Exhibit 10.1

EXECUTION COPY

TIME WARNER TELECOM INC.

CLASS A COMMON STOCK

UNDERWRITING AGREEMENT

March 23, 2006

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March 23, 2006

Deutsche Bank Securities Inc.

Morgan Stanley & Co. Incorporated

J.P. Morgan Securities Inc.

Wachovia Capital Markets, LLC

 

c/o Deutsche Bank Securities Inc.

60 Wall Street

New York, NY 10005

Ladies and Gentlemen:

Certain stockholders of the Time Warner Telecom Inc., a Delaware corporation
(the “Company”) named in Schedule III hereto (the “Selling Stockholders”)
severally propose to sell to Deutsche Bank Securities Inc. (“Deutsche Bank”),
Morgan Stanley & Co. Incorporated (“Morgan Stanley”), Wachovia Capital Markets,
LLC and J.P. Morgan Securities Inc. (the “Underwriters”) an aggregate of
19,400,000 shares (the “Firm Shares”) of the Class A Common Stock, par value
$.01 per share, of the Company (the “Class A Common Stock”), each Selling
Stockholder selling the amount set forth opposite such Selling Stockholder’s
name in Schedule III hereto. The Selling Stockholders also propose to sell to
the several Underwriters not more than an additional aggregate of 2,910,000
shares of the Class A Common Stock (the “Additional Shares”) if and to the
extent that Deutsche Bank and Morgan Stanley shall have determined to exercise,
on behalf of the Underwriters, the right to purchase such Additional Shares (or
any portion thereof) granted in Section 3 hereof. The Firm Shares and the
Additional Shares are hereinafter collectively referred to as the “Shares.”

The Company has filed with the Securities and Exchange Commission (the
“Commission”) a registration statement, including a prospectus (the file number
of which is set forth in Schedule I hereto) on Form S-3, relating to securities
(the “Shelf Securities”), including the Shares, for registration under the
Securities Act of 1933, as amended (the “Securities Act”), of such Shelf
Securities and the offering thereof from time to time in accordance with Rule
415. The registration statement as amended to the date of this Agreement,
including the information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 430A or Rule 430B under
the Securities Act, is hereinafter referred to as the “Registration Statement,”
and the related prospectus covering the Shelf Securities dated March 17, 2006 in
the form first used to confirm sales of the Shares (or in the form first made
available to the Underwriters by the Company to meet requests of purchasers
pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the
“Basic Prospectus.” The Basic Prospectus, as supplemented by the prospectus
supplement specifically relating to the Shares in the form first used to confirm
sales of the Shares (or in the form first made available to the Underwriters by
the Company to meet

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requests of purchasers pursuant to Rule 173 under the Securities Act), is
hereinafter referred to as the “Prospectus,” and the term “preliminary
prospectus” means the Basic Prospectus as supplemented by the preliminary
prospectus supplement dated March 17, 2006. For purposes of this Agreement,
“free writing prospectus” has the meaning set forth in Rule 405 under the
Securities Act and “Time of Sale Prospectus” means the preliminary prospectus
together with the free writing prospectuses, if any, each identified in Schedule
I hereto. As used herein, the terms “Registration Statement,” “Basic
Prospectus,” “preliminary prospectus,” “Time of Sale Prospectus” and Prospectus
shall include the documents, if any, incorporated by reference therein. The
terms “supplement,” “amendment,” and “amend” as used herein with respect to the
Registration Statement, the Basic Prospectus, the Time of Sale Prospectus, any
preliminary prospectus or free writing prospectus shall include all documents
subsequently filed by the Company with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), that are deemed to be
incorporated by reference therein.

1. Representations and Warranties. The Company represents and warrants to and
agrees with each of the Underwriters that:

(a) The Registration Statement has become effective; no stop order suspending
the effectiveness of the Registration Statement is in effect, and no proceedings
for such purpose are pending before or, to the knowledge of the Company,
threatened by the Commission. If the Registration Statement is an automatic
shelf registration statement as defined in Rule 405 under the Securities Act,
the Company is a well-known seasoned issuer (as defined in Rule 405 under the
Securities Act) eligible to use the Registration Statement as an automatic shelf
registration statement and the Company has not received notice that the
Commission objects to the use of the Registration Statement as an automatic
shelf registration statement.

(b) (i) Each document, if any, filed or to be filed pursuant to the Exchange Act
and incorporated by reference in the Time of Sale Prospectus or the Prospectus
complied or will comply when so filed in all material respects with the Exchange
Act and the applicable rules and regulations of the Commission thereunder,
(ii) each part of the Registration Statement, when such part became effective,
did not contain, and each such part, as amended or supplemented, if applicable,
will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, (iii) the Registration Statement as of the date hereof
does not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, (iv) the Registration Statement and the Prospectus
comply, and as amended or supplemented, if applicable, will comply in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder, (v) the Time of Sale Prospectus does
not, and at the time of each sale of the Shares in connection with the offering
when the Prospectus is not yet

 

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available to prospective purchasers and at the Closing Date (as defined in
Section 5), the Time of Sale Prospectus will not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, (vi) each broadly available road show, if any, when
considered together with the Time of Sale Prospectus, does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading and (vii) the Prospectus does not contain and, as
amended or supplemented, if applicable, will not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that the representations and warranties set forth
in this paragraph do not apply to statements or omissions in the Registration
Statement, the Time of Sale Prospectus or the Prospectus based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter expressly for use therein.

(c) The Company is not an “ineligible issuer” in connection with the offering
pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing
prospectus that the Company is required to file pursuant to Rule 433(d) under
the Securities Act has been, or will be, filed with the Commission in accordance
with the requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder. Each free writing prospectus that the
Company has filed, or is required to file, pursuant to Rule 433(d) under the
Securities Act or that was prepared by or behalf of or used or referred to by
the Company complies or will comply in all material respects with the
requirements of the Securities Act and the applicable rules and regulations of
the Commission thereunder. Except for the free writing prospectuses, if any,
identified in Schedule I hereto, and electronic road shows, if any, each
furnished to the Underwriters before first use, the Company has not prepared,
used or referred to, and will not, without your prior consent, prepare, use or
refer to, any free writing prospectus.

(d) The Company has been duly incorporated, is validly existing as a corporation
in good standing under the laws of the State of Delaware, has the corporate
power and authority to own its property and to conduct its business as described
in the Time of Sale Prospectus and is duly qualified to transact business and is
in good standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a material adverse effect on the Company and its subsidiaries, taken as a whole.
For the purposes of this Agreement, the term “subsidiary” refers to all direct
and indirect subsidiaries of the Company.

(e) Each subsidiary of the Company has been duly incorporated or, in the case of
partnerships or limited liability companies, duly organized, is validly existing
as a corporation, a partnership or a limited liability company, as the case

 

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may be, in good standing under the laws of the jurisdiction of its incorporation
or organization, has the corporate power or power as a partnership or limited
liability company, as applicable, and authority to own its property and to
conduct its business as described in the Time of Sale Prospectus and is duly
qualified to transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole; all of the issued shares of
capital stock of each subsidiary of the Company that is a corporation have been
duly and validly authorized and issued, are fully paid and non-assessable and
are owned directly or indirectly by the Company, free and clear of any security
interest, mortgage, pledge, lien, encumbrance or claim (collectively, “Liens”)
except for any Liens securing indebtedness of the Company or its subsidiaries
for borrowed money (including pursuant to its credit agreement or indentures) or
as described in the Time of Sale Prospectus or Registration Statement, and all
of the partnership interests or limited liability company membership interest in
each of the Company’s subsidiaries that is a partnership or a limited liability
company, as the case may be, are owned directly or indirectly by the Company,
free and clear of all Liens except for any Liens securing indebtedness of the
Company or its subsidiaries for borrowed money (including pursuant to its credit
agreement or indentures) or as described in the Time of Sale Prospectus or
Registration Statement.

(f) This Agreement has been duly authorized, executed and delivered by the
Company.

(g) The authorized capital stock of the Company conforms as to legal matters in
all material respects to the description thereof contained in the Prospectus.

(h) The outstanding shares of capital stock of the Company (including the Shares
of Class B Common Stock held by the Selling Stockholders) have been duly
authorized and are validly issued, fully paid and non-assessable.

(i) The execution and delivery by the Company of, and the performance by the
Company of its obligations under, this Agreement and the Shares and will not
contravene any provision of applicable law or the certificate of incorporation
or by-laws of the Company or any of its subsidiaries or any agreement or other
instrument binding upon the Company or any of its subsidiaries that is material
to the Company and its subsidiaries, taken as a whole (including, without
limitation, all agreements and indentures listed as Exhibits to the Company’s
Annual Report on Form 10-K for its fiscal year ended December 31, 2005), or any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any of its subsidiaries, and no consent,
approval, authorization or order of, or qualification with, any governmental
body or agency is required for the performance by the Company of its obligations
under this Agreement and the Shares, except such as have been

 

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obtained under the Securities Act and the Exchange Act and as set forth in the
Time of Sale Prospectus or such as may be required by the securities or Blue Sky
laws of the various states in connection with the offer and sale of the Shares.

(j) There has not occurred any material adverse change, or any development
involving a prospective material adverse change, in the condition, financial or
otherwise, or in the earnings, business or operations of the Company and its
subsidiaries, taken as a whole, from that set forth in the Time of Sale
Prospectus.

(k) There are no legal or governmental proceedings pending or, to the knowledge
of the Company, threatened to which the Company or any of its subsidiaries is a
party or to which any of the properties of the Company or any of its
subsidiaries is subject (i) other than proceedings accurately described in all
material respects in the Time of Sale Prospectus and proceedings that would not
have a material adverse effect on the Company and its subsidiaries, taken as a
whole, or on the power or ability of the Company to perform its obligations
under this Agreement or the Shares or to consummate the transactions
contemplated by the Prospectus or (ii) that are required to be described in the
Registration Statement or the Prospectus and are not so described; and there are
no statutes, regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not described or filed as
required.

(l) The Company is not, and after giving effect to the offering and sale of the
Shares and the application of the proceeds thereof as described in the
Prospectus will not be, required to register as an “investment company” as such
term is defined in the Investment Company Act of 1940, as amended.

(m) The Company and its subsidiaries (i) are in compliance with any and all
applicable foreign, federal, state and local laws and regulations relating to
the protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (“Environmental Laws”),
(ii) have received all permits, licenses or other approvals required of them
under applicable Environmental Laws to conduct their respective businesses and
(iii) are in compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or approvals
would not, singly or in the aggregate, have a material adverse effect on the
Company and its subsidiaries, taken as a whole.

(n) There are no costs or liabilities associated with Environmental Laws
(including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws or any
permit, license or approval, any related constraints on operating activities and
any potential liabilities to third parties) which would, singly or in

 

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the aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole.

(o) There are no contracts, agreements or understandings between the Company and
any person granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any of the
securities of the Company (except as otherwise disclosed in the Registration
Statement) or to require the Company to include such securities with the Shares
registered pursuant to the Registration Statement.

(p) Subsequent to the date as of which information is given in the Time of Sale
Prospectus, (i) the Company has not incurred any material liability or
obligation, direct or contingent, nor entered into any material transaction, in
each case, not in the ordinary course of business; (ii) the Company has not
purchased any of its outstanding capital stock, nor declared, paid or otherwise
made any dividend or distribution of any kind on its capital stock other than
ordinary and customary dividends; and (iii) there has not been any material
change in the capital stock, short-term debt or long-term debt of the Company
and its subsidiaries, taken as a whole, except in each case as described in the
Time of Sale Prospectus or the Registration Statement.

(q) The Company and its subsidiaries have good and marketable title in fee
simple to all real property and good and marketable title to all personal
property owned by them, free and clear of all Liens except for any Liens
securing indebtedness of the Company or its subsidiaries for borrowed money
(including pursuant to its credit agreement or indentures) or Liens permitted
under its credit agreement or indentures or for such as are described in the
Time of Sale Prospectus or the Registration Statement or such as do not
materially affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by the
Company and its subsidiaries are held by it under valid, subsisting and
enforceable leases with such exceptions as do not interfere with the use made
and proposed to be made of such property and buildings by the Company and its
subsidiaries or such as do not, singly or in the aggregate, have or could not
result in a material adverse effect on the Company and its subsidiaries, taken
as a whole, except in each case as described in or contemplated by the Time of
Sale Prospectus.

(r) Except as described in the Time of Sale Prospectus, the Company and its
subsidiaries own or possess, or can acquire on reasonable terms, all patents,
patent rights, licenses, inventions, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks and trade names,
currently employed by them in connection with the business now operated by them,
except where the failure to own or possess or to have the right to acquire any
of the foregoing, singly or in the aggregate, does not have a material adverse
effect on the Company and its subsidiaries, taken as a whole, and neither the

 

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Company nor any of its subsidiaries has received any notice of infringement of
or conflict with asserted rights of others with respect to any of the foregoing
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a material adverse effect on the Company and its
subsidiaries, taken as a whole.

(s) Except as described in the Time of Sale Prospectus, no material labor
dispute with the employees of the Company exists or, to the knowledge of the
Company, is imminent, except for disputes that do not or would not have a
material adverse effect on the Company and its subsidiaries, taken as a whole;
and the Company is not aware, but without any independent investigation or
inquiry, of any existing, threatened or imminent labor disturbance by the
employees of any of its principal suppliers, manufacturers or contractors that
could have a material adverse effect on the Company and its subsidiaries, taken
as a whole.

(t) The Company and its subsidiaries are insured by insurers that the Company
reasonably believes to be of recognized financial responsibility against such
losses and risks and in such amounts as are customary in the businesses in which
it is engaged; and neither the Company nor any of its subsidiaries has any
reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at a cost that
would not have a material adverse effect on the Company and its subsidiaries,
taken as a whole, except as described in or contemplated by the Time of Sale
Prospectus.

(u) (i) The Company and its subsidiaries possess all permits, licenses, rights
of way, approvals, consents and other authorizations (collectively issued by the
appropriate federal, state or local regulatory agencies or bodies, (including
the Federal Communications Commission (the “FCC”), the public utilities
commission, or any equivalent body, of each state in which the Company and its
subsidiaries do business and any other relevant state or local governmental
department, commission, board, bureau, agency, court or other authority thereof
(the “Local Authorities”)) required for the conduct of the telecommunications
business now operated by the Company and its subsidiaries (collectively, the
“Governmental Licenses”), except where the failure to possess any such
Governmental Licenses would not, singly or in the aggregate, have a material
adverse effect on the Company and its subsidiaries, taken as a whole; the
Company and its subsidiaries are in compliance with the terms and conditions of
all such Governmental Licenses, except where the failure so to comply would not,
singly or in the aggregate, have a material adverse effect on the Company and
its subsidiaries, taken as a whole; all of the Governmental Licenses are valid
and in full force, except where the invalidity of such Governmental Licenses or
the failure of such Governmental Licenses to be in full force and effect would
not, singly or in the aggregate, have a material adverse effect on the Company
and its subsidiaries, taken as a whole; there is no outstanding adverse
judgment, decree or order that has been issued by the FCC or any of the Local
Authorities against the Company or any of its subsidiaries and which, singly or
in the aggregate, would

 

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have a material adverse effect of the Company and its subsidiaries, taken as a
whole; and neither the Company nor any of its subsidiaries has received any
notice of or is not aware of proceedings relating to the revocation or
modification of any such Governmental Licenses or, except as set forth in the
Time of Sale Prospectus, that would otherwise affect the operations of the
Company or its subsidiaries and which, singly or in the aggregate, would have a
material adverse effect on the Company and its subsidiaries, taken as a whole.

(v) There is, and has been, no failure on the part of the Company or its
subsidiaries, or any of their directors or officers, in their capacities as
such, to comply in all material respects with any provision of the Sarbanes
Oxley Act of 2002 and the rules and regulations promulgated in connection
therewith including, without limitation, Section 402 related to loans and
Sections 302 and 906 related to certifications.

(w) The Company maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management’s general or specific authorizations in all material respects,
(ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain asset accountability and (iii) access to assets is permitted only in
accordance with management’s general or specific authorization in all material
respects, and (iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.

(x) Ernst & Young LLP, who reported on the annual consolidated financial
statements of the Company incorporated by reference in the Registration
Statement and the Prospectus, are independent accountants as required by the
Securities Act.

2. Representations and Warranties of the Selling Stockholders. Each Selling
Stockholder represents and warrants to, solely as to itself and not as to any
other Selling Stockholder, and agrees with each of the Underwriters and the
Company that:

(a) This Agreement has been duly authorized, executed and delivered by or on
behalf of such Selling Stockholder.

(b) The execution and delivery by such Selling Stockholder of, and the
performance by such Selling Stockholder of its obligations under, this
Agreement, will not contravene any provision of applicable law, or the
certificate of incorporation or by-laws of such Selling Stockholder, or any
agreement or other instrument binding upon such Selling Stockholder that is
material to such Selling Stockholder or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over such Selling
Stockholder, and no consent, approval, authorization or order of, or
qualification with, any governmental body

 

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or agency is required for the performance by such Selling Stockholder of its
obligations under this Agreement, except such as may be required by the
securities or Blue Sky laws of the various states in connection with the offer
and sale of the Shares.

(c) Such Selling Stockholder has, and on the Closing Date will have, valid title
to, or a valid “security entitlement” within the meaning of Section 8-501 of the
New York Uniform Commercial Code in respect of, the Shares to be sold by such
Selling Stockholder free and clear of all security interests, claims, liens,
equities or other encumbrances and the legal right and power, and all
authorization and approval required by law, to enter into this Agreement and to
sell, transfer and deliver the Shares to be sold by such Selling Stockholder or
a security entitlement in respect of such Shares.

(d) Upon payment for the Shares to be sold by such Selling Stockholder pursuant
to this Agreement, delivery of such Shares, as directed by the Underwriters, to
Cede & Co. (“Cede”) or such other nominee as may be designated by the Depository
Trust Company (“DTC”), registration of such Shares in the name of Cede or such
other nominee and the crediting of such Shares on the books of DTC to securities
accounts of the Underwriters (assuming that neither DTC nor any such Underwriter
has notice of any adverse claim (within the meaning of Section 8-105 of the New
York Uniform Commercial Code (the “UCC”)) to such Shares), (A) DTC shall be a
“protected purchaser” of such Shares within the meaning of Section 8-303 of the
UCC, (B) under Section 8-501 of the UCC, the Underwriters will acquire a valid
security entitlement in respect of such Shares and (C) no action based on any
“adverse claim”, within the meaning of Section 8-102 of the UCC, to such Shares
may be asserted against the Underwriters with respect to such security
entitlement; for purposes of this representation, such Selling Stockholder may
assume that when such payment, delivery and crediting occur, (x) such Shares
will have been registered in the name of Cede or another nominee designated by
DTC, in each case on the Company’s share registry in accordance with its
certificate of incorporation, bylaws and applicable law, (y) DTC will be
registered as a “clearing corporation” within the meaning of Section 8-102 of
the UCC and (z) appropriate entries to the accounts of the several Underwriters
on the records of DTC will have been made pursuant to the UCC.

(e) (i) The Registration Statement, when it became effective, did not contain,
and, as amended or supplemented, if applicable, will not, as of the Closing
Date, contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, (ii) the Time of Sale Prospectus and the Prospectus do
not contain and, as amended or supplemented, if applicable, will not contain, as
of the Closing Date, any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph are limited to
statements or omissions based

 

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upon information relating to such Selling Stockholder furnished to the Company
in writing by such Selling Stockholder expressly for use in the Registration
Statement, the Time of Sale Prospectus and the Prospectus or any amendments or
supplements thereto (such information, the “Selling Stockholder Information”).

3. Agreements to Sell and Purchase. Each Selling Stockholder, severally and not
jointly, hereby agrees to sell to the several Underwriters the number of Firm
Shares set forth opposite its name on Schedule III hereto and each Underwriter,
upon the basis of the representations and warranties herein contained, but
subject to the conditions hereinafter stated, agrees, severally and not jointly,
to purchase from the Selling Stockholders the respective number of Firm Shares
set forth in Schedule II hereto opposite its name at a purchase price of
$13.99865 per share (the “Purchase Price”).

On the basis of the representations and warranties contained in this Agreement,
and subject to its terms and conditions, each Selling Stockholder, severally and
not jointly, agrees to sell to the Underwriters the number of Additional Shares
set forth opposite its name on Schedule III hereto, and the Underwriters shall
have the right to purchase, severally and not jointly, up to an aggregate of
2,910,000 Additional Shares. You may exercise these rights on behalf of the
Underwriters in whole or from time to time in part by giving written notice of
each election to exercise the option not later than 30 days after the date of
this Agreement. Any exercise notice shall specify the number of Additional
Shares to be purchased by the Underwriters and the date on which such securities
are to be purchased. Each purchase date must be at least one business day after
the written notice is given and may not be earlier than the Closing Date for the
Firm Shares nor later than ten business days after the date of such notice. On
each day, if any, that Additional Shares are to be purchased (each, an “Option
Closing Date”), each Underwriter agrees, severally and not jointly, to purchase
the number of Additional Shares (subject to such adjustments to eliminate
fractional securities as you may determine) that bears the same proportion to
the total number of Additional Shares to be purchased on such Option Closing
Date as the number of Firm Shares set forth in Schedule II hereto opposite the
name of such Underwriter bears to the total number of Firm Shares.

To the extent the Underwriters elect to purchase less than the full number of
Additional Shares, such shares shall be sold pro rata, subject to rounding,
based on the ratio that the number of Additional Shares set forth opposite the
name of such Selling Stockholder bears to 2,910,000; provided, however, that
solely for the purposes of allocating the sale of such Additional Shares as
between American Television and Communications Corporation (“ATC”) and TW/TAE,
Inc. (“TW/TAE” and, together with ATC, the “Time Warner Selling Stockholders”),
such Additional Shares shall be sold first by ATC and, only after ATC shall have
sold all of its Additional Shares, then by TW/TAE.

The Company and each Selling Stockholder hereby agrees that, without the written
consent of the Underwriters listed on Schedule IV hereto on behalf of

 

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the Underwriters, it will not, during the period ending 90 days after the date
of the Prospectus, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend, or otherwise transfer or dispose of,
directly or indirectly, any shares of Class A Common Stock or any securities
convertible into or exercisable or exchangeable for Class A Common Stock,
(ii) file any registration statement with the Commission relating to the
offering of any shares of Class A Common Stock or (iii) enter into any swap or
other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Class A Common Stock, whether any such
transaction described in clause (i), (ii) or (iii) above is to be settled by
delivery of Class A Common Stock or such other securities, in cash or otherwise.

The foregoing sentence shall not apply to (i) the Shares to be sold hereunder,
(ii) the issuance by the Company of shares of Class A Common Stock upon the
exercise of an option or warrant or the conversion of a security outstanding on
the date hereof and as described in the Prospectus (or filing a registration
statement with the Commission related to the issuance or resale of such Class A
Common Stock), (iii) the issuance by the Company of any shares of Class A Common
Stock, options or other securities to or for the benefit of employees of the
Company on or after the date hereof pursuant to the Company’s employee stock
ownership plan or equity incentive plans as described in the Time of Sale
Prospectus or the Registration Statement and the issuance by the Company of
shares of Class A Common Stock upon the exercise of any such options (or filing
a registration statement with the Commission related to the issuance or resale
of such Class A Common Stock), (iv) direct or indirect transfers or disposals by
any of the Selling Stockholders of shares of the Company’s Common Stock or any
security convertible into or exercisable or exchangeable for Common Stock of the
Company, provided that each transferee shall enter into a written agreement
accepting the restrictions set forth in the preceding paragraph and this
paragraph as if it were a Selling Stockholder, (v) the tender by any of the
Selling Stockholders of shares of the Company’s common stock into a tender offer
for all of the shares of the Company’s common stock or the indirect transfer or
disposal of share of the Company’s common stock or any security convertible into
or exercisable or exchangeable for the Company’s common stock as part of a
business combination transaction involving the Company, and (vi) transactions by
the Selling Stockholders relating to shares of common stock or other securities
acquired in open market transactions after the completion of the Offering.

In addition, each Selling Stockholder, agrees that, without the prior written
consent of the Underwriters listed on Schedule IV hereto on behalf of the
Underwriters, it will not, during the period ending 90 days after the date of
the Prospectus, make any demand for, or exercise any right with respect to, the
registration of any shares of Class A Common Stock or any security convertible
into or exercisable or exchangeable for Class A Common Stock. Each Selling
Stockholder consents to the entry of stop transfer instructions with the
Company’s

 

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transfer agent and registrar against the transfer of any Shares held by such
Selling Stockholder except in compliance with the foregoing restrictions.

4. Public Offering. The Selling Stockholders and the Company are advised by the
Underwriters that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after the Registration Statement and
this Agreement have become effective as in their judgment is advisable. The
Selling Stockholders and the Company are further advised by the Underwriters
that the Shares are to be offered to the public upon the terms set forth in the
Prospectus.

5. Payment and Delivery. Payment for the Firm Shares shall be made to each
Selling Stockholder in Federal or other funds immediately available in New York
City against delivery of such Firm Shares for the respective accounts of the
several Underwriters on the date and time set forth in Schedule I hereto, or at
such other time on the same or such other date, not later than the fifth
business day thereafter, as may be designated by you in writing. The time and
date of such payment are hereinafter referred to as the “Closing Date.”

Payment for any Additional Shares shall be made to the Selling Stockholders in
Federal or other funds immediately available in New York City against delivery
of such Additional Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on the date specified in the
corresponding notice described in Section 3 or at such other time on the same or
on such other date, in any event not later than May 8, 2006, as shall be
designated in writing by you. The time and date of such payment are hereinafter
referred to as the “Option Closing Date.”

The Firm Shares and Additional Shares shall be registered in such names and in
such denominations as you shall request in writing not later than one full
business day prior to the Closing Date or the Option Closing Date, as the case
may be. The Firm Shares and Additional Shares shall be delivered to you on the
Closing Date or the Option Closing Date, as the case may be, with any transfer
taxes payable in connection with the transfer of the Shares to you duly paid,
against payment of the Purchase Price therefor.

6. Conditions to the Underwriters’ Obligations. The several obligations of the
Underwriters are subject to the following conditions:

(a) Subsequent to the execution and delivery of this Agreement and prior to the
Closing Date

(i) there shall not have occurred any downgrading, nor shall any notice have
been given of any intended or potential downgrading or of any review for a
possible change that does not indicate the direction of the possible change, in
the rating accorded the Company or any of the securities of the Company or any
of its subsidiaries or in the rating outlook

 

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for the Company by any “nationally recognized statistical rating organization,”
as such term is defined for purposes of Rule 436(g)(2) under the Securities Act;
and

(ii) there shall not have occurred any change, or any development involving a
prospective change, in the financial condition or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from that set
forth in the Time of Sale Prospectus that, in your judgment, is material and
adverse and that makes it, in your judgment, impracticable to market the Shares
on the terms and in the manner contemplated in the Time of Sale Prospectus.

(b) The Underwriters shall have received on the Closing Date a certificate,
dated the Closing Date and signed by an executive officer of the Company, to the
effect set forth in Section 6(a)(i) above and to the effect that the
representations and warranties of the Company contained in this Agreement are
true and correct in all material respects as of the Closing Date and that the
Company has complied in all material respects with all of the agreements and
satisfied all of the conditions on its part to be performed or satisfied
hereunder on or before the Closing Date.

The officer signing and delivering such certificate may rely upon the best of
his or her knowledge as to proceedings threatened.

(c) The Underwriters shall have received on the Closing Date an opinion of
Faegre & Benson LLP, outside counsel for the Company, dated the Closing Date, to
the effect that:

(i) to such counsel’s knowledge, (A) there are not any pending or threatened
governmental proceedings before any court or governmental agency or authority or
any arbitrator to which the Company is a party or to which any of the properties
of the Company is subject of a character required to be disclosed in the Time of
Sale Prospectus which are not disclosed as required, and (B) there is no
contract, indenture, mortgage, loan agreement, note, lease or other document of
a character required to be described in the Time of Sale Prospectus which is not
described as required;

(ii) the outstanding shares of capital stock of the Company (including the
Shares to be sold by the Selling Stockholders) have been duly authorized and are
validly issued and fully paid and non-assessable;

(iii) the Shares conform in all material respects to the description thereof
contained in the Time of Sale Prospectus;

(iv) this Agreement has been duly authorized, executed and delivered by the
Company;

 

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(v) the execution and delivery by the Company of, and the performance by the
Company of its obligations under, this Agreement and the Shares will not
contravene any provision of applicable law or the certificate of incorporation
or by-laws of the Company or, to the best of such counsel’s knowledge, any
agreement or other instrument binding upon the Company or any of its
subsidiaries that is material to the Company and its subsidiaries, taken as a
whole, or, to the best of such counsel’s knowledge, any judgment, order or
decree of any governmental body, agency or court having jurisdiction over the
Company or any subsidiary, and no consent, approval, authorization or order of,
or qualification with, any governmental body or agency is required for the
performance by the Company of its obligations under this Agreement and the
Shares except such as may be required by the securities or Blue Sky laws of the
various states in connection with the offer and sale of the Shares and as for
such as may be required by the FCC or Local Authorities, as to which such
counsel expresses no opinion;

(vi) the statements relating to legal matters, documents or proceedings included
in (A) the Time of Sale Prospectus and the Prospectus under the captions
“Description of Capital Stock,” insofar as relevant to the offering of the
Shares, “Underwriters” (except relating to price, stabilization, short positions
and passive market making activities, as to which such counsel need not express
an opinion) “Description of the Debt Securities,” and “Description of Common
Stock” and (B) the Registration Statement in Item 15, in each case insofar as
such statements constitute summaries of the legal matters, documents or
proceedings referred to therein fairly summarize in all material respects such
matters, documents or proceedings;

(vii) such counsel does not know of any legal or governmental proceedings
pending or threatened to which the Company or any of its subsidiaries is a party
or to which any of the properties of the Company or any of its subsidiaries is
subject that are required to be described in the Registration Statement or the
Prospectus and are not so described or of any statutes, regulations, contracts
or other documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the Registration
Statement that are not described or filed as required, except for such statutes,
regulations, contracts or other documents relating to telecommunications law,
the FCC or Local Authorities, as to which such counsel expresses no opinion;

(viii) the Company is not, and after giving effect to the offering and sale of
the Shares and the application of the proceeds thereof as described in the
Prospectus will not be, required to register as an “investment company” as such
term is defined in the Investment Company Act of 1940, as amended;

 

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(ix) (A) in the opinion of such counsel (1) each document filed pursuant to the
Exchange Act and incorporated by reference in the Registration Statement and the
Prospectus (except for the financial statements and financial schedules and
other financial and statistical data included therein, as to which such counsel
need not express any opinion) appeared on its face to be appropriately
responsive as of its filing date in all material respects to the requirements of
the Exchange Act and the applicable rules and regulations of the Commission
thereunder, and (2) the Registration Statement and the Prospectus (except for
the financial statements and financial schedules and other financial and
statistical data included therein) appear on their face to be appropriately
responsive in all material respects to the requirements of the Securities Act
and the applicable rules and regulations of the Commission thereunder, and
(B) nothing has come to the attention of such counsel that causes such counsel
to believe that (1) any part of the Registration Statement, when such part
became effective, (except for the financial statements and financial schedules
and other financial and statistical data included therein) contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading,
(2) the Registration Statement or the Prospectus (except for the financial
statements and financial schedules and other financial and statistical data
included therein) on the date of this Agreement contained any untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (3) the Time
of Sale Prospectus (except for the financial statements and financial schedules
and other financial and statistical data included therein, as to which such
counsel need not express any belief) as of the date of this Agreement or as
amended or supplemented, if applicable, as of the Closing Date contains any
untrue statement of a material fact or omits to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made not misleading or (4) the Prospectus (except for the
financial statements and financial schedules and other financial and statistical
data included therein, as to which such counsel need not express any belief) as
amended or supplemented, if applicable, as of the Closing Date contains any
untrue statement of a material fact or omits to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made not misleading; and

(d) The Underwriters shall have received on the Closing Date an opinion of Paul
B. Jones, Esq., Senior Vice President and General Counsel of Company, dated the
Closing Date, to the effect that:

(i) the Company has been duly incorporated, is validly existing as a corporation
in good standing under the laws of the State of Delaware, has the corporate
power and authority to own its property and to conduct its business as described
in the Time of Sale Prospectus and is

 

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duly qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole;

(ii) each subsidiary of the Company has been duly incorporated, or, in the case
of partnerships or limited liability companies, duly organized, is validly
existing as a corporation, a partnership or a limited liability company, as the
case may be, has the corporate power and authority to own its property and to
conduct its business as described in the Time of Sale Prospectus and is duly
qualified to transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole;

(iii) except as otherwise disclosed in the Time of Sale Prospectus, all of the
issued shares of capital stock of each subsidiary of the Company that is a
corporation have been validly authorized and issued, are fully paid and
non-assessable and are owned directly by the Company free and clear of all Liens
except for any Liens securing indebtedness of the Company or its subsidiaries
for borrowed money (including pursuant to its credit agreement or indentures) or
as described in the Time of Sale Prospectus or Registration Statement; and all
of the partnership interests and membership interests in each of the
subsidiaries of the Company that is a partnership or a limited liability
company, are owned directly by the Company free and clear of all Liens except
for any Liens securing indebtedness of the Company or its subsidiaries for
borrowed money (including pursuant to its credit agreement or indentures) or as
described in the Time of Sale Prospectus or Registration Statement;

(iv) the authorized capital stock of the Company conforms as to legal matters in
all material respects to the description thereof contained in the Time of Sale
Prospectus;

(v) the statements contained in the Time of Sale Prospectus under the captions
“Risk Factors – Several customers account for a significant portion of our
revenue, and some of our customers’ purchases may not continue due to customer
consolidations, financial difficulties or other factors,” “Risk Factors – We
have experienced reductions in switched access and reciprocal compensation
revenue as a result of regulatory rate reform, and we may experience further
such reductions in the future,” “Risk Factors – Risks Relating to Our Business –
We may be adversely affected by changes in the regulation of special access
services,” “Risk Factors – Risks Relating to Our Business – We must obtain
access

 

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to rights-of-way and pole attachments on reasonable terms and conditions,” “Risk
Factors – Risks Relating to Our Business – Our revolving credit facility and
term loan B and the indentures relating to each outstanding series of our senior
notes contain restrictive covenants that may limit our flexibility, and breach
of those covenants may cause us to be in default under those agreements,” “Risk
Factors – Risks Relating to Our Ownership Structure – We are controlled by the
Class B Stockholders,” “Risk Factors – Risks Relating to Our Ownership Structure
– Time Warner Inc. can sell control of us at any time, and sales by the Class B
stockholders could adversely affect us,” “Risk Factors – Risks Relating to Our
Ownership Structure – Each of the Class B stockholders has veto rights over
certain actions”; and, except as updated in the Prospectus or in any later
document incorporated by reference into the Prospectus, in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2005 under the captions
“Item 1. Business—Services— Limitation on Residential and Content Services,”
“Item 1. Business—Competition,” “Item 1. Business—Government Regulation,” “Item
1A. Risk Factors—Risks Relating to Our Business—Several customers account for a
significant proportion of our revenue, and some of our customers’ purchases may
not continue due to customer consolidations, financial difficulties or other
factors,” “Item 1A. Risk Factors—Risks Relating to Our Business—We must obtain
access to rights-of-way and pole attachments on reasonable terms and
conditions,” “Item 1A. Risk Factors—Risks Relating to Our Business—We have
experienced reductions in switched access and reciprocal compensation revenue as
a result of regulatory rate reform, and we may experience further such
reductions in the future,” “Item 1A. Risk Factors—Risks Relating to Our
Business—We may be adversely affected by changes in the regulation of special
access services,” “Item 1A. Risk Factors—Risks Relating to Our Business—We may
be adversely affected by changes to the Communications Act,” “Item 1A. Risk
Factors—Risks Relating to Our Ownership Structure—We are controlled by the Class
B Stockholders,” “Item 1A. Risk Factors—Risks Relating to Our Ownership
Structure—Each of the Class B Stockholders has veto rights over certain
actions,” “Item 1A. Risk Factors—Risks Relating to Our Ownership Structure—Time
Warner Inc. can sell control of us at any time, and sales by the Class B
Stockholders could adversely affect us,” “Item 3. Legal Proceedings” and “Item
13. Certain Relationships and Related Transactions” and except as updated in the
Time of Sale Prospectus or in any later document incorporated by reference in
the Time of Sale Prospectus , in the Company’s definitive proxy statement for
the Company’s Annual Meeting of Stockholders held on June 16, 2005 as filed with
the Commission under the caption “Certain Relationships and Related
Transactions,” in each case insofar as such statements constitute a summary of
the legal or regulatory matters or legal or regulatory proceedings referred to
therein, are correct in

 

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all material respects and do not omit a material fact necessary to make the
statements contained therein not misleading;

(vi) to such counsel’s knowledge, the Company possesses the governmental
licenses required by federal or state telecommunications regulatory bodies
necessary for the Company’s existing services (the “Communications Licenses”)
and the Company is in compliance with the terms and conditions of all such
Communications Licenses, except where the failure to so comply would not, singly
or in the aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole, and such Communications Licenses are valid and
in full force and effect, except where the invalidity of such Communications
Licenses to be in full force and effect would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole;

(vii) there is no outstanding adverse judgment, decree or order that has been
issued by the FCC or any state telecommunications regulatory body against the
Company and its subsidiaries which, singly or in the aggregate, would have a
material adverse effect on the Company and its subsidiaries, taken as a whole;
and, to the best of such counsel’s knowledge, neither the Company nor any of its
subsidiaries is the subject of, or threatened by, any proceedings relating to
the revocation or modification of any such Communications Licenses or, except as
set forth in the Time of Sale Prospectus, that would otherwise adversely affect
the operation of the Company and its subsidiaries, taken as a whole, which
singly or in the aggregate, would have a material adverse effect on the Company
and its subsidiaries, taken as a whole;

(viii) the execution, delivery and performance of this Agreement, and the
consummation of the transactions contemplated herein, the issuance and sale of
the Shares, and the use of proceeds from the sale of the Shares to the extent
expressly described in the Time of Sale Prospectus under the caption “Use of
Proceeds,” and compliance by the Company with their obligations under this
Agreement and the Shares do not and will not, whether with or without the giving
of notice or lapse of time or both, result in any violation of any applicable
law, statute, rule, regulation, judgment, order, writ or decree, known to such
counsel, of any federal or state telecommunications regulatory body having
jurisdiction over the Company except for such violations that would not have a
material adverse effect on the Company and its subsidiaries, taken as a whole;

(ix) to such counsel’s knowledge, there are no telecommunications statutes or
regulations that are required to be described in the Time of Sale Prospectus
that are not described as required; and

 

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(x) the execution and delivery by the Company of, and the performance by the
Company of their obligations under, this Agreement and the Shares will not
contravene any agreement or other instrument binding upon the Company or any of
its subsidiaries that is material to the Company (including, without limitation,
all agreements and indentures listed as Exhibits to the Company’s Annual Report
on Form 10-K for its fiscal year ended December 31, 2005).

(e) The Underwriters shall have received on the Closing Date an opinion of
Cravath, Swaine & Moore LLP, counsel for the Time Warner Selling Stockholders to
the effect that:

(i) this Agreement has been duly authorized, executed and delivered by or on
behalf of such Time Warner Selling Stockholder;

(ii) upon payment for the Shares to be sold by such Time Warner Selling
Stockholder pursuant to this Agreement, delivery of such Shares, as directed by
the Underwriters, to Cede or such other nominee as may be designated by DTC,
registration of such Shares in the name of Cede or such other nominee and the
crediting of such Shares on the books of DTC to securities accounts of the
Underwriters (assuming that neither DTC nor any such Underwriter has notice of
any adverse claim within the meaning of Section 8-105 of the UCC to such
Shares), (A) DTC shall be a “protected purchaser” of such Shares within the
meaning of Section 8-303 of the UCC, (B) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of such Shares
and (C) no action based on any “adverse claim” (within the meaning of
Section 8-102 of the UCC) to such Shares may be asserted against the
Underwriters with respect to such security entitlement; in giving this opinion,
counsel for such Time Warner Selling Stockholder may assume that when such
payment, delivery and crediting occur, (x) such Shares will have been registered
in the name of Cede or another nominee designated by DTC, in each case on the
Company’s share registry in accordance with its certificate of incorporation,
bylaws and applicable law, (y) DTC will be registered as a “clearing
corporation” within the meaning of Section 8-102 of the UCC and (z) appropriate
entries to the accounts of the several Underwriters on the records of DTC will
have been made pursuant to the UCC; and

(iii) the execution and delivery by each Time Warner Selling Stockholder of, and
the performance by each Time Warner Selling Stockholder of its obligations under
this Agreement will not conflict with, or constitute a default under the laws of
the state of New York.

 

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(f) The Underwriters shall have received on the Closing Date an opinion of
Brenda Karickhoff, Esq., Senior Vice President and Deputy General Counsel of
Time Warner Inc., to the effect that:

(i) the execution and delivery by each Time Warner Selling Stockholder of, and
the performance by each Time Warner Selling Stockholder of its obligations under
this Agreement will not conflict with, or constitute a default under, (a) any
provision of the certificate of incorporation or by-laws of such Time Warner
Selling Stockholder, (b) to such counsel’s knowledge, any of the terms or
provisions of any agreement or other instrument binding upon such Time Warner
Selling Stockholder that is material to such Time Warner Selling Stockholder,
(c) to such counsel’s knowledge, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over such Time Warner
Selling Stockholder or (d) the corporate laws of the State of Delaware or
federal law or regulation (other than federal and state securities or Blue Sky
laws or the rules and regulations of the FCC);

(ii) no consent, approval, authorization or order of, or qualification with, any
federal, New York or Delaware governmental body or agency is required for the
performance by any Time Warner Selling Stockholder of its obligations under this
Agreement, except such as may be required by the securities or Blue Sky laws of
the various states in connection with offer and sale of the Shares; and

(iii) each Time Warner Selling Stockholder has valid title to, or a valid
security entitlement in respect of, the Shares to be sold by such Time Warner
Selling Stockholder free and clear of all security interests, claims, liens,
equities and other encumbrances, and such Time Warner Selling Stockholder has
the legal right and power, and all authorization and approval required by law,
to enter into this Agreement and to sell, transfer and deliver the Shares to be
sold by such Time Warner Selling Stockholder or a security entitlement in
respect of such Shares.

(g) The Underwriters shall have received on the Closing Date an opinion of
Sabin, Bermant & Gould LLP, counsel for Advance Telecom Holdings Corp. and
Samuel I. Newhouse Foundation Inc. (together, the “A/N Selling Stockholders”),
each to the effect that:

(i) this Agreement has been duly authorized, executed and delivered by or on
behalf of each of the A/N Selling Stockholders;

(ii) the execution and delivery by each A/N Selling Stockholder of, and the
performance by such A/N Selling Stockholder of its obligations under, this
Agreement will not contravene any provision of applicable law, or the
certificate of incorporation or by-laws of such A/N Selling Stockholder, or, to
the best of such counsel’s knowledge, any agreement or other instrument binding
upon such A/N Selling Stockholder or, to the best of such counsel’s knowledge,
any judgment, order or decree of any governmental body, agency or court having
jurisdiction over such A/N Selling Stockholder, and no consent, approval,
authorization or order

 

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of, or qualification with, any governmental body or agency is required for the
performance by such A/N Selling Stockholder of its obligations under this
Agreement, except such as may be required by the securities or Blue Sky laws of
the various states in connection with offer and sale of the Shares;

(iii) each of the A/N Selling Stockholders has valid title to, or a valid
security entitlement in respect of, the Shares to be sold by such A/N Selling
Stockholder free and clear of all security interests, claims, liens, equities
and other encumbrances, and each of the A/N Selling Stockholders has the legal
right and power, and all authorization and approval required by law, to enter
into this Agreement and to sell, transfer and deliver the Shares to be sold by
such A/N Selling Stockholder or a security entitlement in respect of such
Shares; and

(iv) upon payment for the Shares to be sold by the A/N Selling Stockholders
pursuant to this Agreement, delivery of such Shares, as directed by the
Underwriters, to Cede or such other nominee as may be designated by DTC,
registration of such Securities in the name of Cede or such other nominee and
the crediting of such Shares on the books of DTC to securities accounts of the
Underwriters (assuming that neither DTC nor any such Underwriter has notice of
any adverse claim within the meaning of Section 8-105 of the UCC to such
Shares), (A) DTC shall be a “protected purchaser” of such Securities within the
meaning of Section 8-303 of the UCC, (B) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect of such
Securities and (C) no action based on any “adverse claim” (within the meaning of
Section 8-102 of the UCC) to such Shares may be asserted against the
Underwriters with respect to such security entitlement; in giving this opinion,
counsel for the A/N Selling Stockholders may assume that when such payment,
delivery and crediting occur, (x) such Shares will have been registered in the
name of Cede or another nominee designated by DTC, in each case on the Company’s
share registry in accordance with its certificate of incorporation, bylaws and
applicable law, (y) DTC will be registered as a “clearing corporation” within
the meaning of Section 8-102 of the UCC and (z) appropriate entries to the
accounts of the several Underwriters on the records of DTC will have been made
pursuant to the UCC.

(h) The Underwriters shall have received on the Closing Date an opinion of
Shearman & Sterling LLP, counsel for the Underwriters, dated the Closing Date,
in the form and substance reasonably satisfactory to them.

(i) The Underwriters shall have received, on each of the date hereof and the
Closing Date, a letter dated the date hereof or the Closing Date, as the case
may be, in form and substance satisfactory to the Underwriters, from Ernst &
Young LLP, independent public accountants, containing statements and

 

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information of the type ordinarily included in accountants’ “comfort letters” to
underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement, the Time of Sale Prospectus
and the Prospectus; provided that the letter delivered on the Closing Date shall
use a “cut-off date” not earlier than the date hereof.

(g) The “lock-up” agreements, each substantially in the form of Exhibit A
hereto, between the Underwriters and substantially all of the executive officers
and directors of the Company listed on Schedule V hereto, and between the
Underwriters and Time Warner Companies, Inc. and Warner Communications Inc.,
relating to sales and certain other dispositions of shares of Class A Common
Stock or certain other securities, delivered to the Underwriters on or before
the date hereof, shall be in full force and effect on the Closing Date.

(h) The Underwriters shall have received on the Closing Date such documents as
they may reasonably request with respect to the good standing of the Company,
the due authorization and issuance of the Shares and other matters related to
the issuance of the Shares.

The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to you on the applicable Option Closing
Date of each of the documents referred to above (other than any lock-up
agreement referenced in Section 6(g)) dated as of the Option Closing Date
(except that insofar as any documents relate to Shares, they may be limited to
covering only Additional Shares).

7. Covenants of the Company. The Company covenants with each Underwriter as
follows:

(a) To furnish to you, without charge, a signed copy of the Registration
Statement (including exhibits thereto and documents incorporated by reference)
and to deliver to each of the Underwriters during the period mentioned in
Section 7(e) or 7(f) below, as many copies of the Time of Sale Prospectus, the
Prospectus, any documents incorporated therein by reference therein and any
supplements and amendments thereto or to the Registration Statement as you may
reasonably request.

(b) Before amending or supplementing the Registration Statement, the Time of
Sale Prospectus or the Prospectus, to furnish to you a copy of each such
proposed amendment or supplement and not to file any such proposed amendment or
supplement to which you reasonably object.

(c) To furnish to you a copy of each proposed free writing prospectus to be
prepared by or on behalf of, used by, or referred to by the Company and not to
use or refer to any proposed free writing prospectus to which you reasonably
object.

 

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(d) Not to take any action that would result in an Underwriter or the Company
being required to file with the Commission pursuant to Rule 433(d) under the
Securities Act a free writing prospectus prepared by or on behalf of the
Underwriter that the Underwriter otherwise would not have been required to file
thereunder.

(e) If the Time of Sale Prospectus is being used to solicit offers to buy the
Shares at a time when the Prospectus is not yet available to prospective
purchasers and any event shall occur or condition exist as a result of which it
is necessary to amend or supplement the Time of Sale Prospectus in order to make
the statements therein, in the light of the circumstances, not misleading, or if
any event shall occur or condition exist as a result of which the Time of Sale
Prospectus conflicts with the information contained in the Registration
Statement then on file, or if, in the opinion of counsel for the Underwriters,
it is necessary to amend or supplement the Time of Sale Prospectus to comply
with applicable law, forthwith to prepare, file with the Commission and furnish,
at its own expense, to the Underwriters and to any dealer upon request, either
amendments or supplements to the Time of Sale Prospectus so that the statements
in the Time of Sale Prospectus as so amended or supplemented will not, in the
light of the circumstances when delivered to a prospective purchaser, be
misleading or so that the Time of Sale Prospectus, as amended or supplemented,
will no longer conflict with the Registration Statement, or so that the Time of
Sale Prospectus, as amended or supplemented, will comply with applicable law.

(f) If, during such period after the first date of the public offering of the
Shares as in the reasonable opinion of counsel for the Underwriters the
Prospectus (or in lieu thereof the notice referred to in Rule 173(a) under the
Securities Act) is required by law to be delivered in connection with sales by
an Underwriter or dealer, any event shall occur or condition exist as a result
of which it is necessary to amend or supplement the Prospectus in order to make
the statements therein, in the light of the circumstances when the Prospectus
(or in lieu thereof the notice referred to in Rule 173(a) under the Securities
Act) is delivered to a purchaser, not misleading, or if, in the reasonable
opinion of counsel for the Underwriters, it is necessary to amend or supplement
the Prospectus to comply with applicable law, forthwith to prepare, file with
the Commission and furnish, at its own expense, to the Underwriters and to the
dealers (whose names and addresses you will furnish to the Company) to which
Shares may have been sold by you on behalf of the Underwriters and to any other
dealers upon request, either amendments or supplements to the Prospectus so that
the statements in the Prospectus as so amended or supplemented will not, in the
light of the circumstances when the Prospectus (or in lieu thereof the notice
referred to in Rule 173(a) under the Securities Act) is delivered to a
purchaser, be misleading or so that the Prospectus, as amended or supplemented,
will comply with applicable law.

(g) To endeavor to qualify the Shares for offer and sale under the securities or
Blue Sky laws of such jurisdictions as you shall reasonably request.

 

23

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(h) To make generally available to the Company’s security holders and to you as
soon as practicable an earning statement covering a period of at least twelve
months beginning with the first fiscal quarter of the Company occurring after
the date of this Agreement which shall satisfy the provisions of Section 11(a)
of the Securities Act and the rules and regulations of the Commission
thereunder.

(i) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this Agreement,
including: (i) the fees, disbursements and expenses of the Company’s counsel,
the Company’s accountants and one counsel for the Selling Stockholders (the
fees, disbursement and expenses of any additional counsel for the Selling
Stockholders must be paid for by the Selling Stockholders) in connection with
the registration and delivery of the Shares under the Securities Act and all
other fees or expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Time of Sale Prospectus,
the Prospectus, any free writing prospectus prepared by or on behalf of, used
by, or referred to by the Company and amendments and supplements to any of the
foregoing, including the filing fees payable to the Commission relating to the
Shares (within the time required by Rule 456 (b)(1), if applicable), all
printing costs associated therewith, and the mailing and delivering of copies
thereof to the Underwriters and dealers, in the quantities hereinabove
specified, (ii) all costs and expenses related to the transfer and delivery of
the Shares to the Underwriters, including any transfer or other taxes payable
thereon, (iii) the cost of printing or producing any Blue Sky or legal
investment memorandum in connection with the offer and sale of the Shares under
state securities laws and all expenses in connection with the qualification of
the Shares for offer and sale under state securities laws as provided in
Section 7(g) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky or legal investment
memorandum, (iv) all filing fees and the reasonable fees and disbursements of
counsel to the Underwriters incurred in connection with the review and
qualification of the offering of the Shares by the National Association of
Securities Dealers, Inc., (v) any fees charged by the rating agencies for the
rating of the Shares, (vi) the cost of the preparation, issuance and delivery of
the Shares, (vii) the costs and charges of any trustee, transfer agent,
registrar or depositary, and (viii) all other costs and expenses incident to the
performance of the obligations of the Company hereunder for which provision is
not otherwise made in this Section. It is understood, however, that except as
provided in this Section, Section 9 entitled “Indemnity and Contribution,” and
the last paragraph of Section 11 below, the Underwriters will pay all of their
costs and expenses, including fees and disbursements of their counsel, transfer
taxes payable on resale of any of the Shares by them and any advertising
expenses connected with any offers they may make.

 

24

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The provisions of this Section shall not supersede or otherwise affect any
agreement that the Company and the Selling Stockholders may otherwise have for
the allocation of such expenses among themselves.

(j) If the third anniversary of the initial effective date of the Registration
Statement occurs before all the Shares have been sold by the Underwriters, prior
to the third anniversary to file a new shelf registration statement and to take
any other action necessary to permit the public offering of the Shares to
continue without interruption; references herein to the Registration Statement
shall include the new registration statement declared effective by the
Commission;

(k) During the period beginning on the date hereof and continuing to and
including the Closing Date, not to offer, sell, contract to sell or otherwise
dispose of any debt securities of the Company or warrants to purchase or
otherwise acquire debt securities of the Company substantially similar to the
Shares (other than (i) the Shares, (ii) commercial paper issued in the ordinary
course of business or (iii) securities or warrants permitted with the prior
written consent of the Underwriters identified in Schedule IV with the
authorization to release this lock-up on behalf of the Underwriters).

8. Covenants of the Underwriters. Each Underwriter severally covenants with the
Company not to take any action that would result in the Company being required
to file with the Commission under Rule 433(d) a free writing prospectus prepared
by or on behalf of such Underwriter that otherwise would not be required to be
filed by the Company thereunder, but for the action of the Underwriter. The
Underwriters further covenant with the Company to pay or cause to be paid the
costs and expenses of the Company relating to investor presentations on any
“road show” undertaken in connection with the marketing of the offering of the
Shares.

9. Indemnity and Contribution. (a) The Company agrees to indemnify and hold
harmless each Underwriter, each person, if any, who controls any Underwriter
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act and each affiliate of any Underwriter within the meaning of
Rule 405 under the Securities Act from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, the preliminary prospectus, the Time of Sale Prospectus, any free
writing prospectus that the Company has filed, or is required to file, pursuant
to Rule 433(d) of the Securities Act, any electronic roadshow or the Prospectus
or any amendment or supplement thereto, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances in which they were made, except insofar as such losses, claims,
damages or liabilities are caused

 

25

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by any such untrue statement or omission or alleged untrue statement or omission
based upon information relating to any Underwriter furnished to the Company in
writing by such Underwriter through you expressly for use therein.

(b) The Company agrees to indemnify and hold harmless each Selling Stockholder,
each person, if any, who controls any Selling Stockholder within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act, and
each affiliate of any Selling Stockholder within the meaning of Rule 405 under
the Securities Act from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
the preliminary prospectus, the Time of Sale Prospectus, any free writing
prospectus that the Company has filed, or is required to file, pursuant to Rule
433(d) of the Securities Act, any electronic road show or the Prospectus (if
used within the period set forth in paragraph (f) of Section 7 hereof and as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto), or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances in which they
were made, except for losses, claims, damages or liabilities with respect to
Selling Stockholder Information provided by such Selling Stockholder.

(c) Each Selling Stockholder agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the Registration
Statement, each Underwriter, each person, if any, who controls any Underwriter
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, and each affiliate of any Underwriter within the meaning of
Rule 405 under the Securities Act from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, the preliminary prospectus, the Time of Sale Prospectus, any free
writing prospectus that the Company has filed, or is required to file, pursuant
to Rule 433(d) of the Securities Act, or the Prospectus (if used within the
period set forth in paragraph (f) of Section 7 hereof and as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances in which they were made but
only with respect to the Selling Stockholder Information provided by such
Selling Stockholder. The liability of each Selling Stockholder under the
indemnity agreement contained in this paragraph shall be limited to an amount
equal to the net proceeds received by such Selling Stockholder from the sale of
Shares by it under this Agreement.

 

26

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(d) Each Underwriter agrees, severally and not jointly, to indemnify and hold
harmless the Company, each Selling Stockholder, the directors and officers of
the Company and each Selling Stockholder who sign the Registration Statement and
each person, if any, who controls the Company or any Selling Stockholder within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
the preliminary prospectus, the Time of Sale Prospectus, any other free writing
prospectus that the Company has filed or is required to file pursuant to Rule
433(d) of the Securities Act or the Prospectus (as amended or supplemented if
the Company shall have furnished any amendments or supplements thereto), or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances in which they were made, but only with
reference to information relating to such Underwriter furnished to the Company
in writing by you on behalf of such Underwriter expressly for use in the
Registration Statement, the preliminary prospectus, the Time of Sale Prospectus,
any other free writing prospectus that the Company has filed or is required to
file pursuant to Rule 433(d) of the Securities Act or the Prospectus or any
amendment or supplement thereto.

(e) In case any proceeding (including any governmental investigation) shall be
instituted involving any person in respect of which indemnity may be sought
pursuant to Section 9(a), 9(b), 9(c) or 9(d), such person (the “indemnified
party”) shall promptly notify the person against whom such indemnity may be
sought (the “indemnifying party”) in writing and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the reasonable
fees and disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (i) the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Underwriters and all persons, if any, who
control any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act or who are affiliates of any
Underwriter within the meaning of

 

27

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Rule 405 under the Securities Act, (ii) the fees and expenses of more than one
separate firm (in addition to any local counsel) for the Company, its directors,
its officers who sign the Registration Statement and each person, if any, who
controls the Company within the meaning of either such Section and (iii) the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all Selling Stockholders and all persons, if any, who control any
Selling Stockholder within the meaning of either such Section, and that all such
fees and expenses shall be reimbursed as they are incurred. In the case of any
such separate firm for the Underwriters and such control persons and affiliates
of any Underwriters, such firm shall be designated in writing by the
Underwriters authorized to appoint counsel under this Section set forth in
Schedule IV hereto. In the case of any such separate firm for the Company, and
such directors, officers and control persons of the Company, such firm shall be
designated in writing by the Company. In the case of any such separate firm for
the Selling Stockholders and such control persons of the Selling Stockholders,
such firm shall be designated in writing by the Time Warner Selling
Stockholders. The indemnifying party shall not be liable for any settlement of
any proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.

(f) To the extent the indemnification provided for in Section 9(a), 9(b), 9(c)
or 9(d) is unavailable to an indemnified party in respect of any losses, claims,
damages or liabilities referred to under such paragraph, then each indemnifying
party under such paragraph, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (i) if the
indemnifying party is the Company (other than as set forth in clause 9(f)(iii)
below) or the Selling Stockholders, in such proportion as is appropriate to
reflect the relative benefits received by the indemnifying party or parties on
the one hand and the indemnified party or parties on the other hand from the
offering of the Shares, (ii) if the indemnifying person is an Underwriter, in
such proportion as is appropriate to reflect the relative fault of such
Underwriter on the one hand and the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities (iii) if the indemnifying person is the
Company and the indemnified party is any Selling Stockholder, in such proportion
as is appropriate to reflect the relative fault of the Company on the one hand
and such Selling Stockholder on the other hand in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, or
(iv) if the allocation provided by clause 9(f)(i), 9(f)(ii) or 9(f)(iii) above
is not permitted by applicable law, in such proportion as

 

28

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is appropriate to reflect not only the relative benefits referred to in clause
9(f)(i) above or the relative fault referred to in clause 9(f)(ii) and 9(f)(iii)
but also the relative fault (in cases covered by clause 9(f)(i)) or such
relative benefits (in cases covered by clause 9(f)(ii) and 9(f)(iii)) of the
indemnifying party or parties on the one hand and of the indemnified party or
parties on the other hand in connection with the statements or omissions that
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company
or the Selling Stockholders on the one hand and the Underwriters on the other
hand in connection with the offering of the Shares shall be deemed to be in the
same respective proportions as the net proceeds from the offering of the Shares
(before deducting expenses) received by the Selling Stockholders and the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover of the Prospectus, bear to the
aggregate public offering price of the Shares. The relative fault of the Company
or the Selling Stockholders on the one hand and the Underwriters on the other
hand shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Selling Stockholders or by the Underwriters and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Underwriters’ respective obligations to
contribute pursuant to this Section 9 are several in proportion to the
respective number of Shares they have purchased hereunder, and not joint. The
liability of any Selling Stockholder under the contribution agreement contained
in this paragraph shall be limited to an amount equal to the net proceeds
received by such Selling Stockholder from the sale of Shares by it under this
Agreement.

(g) The Company, the Selling Stockholders and the Underwriters agree that it
would not be just or equitable if contribution pursuant to this Section 9 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in Section 9(f). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in Section 9(f) shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 9, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Shares underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages that such Underwriter has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The remedies
provided for in this Section 9 are not exclusive and shall not limit any rights
or remedies which may otherwise be available to any indemnified party at law or
in equity.

 

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(h) The indemnity and contribution provisions contained in this Section 9 and
the representations, warranties and other statements of the Company and the
Selling Stockholders contained in this Agreement shall remain operative and in
full force and effect regardless of (i) any termination of this Agreement,
(ii) any investigation made by or on behalf of any Underwriter, any person
controlling any Underwriter or any affiliate of any Underwriter, by or on behalf
of any Selling Stockholder, the officers or directors of any Selling Stockholder
or any person controlling any Selling Stockholder, or by or on behalf of the
Company, its officers or directors or any person controlling the Company and
(iii) acceptance of and payment for any of the Shares.

10. Termination. The Underwriters may terminate this Agreement by notice given
by you to the Company and the Selling Stockholders, if after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading generally
shall have been suspended or materially limited on, or by, as the case may be,
any of the New York Stock Exchange or the Nasdaq National Market, (ii) trading
of any securities of the Company shall have been suspended on any exchange or in
any over-the-counter market, (iii) a material disruption in securities
settlement, payment or clearance services in the United States shall have
occurred, (iv) any moratorium on commercial banking activities shall have been
declared by Federal or New York State authorities or (v) there shall have
occurred any outbreak or escalation of hostilities, or any change in financial
markets or any calamity or crisis that, in your judgment, is material and
adverse and which, singly or together with any other event specified in this
clause (v), makes it, in your judgment, impracticable or inadvisable to proceed
with the offer, sale or delivery of the Shares on the terms and in the manner
contemplated in the Time of Sale Prospectus or the Prospectus.

11. Effectiveness; Defaulting Underwriters. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.

If, on the Closing Date, any one or more of the Underwriters shall fail or
refuse to purchase Firm Shares that it has or they have agreed to purchase
hereunder on such date, and the aggregate number of Firm Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate number of the Firm Shares to be
purchased on such date, the other Underwriters shall be obligated severally in
the proportions that the number of Firm Shares set forth opposite their
respective names in Schedule II bears to the aggregate number of Firm Shares set
forth opposite the names of all such non-defaulting Underwriters, or in such
other proportions as you may specify, to purchase the Firm Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
on such date; provided that in no event shall the number of Firm Shares that any
Underwriter has agreed to purchase on such date pursuant to this Agreement be
increased pursuant to this Section 11 by an amount in excess of one-ninth of
such number of Firm Shares without the written consent of such Underwriter. If,
on the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase

 

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Firm Shares and the aggregate number of Firm Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Shares to be
purchased, and arrangements satisfactory to you, the Company and the Selling
Stockholders for the purchase of such Firm Shares are not made within 36 hours
after such default, this Agreement shall terminate without liability on the part
of any non-defaulting Underwriter, the Company or the Selling Stockholders. In
any such case either you or the Selling Stockholders shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement, in the Time of
Sale Prospectus, in the Prospectus or in any other documents or arrangements may
be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement. If, on an Option Closing Date, any Underwriter
or Underwriters shall fail or refuse to purchase Additional Shares and the
aggregate number of Additional Shares with respect to which such default occurs
is more than one-tenth of the aggregate number of Additional Shares to be
purchased on such Option Closing Date, the non-defaulting Underwriters shall
have the option to (i) terminate their obligation hereunder to purchase the
Additional Shares to be sold on such Option Closing Date or (ii) purchase not
less than the number of Additional Shares that such non-defaulting Underwriters
would have been obligated to purchase in the absence of such default. Any action
taken under this paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriter under this Agreement.

If this Agreement shall be terminated by the Underwriters, or any one of them,
because of any failure or refusal on the part of the Company or the Selling
Stockholders to comply with the terms or to fulfill any of the conditions of
this Agreement, or if for any reason the Company or the Selling Stockholders
shall be unable to perform their obligations under this Agreement, the Company
or the Selling Stockholders as the case may be will reimburse the Underwriters
or such Underwriters as have so terminated this Agreement with respect to
themselves, severally, for all out-of-pocket expenses (including the fees and
disbursements of their counsel) reasonably incurred by such Underwriters in
connection with this Agreement or the offering contemplated hereunder.

12. Entire Agreement. (a) This Agreement, together with any contemporaneous
written agreements and any prior written agreements (to the extent not
superseded by this Agreement) that relate to the offering of the Shares,
represents the entire agreement between the Company and the Selling
Stockholders, on the one hand, and the Underwriters, on the other, with respect
to the preparation of any preliminary prospectus, the Time of Sale Prospectus,
the Prospectus, the conduct of the offering, and the purchase and sale of the
Shares.

(b) The Company acknowledges that in connection with the offering of the Shares:
(i) the Underwriters have acted at arms length, are not agents of, and owe no
fiduciary duties to, the Company or any other person, (ii) the Underwriters owe
the Company only those duties and obligations set forth in this

 

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Agreement and prior written agreements (to the extent not superseded by this
Agreement), if any, and (iii) the Underwriters may have interests that differ
from those of the Company. The Company waives to the full extent permitted by
applicable law any claims it may have against the Underwriters arising from an
alleged breach of fiduciary duty in connection with the offering of the Shares.

13. Counterparts. This Agreement may be signed in two or more counterparts, each
of which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

14. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.

15. Headings. The headings of the sections of this Agreement have been inserted
for convenience of reference only and shall not be deemed a part of this
Agreement.

16. Notices. All communications hereunder shall be in writing and effective only
upon receipt and if to the Underwriters shall be delivered, mailed or sent to
you at the address set forth in Schedule IV hereto; if to the Company shall be
delivered, mailed or sent to the address set forth in Schedule IV hereto; and if
to the Selling Stockholders shall be delivered, mailed or sent to the address
set forth in Schedule IV hereto.

 

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Very truly yours,

TIME WARNER TELECOM INC.

By:  

/s/ Paul B. Jones

 

Name:

 

Paul B. Jones

 

Title:

 

Senior Vice President,

General Counsel & Regulatory Policy

AMERICAN TELEVISION AND COMMUNICATIONS CORPORATION By:  

/s/ Edward B. Ruggiero

 

Name:

 

Edward B. Ruggiero

 

Title:

  Vice President TW/TAE, INC. By:  

/s/ Brenda C. Karickhoff

 

Name:

 

Brenda C. Karickhoff

 

Title:

  Senior Vice President

--------------------------------------------------------------------------------

ADVANCE TELECOM HOLDINGS CORP.

By:  

/s/ S.I. Newhouse, Jr.

 

Name:

 

S.I. Newhouse, Jr.

 

Title:

  Vice President

SAMUEL I. NEWHOUSE FOUNDATION INC.

By:  

/s/ S.I. Newhouse, Jr.

 

Name:

 

S.I. Newhouse, Jr.

 

Title:

  Vice President

 

DEUTSCHE BANK SECURITIES INC.

MORGAN STANLEY & CO. INCORPORATED

WACHOVIA CAPITAL MARKETS, LLC

J.P. MORGAN SECURITIES INC.

Acting severally on behalf of themselves and the several Underwriters named in
Schedule II hereto

By:  

Deutsche Bank Securities Inc.

By:  

/s/ David T. Pearson

 

Name:

 

David T. Pearson

 

Title:

 

Managing Director

--------------------------------------------------------------------------------

SCHEDULE I

 

Term Sheet

To prospectus dated March 17, 2006,

prospectus supplement dated March 17, 2006

  

Term Sheet to

Prospectus Supplement

Registration Statement No. 333-132504

Dated March 17, 2006

Rule 433

Time Warner Telecom Inc.

19,400,000 Shares

Class A Common Stock

In the event of an inconsistency between this Term Sheet and the preliminary
Prospectus Supplement dated March 17, 2006, you should rely on the information
in this Term Sheet.

 

Issuer:    Time Warner Telecom Inc. Common stock symbol:    TWTC Title of
securities:    Class A Common Stock Number of shares offered:    19,400,000
Price to public:    $14.62 Class A Common Stock outstanding after the offering*:
   71,834,233 shares Over-allotment option:    2,910,000 shares Selling
shareholders:   

American Television Communications Corporation TW/TAE, Inc.

Advance Telecom Holdings Corp.

Samuel I. Newhouse Foundation Inc.

Aggregate underwriting compensation:    $12,054,190 (excluding exercise of
over-allotment option) Trade date:    March 23, 2006 Settlement date:    March
29, 2006 Underwriters:   

Deutsche Bank Securities Inc.

Morgan Stanley & Co. Incorporated (Deal Coordinator)

J.P. Morgan Securities Inc.

Wachovia Capital Markets, LLC

 

* Based on the number of shares of Class A Common Stock outstanding as of
February 28, 2006.

The issuer has filed a registration statement (including a prospectus) with the
SEC for the offering to which this communication relates. Before you invest, you
should read the prospectus in that registration statement and other documents
the issuer has filed with the SEC for more complete information about the issuer
and this offering. You may get these documents for free by visiting EDGAR on the
SEC web site at www.sec.gov. Alternatively, the issuer, any underwriter or any
dealer participating in the offering will arrange to send to you the prospectus
if you request it by calling, if you are a retail investor, toll-free
1-800-584-6837 or if you are an institutional investor by calling toll-free
1-866-718-1649.

ANY DISCLAIMERS OR OTHER NOTICES THAT MAY APPEAR BELOW OR ELSEWHERE WITHIN THE
EMAIL ARE NOT APPLICABLE TO THIS COMMUNICATION AND SHOULD BE DISREGARDED. SUCH
DISCLAIMERS OR OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT OF THIS
COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.

 

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SCHEDULE II

 

Underwriter

   Number of Shares
To Be Purchased

Deutsche Bank Securities Inc.

   7,760,000

Morgan Stanley & Co. Incorporated

   6,790,000

J.P. Morgan Securities Inc. .

   3,880,000

Wachovia Capital Markets, LLC.

   970,000     

Total

   19,400,00     

 

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SCHEDULE III

 

Selling Stockholder

  

Number of Firm
Shares

To Be Sold

  

Number of
Additional Shares

To Be Sold

American Television and Communications Corporation

   14,818,108    651,307

TW/TAE, Inc.

   0    1,571,409

Advance Telecom Holdings Corp.

   1,671,080    687,284

Samuel I. Newhouse Foundation Inc.

   2,910,812    0          

Total:

   19,400,000    2,910,000          

 

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SCHEDULE IV

 

Underwriters authorized to release lock-up under Section 3:    For Time Warner
Telecom Inc.:   

Deutsche Bank Securities Inc.

Morgan Stanley & Co. Incorporated

   For American Television and Communications Corporation and TW/TAE, Inc.:   
Deutsche Bank Securities Inc. Morgan Stanley & Co. Incorporated    For Advance
Telecom Holdings Corp. and Samuel I. Newhouse Foundation Inc.:    Morgan Stanley
& Co. Incorporated J.P. Morgan Securities Inc. Underwriters authorized to
appoint counsel under Section 9(d):   

Deutsche Bank Securities Inc.

Morgan Stanley & Co. Incorporated

Address for Notices to Underwriters:   

Deutsche Bank Securities Inc.

60 Wall Street

New York, New York 10005

Address for Notices to the Company:   

Time Warner Telecom Inc.

Attn: General Counsel

10475 Park Meadows Drive

Littleton, Colorado 80124

Address for Notices to American Television and Communications Corporation, Inc.
and TW/TAE, Inc.:   

c/o Time Warner Inc.

One Time Warner Center

New York, New York 10019

Attn: General Counsel

fax: 212-484-7167

 

with copies to:

 

Ray Murphy

Senior Vice President and Treasurer

Time Warner Inc.

One Time Warner Center

New York, New York 10019

 

and

 

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Cravath, Swaine & Moore LLP

Worldwide Plaza

825 Eighth Avenue New York,

New York 10019

Attn: Faiza J. Saeed, Esq.

Address for Notices to Advance Telecom Holdings Corp. and Samuel I. Newhouse
Foundation Inc. :   

Advance Telecom Holdings Corp.

5000 Campuswood Drive

East Syracuse, New York 13057

 

Samuel I. Newhouse Foundation Inc.

Four Time Square

New York, New York 10036

 

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SCHEDULE V

PARTIES TO LOCK-UP AGREEMENTS

Larissa L. Herda

Olaf Olafsson

Richard J. Davies

Spencer B. Hays

Robert D. Marcus

George S. Sacerdote

Roscoe C. Young, II

Kevin W. Mooney

Mark D. Hernandez

Time Warner Companies, Inc.

Warner Communications Inc.

Mark A. Peters

Paul B. Jones

John T. Blount

Catherine A. Hemmer

Michael A. Rouleau

Julie A. Rich

Robert W. Gaskins

Jill R. Stuart

 

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EXHIBIT A

Deutsche Bank Securities Inc.

Morgan Stanley & Co. Incorporated

J.P. Morgan Securities Inc.

Wachovia Capital Markets, LLC

 

c/o Deutsche Bank Securities Inc.

60 Wall Street

New York, NY 10005

Dear Sirs and Mesdames:

The undersigned understands that Deutsche Bank Securities Inc., Morgan Stanley &
Co. Incorporated, J.P. Morgan Securities Inc. and Wachovia Capital Markets, LLC
(the “Underwriters”) severally propose to enter into an Underwriting Agreement
(the “Underwriting Agreement”) with Time Warner Telecom Inc., a Delaware
corporation (the “Company”), and certain selling stockholders of the Company
(the “Selling Stockholders”) providing for the public offering by the
Underwriters of some of the Selling Stockholders’ shares of Class A common
stock, par value $.01 per share of the Company (the “Securities”) (such offering
referred to as the “Offering”).

To induce the Underwriters that may participate in the Offering to continue
their efforts in connection with the Offering, the undersigned hereby agrees
that, without the prior written consent of Deutsche Bank Securities Inc. and
Morgan Stanley & Co. Incorporated on behalf of the Underwriters, he or she will
not, during the period commencing on the date hereof and ending 90 days after
the date of the final prospectus supplement relating to the Offering (the
“Prospectus”), (1) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend, or otherwise transfer or dispose of,
directly or indirectly, any shares of common stock of the Company or any
securities convertible into or exercisable or exchangeable for common stock, or
(2) enter into any swap or other arrangement that transfers to another, in whole
or in part, any of the economic consequences of ownership of the common stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of common stock or such other securities, in cash or
otherwise. The foregoing sentence shall not apply to (i) sales of shares of
Class A Common Stock through existing Rule 10b5-1 plans as in effect on
March 16, 2006, (ii) the transfer by a bona fide gift of Class A Common Stock,
provided that (a) the transferee shall enter into a written agreement accepting
the restrictions set forth in the preceding sentence and (b) no filing of a
registration statement with the Commission or other filing with the Commission,
including under Section 16(a)

 

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of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), shall
be required or shall be voluntarily made in respect of the transfer during the
90-day restricted period, and (iii) transactions relating to shares of Class A
Common Stock or other securities of the Company acquired in open market
transactions after the completion of the Offering, provided that no filing under
Section 16(a) of the Exchange Act shall be required or shall be voluntarily made
during the 90-day restricted period in connection with subsequent sales of
Class A Common Stock or other securities of the Company acquired in such open
market transactions.

In addition, the undersigned agrees that, without the prior written consent of
Deutsche Bank Securities Inc. and Morgan Stanley & Co. Incorporated on behalf of
the Underwriters, he or she will not, during the period commencing on the date
hereof and ending 90 days after the date of the Prospectus, make any demand for
or exercise any right with respect to, the registration of any shares of Class A
Common Stock or any security convertible into or exercisable or exchangeable for
Class A Common Stock. The undersigned also agrees and consents to the entry of
stop transfer instructions with the Company’s transfer agent and registrar
against the transfer of the undersigned’s shares of Class A Common Stock except
in compliance with the foregoing restrictions.

If:

(1) during the last 17 days of the 90-day restricted period the Company issues a
earnings release or material news or a material event relating to the Company
occurs; or

(2) prior to the expiration of the 90-day restricted period, the Company
announces that it will release earnings results during the 16-day period
beginning on the last day of the restricted period; and in each case

(3) at the end of the 90-day restricted period, (i) the Company’s shares are not
“actively traded securities” as such term is defined in Regulation M under the
Securities Act or (ii) the Underwriters are not able to publish or distribute
research reports concerning the Company or its industry pursuant to Rule 139 of
the Securities Act,

then the restrictions imposed by this agreement shall continue to apply until
the expiration of the 18-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event.

The undersigned understands that the Company, the Selling Stockholders and the
Underwriters are relying upon this Lock-Up Agreement in proceeding toward
consummation of the Offering. The undersigned further understands that this
Lock-Up Agreement is irrevocable and shall be binding upon the undersigned’s
heirs, legal representatives, successors and assigns.

 

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The undersigned understands that whether or not the Offering actually occurs
depends on a number of factors, including market conditions. The Offering will
only be made pursuant to an Underwriting Agreement, the terms of which are
subject to negotiation between the Company and the Underwriters.

 

Very truly yours,

   

(Name)

  

(Address)

 

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