

The Company also generates revenue from intercarrier compensation. Intercarrier compensation is comprised of switched access services and reciprocal compensation. Switched access represents the compensation from another carrier for the delivery of traffic from a long distance carrier’s point of presence to an end-user’s premises provided through the Company’s switching facilities. The Federal Communications Commission ("FCC") and state public utility commissions regulate switched access rates in their respective jurisdictions. Reciprocal compensation represents compensation from local exchange carriers (“LECs”) for local exchange traffic originated on another LEC’s facilities and terminated on the Company’s facilities.

The Company’s customers include, among others, enterprise organizations in the financial services, technology and scientific, health care, distribution, manufacturing and professional services industries, data center providers, cloud services providers, public sector entities, system integrators and communications service providers, including incumbent local exchange carriers ("ILECs"), competitive local exchange carriers ("CLECs"), wireless communications companies and cable companies.

Revenue for network, data and Internet, and the majority of voice services is generally billed in advance on a monthly fixed rate basis and recognized over the period the services are provided. Revenue for the majority of intercarrier compensation and certain components of voice services, such as long distance, is generally billed on a transactional basis in arrears based on a customer’s actual usage; therefore, estimates are used to recognize revenue in the period earned.

The Company evaluates whether receivables are reasonably assured of collection based on certain factors, including the likelihood of billing being disputed by customers. If there is a billing dispute with a customer, revenue generally is not recognized until the dispute is resolved. The Company does not recognize revenue associated with contract termination charges until cash is received.

The Company classifies certain taxes and fees billed to customers and remitted to government authorities on a gross versus net basis in revenue and expense. In making this determination, the Company assesses, among other things, whether the Company is the primary obligor or principal taxpayer for the taxes and fees assessed in each jurisdiction where the Company does business. In jurisdictions where the Company determines that it is the principal taxpayer, the Company records the taxes and fees on a gross basis, including the taxes and fees in revenue and expense. In jurisdictions where the Company determines that it is merely a collection agent for the government authority, the Company records the taxes on a net basis.

Significant Customers

Significant Customers

The Company has substantial business relationships with a few large customers, including major telecommunications carriers. The Company’s 10 largest customers accounted for an aggregate of 18% and 19% of the Company’s total revenue in the six months ended June 30,2013 and 2012, respectively. No customer accounted for 5% or more of total revenue for the six months ended June 30,2013 or 2012.

Earnings Per Share and Potential Common Share

Basic earnings per common share (“EPS”) is measured as the income allocated to common stockholders divided by the weighted average outstanding common shares for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (such as convertible securities and stock options) as if they had been converted to shares at the beginning of the period presented. Potential common shares that have an anti-dilutive effect (e.g., those that increase income per share) are excluded from diluted EPS.

XML

Condensed Consolidated Statements Of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended				6 Months Ended
	Jun. 30, 2013		Jun. 30, 2012		Jun. 30, 2013		Jun. 30, 2012
Revenue:
Data and Internet services	$ 209,634		$ 182,480		$ 411,716		$ 359,331
Voice services	93,080		91,008		185,435		180,629
Network services	78,487		83,009		157,350		167,813
Intercarrier compensation	8,282		8,006		16,191		15,655
Total revenue	389,483		364,503		770,692		723,428
Costs and expenses (a):
Operating (exclusive of depreciation, amortization and accretion shown separately below)	164,131	[1]	152,986	[1]	325,213	[1]	302,179	[1]
Selling, general and administrative	96,438	[1]	84,580	[1]	190,000	[1]	170,670	[1]
Depreciation, amortization and accretion	75,652		70,469		150,047		138,863
Total costs and expenses	336,221		308,035		665,260		611,712
Operating income	53,262		56,468		105,432		111,716
Interest expense	(21,544)		(21,860)		(49,884)		(43,441)
Debt extinguishment costs	(399)		0		(399)		0
Interest income	173		93		450		197
Income before income taxes	31,492		34,701		55,599		68,472
Income tax expense	14,145		15,382		25,108		29,821
Net income	$ 17,347		$ 19,319		$ 30,491		$ 38,651
Earnings per share:
Basic (in dollars per share)	$ 0.12		$ 0.13		$ 0.20		$ 0.26
Diluted (in dollars per share)	$ 0.11		$ 0.13		$ 0.20		$ 0.25
Weighted average shares outstanding:
Basic (in shares)	147,071		147,497		148,095		147,232
Diluted (in shares)	148,342		149,532		151,081		149,398

[1] Includes non-cash stock-based employee compensation expense (Note 6):Operating $545 $455 $1,128 $955Selling, general and administrative $7,869 $6,594 $16,748 $14,222

XML

Earnings Per Common Share and Potential Common Share

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Abstract]

Earnings Per Common Share and Potential Common Share

Earnings per Common Share and Potential Common Share

Basic earnings per common share (“EPS”) is measured as the income allocated to common stockholders divided by the weighted average outstanding common shares for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (such as convertible securities and stock options) as if they had been converted to shares at the beginning of the period presented. Potential common shares that have an anti-dilutive effect (e.g., those that increase income per share) are excluded from diluted EPS.

The following is a reconciliation of the numerators and denominators used in the basic and diluted EPS computations:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(amounts in thousands, except per share amounts)
Numerator
Net income	$	17,347		$	19,319		$	30,491		$	38,651
Allocation of net income to unvested restricted stock awards	(331		)	(404		)	(587		)	(808		)
Net income allocated to common stockholders, basic	$	17,016		$	18,915		$	29,904		$	37,843
Net income allocated to common stockholders, diluted	$	17,016		$	18,915		$	29,904		$	37,843
Denominator
Basic weighted average shares outstanding	147,071			147,497			148,095			147,232
Dilutive potential common shares:
Stock options	886			1,566			1,180			1,544
Unvested restricted stock	385			469			1,806			622
Diluted weighted average shares outstanding	148,342			149,532			151,081			149,398
Basic earnings per share	$	0.12		$	0.13		$	0.20		$	0.26
Diluted earnings per share	$	0.11		$	0.13		$	0.20		$	0.25

Options to purchase shares of the Company’s common stock and restricted stock awards and restricted stock units to be settled in common stock upon vesting, which were excluded from the computation of diluted weighted average shares outstanding because their inclusion would be anti-dilutive, totaled 2.9 million shares and no shares for the three and six months ended June 30, 2013, respectively. Shares of common stock subject to issuance upon conversion of the Company’s 2³/₈% Convertible Senior Debentures due 2026 (the “Convertible Debentures”), options to purchase shares of the Company’s common stock and restricted stock awards and restricted stock units to be settled in common stock upon vesting, which were excluded from the computation of diluted weighted average shares outstanding because their inclusion would be anti-dilutive, totaled 23.9 million shares in each of the three and six months ended June 30, 2012.

XML

Earnings Per Common Share and Potential Common Share (Schedule Of Earnings Per Share Reconciliation) (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Earnings Per Share [Abstract]
Net income	$ 17,347	$ 19,319	$ 30,491	$ 38,651
Allocation of net income to unvested restricted stock awards	(331)	(404)	(587)	(808)
Net income allocated to common stockholders, basic	17,016	18,915	29,904	37,843
Net income allocated to common stockholders, diluted	$ 17,016	$ 18,915	$ 29,904	$ 37,843
Basic weighted average shares outstanding (in shares)	147,071	147,497	148,095	147,232
Stock options (in shares)	886	1,566	1,180	1,544
Unvested restricted stock (in shares)	385	469	1,806	622
Diluted weighted average shares outstanding (in shares)	148,342	149,532	151,081	149,398
Basic earnings per share (in dollars per share)	$ 0.12	$ 0.13	$ 0.20	$ 0.26
Diluted earnings per share (in dollars per share)	$ 0.11	$ 0.13	$ 0.20	$ 0.25

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Earnings Per Common Share and Potential Common Share (Tables)

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Abstract]

Schedule Of Earnings Per Share Reconciliation

The following is a reconciliation of the numerators and denominators used in the basic and diluted EPS computations:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(amounts in thousands, except per share amounts)
Numerator
Net income	$	17,347		$	19,319		$	30,491		$	38,651
Allocation of net income to unvested restricted stock awards	(331		)	(404		)	(587		)	(808		)
Net income allocated to common stockholders, basic	$	17,016		$	18,915		$	29,904		$	37,843
Net income allocated to common stockholders, diluted	$	17,016		$	18,915		$	29,904		$	37,843
Denominator
Basic weighted average shares outstanding	147,071			147,497			148,095			147,232
Dilutive potential common shares:
Stock options	886			1,566			1,180			1,544
Unvested restricted stock	385			469			1,806			622
Diluted weighted average shares outstanding	148,342			149,532			151,081			149,398
Basic earnings per share	$	0.12		$	0.13		$	0.20		$	0.26
Diluted earnings per share	$	0.11		$	0.13		$	0.20		$	0.25

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Investments (Narrative) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Schedule of Available-for-sale Securities [Line Items]
Proceeds from the sale and maturity of available-for-sale securities	$ 91,051	$ 69,579	$ 125,041	$ 106,053
Realized net gains or losses on sale of investments	0	0	0	0
Unrealized net gains or losses on investments	$ 0	$ 0	$ 0	$ 0
Maximum [Member]
Schedule of Available-for-sale Securities [Line Items]
Available-for-sale Securities maturity period			1 year

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Investments (Investments Schedule) (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Schedule of Investments [Line Items]
Cash equivalents	$ 375,105	$ 731,823
Investments	194,155	167,564
Total cash equivalents and investments	569,260	899,387
Money Market Funds [Member]
Schedule of Investments [Line Items]
Cash equivalents	302,366	425,165
U.S. Treasury money market mutual funds [Member]
Schedule of Investments [Line Items]
Cash equivalents	66,044	262,967
Commercial paper [Member]
Schedule of Investments [Line Items]
Cash equivalents	6,695	30,692
Investments	59,976	32,480
Certificates of deposit [Member]
Schedule of Investments [Line Items]
Cash equivalents	0	8,000
Investments	4,750	0
Debt securities issued by U.S. Government agencies [Member]
Schedule of Investments [Line Items]
Cash equivalents	0	4,999
Investments	29,079	45,214
Debt securities issued by U.S. Treasury [Member]
Schedule of Investments [Line Items]
Investments	$ 100,350	$ 89,870

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Supplemental Guarantor Information (Condensed Consolidating Statement Of Operations) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Condensed Financial Statements Captions [Line Items]
Total revenue	$ 389,483	$ 364,503	$ 770,692	$ 723,428
Costs and expenses:
Operating, selling, general and administrative	260,569	237,566	515,213	472,849
Depreciation, amortization and accretion	75,652	70,469	150,047	138,863
Corporate expense allocation	0	0	0	0
Total costs and expenses	336,221	308,035	665,260	611,712
Operating income	53,262	56,468	105,432	111,716
Interest expense, net	(21,371)	(21,767)	(49,434)	(43,244)
Debt extinguishment costs	(399)	0	(399)	0
Interest expense allocation	0	0	0	0
Income before income taxes and equity in undistributed earnings of subsidiaries	31,492	34,701	55,599	68,472
Income tax expense	14,145	15,382	25,108	29,821
Net income (loss) before equity in undistributed earnings of subsidiaries	17,347	19,319	30,491	38,651
Equity in undistributed earnings of subsidiaries	0	0	0	0
Net income	17,347	19,319	30,491	38,651
Parent Guarantor [Member]
Condensed Financial Statements Captions [Line Items]
Total revenue	0	0	0	0
Costs and expenses:
Operating, selling, general and administrative	0	0	0	0
Depreciation, amortization and accretion	0	0	0	0
Corporate expense allocation	0	0	0	0
Total costs and expenses	0	0	0	0
Operating income	0	0	0	0
Interest expense, net	(1,569)	(7,789)	(9,705)	(15,467)
Debt extinguishment costs	(327)		(327)
Interest expense allocation	1,896	7,789	10,032	15,467
Income before income taxes and equity in undistributed earnings of subsidiaries	0	0	0	0
Income tax expense	0	0	0	0
Net income (loss) before equity in undistributed earnings of subsidiaries	0	0	0	0
Equity in undistributed earnings of subsidiaries	17,347	19,319	30,491	38,651
Net income	17,347	19,319	30,491	38,651
Issuer [Member]
Condensed Financial Statements Captions [Line Items]
Total revenue	0	0	0	0
Costs and expenses:
Operating, selling, general and administrative	67,167	52,422	131,974	105,426
Depreciation, amortization and accretion	6,707	6,677	13,286	11,469
Corporate expense allocation	(73,874)	(59,099)	(145,260)	(116,895)
Total costs and expenses	0	0	0	0
Operating income	0	0	0	0
Interest expense, net	(17,942)	(12,075)	(35,820)	(24,087)
Debt extinguishment costs	(72)		(72)
Interest expense allocation	18,014	12,075	35,892	24,087
Income before income taxes and equity in undistributed earnings of subsidiaries	0	0	0	0
Income tax expense	13,672	14,947	24,289	28,977
Net income (loss) before equity in undistributed earnings of subsidiaries	(13,672)	(14,947)	(24,289)	(28,977)
Equity in undistributed earnings of subsidiaries	31,019	34,266	54,780	67,628
Net income	17,347	19,319	30,491	38,651
Combined Subsidiary Guarantors [Member]
Condensed Financial Statements Captions [Line Items]
Total revenue	389,483	364,503	770,692	723,428
Costs and expenses:
Operating, selling, general and administrative	193,402	185,144	383,239	367,423
Depreciation, amortization and accretion	68,945	63,792	136,761	127,394
Corporate expense allocation	73,874	59,099	145,260	116,895
Total costs and expenses	336,221	308,035	665,260	611,712
Operating income	53,262	56,468	105,432	111,716
Interest expense, net	(1,860)	(1,903)	(3,909)	(3,690)
Debt extinguishment costs	0		0
Interest expense allocation	(19,910)	(19,864)	(45,924)	(39,554)
Income before income taxes and equity in undistributed earnings of subsidiaries	31,492	34,701	55,599	68,472
Income tax expense	473	435	819	844
Net income (loss) before equity in undistributed earnings of subsidiaries	31,019	34,266	54,780	67,628
Equity in undistributed earnings of subsidiaries	0	0	0	0
Net income	31,019	34,266	54,780	67,628
Eliminations [Member]
Condensed Financial Statements Captions [Line Items]
Total revenue	0	0	0	0
Costs and expenses:
Operating, selling, general and administrative	0	0	0	0
Depreciation, amortization and accretion	0	0	0	0
Corporate expense allocation	0	0	0	0
Total costs and expenses	0	0	0	0
Operating income	0	0	0	0
Interest expense, net	0	0	0	0
Debt extinguishment costs	0		0
Interest expense allocation	0	0	0	0
Income before income taxes and equity in undistributed earnings of subsidiaries	0	0	0	0
Income tax expense	0	0	0	0
Net income (loss) before equity in undistributed earnings of subsidiaries	0	0	0	0
Equity in undistributed earnings of subsidiaries	(48,366)	(53,585)	(85,271)	(106,279)
Net income	$ (48,366)	$ (53,585)	$ (85,271)	$ (106,279)

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Fair Value Measurements (Summary Of Carrying Amounts And Fair Values Of Long-Term Debt, Including Current Portion) (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended	6 Months Ended	1 Months Ended	6 Months Ended
	Jun. 30, 2013 Term Loan B - Extended Tranche, Due 2016 [Member]	Dec. 31, 2012 Term Loan B - Extended Tranche, Due 2016 [Member]	Jun. 30, 2013 8% Senior Notes, net of discount [Member]	Apr. 30, 2013 Term Loan B Due 2020, net of discount [Member]	Jun. 30, 2013 Term Loan B Due 2020, net of discount [Member]	Jun. 30, 2013 5 3/8% Senior Notes [Member]	Jun. 30, 2013 2 3/8% Convertible Senior Debentures, net of discount [Member]	Jun. 30, 2012 2 3/8% Convertible Senior Debentures, net of discount [Member]	Jun. 30, 2013 Carrying Value [Member]	Dec. 31, 2012 Carrying Value [Member]	Jun. 30, 2013 Carrying Value [Member] Term Loan B - Extended Tranche, Due 2016 [Member]	Dec. 31, 2012 Carrying Value [Member] Term Loan B - Extended Tranche, Due 2016 [Member]	Jun. 30, 2013 Carrying Value [Member] 8% Senior Notes, net of discount [Member]	Dec. 31, 2012 Carrying Value [Member] 8% Senior Notes, net of discount [Member]	Jun. 30, 2013 Carrying Value [Member] Term Loan B Due 2020, net of discount [Member]	Dec. 31, 2012 Carrying Value [Member] Term Loan B Due 2020, net of discount [Member]	Jun. 30, 2013 Carrying Value [Member] 5 3/8% Senior Notes [Member]	Dec. 31, 2012 Carrying Value [Member] 5 3/8% Senior Notes [Member]	Jun. 30, 2013 Carrying Value [Member] 2 3/8% Convertible Senior Debentures, net of discount [Member]	Dec. 31, 2012 Carrying Value [Member] 2 3/8% Convertible Senior Debentures, net of discount [Member]	Jun. 30, 2013 Fair Value Level 2 [Member]	Dec. 31, 2012 Fair Value Level 2 [Member]	Jun. 30, 2013 Fair Value Level 2 [Member] Term Loan B - Extended Tranche, Due 2016 [Member]	Dec. 31, 2012 Fair Value Level 2 [Member] Term Loan B - Extended Tranche, Due 2016 [Member]	Jun. 30, 2013 Fair Value Level 2 [Member] 8% Senior Notes, net of discount [Member]	Dec. 31, 2012 Fair Value Level 2 [Member] 8% Senior Notes, net of discount [Member]	Jun. 30, 2013 Fair Value Level 2 [Member] Term Loan B Due 2020, net of discount [Member]	Dec. 31, 2012 Fair Value Level 2 [Member] Term Loan B Due 2020, net of discount [Member]	Jun. 30, 2013 Fair Value Level 2 [Member] 5 3/8% Senior Notes [Member]	Dec. 31, 2012 Fair Value Level 2 [Member] 5 3/8% Senior Notes [Member]	Jun. 30, 2013 Fair Value Level 2 [Member] 2 3/8% Convertible Senior Debentures, net of discount [Member]	Dec. 31, 2012 Fair Value Level 2 [Member] 2 3/8% Convertible Senior Debentures, net of discount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term Debt, Carrying Value									$ 1,622,169	$ 1,739,120	$ 0	$ 463,019	$ 428,195	$ 428,001	$ 517,477	$ 0	$ 480,000	$ 480,000	$ 196,497	$ 368,100
Long-term Debt, Fair Value																					$ 1,754,450	$ 1,953,543	$ 0	$ 465,334	$ 456,875	$ 470,850	$ 520,650	$ 0	$ 478,800	$ 505,200	$ 298,125	$ 512,159
Interest rate percentage			8.00%			5.375%	2.375%	2.375%
Debt instruments maturity date	2016	2016	2018	2020	2020	2022	2026

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Earnings Per Common Share and Potential Common Share (Narrative) (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially anti-dilutive shares outstanding	2,900,000	23,900,000	0	23,900,000
2 3/8% Convertible Senior Debentures, Due 2026 [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Interest rate percentage	2.375%	2.375%	2.375%	2.375%

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Condensed Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Statement of Other Comprehensive Income [Abstract]
Net income	$ 17,347	$ 19,319	$ 30,491	$ 38,651
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(28)	(52)	(20)	(60)
Other comprehensive loss, net of tax	(28)	(52)	(20)	(60)
Comprehensive income	$ 17,319	$ 19,267	$ 30,471	$ 38,591

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Condensed Consolidated Statement Of Changes In Stockholders' Equity (USD $) In Thousands, unless otherwise specified	Total	Common Stock [Member]	Treasury Stock [Member]	Additional paid-in capital [Member]	Accumulated deficit [Member]	Accumulated other comprehensive (loss) income [Member]
Balance at Dec. 31, 2012	$ 1,111,939	$ 1,520	$ (10,979)	$ 1,843,126	$ (721,793)	$ 65
Balance (in shares) at Dec. 31, 2012		151,953	(556)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	30,491				30,491
Unrealized loss on available-for-sale securities, net of tax	(20)					(20)
Reacquisition of the equity component of convertible debentures	(78,776)			(78,776)
Purchases of treasury stock (in shares)			(7,653)
Purchases of treasury stock	(205,455)		(205,455)
Exercise of stock options net of withholdings to satisfy employee tax obligations upon vesting of stock awards (in shares)		1,309	1,782
Exercise of stock options net of withholdings to satisfy employee tax obligations upon vesting of stock awards	32,559	13	44,855	(520)	(11,789)
Stock-based compensation (in shares)		498	285
Stock-based compensation	17,876	5	4,796	19,504	(6,429)
Balance at Jun. 30, 2013	$ 908,614	$ 1,538	$ (166,783)	$ 1,783,334	$ (709,520)	$ 45
Balance (in shares) at Jun. 30, 2013		153,760	(6,142)

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Investments

6 Months Ended

Jun. 30, 2013

Investments [Abstract]

Investments

Investments

The Company’s investments at June 30, 2013 and December 31, 2012 are summarized as follows:

	June 30, 2013		December 31, 2012
	(amounts in thousands)
Cash equivalents:
Prime money market mutual funds	$	302,366	$	425,165
U.S. Treasury money market mutual funds	66,044		262,967
Commercial paper	6,695		30,692
Certificates of deposit	—		8,000
Debt securities issued by U.S. Government agencies	—		4,999
Total cash equivalents	375,105		731,823
Investments:
Debt securities issued by the U.S. Treasury	100,350		89,870
Commercial paper	59,976		32,480
Debt securities issued by U.S. Government agencies	29,079		45,214
Certificates of deposit	4,750		—
Total investments	194,155		167,564
Total cash equivalents and investments	$	569,260	$	899,387

At June 30, 2013 and December 31, 2012, the carrying values of investments included in cash and cash equivalents approximated fair value. The aggregate fair value of available-for-sale securities by major security type is included in Note 5. The amortized cost basis of the available-for-sale securities was not materially different from the aggregate fair value. The contractual maturities of the Company’s available-for-sale securities are all within one year.

Proceeds from the sale and maturity of available-for-sale securities were $91.1 million and $69.6 million during the three months ended June 30,2013 and 2012, respectively, and $125.0 million and $106.1 million during the six months ended June 30,2013 and 2012, respectively. Gains and losses on investments are calculated using the specific identification method and are recognized during the period the investment is sold. The Company recognized no material unrealized or realized net gains or losses during the three and six months ended June 30,2013 and 2012.

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Organization and Summary Of Significant Accounting Policies

6 Months Ended

Jun. 30, 2013

Organization And Summary Of Significant Accounting Policies [Abstract]

Organization and Summary Of Significant Accounting Policies

Organization and Summary of Significant Accounting Policies

Description of Business and Capital Structure

tw telecom inc. (together with its wholly-owned subsidiaries, the “Company”) is a leading national provider of managed network services, specializing in business Ethernet, data networking, converged, Internet Protocol ("IP") based virtual private network or "IP VPN", Internet access, voice, including voice over Internet Protocol or “VoIP”, and network security services to enterprise organizations, including public sector entities, and carriers throughout the United States, including their global locations.

The Company has one class of common stock outstanding with one vote per share. The Company also is authorized to issue shares of preferred stock. The Company’s Board of Directors has the authority to establish voting powers, preferences, and special rights for the preferred stock. No shares of preferred stock have been issued.

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. These condensed consolidated financial statements should therefore be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2012 filed with the SEC. The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and include all adjustments of a normal, recurring nature that are, in the opinion of management, necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for an interim period are not necessarily indicative of the results of operations for a full fiscal year.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Recently Adopted Accounting Pronouncements

In February 2013, the Financial Accounting Standards Board (the "FASB") issued an accounting standard update that requires entities to provide information about the amounts reclassified out of accumulated other comprehensive income by component. Additionally, entities are required to present, either on the face of the financial statements or in the notes, significant amounts reclassified out of accumulated other comprehensive income and the respective income statement line items affected by the reclassification. The guidance does not change the current requirements for reporting net income or other comprehensive income. The accounting standard update is effective on a prospective basis for interim and annual periods beginning after December 15, 2012. The Company adopted this accounting standard update in the three months ended March 31, 2013. This update affected presentation and disclosure, but did not affect the Company's consolidated financial position, results of operations or cash flows. See "Accumulated Other Comprehensive Income" below.

Accumulated Other Comprehensive Income

The balance in accumulated other comprehensive income as of June 30, 2013 relates to the Company's investments that are classified as available-for-sale securities. The Company recognized no material changes in accumulated other comprehensive income for the three and six months ended June 30,2013. There were no significant items reclassified out of accumulated other comprehensive income for the three and six months ended June 30,2013.

Revenue

The Company’s revenue is derived primarily from business communications services comprised of the following:

• Data and Internet services include services that enable customers to connect their internal computer networks and to access external networks, including Internet access at high speeds using Ethernet protocol, local and wide-area business Ethernet and IP VPN solutions. Data and Internet services also include a portfolio of managed services including the data and Internet components of converged services, which fully integrates a combination of certain communication applications including IP VPN, Internet, security and managed router service into a single managed IP solution, and the data and Internet components of integrated services, which enable customers to purchase a full array of access options that include Internet services.

• Voice services include traditional and next generation voice capabilities, including voice services provided as standalone and bundled services, long distance and toll free services. Voice services also include the voice components of converged and integrated services.

• Network services are point-to-point services that transmit voice, data and images using state-of-the-art fiber optics, and collocation services that provide secure space with controlled climate and power where customers can locate their equipment to connect to the Company’s network in facilities equipped for enterprise information technology environmental requirements.

The Company also generates revenue from intercarrier compensation. Intercarrier compensation is comprised of switched access services and reciprocal compensation. Switched access represents the compensation from another carrier for the delivery of traffic from a long distance carrier’s point of presence to an end-user’s premises provided through the Company’s switching facilities. The Federal Communications Commission ("FCC") and state public utility commissions regulate switched access rates in their respective jurisdictions. Reciprocal compensation represents compensation from local exchange carriers (“LECs”) for local exchange traffic originated on another LEC’s facilities and terminated on the Company’s facilities.

The Company’s customers include, among others, enterprise organizations in the financial services, technology and scientific, health care, distribution, manufacturing and professional services industries, data center providers, cloud services providers, public sector entities, system integrators and communications service providers, including incumbent local exchange carriers ("ILECs"), competitive local exchange carriers ("CLECs"), wireless communications companies and cable companies.

Revenue for network, data and Internet, and the majority of voice services is generally billed in advance on a monthly fixed rate basis and recognized over the period the services are provided. Revenue for the majority of intercarrier compensation and certain components of voice services, such as long distance, is generally billed on a transactional basis in arrears based on a customer’s actual usage; therefore, estimates are used to recognize revenue in the period earned.

The Company evaluates whether receivables are reasonably assured of collection based on certain factors, including the likelihood of billing being disputed by customers. If there is a billing dispute with a customer, revenue generally is not recognized until the dispute is resolved. The Company does not recognize revenue associated with contract termination charges until cash is received.

The Company classifies certain taxes and fees billed to customers and remitted to government authorities on a gross versus net basis in revenue and expense. In making this determination, the Company assesses, among other things, whether the Company is the primary obligor or principal taxpayer for the taxes and fees assessed in each jurisdiction where the Company does business. In jurisdictions where the Company determines that it is the principal taxpayer, the Company records the taxes and fees on a gross basis, including the taxes and fees in revenue and expense. In jurisdictions where the Company determines that it is merely a collection agent for the government authority, the Company records the taxes on a net basis. The total amounts classified as revenue, primarily included in voice services, associated with such taxes and fees were approximately $20.6 million and $19.8 million for the three months ended June 30,2013 and 2012, respectively, and approximately $41.2 million and $39.5 million for the six months ended June 30,2013 and 2012, respectively.

Significant Customers

The Company has substantial business relationships with a few large customers, including major telecommunications carriers. The Company’s 10 largest customers accounted for an aggregate of 18% and 19% of the Company’s total revenue in the six months ended June 30,2013 and 2012, respectively. No customer accounted for 5% or more of total revenue for the six months ended June 30,2013 or 2012.

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Long-Term Debt and Capital Lease Obligations (Summary Of Long-Term Debt and Capital Lease Obligations) (Details) (USD $) In Thousands, unless otherwise specified			6 Months Ended	12 Months Ended			6 Months Ended			1 Months Ended	6 Months Ended			6 Months Ended			6 Months Ended
	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2013 Term Loan B - Extended Tranche, Due 2016 [Member]	Dec. 31, 2012 Term Loan B - Extended Tranche, Due 2016 [Member]	Jun. 30, 2013 Term Loan B - Extended Tranche, Due 2016 [Member] Term Loan [Member]	Dec. 31, 2012 Term Loan B - Extended Tranche, Due 2016 [Member] Term Loan [Member]	Jun. 30, 2013 8% Senior Notes, Due 2018 [Member]	Jun. 30, 2013 8% Senior Notes, Due 2018 [Member] Senior Notes [Member]	Dec. 31, 2012 8% Senior Notes, Due 2018 [Member] Senior Notes [Member]	Apr. 30, 2013 Term Loan B, due 2020 [Member]	Jun. 30, 2013 Term Loan B, due 2020 [Member]	Jun. 30, 2013 Term Loan B, due 2020 [Member] Term Loan [Member]	Dec. 31, 2012 Term Loan B, due 2020 [Member] Term Loan [Member]	Jun. 30, 2013 5 3/8% Senior Notes, Due 2022 [Member]	Jun. 30, 2013 5 3/8% Senior Notes, Due 2022 [Member] Senior Notes [Member]	Dec. 31, 2012 5 3/8% Senior Notes, Due 2022 [Member] Senior Notes [Member]	Jun. 30, 2013 2 3/8% Convertible Senior Debentures, Due 2026 [Member]	Jun. 30, 2012 2 3/8% Convertible Senior Debentures, Due 2026 [Member]	Jun. 30, 2013 2 3/8% Convertible Senior Debentures, Due 2026 [Member] Convertible and Unsecured Debenture [Member]		Dec. 31, 2012 2 3/8% Convertible Senior Debentures, Due 2026 [Member] Convertible and Unsecured Debenture [Member]
Debt Instrument [Line Items]
Long-term debt					$ 0	$ 463,019		$ 430,000	$ 430,000			$ 520,000	$ 0		$ 480,000	$ 480,000			$ 196,497	[1]	$ 373,743	[1]
Capital lease obligations	23,536	20,091
Total obligations	1,650,033	1,766,853
Unamortized discounts	(4,328)	(7,642)
Current portion	(203,902)	(374,969)
Total long-term debt and capital lease obligations	$ 1,441,803	$ 1,384,242
Interest rate percentage							8.00%							5.375%			2.375%	2.375%
Debt instruments maturity date			2016	2016			2018			2020	2020			2022			2026

[1] Subsequent to June 30, 2013, the remaining outstanding amount of Convertible Debentures were retired. See "Retirement of Convertible Debentures including Subsequent Event" below.

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Stock-Based Compensation (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2013
Restricted Stock Awards And Units Member
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock awards and units granted (shares)	1.4
Unvested restricted stock awards and units (shares)	4.2
Unrecognized compensation expense	$ 75.4
Weighted-average recognition period (in years)	2 years 6 months
Stock Options Member
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options granted (shares)	0
Options outstanding (shares)	1.8
Options exercisable (shares)	1.6
Unrecognized compensation expense	$ 0.7
Weighted-average recognition period (in years)	7 months 6 days

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Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Statement of Financial Position [Abstract]
Receivables, allowances	$ 6,705	$ 7,067
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	20,000	20,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	439,800	439,800
Common stock, shares issued (in shares)	153,760	151,953
Treasury stock, shares (in shares)	6,142	556

XML

Stock-Based Compensation

6 Months Ended

Jun. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Stock-Based Compensation

During the six months ended June 30,2013, the Company granted restricted stock awards and restricted stock units with respect to 1.4 million shares and no stock options. As of June 30, 2013, the Company had 4.2 million restricted stock awards and restricted stock units that were unvested and 1.8 million stock options outstanding, of which 1.6 million were exercisable.

As of June 30, 2013, there was $75.4 million of total unrecognized compensation expense related to unvested restricted stock awards and restricted stock units, which is expected to be recognized over a weighted-average period of 2.5 years, and $0.7 million of total unrecognized compensation expense related to unvested stock options, which is expected to be recognized over a weighted-average period of 0.6 years.

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Condensed Consolidated Statements Of Operations (Parenthetical) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Operating
Allocated share-based compensation expense	$ 545	$ 455	$ 1,128	$ 955
Selling, general and administrative
Allocated share-based compensation expense	$ 7,869	$ 6,594	$ 16,748	$ 14,222

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 420,265	$ 806,728
Investments	194,155	167,564
Receivables, less allowances of $6,705 and $7,067, respectively	109,765	99,703
Prepaid expenses and other current assets	28,817	19,164
Deferred income taxes	76,160	76,160
Total current assets	829,162	1,169,319
Property, plant and equipment	4,421,375	4,247,868
Less accumulated depreciation	(2,874,081)	(2,755,622)
Property, plant and equipment, net, total	1,547,294	1,492,246
Deferred income taxes	77,582	101,885
Goodwill	412,694	412,694
Intangible assets, net of accumulated amortization	14,557	17,578
Other assets, net	33,897	30,015
Total assets	2,915,186	3,223,737
Current liabilities:
Accounts payable	61,321	55,857
Deferred revenue	47,501	45,471
Accrued taxes, franchise and other fees	57,747	60,844
Accrued interest	19,408	20,343
Accrued payroll and benefits	47,174	45,727
Accrued carrier costs	24,327	30,765
Current portion debt and capital lease obligations, net	203,902	374,969
Other current liabilities	37,571	29,163
Total current liabilities	498,951	663,139
Long-term debt and capital lease obligations, net	1,441,803	1,384,242
Long-term deferred revenue	21,615	23,177
Other long-term liabilities	44,203	41,240
Commitments and contingencies (Note 7)
Stockholders' equity:
Preferred stock, $0.01 par value, 20,000 shares authorized, no shares issued and outstanding	0	0
Common stock, $0.01 par value, 439,800 shares authorized and 153,760 and 151,953 shares issued, respectively	1,538	1,520
Additional paid-in capital	1,783,334	1,843,126
Treasury stock, 6,142 and 556 shares, at cost, respectively	(166,783)	(10,979)
Accumulated deficit	(709,520)	(721,793)
Accumulated other comprehensive income	45	65
Total stockholders' equity	908,614	1,111,939
Total liabilities and stockholders' equity	$ 2,915,186	$ 3,223,737

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Long-Term Debt and Capital Lease Obligations (Textuals) (Details) (USD $)	6 Months Ended			12 Months Ended	1 Months Ended	6 Months Ended	3 Months Ended								0 Months Ended	12 Months Ended	1 Months Ended
	Jun. 30, 2013	Jun. 30, 2013 2 3/8% Convertible Senior Debentures, Due 2026 [Member]	Jun. 30, 2013 Term Loan B - Extended Tranche, Due 2016 [Member]	Dec. 31, 2012 Term Loan B - Extended Tranche, Due 2016 [Member]	Apr. 30, 2013 Term Loan B Due 2020, net of discount [Member]	Jun. 30, 2013 Term Loan B Due 2020, net of discount [Member]	Jun. 30, 2013 Convertible and Unsecured Debenture [Member] 2 3/8% Convertible Senior Debentures, Due 2026 [Member]		Dec. 31, 2012 Convertible and Unsecured Debenture [Member] 2 3/8% Convertible Senior Debentures, Due 2026 [Member]		Jun. 30, 2013 Term Loan [Member] Term Loan B - Extended Tranche, Due 2016 [Member]	Dec. 31, 2012 Term Loan [Member] Term Loan B - Extended Tranche, Due 2016 [Member]	Jun. 30, 2013 Term Loan [Member] Term Loan B Due 2020, net of discount [Member]	Dec. 31, 2012 Term Loan [Member] Term Loan B Due 2020, net of discount [Member]	Jul. 03, 2013 Repayment of Debt [Member] Subsequent Event [Member] Convertible and Unsecured Debenture [Member] 2 3/8% Convertible Senior Debentures, Due 2026 [Member]	Dec. 31, 2012 Revolving Credit Facility [Member]	Apr. 30, 2013 Revolving Credit Facility 2018 [Member]	Apr. 30, 2013 Minimum [Member] Revolving Credit Facility 2018 [Member]	Apr. 30, 2013 Maximum [Member] Revolving Credit Facility 2018 [Member]
Debt Instrument [Line Items]
Redemption Price On Or After April Six Two Thousand Thirteen For Convertible Debentures							100.00%
Debt instrument redemption price							100.00%
Debt Instrument, Quarterly Repayment Percentage of Principal					0.25%
Long-term debt							$ 196,497,000	[1]	$ 373,743,000	[1]	$ 0	$ 463,019,000	$ 520,000,000	$ 0
Cash Settlements of Convertible Debentures							255,800,000								296,900,000
Principal Amount of Convertible Debenture Repurchase and Conversion Settled							177,200,000								196,497,000
Offering price as percentage of principal amount					99.50%
Debt Instrument, Covenant Compliance	As of June 30, 2013, tw telecom inc. and its wholly-owned subsidiary, tw telecom holdings inc. ("Holdings"), were in compliance with all of their debt covenants.
Line of Credit Facility, Maximum Borrowing Capacity																80,000,000	100,000,000
Debt Instrument, Face Amount					520,000,000
Debt Instrument, Maturity Date, Description		2026	2016	2016	2020	2020										2014	2018
Debt Instrument, Basis Spread on Variable Rate					2.50%													1.75%	2.75%
Debt Instrument, Interest Rate, Effective Percentage						2.70%
Deferred Finance Costs, Gross					$ 4,600,000												$ 1,400,000
Line of Credit Facility, Commitment Fee Percentage																		0.375%	0.50%

[1] Subsequent to June 30, 2013, the remaining outstanding amount of Convertible Debentures were retired. See "Retirement of Convertible Debentures including Subsequent Event" below.

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Organization and Summary Of Significant Accounting Policies (Details) (USD $) Share data in Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013 votes classes	Jun. 30, 2012	Jun. 30, 2013 customers votes classes	Jun. 30, 2012 customers	Dec. 31, 2012
Organization And Summary Of Significant Accounting Policies [Abstract]
Classes of common shares	1		1
Votes per share	1		1
Preferred stock, shares issued (in shares)	0		0		0
Material changes in accumulated other comprehensive income	$ 0		$ 0
Significant items reclassified out of accumulated other comprehensive income	0		0
Revenue associated with certain taxes and fees	$ 20,600,000	$ 19,800,000	$ 41,200,000	$ 39,500,000
Number of customers that account for greater than 5% of revenue			0	0
Ten largest customers percentage of total revenue			18.00%	19.00%

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Supplemental Guarantor Information (Condensed Consolidated Statement of Comprehensive Income) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Condensed Financial Statements Captions [Line Items]
Net income	$ 17,347	$ 19,319	$ 30,491	$ 38,651
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(28)	(52)	(20)	(60)
Other comprehensive loss, net of tax	(28)	(52)	(20)	(60)
Comprehensive income	17,319	19,267	30,471	38,591
Parent Guarantor [Member]
Condensed Financial Statements Captions [Line Items]
Net income	17,347	19,319	30,491	38,651
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(28)	(52)	(20)	(60)
Other comprehensive loss, net of tax	(28)	(52)	(20)	(60)
Comprehensive income	17,319	19,267	30,471	38,591
Issuer [Member]
Condensed Financial Statements Captions [Line Items]
Net income	17,347	19,319	30,491	38,651
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(28)	(52)	(20)	(60)
Other comprehensive loss, net of tax	(28)	(52)	(20)	(60)
Comprehensive income	17,319	19,267	30,471	38,591
Combined Subsidiary Guarantors [Member]
Condensed Financial Statements Captions [Line Items]
Net income	31,019	34,266	54,780	67,628
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	0	0	0	0
Other comprehensive loss, net of tax	0	0	0	0
Comprehensive income	31,019	34,266	54,780	67,628
Eliminations [Member]
Condensed Financial Statements Captions [Line Items]
Net income	(48,366)	(53,585)	(85,271)	(106,279)
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	28	52	20	60
Other comprehensive loss, net of tax	28	52	20	60
Comprehensive income	$ (48,338)	$ (53,533)	$ (85,251)	$ (106,219)

XML

Supplemental Guarantor Information (Condensed Consolidating Statement Of Cash Flows) (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Cash flows from operating activities:
Net income	$ 30,491	$ 38,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	150,047	138,863
Deferred income taxes	24,289	28,977
Stock-based compensation expense	17,876	15,177
Amortization of discount on debt and deferred debt issue costs and other	8,249	12,367
Intercompany and equity investment changes	0	0
Changes in operating assets and liabilities	(24,392)	(25,436)
Net cash provided by operating activities	206,560	208,599
Cash flows from investing activities:
Capital expenditures	(187,509)	(157,575)
Purchases of investments	(157,523)	(119,813)
Proceeds from sale of investments	125,041	106,053
Other investing activities, net	(465)	5,707
Net cash used in investing activities	(220,456)	(165,628)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	32,559	5,828
Purchases of treasury stock	(197,310)	(11,519)
Excess tax benefits from stock-based compensation	944	716
Net proceeds from modification of debt, net of debt issuance costs	49,684	0
Retirement of convertible debt obligations	(256,348)	0
Payment of debt and capital lease obligations	(2,096)	(3,712)
Net cash used in financing activities	(372,567)	(8,687)
(Decrease) increase in cash and cash equivalents	(386,463)	34,284
Cash and cash equivalents at beginning of period	806,728	353,394
Cash and cash equivalents at end of period	420,265	387,678
Parent Guarantor [Member]
Cash flows from operating activities:
Net income	30,491	38,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	0	0
Deferred income taxes	0	0
Stock-based compensation expense	0	0
Amortization of discount on debt and deferred debt issue costs and other	6,244	11,029
Intercompany and equity investment changes	385,403	(43,989)
Changes in operating assets and liabilities	(1,039)	0
Net cash provided by operating activities	421,099	5,691
Cash flows from investing activities:
Capital expenditures	0	0
Purchases of investments	0	0
Proceeds from sale of investments	0	0
Other investing activities, net	0	0
Net cash used in investing activities	0	0
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	32,559	5,828
Purchases of treasury stock	(197,310)	(11,519)
Excess tax benefits from stock-based compensation	0	0
Net proceeds from modification of debt, net of debt issuance costs	0
Retirement of convertible debt obligations	(256,348)
Payment of debt and capital lease obligations	0	0
Net cash used in financing activities	(421,099)	(5,691)
(Decrease) increase in cash and cash equivalents	0	0
Cash and cash equivalents at beginning of period	24,544	24,543
Cash and cash equivalents at end of period	24,544	24,543
Issuer [Member]
Cash flows from operating activities:
Net income	30,491	38,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	13,286	11,469
Deferred income taxes	24,289	28,977
Stock-based compensation expense	0	0
Amortization of discount on debt and deferred debt issue costs and other	2,005	1,338
Intercompany and equity investment changes	(466,631)	(15,137)
Changes in operating assets and liabilities	15,973	(9,986)
Net cash provided by operating activities	(380,587)	55,312
Cash flows from investing activities:
Capital expenditures	(22,465)	(6,067)
Purchases of investments	(157,523)	(119,813)
Proceeds from sale of investments	125,041	106,053
Other investing activities, net	(83)	1,310
Net cash used in investing activities	(55,030)	(18,517)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	0	0
Purchases of treasury stock	0	0
Excess tax benefits from stock-based compensation	944	716
Net proceeds from modification of debt, net of debt issuance costs	49,684
Retirement of convertible debt obligations	0
Payment of debt and capital lease obligations	(1,474)	(3,227)
Net cash used in financing activities	49,154	(2,511)
(Decrease) increase in cash and cash equivalents	(386,463)	34,284
Cash and cash equivalents at beginning of period	782,184	328,851
Cash and cash equivalents at end of period	395,721	363,135
Combined Subsidiary Guarantors [Member]
Cash flows from operating activities:
Net income	54,780	67,628
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	136,761	127,394
Deferred income taxes	0	0
Stock-based compensation expense	17,876	15,177
Amortization of discount on debt and deferred debt issue costs and other	0	0
Intercompany and equity investment changes	(4,043)	(47,153)
Changes in operating assets and liabilities	(39,326)	(15,450)
Net cash provided by operating activities	166,048	147,596
Cash flows from investing activities:
Capital expenditures	(165,044)	(151,508)
Purchases of investments	0	0
Proceeds from sale of investments	0	0
Other investing activities, net	(382)	4,397
Net cash used in investing activities	(165,426)	(147,111)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	0	0
Purchases of treasury stock	0	0
Excess tax benefits from stock-based compensation	0	0
Net proceeds from modification of debt, net of debt issuance costs	0
Retirement of convertible debt obligations	0
Payment of debt and capital lease obligations	(622)	(485)
Net cash used in financing activities	(622)	(485)
(Decrease) increase in cash and cash equivalents	0	0
Cash and cash equivalents at beginning of period	0	0
Cash and cash equivalents at end of period	0	0
Eliminations [Member]
Cash flows from operating activities:
Net income	(85,271)	(106,279)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	0	0
Deferred income taxes	0	0
Stock-based compensation expense	0	0
Amortization of discount on debt and deferred debt issue costs and other	0	0
Intercompany and equity investment changes	85,271	106,279
Changes in operating assets and liabilities	0	0
Net cash provided by operating activities	0	0
Cash flows from investing activities:
Capital expenditures	0	0
Purchases of investments	0	0
Proceeds from sale of investments	0	0
Other investing activities, net	0	0
Net cash used in investing activities	0	0
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	0	0
Purchases of treasury stock	0	0
Excess tax benefits from stock-based compensation	0	0
Net proceeds from modification of debt, net of debt issuance costs	0
Retirement of convertible debt obligations	0
Payment of debt and capital lease obligations	0	0
Net cash used in financing activities	0	0
(Decrease) increase in cash and cash equivalents	0	0
Cash and cash equivalents at beginning of period	0	0
Cash and cash equivalents at end of period	$ 0	$ 0

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Fair Value Measurements

6 Months Ended

Jun. 30, 2013

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Fair value, as defined by relevant accounting standards, is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would complete a transaction and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions and risk of nonperformance.

Fair Value Hierarchy

Relevant accounting standards set forth a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Relevant accounting standards establish three levels of inputs that may be used to measure fair value:

• Level 1—Quoted prices in active markets for identical assets or liabilities. Level 1 assets that are measured at fair value on a recurring basis consist of the Company’s investments in prime money market mutual funds and U.S. Treasury money market mutual funds that are traded in an active market with sufficient volume and frequency of transactions, and are included as a component of cash and cash equivalents in the condensed consolidated balance sheets.

• Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets that are measured at fair value on a recurring basis consist of the Company’s investments in certificates of deposit, commercial paper and debt securities issued by the U.S. Treasury and other U.S. government agencies using observable inputs in less active markets and are included as a component of cash and cash equivalents and investments in the condensed consolidated balance sheets. Level 2 liabilities that are measured, but not carried, at fair value on a recurring basis include the Company’s long-term debt. The Company’s long-term debt has not been listed on any securities exchange or quoted on an inter-dealer automated quotation system. The Company has estimated the fair value of its long-term debt based on indicative pricing published by certain investment banks or trading levels in our long-term debt.

• Level 3—Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities. The Company did not have any Level 3 assets or liabilities that were measured at fair value at June 30, 2013 and December 31, 2012.

The following table reflects assets and liabilities that are measured and carried at fair value on a recurring basis at June 30, 2013 and December 31, 2012:

	Fair Value Measurements At June 30, 2013						Assets at Fair Value
	Level 1		Level 2		Level 3
	(amounts in thousands)
Assets
Prime money market mutual funds	$	302,366	$	—	$	—	$	302,366
U.S. Treasury money market mutual funds	66,044		—		—		66,044
Commercial paper	—		6,695		—		6,695
Investments included in cash and cash equivalents	$	368,410	$	6,695	$	—	$	375,105
Debt securities issued by the U.S. Treasury	—		100,350		—		100,350
Commercial paper	—		59,976		—		59,976
Debt securities issued by U.S. Government agencies	—		29,079		—		29,079
Certificates of deposit	—		4,750		—		4,750
Short-term investments	$	—	$	194,155	$	—	$	194,155
Total assets	$	368,410	$	200,850	$	—	$	569,260

	Fair Value Measurements At December 31, 2012						Assets at Fair Value
	Level 1		Level 2		Level 3
	(amounts in thousands)
Assets
Prime money market mutual funds	$	425,165	$	—	$	—	$	425,165
U.S. Treasury money market mutual funds	262,967		—		—		262,967
Commercial paper	—		30,692		—		30,692
Certificates of deposit	—		8,000		—		8,000
Debt securities issued by U.S. Government agencies	—		4,999		—		4,999
Investments included in cash and cash equivalents	$	688,132	$	43,691	$	—	$	731,823
Debt securities issued by the U.S. Treasury	—		89,870		—		89,870
Debt securities issued by U.S. Government agencies	—		45,214		—		45,214
Commercial paper	—		32,480		—		32,480
Short-term investments	$	—	$	167,564	$	—	$	167,564
Total assets	$	688,132	$	211,255	$	—	$	899,387

The following table summarizes the carrying amounts and estimated fair values of the Company’s long-term debt, including the current portion, at June 30, 2013 and December 31, 2012:

	June 30, 2013				December 31, 2012
	Carrying Value		Fair Value Level 2		Carrying Value		Fair Value Level 2
	(amounts in thousands)
Term Loan B - Extended tranche, due 2016	$	—	$	—	$	463,019	$	465,334
8% Senior Notes, net of discount	428,195		456,875		428,001		470,850
Term Loan B, net of discount	517,477		520,650		—		—
53/8% Senior Notes	480,000		478,800		480,000		505,200
23/8% Convertible Senior Debentures, net of discount	196,497		298,125		368,100		512,159
Total debt	$	1,622,169	$	1,754,450	$	1,739,120	$	1,953,543

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Fair Value Measurements (Schedule Of Assets And Liabilities Measured And Carried At Fair Value On Recurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	$ 375,105	$ 731,823
Short-term investments	194,155	167,564
Fair Value, Measurements, Recurring [Member] | Fair Value Measurements, Level 1 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	368,410	688,132
Short-term investments	0	0
Total assets	368,410	688,132
Fair Value, Measurements, Recurring [Member] | Fair Value Measurements, Level 2 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	6,695	43,691
Short-term investments	194,155	167,564
Total assets	200,850	211,255
Fair Value, Measurements, Recurring [Member] | Fair Value Measurements, Level 3 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	0	0
Short-term investments	0	0
Total assets	0	0
Fair Value, Measurements, Recurring [Member] | Estimate of Fair Value [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	375,105	731,823
Short-term investments	194,155	167,564
Total assets	569,260	899,387
Fair Value, Measurements, Recurring [Member] | Money Market Funds [Member] | Fair Value Measurements, Level 1 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	302,366	425,165
Fair Value, Measurements, Recurring [Member] | Money Market Funds [Member] | Fair Value Measurements, Level 2 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	0	0
Fair Value, Measurements, Recurring [Member] | Money Market Funds [Member] | Fair Value Measurements, Level 3 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	0	0
Fair Value, Measurements, Recurring [Member] | Money Market Funds [Member] | Estimate of Fair Value [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	302,366	425,165
Fair Value, Measurements, Recurring [Member] | U.S. Treasury money market mutual funds [Member] | Fair Value Measurements, Level 1 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	66,044	262,967
Fair Value, Measurements, Recurring [Member] | U.S. Treasury money market mutual funds [Member] | Fair Value Measurements, Level 2 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	0	0
Fair Value, Measurements, Recurring [Member] | U.S. Treasury money market mutual funds [Member] | Fair Value Measurements, Level 3 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	0	0
Fair Value, Measurements, Recurring [Member] | U.S. Treasury money market mutual funds [Member] | Estimate of Fair Value [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	66,044	262,967
Fair Value, Measurements, Recurring [Member] | Commercial paper [Member] | Fair Value Measurements, Level 1 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	0	0
Short-term investments	0	0
Fair Value, Measurements, Recurring [Member] | Commercial paper [Member] | Fair Value Measurements, Level 2 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	6,695	30,692
Short-term investments	59,976	32,480
Fair Value, Measurements, Recurring [Member] | Commercial paper [Member] | Fair Value Measurements, Level 3 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	0	0
Short-term investments	0	0
Fair Value, Measurements, Recurring [Member] | Commercial paper [Member] | Estimate of Fair Value [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents	6,695	30,692
Short-term investments	59,976	32,480
Fair Value, Measurements, Recurring [Member] | Debt securities issued by U.S. Treasury [Member] | Fair Value Measurements, Level 1 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Short-term investments	0	0
Fair Value, Measurements, Recurring [Member] | Debt securities issued by U.S. Treasury [Member] | Fair Value Measurements, Level 2 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Short-term investments	100,350	89,870
Fair Value, Measurements, Recurring [Member] | Debt securities issued by U.S. Treasury [Member] | Fair Value Measurements, Level 3 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Short-term investments	0	0
Fair Value, Measurements, Recurring [Member] | Debt securities issued by U.S. Treasury [Member] | Estimate of Fair Value [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Short-term investments	100,350	89,870
Fair Value, Measurements, Recurring [Member] | Debt securities issued by U.S. Government agencies [Member] | Fair Value Measurements, Level 1 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents		0
Short-term investments	0	0
Fair Value, Measurements, Recurring [Member] | Debt securities issued by U.S. Government agencies [Member] | Fair Value Measurements, Level 2 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents		4,999
Short-term investments	29,079	45,214
Fair Value, Measurements, Recurring [Member] | Debt securities issued by U.S. Government agencies [Member] | Fair Value Measurements, Level 3 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents		0
Short-term investments	0	0
Fair Value, Measurements, Recurring [Member] | Debt securities issued by U.S. Government agencies [Member] | Estimate of Fair Value [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents		4,999
Short-term investments	29,079	45,214
Fair Value, Measurements, Recurring [Member] | Certificates of deposit [Member] | Fair Value Measurements, Level 1 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents		0
Short-term investments	0
Fair Value, Measurements, Recurring [Member] | Certificates of deposit [Member] | Fair Value Measurements, Level 2 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents		8,000
Short-term investments	4,750
Fair Value, Measurements, Recurring [Member] | Certificates of deposit [Member] | Fair Value Measurements, Level 3 [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents		0
Short-term investments	0
Fair Value, Measurements, Recurring [Member] | Certificates of deposit [Member] | Estimate of Fair Value [Member]
Fair Value, Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investments included in cash and cash equivalents		8,000
Short-term investments	$ 4,750

XML

Supplemental Guarantor Information

6 Months Ended

Jun. 30, 2013

Supplemental Guarantor Information [Abstract]

Supplemental Guarantor Information

Supplemental Guarantor Information

The 8% Senior Notes due 2018 (the “2018 Notes”) and 5³/₈% Senior Notes due 2022 (the "2022 Notes") are unsecured obligations of Holdings ("Issuer") and are guaranteed by the Company (“Parent Guarantor”) and substantially all of the Issuer’s subsidiaries (“Combined Subsidiary Guarantors”). The guarantees are joint and several. A significant amount of the Issuer’s cash flow is generated by the Combined Subsidiary Guarantors. As a result, funds necessary to meet the Issuer’s debt service obligations are provided in large part by distributions or advances from the Combined Subsidiary Guarantors. The 2018 Notes and 2022 Notes are governed by an indenture that contains certain restrictive covenants. These restrictions affect, and in many respects limit or prohibit, among other things, the ability of the Parent Guarantor, the Issuer and its subsidiaries to incur indebtedness, make prepayments of certain indebtedness, pay dividends, make investments, engage in transactions with stockholders and affiliates, issue capital stock of subsidiaries, create liens, sell assets and engage in mergers and consolidations.

The following information sets forth the Company’s Condensed Consolidating Balance Sheets as of June 30, 2013 and December 31, 2012, Condensed Consolidating Statements of Operations for the three and six months ended June 30,2013 and 2012, Condensed Consolidating Statements of Comprehensive Income for the three and six months ended June 30,2013 and 2012, and Condensed Consolidating Statements of Cash Flows for the six months ended June 30,2013 and 2012.

tw telecom inc.

CONDENSED CONSOLIDATING BALANCE SHEET

June 30, 2013

(unaudited)

	Parent Guarantor		Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	24,544	$	395,721		$	—		$	—		$	420,265
Investments	—		194,155			—			—			194,155
Receivables, net	—		—			109,765			—			109,765
Prepaid expenses and other current assets	—		19,599			9,218			—			28,817
Deferred income taxes	—		76,140			20			—			76,160
Intercompany receivable	1,407,656		969,335			—			(2,376,991		)	—
Total current assets	1,432,200		1,654,950			119,003			(2,376,991		)	829,162
Property, plant and equipment, net	—		57,949			1,489,345			—			1,547,294
Deferred income taxes	—		77,098			484			—			77,582
Goodwill	—		—			412,694			—			412,694
Intangible and other assets, net	—		25,181			23,273			—			48,454
Total assets	$	1,432,200	$	1,815,178		$	2,044,799		$	(2,376,991	)	$	2,915,186
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—	$	8,996		$	52,325		$	—		$	61,321
Current portion debt and capital lease obligations	196,497		5,782			1,623			—			203,902
Other current liabilities	1,180		82,055			150,493			—			233,728
Intercompany payable	—		—			2,376,991			(2,376,991		)	—
Total current liabilities	197,677		96,833			2,581,432			(2,376,991		)	498,951
Losses in subsidiary in excess of investment	325,940		858,775			—			(1,184,715		)	—
Long-term debt and capital lease obligations, net	—		1,420,566			21,237			—			1,441,803
Long-term deferred revenue	—		—			21,615			—			21,615
Other long-term liabilities	—		7,392			36,811			—			44,203
Stockholders’ equity (deficit)	908,583		(568,388		)	(616,296		)	1,184,715			908,614
Total liabilities and stockholders’ equity	$	1,432,200	$	1,815,178		$	2,044,799		$	(2,376,991	)	$	2,915,186

tw telecom inc.

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2012

	Parent Guarantor		Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	24,544	$	782,184		$	—		$	—		$	806,728
Investments	—		167,564			—			—			167,564
Receivables, net	—		—			99,703			—			99,703
Prepaid expenses and other current assets	—		11,270			7,894			—			19,164
Deferred income taxes	—		76,140			20			—			76,160
Intercompany receivable	1,864,694		506,610			—			(2,371,304		)	—
Total current assets	1,889,238		1,543,768			107,617			(2,371,304		)	1,169,319
Property, plant and equipment, net	—		48,686			1,443,560			—			1,492,246
Deferred income taxes	—		101,401			484			—			101,885
Goodwill	—		—			412,694			—			412,694
Intangible and other assets, net	275		20,634			26,684			—			47,593
Total assets	$	1,889,513	$	1,714,489		$	1,991,039		$	(2,371,304	)	$	3,223,737
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—	$	7,141		$	48,716		$	—		$	55,857
Current portion debt and capital lease obligations, net	368,100		5,475			1,394			—			374,969
Other current liabilities	2,219		64,564			165,530			—			232,313
Intercompany payable	—		—			2,371,304			(2,371,304		)	—
Total current liabilities	370,319		77,180			2,586,944			(2,371,304		)	663,139
Losses in subsidiary in excess of investment	407,286		862,681			—			(1,269,967		)	—
Long-term debt and capital lease obligations, net	—		1,366,463			17,779			—			1,384,242
Long-term deferred revenue	—		—			23,177			—			23,177
Other long-term liabilities	—		7,024			34,216			—			41,240
Stockholders’ equity (deficit)	1,111,908		(598,859		)	(671,077		)	1,269,967			1,111,939
Total liabilities and stockholders’ equity (deficit)	$	1,889,513	$	1,714,489		$	1,991,039		$	(2,371,304	)	$	3,223,737

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Three Months Ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	389,483		$	—		$	389,483
Costs and expenses:
Operating, selling, general and administrative	—			67,167			193,402			—			260,569
Depreciation, amortization and accretion	—			6,707			68,945			—			75,652
Corporate expense allocation	—			(73,874		)	73,874			—			—
Total costs and expenses	—			—			336,221			—			336,221
Operating income	—			—			53,262			—			53,262
Interest expense, net	(1,569		)	(17,942		)	(1,860		)	—			(21,371		)
Debt extinguishment costs	(327		)	(72		)	—			—			(399		)
Interest expense allocation	1,896			18,014			(19,910		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			31,492			—			31,492
Income tax expense	—			13,672			473			—			14,145
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(13,672		)	31,019			—			17,347
Equity in undistributed earnings of subsidiaries	17,347			31,019			—			(48,366		)	—
Net income	$	17,347		$	17,347		$	31,019		$	(48,366	)	$	17,347

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Three Months Ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	364,503		$	—		$	364,503
Costs and expenses:
Operating, selling, general and administrative	—			52,422			185,144			—			237,566
Depreciation, amortization and accretion	—			6,677			63,792			—			70,469
Corporate expense allocation	—			(59,099		)	59,099			—			—
Total costs and expenses	—			—			308,035			—			308,035
Operating income	—			—			56,468			—			56,468
Interest expense, net	(7,789		)	(12,075		)	(1,903		)	—			(21,767		)
Interest expense allocation	7,789			12,075			(19,864		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			34,701			—			34,701
Income tax expense	—			14,947			435			—			15,382
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(14,947		)	34,266			—			19,319
Equity in undistributed earnings of subsidiaries	19,319			34,266			—			(53,585		)	—
Net income	$	19,319		$	19,319		$	34,266		$	(53,585	)	$	19,319

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	770,692		$	—		$	770,692
Costs and expenses:
Operating, selling, general and administrative	—			131,974			383,239			—			515,213
Depreciation, amortization and accretion	—			13,286			136,761			—			150,047
Corporate expense allocation	—			(145,260		)	145,260			—			—
Total costs and expenses	—			—			665,260			—			665,260
Operating income	—			—			105,432			—			105,432
Interest expense, net	(9,705		)	(35,820		)	(3,909		)	—			(49,434		)
Debt extinguishment costs	(327		)	(72		)	—			—			(399		)
Interest expense allocation	10,032			35,892			(45,924		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			55,599			—			55,599
Income tax expense	—			24,289			819			—			25,108
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(24,289		)	54,780			—			30,491
Equity in undistributed earnings of subsidiaries	30,491			54,780			—			(85,271		)	—
Net income	$	30,491		$	30,491		$	54,780		$	(85,271	)	$	30,491

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	723,428		$	—		$	723,428
Costs and expenses:
Operating, selling, general and administrative	—			105,426			367,423			—			472,849
Depreciation, amortization and accretion	—			11,469			127,394			—			138,863
Corporate expense allocation	—			(116,895		)	116,895			—			—
Total costs and expenses	—			—			611,712			—			611,712
Operating income	—			—			111,716			—			111,716
Interest expense, net	(15,467		)	(24,087		)	(3,690		)	—			(43,244		)
Interest expense allocation	15,467			24,087			(39,554		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			68,472			—			68,472
Income tax expense	—			28,977			844			—			29,821
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(28,977		)	67,628			—			38,651
Equity in undistributed earnings of subsidiaries	38,651			67,628			—			(106,279		)	—
Net income	$	38,651		$	38,651		$	67,628		$	(106,279	)	$	38,651

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Three Months Ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	17,347		$	17,347		$	31,019	$	(48,366	)	$	17,347
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(28		)	(28		)	—		28			(28		)
Other comprehensive loss, net of tax	(28		)	(28		)	—		28			(28		)
Comprehensive income	$	17,319		$	17,319		$	31,019	$	(48,338	)	$	17,319

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Three Months Ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	19,319		$	19,319		$	34,266	$	(53,585	)	$	19,319
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(52		)	(52		)	—		52			(52		)
Other comprehensive loss, net of tax	(52		)	(52		)	—		52			(52		)
Comprehensive income	$	19,267		$	19,267		$	34,266	$	(53,533	)	$	19,267

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	30,491		$	30,491		$	54,780	$	(85,271	)	$	30,491
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(20		)	(20		)	—		20			(20		)
Other comprehensive loss, net of tax	(20		)	(20		)	—		20			(20		)
Comprehensive income	$	30,471		$	30,471		$	54,780	$	(85,251	)	$	30,471

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	38,651		$	38,651		$	67,628	$	(106,279	)	$	38,651
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(60		)	(60		)	—		60			(60		)
Other comprehensive loss, net of tax	(60		)	(60		)	—		60			(60		)
Comprehensive income	$	38,591		$	38,591		$	67,628	$	(106,219	)	$	38,591

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Cash flows from operating activities:
Net income	$	30,491		$	30,491		$	54,780		$	(85,271	)	$	30,491
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	—			13,286			136,761			—			150,047
Deferred income taxes	—			24,289			—			—			24,289
Stock-based compensation expense	—			—			17,876			—			17,876
Amortization of discount on debt and deferred debt issue costs and other	6,244			2,005			—			—			8,249
Intercompany and equity investment changes	385,403			(466,631		)	(4,043		)	85,271			—
Changes in operating assets and liabilities	(1,039		)	15,973			(39,326		)	—			(24,392		)
Net cash provided by (used in) operating activities	421,099			(380,587		)	166,048			—			206,560
Cash flows from investing activities:
Capital expenditures	—			(22,465		)	(165,044		)	—			(187,509		)
Purchases of investments	—			(157,523		)	—			—			(157,523		)
Proceeds from sale of investments	—			125,041			—			—			125,041
Other investing activities, net	—			(83		)	(382		)	—			(465		)
Net cash used in investing activities	—			(55,030		)	(165,426		)	—			(220,456		)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	32,559			—			—			—			32,559
Purchases of treasury stock	(197,310		)	—			—			—			(197,310		)
Excess tax benefits from stock-based compensation	—			944			—			—			944
Net proceeds from modification of debt, net of debt issuance costs	—			49,684			—			—			49,684
Retirement of convertible debt obligations	(256,348		)	—			—			—			(256,348		)
Payment of debt and capital lease obligations	—			(1,474		)	(622		)	—			(2,096		)
Net cash (used in) provided by financing activities	(421,099		)	49,154			(622		)	—			(372,567		)
Decrease in cash and cash equivalents	—			(386,463		)	—			—			(386,463		)
Cash and cash equivalents at beginning of period	24,544			782,184			—			—			806,728
Cash and cash equivalents at end of period	$	24,544		$	395,721		$	—		$	—		$	420,265

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Cash flows from operating activities:
Net income	$	38,651		$	38,651		$	67,628		$	(106,279	)	$	38,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	—			11,469			127,394			—			138,863
Deferred income taxes	—			28,977			—			—			28,977
Stock-based compensation expense	—			—			15,177			—			15,177
Amortization of discount on debt and deferred debt issue costs and other	11,029			1,338			—			—			12,367
Intercompany and equity investment changes	(43,989		)	(15,137		)	(47,153		)	106,279			—
Changes in operating assets and liabilities	—			(9,986		)	(15,450		)	—			(25,436		)
Net cash provided by operating activities	5,691			55,312			147,596			—			208,599
Cash flows from investing activities:
Capital expenditures	—			(6,067		)	(151,508		)	—			(157,575		)
Purchases of investments	—			(119,813		)	—			—			(119,813		)
Proceeds from sale of investments	—			106,053			—			—			106,053
Proceeds from sale of assets and other investing activities, net	—			1,310			4,397			—			5,707
Net cash used in investing activities	—			(18,517		)	(147,111		)	—			(165,628		)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	5,828			—			—			—			5,828
Purchases of treasury stock	(11,519		)	—			—			—			(11,519		)
Excess tax benefits from stock-based compensation	—			716			—			—			716
Payment of debt and capital lease obligations	—			(3,227		)	(485		)	—			(3,712		)
Net cash used in financing activities	(5,691		)	(2,511		)	(485		)	—			(8,687		)
Increase in cash and cash equivalents	—			34,284			—			—			34,284
Cash and cash equivalents at beginning of period	24,543			328,851			—			—			353,394
Cash and cash equivalents at end of period	$	24,543		$	363,135		$	—		$	—		$	387,678

XML

Long-Term Debt and Capital Lease Obligations

6 Months Ended

Jun. 30, 2013

Debt Disclosure [Abstract]

Long-Term Debt and Capital Lease Obligations

Long-Term Debt and Capital Lease Obligations

The components of long-term debt and capital lease obligations at June 30, 2013 and December 31, 2012 were as follows:

	June 30, 2013			December 31, 2012
	(amounts in thousands)
Term Loan B - extended tranche, due 2016	$	—		$	463,019
8% Senior Notes, due 2018	430,000			430,000
Term Loan B, due 2020	520,000			—
53/8% Senior Notes, due 2022	480,000			480,000
23/8% Convertible Senior Debentures, due 2026 (1)	196,497			373,743
Capital lease obligations	23,536			20,091
Total obligations	1,650,033			1,766,853
Unamortized discounts	(4,328		)	(7,642		)
Current portion	(203,902		)	(374,969		)
Total long-term debt and capital lease obligations	$	1,441,803		$	1,384,242

⁽¹⁾  Subsequent to June 30, 2013, the remaining outstanding amount of Convertible Debentures were retired. See "Retirement of Convertible Debentures including Subsequent Event" below.

As of June 30, 2013, tw telecom inc. and its wholly-owned subsidiary, tw telecom holdings inc. ("Holdings"), were in compliance with all of their debt covenants.

Modification of Term Loan and Revolver

As of December 31, 2012, Holdings had a senior secured credit facility consisting of an $463.0 million outstanding principal amount Term Loan B (the "Term Loan") due December 2016 and an undrawn $80 million Revolving Credit Facility (the "Revolver") expiring December 2014. In April 2013, Holdings entered into a Second Amended and Restated Credit Agreement ("Amendment and Restatement") to increase the Term Loan to $520 million and extend the maturity date to April 2020. The Term Loan was issued at an offering price of 99.5% of the principal amount. Additionally, the Amendment and Restatement increased the Revolver, which remains undrawn, to $100 million and extended the maturity date to April 2018. Components of the Amendment and Restatement are detailed below:

•The Term Loan is a secured obligation, on a first lien basis, of Holdings. The Term Loan is guaranteed by the Company and Holdings' subsidiaries. Repayments of the Term Loan are due quarterly in an amount equal to 1/4 of 1% of the aggregate principal amount on the last day of each quarter commencing September 30, 2013. Interest on the Term Loan is computed based on a specified Eurodollar rate plus 2.5%. Interest is reset periodically and payable at least quarterly. Based on the Eurodollar rate in effect at June 30, 2013, the effective interest rate was 2.70%. In accordance with applicable accounting guidance, the amended and restated Term Loan agreement was accounted for as a modification of the existing debt. The fees paid to the lenders of $4.6 million were added to the existing deferred debt issuance costs and will be amortized through the maturity date of the Term Loan.

•The Revolver is secured and guaranteed in the same manner as the Term Loan. Interest on outstanding Revolver amounts, if any, will be computed based on a specified Eurodollar rate plus 1.75%-2.75%, depending on the Company's consolidated total leverage ratio, as defined in the Revolver, and will be reset periodically and payable quarterly. The Company is required to pay a commitment fee on the undrawn commitment amounts on a quarterly basis of 0.375%-0.5% per annum. The Amendment and Restatement contains customary affirmative and negative covenants. Most of the Revolver covenants apply whether or not the Company draws on that facility. In addition, if the Revolver were drawn, certain financial maintenance covenants would apply. The fees paid to the lenders of $1.4 million were added to existing debt issuance costs and will be amortized through the expiration date.

Retirement of Convertible Debentures including Subsequent Event

As of December 31, 2012, the Company had outstanding $373.7 million principal amount of Convertible Debentures. In the three months ended June 30, 2013, the Company cash settled approximately $255.8 million on $177.2 million principal amount of the Convertible Debentures as a result of repurchases by the Company and conversions by holders of the Convertible Debentures, resulting in $196.5 million outstanding principal amount as of June 30, 2013.

The Convertible Debentures were redeemable in whole or in part at the Company’s option at any time on or after April 6, 2013 at a redemption price equal to 100% of the principal amount of the debentures to be redeemed, plus accrued and unpaid interest. On May 29, 2013, the Company called for redemption all of the remaining outstanding Convertible Debentures. Holders of the Convertible Debentures had the option to require the Company to purchase all or part of the Convertible Debentures on April 1, 2013, at 100% of the principal and unpaid interest, or at any time prior to April 1, 2026, to convert the debentures into shares of the Company’s common stock. Upon conversion, the Company had the right to deliver, in lieu of shares of common stock, cash or a combination of cash and shares of common stock. The Company elected to settle its conversion obligation entirely in cash. On July 3, 2013, the remaining $196.5 million outstanding principal amount of the Convertible Debentures was settled in cash for approximately $296.9 million as a result of conversions by holders of the Convertible Debentures in connection with the redemption.

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Condensed Consolidated Statements Of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Cash flows from operating activities:
Net income	$ 30,491	$ 38,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	150,047	138,863
Deferred income taxes	24,289	28,977
Stock-based compensation expense	17,876	15,177
Amortization of discount on debt and deferred debt issue costs and other	8,249	12,367
Changes in operating assets and liabilities:
Receivables, prepaid expenses and other assets	(14,046)	(5,651)
Accounts payable, deferred revenue and other liabilities	(10,346)	(19,785)
Net cash provided by operating activities	206,560	208,599
Cash flows from investing activities:
Capital expenditures	(187,509)	(157,575)
Purchases of investments	(157,523)	(119,813)
Proceeds from sale of investments	125,041	106,053
Other investing activities, net	(465)	5,707
Net cash used in investing activities	(220,456)	(165,628)
Cash flows from financing activities:
Proceeds from issuance of common stock upon exercise of stock options	50,874	15,784
Taxes paid related to net share settlement of equity awards	(18,315)	(9,956)
Purchases of treasury stock	(197,310)	(11,519)
Excess tax benefits from stock-based compensation	944	716
Proceeds from modification of debt, net of financing costs	49,684	0
Retirement of convertible debt obligations	(256,348)	0
Payment of debt and capital lease obligations	(2,096)	(3,712)
Net cash used in financing activities	(372,567)	(8,687)
(Decrease) increase in cash and cash equivalents	(386,463)	34,284
Cash and cash equivalents at beginning of period	806,728	353,394
Cash and cash equivalents at end of period	420,265	387,678
Supplemental disclosures of cash flow information:
Cash paid for interest	43,540	31,850
Cash paid for income taxes, net of refunds	4,477	5,058
Addition of capital lease obligation	$ 4,302	$ 2,326

XML

Supplemental Guarantor Information (Condensed Consolidating Balance Sheet) (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2013	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2011
Current assets:
Cash and cash equivalents	$ 420,265	$ 806,728	$ 387,678	$ 353,394
Investments	194,155	167,564
Receivables, net	109,765	99,703
Prepaid expenses and other current assets	28,817	19,164
Deferred income taxes	76,160	76,160
Intercompany receivable	0	0
Total current assets	829,162	1,169,319
Property, plant and equipment, net	1,547,294	1,492,246
Deferred income taxes	77,582	101,885
Goodwill	412,694	412,694
Intangible and other assets, net	48,454	47,593
Total assets	2,915,186	3,223,737
Current liabilities:
Accounts payable	61,321	55,857
Current portion debt and capital lease obligations, net	203,902	374,969
Other current liabilities	233,728	232,313
Intercompany payable	0	0
Total current liabilities	498,951	663,139
Losses in subsidiary in excess of investment	0	0
Long-term debt and capital lease obligations, net	1,441,803	1,384,242
Long-term deferred revenue	21,615	23,177
Other long-term liabilities	44,203	41,240
Stockholders' equity (deficit)	908,614	1,111,939
Total liabilities and stockholders' equity	2,915,186	3,223,737
Parent Guarantor [Member]
Current assets:
Cash and cash equivalents	24,544	24,544	24,543	24,543
Investments	0	0
Receivables, net	0	0
Prepaid expenses and other current assets	0	0
Deferred income taxes	0	0
Intercompany receivable	1,407,656	1,864,694
Total current assets	1,432,200	1,889,238
Property, plant and equipment, net	0	0
Deferred income taxes	0	0
Goodwill	0	0
Intangible and other assets, net	0	275
Total assets	1,432,200	1,889,513
Current liabilities:
Accounts payable	0	0
Current portion debt and capital lease obligations, net	196,497	368,100
Other current liabilities	1,180	2,219
Intercompany payable	0	0
Total current liabilities	197,677	370,319
Losses in subsidiary in excess of investment	325,940	407,286
Long-term debt and capital lease obligations, net	0	0
Long-term deferred revenue	0	0
Other long-term liabilities	0	0
Stockholders' equity (deficit)	908,583	1,111,908
Total liabilities and stockholders' equity	1,432,200	1,889,513
Issuer [Member]
Current assets:
Cash and cash equivalents	395,721	782,184	363,135	328,851
Investments	194,155	167,564
Receivables, net	0	0
Prepaid expenses and other current assets	19,599	11,270
Deferred income taxes	76,140	76,140
Intercompany receivable	969,335	506,610
Total current assets	1,654,950	1,543,768
Property, plant and equipment, net	57,949	48,686
Deferred income taxes	77,098	101,401
Goodwill	0	0
Intangible and other assets, net	25,181	20,634
Total assets	1,815,178	1,714,489
Current liabilities:
Accounts payable	8,996	7,141
Current portion debt and capital lease obligations, net	5,782	5,475
Other current liabilities	82,055	64,564
Intercompany payable	0	0
Total current liabilities	96,833	77,180
Losses in subsidiary in excess of investment	858,775	862,681
Long-term debt and capital lease obligations, net	1,420,566	1,366,463
Long-term deferred revenue	0	0
Other long-term liabilities	7,392	7,024
Stockholders' equity (deficit)	(568,388)	(598,859)
Total liabilities and stockholders' equity	1,815,178	1,714,489
Combined Subsidiary Guarantors [Member]
Current assets:
Cash and cash equivalents	0	0	0	0
Investments	0	0
Receivables, net	109,765	99,703
Prepaid expenses and other current assets	9,218	7,894
Deferred income taxes	20	20
Intercompany receivable	0	0
Total current assets	119,003	107,617
Property, plant and equipment, net	1,489,345	1,443,560
Deferred income taxes	484	484
Goodwill	412,694	412,694
Intangible and other assets, net	23,273	26,684
Total assets	2,044,799	1,991,039
Current liabilities:
Accounts payable	52,325	48,716
Current portion debt and capital lease obligations, net	1,623	1,394
Other current liabilities	150,493	165,530
Intercompany payable	2,376,991	2,371,304
Total current liabilities	2,581,432	2,586,944
Losses in subsidiary in excess of investment	0	0
Long-term debt and capital lease obligations, net	21,237	17,779
Long-term deferred revenue	21,615	23,177
Other long-term liabilities	36,811	34,216
Stockholders' equity (deficit)	(616,296)	(671,077)
Total liabilities and stockholders' equity	2,044,799	1,991,039
Eliminations [Member]
Current assets:
Cash and cash equivalents	0	0	0	0
Investments	0	0
Receivables, net	0	0
Prepaid expenses and other current assets	0	0
Deferred income taxes	0	0
Intercompany receivable	(2,376,991)	(2,371,304)
Total current assets	(2,376,991)	(2,371,304)
Property, plant and equipment, net	0	0
Deferred income taxes	0	0
Goodwill	0	0
Intangible and other assets, net	0	0
Total assets	(2,376,991)	(2,371,304)
Current liabilities:
Accounts payable	0	0
Current portion debt and capital lease obligations, net	0	0
Other current liabilities	0	0
Intercompany payable	(2,376,991)	(2,371,304)
Total current liabilities	(2,376,991)	(2,371,304)
Losses in subsidiary in excess of investment	(1,184,715)	(1,269,967)
Long-term debt and capital lease obligations, net	0	0
Long-term deferred revenue	0	0
Other long-term liabilities	0	0
Stockholders' equity (deficit)	1,184,715	1,269,967
Total liabilities and stockholders' equity	$ (2,376,991)	$ (2,371,304)

XML

Investments (Tables)

6 Months Ended

Jun. 30, 2013

Investments [Abstract]

Investments Schedule

The Company’s investments at June 30, 2013 and December 31, 2012 are summarized as follows:

	June 30, 2013		December 31, 2012
	(amounts in thousands)
Cash equivalents:
Prime money market mutual funds	$	302,366	$	425,165
U.S. Treasury money market mutual funds	66,044		262,967
Commercial paper	6,695		30,692
Certificates of deposit	—		8,000
Debt securities issued by U.S. Government agencies	—		4,999
Total cash equivalents	375,105		731,823
Investments:
Debt securities issued by the U.S. Treasury	100,350		89,870
Commercial paper	59,976		32,480
Debt securities issued by U.S. Government agencies	29,079		45,214
Certificates of deposit	4,750		—
Total investments	194,155		167,564
Total cash equivalents and investments	$	569,260	$	899,387

XML

Commitments and Contingencies

6 Months Ended

Jun. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Management routinely reviews the Company’s exposure to liabilities incurred in the normal course of its business operations. Where a probable contingency exists and the amount of the loss can be reasonably estimated, the Company records the estimated liability. Considerable judgment is required in analyzing and recording such liabilities and actual results may vary from the estimates.

The Company’s pending legal proceedings are limited to litigation incidental to its business. In the opinion of management, the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial statements.

XML

Supplemental Guarantor Information (Tables)

6 Months Ended

Jun. 30, 2013

Supplemental Guarantor Information [Abstract]

Condensed Consolidating Balance Sheet

tw telecom inc.

CONDENSED CONSOLIDATING BALANCE SHEET

June 30, 2013

(unaudited)

	Parent Guarantor		Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	24,544	$	395,721		$	—		$	—		$	420,265
Investments	—		194,155			—			—			194,155
Receivables, net	—		—			109,765			—			109,765
Prepaid expenses and other current assets	—		19,599			9,218			—			28,817
Deferred income taxes	—		76,140			20			—			76,160
Intercompany receivable	1,407,656		969,335			—			(2,376,991		)	—
Total current assets	1,432,200		1,654,950			119,003			(2,376,991		)	829,162
Property, plant and equipment, net	—		57,949			1,489,345			—			1,547,294
Deferred income taxes	—		77,098			484			—			77,582
Goodwill	—		—			412,694			—			412,694
Intangible and other assets, net	—		25,181			23,273			—			48,454
Total assets	$	1,432,200	$	1,815,178		$	2,044,799		$	(2,376,991	)	$	2,915,186
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—	$	8,996		$	52,325		$	—		$	61,321
Current portion debt and capital lease obligations	196,497		5,782			1,623			—			203,902
Other current liabilities	1,180		82,055			150,493			—			233,728
Intercompany payable	—		—			2,376,991			(2,376,991		)	—
Total current liabilities	197,677		96,833			2,581,432			(2,376,991		)	498,951
Losses in subsidiary in excess of investment	325,940		858,775			—			(1,184,715		)	—
Long-term debt and capital lease obligations, net	—		1,420,566			21,237			—			1,441,803
Long-term deferred revenue	—		—			21,615			—			21,615
Other long-term liabilities	—		7,392			36,811			—			44,203
Stockholders’ equity (deficit)	908,583		(568,388		)	(616,296		)	1,184,715			908,614
Total liabilities and stockholders’ equity	$	1,432,200	$	1,815,178		$	2,044,799		$	(2,376,991	)	$	2,915,186

tw telecom inc.

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2012

	Parent Guarantor		Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	24,544	$	782,184		$	—		$	—		$	806,728
Investments	—		167,564			—			—			167,564
Receivables, net	—		—			99,703			—			99,703
Prepaid expenses and other current assets	—		11,270			7,894			—			19,164
Deferred income taxes	—		76,140			20			—			76,160
Intercompany receivable	1,864,694		506,610			—			(2,371,304		)	—
Total current assets	1,889,238		1,543,768			107,617			(2,371,304		)	1,169,319
Property, plant and equipment, net	—		48,686			1,443,560			—			1,492,246
Deferred income taxes	—		101,401			484			—			101,885
Goodwill	—		—			412,694			—			412,694
Intangible and other assets, net	275		20,634			26,684			—			47,593
Total assets	$	1,889,513	$	1,714,489		$	1,991,039		$	(2,371,304	)	$	3,223,737
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—	$	7,141		$	48,716		$	—		$	55,857
Current portion debt and capital lease obligations, net	368,100		5,475			1,394			—			374,969
Other current liabilities	2,219		64,564			165,530			—			232,313
Intercompany payable	—		—			2,371,304			(2,371,304		)	—
Total current liabilities	370,319		77,180			2,586,944			(2,371,304		)	663,139
Losses in subsidiary in excess of investment	407,286		862,681			—			(1,269,967		)	—
Long-term debt and capital lease obligations, net	—		1,366,463			17,779			—			1,384,242
Long-term deferred revenue	—		—			23,177			—			23,177
Other long-term liabilities	—		7,024			34,216			—			41,240
Stockholders’ equity (deficit)	1,111,908		(598,859		)	(671,077		)	1,269,967			1,111,939
Total liabilities and stockholders’ equity (deficit)	$	1,889,513	$	1,714,489		$	1,991,039		$	(2,371,304	)	$	3,223,737

Condensed Consolidating Statement Of Operations

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Three Months Ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	389,483		$	—		$	389,483
Costs and expenses:
Operating, selling, general and administrative	—			67,167			193,402			—			260,569
Depreciation, amortization and accretion	—			6,707			68,945			—			75,652
Corporate expense allocation	—			(73,874		)	73,874			—			—
Total costs and expenses	—			—			336,221			—			336,221
Operating income	—			—			53,262			—			53,262
Interest expense, net	(1,569		)	(17,942		)	(1,860		)	—			(21,371		)
Debt extinguishment costs	(327		)	(72		)	—			—			(399		)
Interest expense allocation	1,896			18,014			(19,910		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			31,492			—			31,492
Income tax expense	—			13,672			473			—			14,145
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(13,672		)	31,019			—			17,347
Equity in undistributed earnings of subsidiaries	17,347			31,019			—			(48,366		)	—
Net income	$	17,347		$	17,347		$	31,019		$	(48,366	)	$	17,347

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Three Months Ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	364,503		$	—		$	364,503
Costs and expenses:
Operating, selling, general and administrative	—			52,422			185,144			—			237,566
Depreciation, amortization and accretion	—			6,677			63,792			—			70,469
Corporate expense allocation	—			(59,099		)	59,099			—			—
Total costs and expenses	—			—			308,035			—			308,035
Operating income	—			—			56,468			—			56,468
Interest expense, net	(7,789		)	(12,075		)	(1,903		)	—			(21,767		)
Interest expense allocation	7,789			12,075			(19,864		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			34,701			—			34,701
Income tax expense	—			14,947			435			—			15,382
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(14,947		)	34,266			—			19,319
Equity in undistributed earnings of subsidiaries	19,319			34,266			—			(53,585		)	—
Net income	$	19,319		$	19,319		$	34,266		$	(53,585	)	$	19,319

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	770,692		$	—		$	770,692
Costs and expenses:
Operating, selling, general and administrative	—			131,974			383,239			—			515,213
Depreciation, amortization and accretion	—			13,286			136,761			—			150,047
Corporate expense allocation	—			(145,260		)	145,260			—			—
Total costs and expenses	—			—			665,260			—			665,260
Operating income	—			—			105,432			—			105,432
Interest expense, net	(9,705		)	(35,820		)	(3,909		)	—			(49,434		)
Debt extinguishment costs	(327		)	(72		)	—			—			(399		)
Interest expense allocation	10,032			35,892			(45,924		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			55,599			—			55,599
Income tax expense	—			24,289			819			—			25,108
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(24,289		)	54,780			—			30,491
Equity in undistributed earnings of subsidiaries	30,491			54,780			—			(85,271		)	—
Net income	$	30,491		$	30,491		$	54,780		$	(85,271	)	$	30,491

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Total revenue	$	—		$	—		$	723,428		$	—		$	723,428
Costs and expenses:
Operating, selling, general and administrative	—			105,426			367,423			—			472,849
Depreciation, amortization and accretion	—			11,469			127,394			—			138,863
Corporate expense allocation	—			(116,895		)	116,895			—			—
Total costs and expenses	—			—			611,712			—			611,712
Operating income	—			—			111,716			—			111,716
Interest expense, net	(15,467		)	(24,087		)	(3,690		)	—			(43,244		)
Interest expense allocation	15,467			24,087			(39,554		)	—			—
Income before income taxes and equity in undistributed earnings of subsidiaries	—			—			68,472			—			68,472
Income tax expense	—			28,977			844			—			29,821
Net income (loss) before equity in undistributed earnings of subsidiaries	—			(28,977		)	67,628			—			38,651
Equity in undistributed earnings of subsidiaries	38,651			67,628			—			(106,279		)	—
Net income	$	38,651		$	38,651		$	67,628		$	(106,279	)	$	38,651

Condensed Consolidating Statement of Comprehensive Income

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Three Months Ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	17,347		$	17,347		$	31,019	$	(48,366	)	$	17,347
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(28		)	(28		)	—		28			(28		)
Other comprehensive loss, net of tax	(28		)	(28		)	—		28			(28		)
Comprehensive income	$	17,319		$	17,319		$	31,019	$	(48,338	)	$	17,319

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Three Months Ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	19,319		$	19,319		$	34,266	$	(53,585	)	$	19,319
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(52		)	(52		)	—		52			(52		)
Other comprehensive loss, net of tax	(52		)	(52		)	—		52			(52		)
Comprehensive income	$	19,267		$	19,267		$	34,266	$	(53,533	)	$	19,267

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	30,491		$	30,491		$	54,780	$	(85,271	)	$	30,491
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(20		)	(20		)	—		20			(20		)
Other comprehensive loss, net of tax	(20		)	(20		)	—		20			(20		)
Comprehensive income	$	30,471		$	30,471		$	54,780	$	(85,251	)	$	30,471

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors		Eliminations			Consolidated
	(amounts in thousands)
Net income	$	38,651		$	38,651		$	67,628	$	(106,279	)	$	38,651
Other comprehensive loss, net of tax:
Unrealized loss on available-for-sale securities	(60		)	(60		)	—		60			(60		)
Other comprehensive loss, net of tax	(60		)	(60		)	—		60			(60		)
Comprehensive income	$	38,591		$	38,591		$	67,628	$	(106,219	)	$	38,591

Condensed Consolidating Statement Of Cash Flows

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six months ended June 30, 2013

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Cash flows from operating activities:
Net income	$	30,491		$	30,491		$	54,780		$	(85,271	)	$	30,491
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	—			13,286			136,761			—			150,047
Deferred income taxes	—			24,289			—			—			24,289
Stock-based compensation expense	—			—			17,876			—			17,876
Amortization of discount on debt and deferred debt issue costs and other	6,244			2,005			—			—			8,249
Intercompany and equity investment changes	385,403			(466,631		)	(4,043		)	85,271			—
Changes in operating assets and liabilities	(1,039		)	15,973			(39,326		)	—			(24,392		)
Net cash provided by (used in) operating activities	421,099			(380,587		)	166,048			—			206,560
Cash flows from investing activities:
Capital expenditures	—			(22,465		)	(165,044		)	—			(187,509		)
Purchases of investments	—			(157,523		)	—			—			(157,523		)
Proceeds from sale of investments	—			125,041			—			—			125,041
Other investing activities, net	—			(83		)	(382		)	—			(465		)
Net cash used in investing activities	—			(55,030		)	(165,426		)	—			(220,456		)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	32,559			—			—			—			32,559
Purchases of treasury stock	(197,310		)	—			—			—			(197,310		)
Excess tax benefits from stock-based compensation	—			944			—			—			944
Net proceeds from modification of debt, net of debt issuance costs	—			49,684			—			—			49,684
Retirement of convertible debt obligations	(256,348		)	—			—			—			(256,348		)
Payment of debt and capital lease obligations	—			(1,474		)	(622		)	—			(2,096		)
Net cash (used in) provided by financing activities	(421,099		)	49,154			(622		)	—			(372,567		)
Decrease in cash and cash equivalents	—			(386,463		)	—			—			(386,463		)
Cash and cash equivalents at beginning of period	24,544			782,184			—			—			806,728
Cash and cash equivalents at end of period	$	24,544		$	395,721		$	—		$	—		$	420,265

tw telecom inc.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six months ended June 30, 2012

(unaudited)

	Parent Guarantor			Issuer			Combined Subsidiary Guarantors			Eliminations			Consolidated
	(amounts in thousands)
Cash flows from operating activities:
Net income	$	38,651		$	38,651		$	67,628		$	(106,279	)	$	38,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	—			11,469			127,394			—			138,863
Deferred income taxes	—			28,977			—			—			28,977
Stock-based compensation expense	—			—			15,177			—			15,177
Amortization of discount on debt and deferred debt issue costs and other	11,029			1,338			—			—			12,367
Intercompany and equity investment changes	(43,989		)	(15,137		)	(47,153		)	106,279			—
Changes in operating assets and liabilities	—			(9,986		)	(15,450		)	—			(25,436		)
Net cash provided by operating activities	5,691			55,312			147,596			—			208,599
Cash flows from investing activities:
Capital expenditures	—			(6,067		)	(151,508		)	—			(157,575		)
Purchases of investments	—			(119,813		)	—			—			(119,813		)
Proceeds from sale of investments	—			106,053			—			—			106,053
Proceeds from sale of assets and other investing activities, net	—			1,310			4,397			—			5,707
Net cash used in investing activities	—			(18,517		)	(147,111		)	—			(165,628		)
Cash flows from financing activities:
Net proceeds (tax withholdings) from issuance of common stock upon exercise of stock options and vesting of restricted stock awards and units	5,828			—			—			—			5,828
Purchases of treasury stock	(11,519		)	—			—			—			(11,519		)
Excess tax benefits from stock-based compensation	—			716			—			—			716
Payment of debt and capital lease obligations	—			(3,227		)	(485		)	—			(3,712		)
Net cash used in financing activities	(5,691		)	(2,511		)	(485		)	—			(8,687		)
Increase in cash and cash equivalents	—			34,284			—			—			34,284
Cash and cash equivalents at beginning of period	24,543			328,851			—			—			353,394
Cash and cash equivalents at end of period	$	24,543		$	363,135		$	—		$	—		$	387,678

XML

Long-Term Debt and Capital Lease Obligations (Tables)

6 Months Ended

Jun. 30, 2013

Debt Disclosure [Abstract]

Summary Of Long-Term Debt and Capital Lease Obligations

The components of long-term debt and capital lease obligations at June 30, 2013 and December 31, 2012 were as follows:

	June 30, 2013			December 31, 2012
	(amounts in thousands)
Term Loan B - extended tranche, due 2016	$	—		$	463,019
8% Senior Notes, due 2018	430,000			430,000
Term Loan B, due 2020	520,000			—
53/8% Senior Notes, due 2022	480,000			480,000
23/8% Convertible Senior Debentures, due 2026 (1)	196,497			373,743
Capital lease obligations	23,536			20,091
Total obligations	1,650,033			1,766,853
Unamortized discounts	(4,328		)	(7,642		)
Current portion	(203,902		)	(374,969		)
Total long-term debt and capital lease obligations	$	1,441,803		$	1,384,242

⁽¹⁾  Subsequent to June 30, 2013, the remaining outstanding amount of Convertible Debentures were retired. See "Retirement of Convertible Debentures including Subsequent Event" below.

XML

Document And Entity Information	6 Months Ended
	Jun. 30, 2013	Jul. 31, 2013
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2
Trading Symbol	twtc
Entity Registrant Name	tw telecom inc.
Entity Central Index Key	0001057758
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		145,666,574

XML

Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2013

Fair Value Disclosures [Abstract]

Schedule Of Assets And Liabilities Measured And Carried At Fair Value On Recurring Basis

The following table reflects assets and liabilities that are measured and carried at fair value on a recurring basis at June 30, 2013 and December 31, 2012:

	Fair Value Measurements At June 30, 2013						Assets at Fair Value
	Level 1		Level 2		Level 3
	(amounts in thousands)
Assets
Prime money market mutual funds	$	302,366	$	—	$	—	$	302,366
U.S. Treasury money market mutual funds	66,044		—		—		66,044
Commercial paper	—		6,695		—		6,695
Investments included in cash and cash equivalents	$	368,410	$	6,695	$	—	$	375,105
Debt securities issued by the U.S. Treasury	—		100,350		—		100,350
Commercial paper	—		59,976		—		59,976
Debt securities issued by U.S. Government agencies	—		29,079		—		29,079
Certificates of deposit	—		4,750		—		4,750
Short-term investments	$	—	$	194,155	$	—	$	194,155
Total assets	$	368,410	$	200,850	$	—	$	569,260

	Fair Value Measurements At December 31, 2012						Assets at Fair Value
	Level 1		Level 2		Level 3
	(amounts in thousands)
Assets
Prime money market mutual funds	$	425,165	$	—	$	—	$	425,165
U.S. Treasury money market mutual funds	262,967		—		—		262,967
Commercial paper	—		30,692		—		30,692
Certificates of deposit	—		8,000		—		8,000
Debt securities issued by U.S. Government agencies	—		4,999		—		4,999
Investments included in cash and cash equivalents	$	688,132	$	43,691	$	—	$	731,823
Debt securities issued by the U.S. Treasury	—		89,870		—		89,870
Debt securities issued by U.S. Government agencies	—		45,214		—		45,214
Commercial paper	—		32,480		—		32,480
Short-term investments	$	—	$	167,564	$	—	$	167,564
Total assets	$	688,132	$	211,255	$	—	$	899,387

Summary Of Carrying Amounts And Fair Values Of Long-Term Debt, Including Current Portion

The following table summarizes the carrying amounts and estimated fair values of the Company’s long-term debt, including the current portion, at June 30, 2013 and December 31, 2012:

	June 30, 2013				December 31, 2012
	Carrying Value		Fair Value Level 2		Carrying Value		Fair Value Level 2
	(amounts in thousands)
Term Loan B - Extended tranche, due 2016	$	—	$	—	$	463,019	$	465,334
8% Senior Notes, net of discount	428,195		456,875		428,001		470,850
Term Loan B, net of discount	517,477		520,650		—		—
53/8% Senior Notes	480,000		478,800		480,000		505,200
23/8% Convertible Senior Debentures, net of discount	196,497		298,125		368,100		512,159
Total debt	$	1,622,169	$	1,754,450	$	1,739,120	$	1,953,543