LEVEL 3 COMMUNICATIONS INC, 10-K filed on 2/27/2015
Annual Report
Document and Entity Information Document (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Feb. 26, 2015
Jun. 30, 2014
Entity Information [Line Items]
 
 
 
Entity Registrant Name
LEVEL 3 COMMUNICATIONS INC 
 
 
Entity Central Index Key
0000794323 
 
 
Document Type
10-K 
 
 
Document Period End Date
Dec. 31, 2014 
 
 
Amendment Flag
false 
 
 
Current Fiscal Year End Date
--12-31 
 
 
Entity Well-known Seasoned Issuer
Yes 
 
 
Entity Voluntary Filers
No 
 
 
Entity Current Reporting Status
Yes 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
Entity Public Float
 
 
$ 5,814 
Entity Common Stock, Shares Outstanding
 
345,534,473 
 
Document Fiscal Year Focus
2014 
 
 
Document Fiscal Period Focus
FY 
 
 
Consolidated Statements of Operations (USD $)
In Millions, except Share data in Thousands, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Revenue
$ 6,777 
$ 6,313 
$ 6,376 
Costs and Expenses:
 
 
 
Network Access Costs
2,529 
2,471 
2,602 
Network Related Expenses
1,246 
1,214 
1,249 
Depreciation and Amortization
808 
800 
749 
Selling, General and Administrative Expenses
1,181 
1,162 
1,201 
Total Costs and Expenses
5,764 
5,647 
5,801 
Operating Income (Loss)
1,013 
666 
575 
Other Income (Expense):
 
 
 
Interest income
1 
0 
2 
Interest expense
(654)
(649)
(733)
Loss on modification and extinguishment of debt, net
(53)
(84)
(160)
Other, net
(69)
(4)
(58)
Total Other Expense
(775)
(737)
(949)
Income (Loss) Before Income Taxes
238 
(71)
(374)
Income Tax Benefit (Expense)
76 
(38)
(48)
Net income (loss)
$ 314 
$ (109)
$ (422)
Earnings Per Share, Basic
$ 1.23 
$ (0.49)
$ (1.96)
Weighted Average Number of Shares Outstanding, Basic
254,428 
222,368 
215,356 
Earnings Per Share, Diluted
$ 1.21 
$ (0.49)
$ (1.96)
Weighted Average Number of Shares Outstanding, Diluted
258,483 
222,368 
215,356 
Consolidated Statements of Comprehensive Income (Loss) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Net Income (Loss)
$ 314 
$ (109)
$ (422)
Other Comprehensive Income (Loss) Before Income Taxes:
 
 
 
Foreign Currency Translation
(178)
11 
17 
Holding Gain (Loss) on Interest Rate Swaps, including Reclassification Gains (Losses)
0 
0 
25 
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax
0 
0 
65 
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, before Tax
(5)
(1)
(1)
Other Comprehensive Income (Loss) Before Income Taxes
(183)
10 
106 
Income Tax Related to Items of Other Comprehensive Income (Loss)
0 
0 
0 
Other Comprehensive Income (Loss), Net of Income Taxes
(183)
10 
106 
Comprehensive Income (Loss)
$ 131 
$ (99)
$ (316)
Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Assets
 
 
Cash and cash equivalents
$ 580 
$ 631 
Restricted cash and securities
7 
7 
Receivables, less allowances for doubtful accounts of $30 and $32, respectively
737 
673 
Other
165 
143 
Total Current Assets
1,489 
1,454 
Property, plant and equipment, net of accumulated depreciation of $9,629 and $9,089, respectively
9,860 
8,240 
Restricted Cash and Securities
20 
23 
Goodwill
7,689 
2,577 
Other Intangibles, net
1,414 
205 
Other Assets, net
475 
375 
Total Assets
20,947 
12,874 
Liabilities:
 
 
Accounts payable
664 
625 
Current portion of long-term debt
349 
31 
Accrued payroll and employee benefits
273 
209 
Accrued interest
174 
160 
Current portion of deferred revenue
287 
253 
Other
167 
168 
Total Current Liabilities
1,914 
1,446 
Long-Term Debt, less current portion
10,984 
8,331 
Deferred Revenue, less current portion
921 
906 
Other Liabilities
765 
780 
Total Liabilities
14,584 
11,463 
Commitments and Contingencies
0 
0 
Stockholders’ Equity:
 
 
Preferred stock, $.01 par value, authorized 10,000,000 shares: no shares issued or outstanding
0 
0 
Common stock, $.01 par value, authorized 433,333,333 shares at December 31, 2014 and 343,333,333 shares at December 31, 2013; 341,361,420 shares issued and outstanding at December 31, 2014 and 234,688,063 shares issued and outstanding at December 31, 2013
3 
2 
Additional paid-in capital
19,159 
14,339 
Accumulated other comprehensive income (loss)
(147)
36 
Accumulated deficit
(12,652)
(12,966)
Total Stockholders’ Equity
6,363 
1,411 
Total Liabilities and Stockholders’ Equity
$ 20,947 
$ 12,874 
Consolidated Balance Sheets Parentheticals (Parentheticals) (USD $)
In Millions, except Share data, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Allowance for doubtful accounts
$ 30 
$ 32 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
$ 9,629 
$ 9,089 
Preferred stock, par value
$ 0.01 
$ 0.01 
Preferred stock, shares authorized
10,000,000 
10,000,000 
Preferred stock, shares issued
0 
0 
Preferred stock, shares outstanding
0 
0 
Common stock, par value
$ 0.01 
$ 0.01 
Common Stock, Shares Authorized
433,333,333 
343,333,333 
Common stock, shares issued
341,361,420 
234,688,063 
Common stock, shares outstanding
341,361,420 
234,688,063 
Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Cash Flows from Operating Activities:
 
 
 
Net Income (Loss)
$ 314 
$ (109)
$ (422)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
 
 
 
Depreciation and amortization
808 
800 
749 
Asset retirement obligation adjustment
0 
0 
(47)
Loss on impairment
18 
7 
0 
Non-cash compensation expense attributable to stock awards
73 
151 
135 
Loss on modification and extinguishment of debt, net
53 
84 
160 
Loss on interest rate swaps
0 
0 
60 
Accretion of debt discount and amortization of debt issuance costs
36 
36 
46 
Accrued interest on long-term debt, net
12 
(49)
(5)
Non-cash tax adjustments
(7)
(42)
(14)
Deferred income taxes
(116)
(29)
21 
Gain on sale of property, plant, and equipment and other assets
(3)
(2)
(1)
Other, net
(8)
(41)
(23)
Changes in working capital items:
 
 
 
Receivables
9 
30 
(86)
Other current assets
2 
3 
(5)
Payables
(77)
(162)
18 
Deferred revenue
6 
28 
(10)
Other current liabilities
41 
8 
2 
Net Cash Provided by Operating Activities
1,161 
713 
578 
Cash Flows from Investing Activities:
 
 
 
Capital expenditures
(910)
(760)
(743)
Decrease (increase) in restricted cash and securities, net
(10)
13 
20 
Proceeds from sale of property, plant and equipment and other assets
3 
0 
0 
Investment in tw telecom, net of cash acquired
(167)
0 
0 
Other
(2)
2 
(2)
Net Cash Used in Investing Activities
(1,086)
(745)
(725)
Cash Flows from Financing Activities:
 
 
 
Long-term debt borrowings, net of issuance costs
589 
1,502 
4,504 
Payments on and repurchases of long-term debt, including current portion and refinancing costs
(671)
(1,796)
(4,302)
Proceeds from Stock Options Exercised
0 
0 
5 
Net Cash Provided by (Used in) Financing Activities
(82)
(294)
207 
Effect of Exchange Rates on Cash and Cash Equivalents
(44)
(22)
1 
Net Change in Cash and Cash Equivalents
(51)
(348)
61 
Cash and Cash Equivalents at Beginning of Year
631 
979 
918 
Cash and Cash Equivalents at End of Year
580 
631 
979 
Supplemental Disclosure of Cash Flow Information:
 
 
 
Cash interest paid
598 
674 
695 
Income taxes paid, net of refunds
44 
33 
32 
Non-cash Investing and Financing Activities:
 
 
 
Capital lease obligations incurred
2 
13 
0 
Notes issued for property
0 
12 
0 
Long-term debt conversion into equity
142 
200 
100 
Premium on long-term debt conversion into equity
0 
0 
39 
Accrued interest conversion into equity
2 
3 
2 
Long-term debt issued and proceeds placed in escrow
3,000 
0 
0 
Escrowed Securities used in the acquisition of tw telecom
$ 3,014 
$ 0 
$ 0 
Consolidated Statements of Changes In Stockholders' Equity (USD $)
In Millions, except Share data, unless otherwise specified
Total
Common Stock
Additional Paid-in Capital
Accumulated Other Comprehensive Income (Loss)
Accumulated Deficit
Beginning balance at Dec. 31, 2011
$ 1,193 
$ 2 
$ 13,706 
$ (80)
$ (12,435)
Beginning balance (in shares) at Dec. 31, 2011
 
207,913,428 
 
 
 
Common Stock
 
 
 
 
 
Common stock issued under employee stock benefit plans and other
88 
0 
88 
0 
0 
Common stock issued under employee stock benefit plans and other (in shares)
 
5,019,513 
 
 
 
Stock-based compensation expense
67 
0 
67 
0 
0 
Conversion of debt to equity
139 
0 
139 
0 
0 
Conversion of debt to equity (in shares)
 
5,447,129 
 
 
 
Net Income (Loss)
(422)
0 
0 
0 
(422)
Other Comprehensive Income (Loss)
106 
0 
0 
106 
0 
Ending balance at Dec. 31, 2012
1,171 
2 
14,000 
26 
(12,857)
Ending balance (in shares) at Dec. 31, 2012
 
218,380,070 
 
 
 
Common Stock
 
 
 
 
 
Common stock issued under employee stock benefit plans and other
70 
0 
70 
0 
0 
Common stock issued under employee stock benefit plans and other (in shares)
 
5,493,729 
 
 
 
Stock-based compensation expense
69 
0 
69 
0 
0 
Conversion of debt to equity
200 
0 
200 
0 
0 
Conversion of debt to equity (in shares)
 
10,814,264 
 
 
 
Net Income (Loss)
(109)
0 
0 
0 
(109)
Other Comprehensive Income (Loss)
10 
0 
0 
10 
0 
Ending balance at Dec. 31, 2013
1,411 
2 
14,339 
36 
(12,966)
Ending balance (in shares) at Dec. 31, 2013
234,688,063 
234,688,063 
 
 
 
Common Stock
 
 
 
 
 
Common stock issued under employee stock benefit plans and other
78 
0 
78 
0 
0 
Common stock issued under employee stock benefit plans and other (in shares)
 
4,528,559 
 
 
 
Stock-based compensation expense
55 
0 
55 
0 
0 
tw telecom acquisition equity consideration
4,544 
1 
4,543 
0 
0 
tw telecom acquisition equity consideration (in shares)
 
96,868,883 
 
 
 
Conversion of debt to equity
144 
0 
144 
0 
0 
Conversion of debt to equity (in shares)
 
5,275,915 
 
 
 
Net Income (Loss)
314 
0 
0 
0 
314 
Other Comprehensive Income (Loss)
(183)
0 
0 
(183)
0 
Ending balance at Dec. 31, 2014
$ 6,363 
$ 3 
$ 19,159 
$ (147)
$ (12,652)
Ending balance (in shares) at Dec. 31, 2014
341,361,420 
341,361,420 
 
 
 
Organization and Summary of Significant Accounting Policies
Organization and Summary of Significant Accounting Policies
Organization and Summary of Significant Accounting Policies

Description of Business

Level 3 Communications, Inc. and subsidiaries (the "Company" or "Level 3") is a facilities-based provider (that is, a provider that owns or leases a substantial portion of the plant, property and equipment necessary to provide its services) of a broad range of integrated communications services. The Company created its communications network by constructing its own assets and through a combination of purchasing other companies and purchasing or leasing facilities from others. Level 3's network is an international, facilities-based communications network. The Company designed its network to provide communications services that employ and take advantage of rapidly improving underlying optical, Internet Protocol, computing and storage technologies.

On October 31, 2014, the Company completed the acquisition of tw telecom inc. (“tw telecom”) and tw telecom became an indirect, wholly owned subsidiary of the Company through a tax-free, stock and cash reorganization (the "Merger"). See Note 2 - Events Associated with the Merger of tw telecom.

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of Level 3 Communications, Inc. and subsidiaries in which it has a controlling interest. All significant intercompany accounts and transactions have been eliminated. The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP").

As part of its consolidation policy, the Company considers its controlled subsidiaries, investments in businesses in which the Company is not the primary beneficiary or does not have effective control but has the ability to significantly influence operating and financial policies, and variable interests resulting from economic arrangements that give the Company rights to economic risks or rewards of a legal entity. The Company does not have variable interests in a variable interest entity where it is required to consolidate the entity as the primary beneficiary or where it has concluded it is not the primary beneficiary.

Foreign Currency Translation

Local currencies of foreign subsidiaries are the functional currencies for financial reporting purposes except for certain foreign subsidiaries in Latin America. For operations outside the United States that have functional currencies other than the U.S. dollar, assets and liabilities are translated to U.S. dollars at period-end exchange rates, and revenue, expenses and cash flows are translated using average exchange rates prevailing during the year. A significant portion of the Company's non-United States subsidiaries have either the British pound, the euro or the Brazilian real as the functional currency, each of which experienced significant fluctuations against the U.S. dollar during 2014, 2013 and 2012. Foreign currency translation gains and losses are recognized as a component of accumulated other comprehensive income (loss) in stockholders' equity and in the Consolidated Statements of Comprehensive Income (Loss) in accordance with accounting guidance for foreign currency translation. The Company considers the majority of its investments in its foreign subsidiaries to be long-term in nature. The Company's non-United States exchange transaction gains (losses), including where transactions with its non-United States subsidiaries are not considered to be long-term in nature, are included within other income (expense) in Other, net on the Consolidated Statements of Operations.

Reclassifications

Certain amounts in the prior year Consolidated Financial Statements and accompanying footnotes have been reclassified to conform to the current year's presentation.



Use of Estimates

The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. The accounting estimates that require management's judgments include revenue recognition, revenue reserves, network access costs, network access cost dispute reserves, determination of the useful lives of long-lived assets, measurement and recognition of stock-based compensation expense, valuation of long-lived assets, goodwill and acquired indefinite-lived intangible assets for purposes of impairment testing, valuation of asset retirement obligations, allowance for doubtful accounts, measurement of the fair value of assets acquired and liabilities assumed in business combinations, accruals for estimated tax and legal liabilities, and valuation allowance for deferred tax assets. Actual results could differ from these estimates under different assumptions or conditions and such differences could be material.

Revenue

Revenue is recognized monthly as the services are provided based on contractual amounts expected to be collected. Management establishes appropriate revenue reserves at the time services are rendered based on an analysis of historical credit activity to address, where significant, situations in which collection is not reasonably assured as a result of credit risk, potential billing disputes or other reasons. Actual results may differ from these estimates under different assumptions or conditions and these differences could be material.

Intercarrier compensation revenue is recognized when an interconnection agreement is in place with another carrier, or if an agreement has expired, when the parties have agreed to continue operating under the previous agreement until a new agreement is negotiated and executed, or at rates mandated by the Federal Communications Commission (the "FCC").

For certain sale and long-term indefeasible right of use, or IRU, contracts involving private line, wavelengths and dark fiber services, the Company may receive upfront payments for services to be delivered for a period of up to 25 years. In these situations, the Company defers the revenue and amortizes it on a straight-line basis to earnings over the term of the contract.

Termination revenue is recognized when a customer discontinues service prior to the end of the contract period for which Level 3 had previously received consideration and for which revenue recognition was deferred. Termination revenue also is recognized when customers are required to make termination penalty payments to Level 3 to settle contractually committed purchase amounts that the customer no longer expects to meet or when a customer and Level 3 renegotiate a contract under which Level 3 is no longer obligated to provide services for consideration previously received and for which revenue recognition has been deferred.

The Company is obligated under dark fiber IRUs and other capacity agreements to maintain its network in efficient working order and in accordance with industry standards. Customers are obligated for the term of the agreement to pay for their allocable share of the costs for operating and maintaining the network. The Company recognizes this revenue monthly as services are provided.

Level 3's customer contracts require the Company to meet certain service level commitments. If Level 3 does not meet the required service levels, it may be obligated to provide credits, usually in the form of free service, for a short period of time. The credits are a reduction to revenue and, to date, have not been material.

Network Access Costs

Network Access Costs for the communications business include leased capacity, right-of-way costs, access charges, satellite transponder lease costs and other third party costs directly attributable to providing access to customer locations from the Level 3 network, but excludes Network Related Expenses, and depreciation and amortization. Network Access Costs do not include any employee expenses or impairment expenses; these expenses are allocated to Network Related Expenses or Selling, General and Administrative Expenses.

The Company recognizes the network access costs as they are incurred in accordance with contractual requirements. The Company disputes incorrect billings from its suppliers of network services. The most prevalent types of disputes include disputes for circuits that are not disconnected by the supplier on a timely basis and usage bills with incorrect or inadequate information. Depending on the type and complexity of the issues involved, it may and often does take several quarters to resolve the disputes. The Company establishes appropriate network access costs reserves for disputed supplier billings based on an analysis of historical experience in resolving disputes with its suppliers.

In determining the amount of the network access costs and related accrued liabilities to reflect in its Consolidated Financial Statements, the Company considers the adequacy of documentation of disconnect notices, compliance with prevailing contractual requirements for submitting these disconnect notices and disputes to the provider of the network services, and compliance with its interconnection agreements with these carriers. Judgment is required in estimating the ultimate outcome of the dispute resolution process, as well as any other amounts that may be incurred to conclude the negotiations or settle any litigation. Actual results may differ from these estimates under different assumptions or conditions and these differences could be material.

Network Related Expenses

Network Related Expenses includes certain expenses associated with the delivery of services to customers and the operation and maintenance of the Level 3 network, such as facility rent, utilities, maintenance and other costs, each related to the operation of its communications network, as well as salaries, wages and related benefits (including non-cash stock-based compensation expenses) associated with personnel who are responsible for the delivery of services, operation and maintenance of its communications network, and accretion expense on asset retirement obligations, but excludes depreciation and amortization.

Selling, General and Administrative Expenses

Selling, General and Administrative Expenses includes the salaries, wages and related benefits (including non-cash, stock-based compensation expenses) and the related costs of corporate and sales personnel, travel, insurance, non-network related rent, advertising, and other administrative expenses.

USF and Gross Receipts Taxes

The revenue recognition standards include guidance relating to any tax assessed by a governmental authority that is directly imposed on a revenue-producing transaction between a seller and a customer and may include, but is not limited to, gross receipts taxes and certain state regulatory fees. The Company records Universal Service Fund ("USF") contributions where the Company is the primary obligor for the taxes assessed in each jurisdiction where it does business on a gross basis in its Consolidated Statements of Operations, but generally records gross receipts taxes and certain state regulatory fees billed to its customers on a net basis in its Consolidated Statements of Operations. Total revenue and network access cost on the Consolidated Statements of Operations includes USF contributions totaling $234 million, $194 million and $191 million for the years ended December 31, 2014, 2013 and 2012, respectively.


Stock-Based Compensation

The Company recognizes the estimated fair value of stock-based compensation costs, net of an estimated forfeiture rate, over the requisite service period of the award, which is generally the vesting term or term for restrictions on transfer that lapse, as the case may be. The Company funded a portion of its 2013 and 2012 discretionary bonus in restricted stock unit awards that vested upon issuance. The Company estimates forfeiture rates based on its historical experience for the type of award, adjusted for expected activities as necessary.

Income Taxes

The Company recognizes deferred tax assets and liabilities for its domestic and non-U.S. operations, for operating loss and other credit carry forwards and the expected tax consequences of temporary differences between the tax basis of assets and liabilities and their reported amounts using enacted tax rates in effect for the year the differences are expected to reverse. The Company records a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be realized. This assessment requires judgment as to the likelihood and amounts of future taxable income by tax jurisdiction.

Cash and Cash Equivalents

The Company classifies investments as cash equivalents if they are readily convertible to cash and have original maturities of three months or less at the time of acquisition. Cash and cash equivalents consist primarily of highly liquid investments in government and government agency securities and money market funds issued or managed by financial institutions in the U.S., Europe and Latin America and commercial paper depending on liquidity requirements. As of December 31, 2014, 2013 and 2012, the carrying value of cash and cash equivalents approximates fair value due to the short period of time to maturity.

Restricted Cash and Securities

Restricted cash and securities consists primarily of cash and investments that serve to collateralize outstanding letters of credit and certain performance and operating obligations of the Company. Restricted cash and securities are recorded as current or non-current assets in the Consolidated Balance Sheets depending on the duration of the restriction and the purpose for which the restriction exists. Restricted cash and securities are stated at cost which approximates fair value as of December 31, 2014 and 2013.

Allowance for Doubtful Accounts

Trade accounts receivable are recorded at the invoiced amount and can bear interest. The Company establishes an allowance for doubtful accounts for accounts receivable amounts that may not be collectible. The Company determines the allowance for doubtful accounts based on the aging of its accounts receivable balances, the credit quality of its customers and an analysis of its historical experience of bad debt write-offs. Accounts receivable balances are written off against the allowance for doubtful accounts after all means of collection have been exhausted and the potential for recovery is considered remote. The Company recognized bad debt expense, net of recoveries, of approximately $22 million in 2014, $17 million in 2013 and $15 million in 2012.

Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation and amortization for the Company's property, plant and equipment are computed using the straight-line method based on the following estimated useful lives:

Facility and Leasehold Improvements
15
-
40
years
Network Infrastructure (including fiber and conduit)
25
-
50
years
Operating Equipment
5
-
15
years
Furniture, Fixtures, Office Equipment and Other
3
-
7
years


The Company performs internal reviews to evaluate the depreciable lives of its property, plant and equipment annually, or more frequently if new facts and circumstances arise, that may affect management's original estimates. Due to the rapid changes in technology and the competitive environment, selecting the estimated economic life of telecommunications property, plant, and equipment requires a significant amount of judgment. The Company's internal reviews take into account input from the Company's global engineering and network services personnel, actual usage, the physical condition of the Company's property, plant, and equipment, industry data, and other relevant factors. In connection with its periodic review of the estimated useful lives of property, plant and equipment, the Company may determine that the period it expects to use certain assets is different than the remaining previously estimated useful lives. The Company completed an evaluation in the first quarter 2014 and revised its estimated useful lives for: IP equipment from its historical estimate of four years to a revised estimate of seven years; racks and cabinets from its historical estimate of seven years to a revised estimate of 15 years; and facility equipment from its historical estimate of 10 years to its revised estimate of 15 years. In determining the change in estimated useful lives, the Company, with input from its engineering team, considered its historical usage patterns and retirements, estimates of technological obsolescence and expected usage and maintenance. The change in the estimated useful lives of the Company’s property, plant and equipment was accounted for as a change in accounting estimate on a prospective basis effective January 1, 2014 under the accounting standard related to changes in accounting estimates.

The carrying values of assets subject to these revisions were (in millions):
 
 
January 1, 2014
IP Equipment
 
$
222

Racks and Cabinets
 
114

Facility Equipment
 
151

 
 
$
487


The change in estimated useful lives of the Company’s property, plant and equipment resulted in less depreciation expense than would have otherwise been recorded and in the following increase in net income and net income per share for the year ended December 31, 2014 (in millions, except per share amounts):

Net Income
 
$
90

Basic Net Income per Share
 
$
0.35

Diluted Net Income per Share
 
$
0.35



Leasehold improvements are depreciated over the shorter of their estimated useful lives or lease terms that are reasonably assured.

The Company capitalizes costs directly associated with expansions and improvements of the Company's communications network and customer installations, including employee-related costs, and generally capitalizes costs associated with network construction and provisioning of services. The Company amortizes such costs over an estimated useful life of 3 to 7 years.

In addition, the Company continues to develop business support systems required for its business. The external direct costs of software, materials and services, and payroll and payroll-related expenses for employees directly associated with business support systems projects are capitalized. The total cost of the business support system is amortized over an estimated useful life of 3 years.

Capitalized labor and related costs associated with employees and contract labor working on capital projects were approximately $187 million, $164 million and $146 million for the years ended December 31, 2014, 2013 and 2012, respectively.

Asset Retirement Obligations

The Company recognizes a liability for the estimated fair value of legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or the normal operation of a long-lived asset in the period incurred. The fair value of the obligation is also capitalized as property, plant and equipment and then amortized over the estimated remaining useful life of the associated asset. Increases to the asset retirement obligation liability due to the passage of time are recognized as accretion expense and included within network related expenses. Changes in the liability due to revisions to the amount or timing of future cash flows are recognized by increasing or decreasing the liability with the offset adjusting the carrying amount of the related long-lived asset. To the extent that the downward revisions exceed the carrying amount of the related long-lived asset initially recorded when the asset retirement obligation liability was established, the Company records the remaining adjustment as a reduction to depreciation expense, to the extent of historical depreciation of the related long-lived asset, and then to network related expenses.

Goodwill and Acquired Indefinite-Lived Intangible Assets

Accounting guidance prohibits the amortization of goodwill and purchased intangible assets with indefinite useful lives. The Company reviews goodwill and purchased intangible assets with indefinite lives for impairment annually as of October 1st and whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable.

The Company's goodwill impairment review process considers the fair value of each reporting unit relative to its carrying value. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired and no further testing is performed. If the carrying value of the reporting unit exceeds its fair value, then a second step must be performed, and the implied fair value of the reporting unit's goodwill must be determined and compared to the carrying value of the reporting unit's goodwill. If the carrying value of a reporting unit's goodwill exceeds its implied fair value, then an impairment loss equal to the difference will be recorded. Prior to performing the two step evaluation, an assessment of qualitative factors may be performed to determine whether it is more likely than not that the fair value of a reporting unit exceeds the carrying value. If it is determined that it is unlikely that the carrying value exceeds the fair value, the Company is not required to complete the two step goodwill impairment evaluation.

At the time of each impairment assessment date in 2014, 2013 and 2012, the Company's reporting units consisted of its three regional operating units in: North America; Europe, the Middle East and Africa ("EMEA"); and Latin America.


The Company's indefinite-lived intangible assets impairment review process compares the estimated fair value of the indefinite-lived intangible assets to their respective carrying values. If the fair value of the indefinite-lived intangible assets exceeds their carrying values, then the indefinite-lived intangible assets are not impaired. If the carrying value of the indefinite-lived intangible assets exceeds their fair value, then an impairment loss equal to the difference will be recorded. In accordance with applicable accounting guidance, an entity may assess qualitative factors to determine whether it is more likely than not that the fair value exceeds the carrying value prior to performing the two step evaluation. If it is determined that it is unlikely the carrying value exceeds the fair value, then the entity is not required to complete the two step indefinite-lived intangible assets impairment evaluation.

Long-Lived Assets Including Finite-Lived Purchased Intangible Assets

The Company amortizes acquired intangible assets with finite lives using the straight-line method over the estimated economic lives of the assets, ranging from 4 to 12 years.

The Company evaluates long-lived assets, such as property, plant and equipment and acquired intangible assets with finite lives, for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the asset groups are expected to generate and recognizes an impairment loss when estimated undiscounted future cash flows expected to result from the use of the assets plus net proceeds expected from disposition of the assets, if any, are less than the carrying value of the assets. If an asset is deemed to be impaired, the amount of the impairment loss is the excess of the asset's carrying value over its estimated fair value.

The Company conducted a long-lived asset impairment analysis in 2014, 2013 and 2012 and in each case concluded that its long-lived assets, including finite-lived acquired intangible assets, were not impaired.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash equivalents, accounts receivable, restricted cash and securities and derivatives. The Company maintains its cash equivalents, restricted cash and securities and derivatives with various financial institutions. These financial institutions are primarily located in the United States, Europe and Latin America and the Company's policy is to limit exposure with any one institution. As part of its cash and risk management processes, the Company performs periodic evaluations of the relative credit standing of the financial institutions. The Company also has established guidelines relative to financial instrument credit ratings, diversification and maturities that seek to maintain safety and liquidity. The Company's investment strategy generally results in lower yields on investments but reduces the risk to principal in the short term prior to these funds being used in the Company's business. Notwithstanding the devaluation of the Venezuelan bolivar, the Company has not experienced any material losses on financial instruments held at financial institutions.

The Company provides communications services to a wide range of wholesale and enterprise customers, ranging from well capitalized national carriers to small early stage companies primarily in the United States, Europe, and Latin America. Credit risk with respect to accounts receivable is generally diversified due to the large number of entities comprising Level 3's customer base and their dispersion across many different industries and geographical regions. The Company performs ongoing credit evaluations of its customers' financial condition and generally requires no collateral from its customers, although letters of credit and deposits are required in certain limited circumstances. The Company has from time to time entered into agreements with value-added resellers and other channel partners to reach consumer and enterprise markets for voice services. The Company has policies and procedures in place
to evaluate the financial condition of these resellers prior to initiating service to the final customer. The Company maintains an allowance for doubtful accounts based upon the expected collectability of accounts receivable. Due to the Company's credit evaluation and collection process, bad debt expenses have not been significant; however, the Company is not able to predict changes in the financial stability of its customers. Any material change in the financial status of any one or a particular group of customers may cause the Company to adjust its estimate of the recoverability of receivables and could have a material adverse effect on the Company's results of operations. Fair values of accounts receivable approximate carrying amount due to the short period of time to collection.

A relatively small number of customers account for a significant percentage of the Company's revenue. The Company's top ten customers accounted for approximately 17%, 17% and 17% of Level 3's revenue for the years ended December 31, 2014, 2013 and 2012, respectively.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. This ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for fiscal years beginning after December 15, 2016, and interim periods within those years. Early application is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its Consolidated Financial Statements and related disclosures and has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

Disaggregation of Network Related Expenses; Change in Description of Cost of Revenue to Network Access Costs
Historically, the Company has included "network related expenses" including facility rent, utilities, maintenance and other costs, each related to the operation of Level 3's communications network, as well as salaries, wages and related benefits (including non-cash stock-based compensation expenses) associated with personnel who are responsible for the delivery of services as well as operation and maintenance of its communications network, and accretion expense on asset retirement obligations, but excluding depreciation and amortization, within the line item "Selling, General and Administrative Expenses" in its Consolidated Statements of Operations. Beginning with the third quarter 2014, these network related expenses have been reported under a separate line item, “Network Related Expenses,” in the Company’s Consolidated Statements of Operations. Beginning with the third quarter 2014, “Selling, General and Administrative Expenses” include the salaries, wages and related benefits (including non-cash, stock-based compensation expenses) and the related costs of corporate and sales personnel, travel, insurance, non-network related rent, advertising and other administrative expenses.
In addition, the Company has changed the description of “Cost of Revenue” in its Consolidated Statements of Operations to “Network Access Costs.” Network Access Costs include leased capacity costs, right-of-way costs, access charges, satellite transponder lease costs and other third party costs directly attributable to providing access to customer locations from the Level 3 network. Network Access Costs exclude Network Related Expenses, and depreciation and amortization. Network Access Costs do not include any employee expenses or impairment expenses; these expenses are allocated to Network Related Expenses or Selling, General and Administrative Expenses.
The changes outlined above do not affect the Company’s previously reported Consolidated Total Costs and Expenses, Operating Income, Net Income (Loss) or Income (Loss) per Share in the Consolidated Statements of Operations, or any items reported in the Consolidated Balance Sheets,
Consolidated Statements of Comprehensive Income (Loss), Cash Flows or Changes in Stockholders’ Equity.
The following table reflects the change of the description of "Cost of Revenue" to "Network Access Costs" and the disaggregation of "Network Related Expenses" from "Selling, General and Administrative Expenses" for the years ended December 31, 2013 and 2012 in the Consolidated Statements of Operations, assuming the changes discussed above were in effect for the entire period reported below.
(dollars in millions)
As Previously Reported
Adjustment
Revised Reporting (1)
Year Ended December 31, 2013
 
 
 
Cost of Revenue
$
2,471

$
(2,471
)
$
—

Network Access Costs
—

2,471

2,471

Network Related Expenses
—

1,214

1,214

Selling, General and Administrative Expenses
2,376

(1,214
)
1,162

Total Costs and Expenses
5,647

—

5,647

 
 
 
 
Year Ended December 31, 2012
 
 
 
Cost of Revenue
2,602

(2,602
)
—

Network Access Costs
—

2,602

2,602

Network Related Expenses
—

1,249

1,249

Selling, General and Administrative Expenses
2,450

(1,249
)
1,201

Total Costs and Expenses
5,801

—

5,801


(1) The description of "Cost of Revenue" has been changed to "Network Access Costs" and the
presentation of "Network Related Expenses" has been disaggregated from "Selling, General and
Administrative Expenses" in the Consolidated Statements of Operations for the years ended December 31, 2013 and 2012.

As a result of the above, the Company also revised the Condensed Consolidating Statements of Operations for the years ended December 31, 2013 and 2012 in Note 17 Condensed Consolidating Financial Information, and the presentation for all periods within 2013 and 2012 included in Note 18 Unaudited Quarterly Financial Data.
Events Associated with the Merger of tw telecom inc.
Events Associated with the Amalgamation of Global Crossing
Events Associated with the Merger of tw telecom inc.

On October 31, 2014, the Company completed its acquisition of tw telecom and tw telecom became an indirect, wholly owned subsidiary of the Company through a tax-free, stock and cash reorganization (the "Merger"). As a result of the Merger, (1) each issued and outstanding share of common stock of tw telecom was exchanged for 0.7 shares of Level 3 common stock and $10 in cash ( together the "merger consideration"); (2) the outstanding stock options of tw telecom were canceled and the holders received the merger consideration, net of aggregate per share exercise price; (3) each restricted stock unit award of tw telecom was immediately vested and canceled and the holders received the merger consideration; and (4) each restricted stock unit of tw telecom was immediately vested and canceled and holders received the merger consideration.

In connection with the closing of the Merger, Level 3 Financing, Inc., a wholly owned subsidiary, amended its existing credit agreement to incur an additional $2 billion of borrowings through an additional Tranche (the "Tranche B 2022 Term Loan"). The aggregate net proceeds of the Tranche B 2022 Term Loan were used to finance the cash portion of the merger consideration payable to tw telecom's stockholders and to refinance certain existing indebtedness of tw telecom, including fees and premiums, in connection with the closing of the Merger (see Note 11 — Long-Term Debt for additional information). In addition, the net proceeds from the issuance of $1 billion of 5.375% Senior Notes due 2022 raised in August 2014 (see Note 11 — Long-Term Debt) were used to finance the cash portion of the merger consideration payable to tw telecom stockholders and to refinance certain existing indebtedness of tw telecom, including fees and premiums, in connection with the closing of the Merger.

On October 30, 2014, the Company increased the number of authorized shares of common stock to 433,333,333. As a result of the Merger, the Company issued approximately 96.9 million shares of Level 3 common stock to former holders of tw telecom common shares, stock options, restricted stock awards and restricted stock units. In addition, Level 3 called for redemption and discharged or repaid approximately $1.793 billion of tw telecom's outstanding consolidated debt including premiums of $154 million.

Based on the number of Level 3 shares issued, Level 3's closing stock price of $46.91 on October 31, 2014, the cash paid to the former holders of tw telecom common stock and the $2.1 billion of debt of tw telecom called for redemption and discharged or repaid, the aggregate consideration for acquisition
accounting, including assumed capital leases of $152 million, approximated $8.1 billion.

The premium paid by Level 3 in this transaction is attributable to strategic benefits, as the transaction further solidifies Level 3's position as a premier global communications provider to the enterprise, government and carrier market, combining tw telecom's extensive local operations and assets in North America with Level 3's global assets and capabilities. tw telecom's business model is directly aligned with Level 3's initiatives for growth, which include building managed solutions to meet customer needs through an advanced IP/optical network.

The goodwill associated with this transaction is not expected to be deductible for income tax purposes except that certain deductible goodwill of tw telecom will continue to be deductible following the Merger.

The combined results of operations of Level 3 and tw telecom are included in the Company's consolidated results of operations beginning in November 2014. Included in the combined financial results is $285 million in revenue attributable to tw telecom since the completion of the Merger. The assets acquired and liabilities assumed of tw telecom were recognized at their acquisition date fair value. The purchase price allocation of acquired assets and assumed liabilities, including the assignment of goodwill to reporting units, will require extensive analysis and is expected to be completed no later than October 31, 2015. The following is a preliminary allocation of purchase price based on information currently available. The final identification of all the intangible assets acquired and determination of the purchase price allocation may be significantly different from the preliminary allocation reflected below.


 
Initial Purchase Price Allocation
 
(dollars in millions)
Assets:
 
Cash, Cash Equivalents and Restricted Cash
$
309

Property, Plant and Equipment
1,555

Goodwill
5,124

Identifiable Intangible Assets
1,323

Other Assets
138

Total Assets
8,449

 
 
Liabilities:
 
Long-Term Debt
(2,099
)
Deferred Revenue
(60
)
Other Liabilities
(279
)
Total Liabilities
(2,438
)
Total Consideration to be Allocated
$
6,011



The following unaudited pro forma financial information presents the combined results of Level 3 and tw telecom as if the completion of the Merger had occurred as of January 1, 2013 (dollars in millions, except per share data).
 
Year Ended December 31,
 
2014
 
2013
Total Revenue
$
8,123

 
$
7,825

Net Income (Loss)
$
141

 
$
(165
)
Net Income (Loss) per Share- Basic
$
0.42

 
$
(0.52
)
Net Income (Loss) per Share - Diluted
$
0.42

 
$
(0.52
)


These pro forma results include certain adjustments, primarily due to increases in depreciation and
amortization expense due to fair value adjustments of tangible and intangible assets, increases in interest
expense due to Level 3's issuance of incremental debt to finance cash consideration partially offset by the
refinancing of tw telecom debt that had higher interest rates than the incremental financing, and to eliminate historical transactions between Level 3 and tw telecom. The unaudited pro forma information is not intended to represent or be indicative of the actual results of operations of Level 3 that would have been reported had the Merger been completed on January 1, 2013, nor is it representative of future operating results of the Company. The pro forma information does not include any operating efficiencies or cost savings that Level 3 may achieve with respect to combining the companies.

Acquisition related costs include transaction costs such as legal, accounting, valuation and other
professional services as well as integration costs such as severance and retention. Acquisition related costs have been recorded in Network Related Expenses and Selling, General and Administrative Expenses in the Company's Consolidated Statements of Operations. Level 3 incurred total acquisition related transaction and integration costs of approximately $81 million through December 31, 2014.


Earnings Per Share
Loss Per Share
(Loss) Per Share

The Company computes basic net earnings (loss) per share by dividing net income or loss for the period by the weighted average number of shares of common stock outstanding during the period. Diluted net earnings (loss) per share is computed by dividing net income or loss for the period by the weighted average number of shares of common stock outstanding during the period and including the dilutive effect of common stock that would be issued assuming conversion or exercise of outstanding convertible notes and stock-based compensation awards. No such items were included in the computation of diluted earnings per share in the years ended 2013 and 2012 because the Company incurred a loss from continuing operations in each of these periods and the effect of inclusion would have been anti-dilutive.

The effect of approximately 17 million, 18 million and 35 million shares issuable pursuant to the various series of convertible notes outstanding at December 31, 2014, 2013 and 2012, respectively, have not been included in the computation of diluted earnings (loss) per share because their inclusion would have been anti-dilutive to the computation. In addition, the effect of the approximately 6 million and 7 million stock options, outperform stock appreciation rights ("OSOs"), restricted stock units ("RSUs") and warrants outstanding at December 31, 2013 and 2012, respectively, have not been included in the computation of diluted earnings (loss) per share because their inclusion would have been anti-dilutive to the computation.
Property, Plant and Equipment
Property, Plant and Equipment
Property, Plant and Equipment

The components of the Company's property, plant and equipment as of December 31, 2014 and 2013 are as follows (dollars in millions):
 
 
Cost
 
Accumulated
Depreciation
 
Net
December 31, 2014
 
 
 
 
 
 
Land
 
$
192

 
$
—

 
$
192

Land Improvements
 
73

 
(50
)
 
23

Facility and Leasehold Improvements
 
2,489

 
(1,265
)
 
1,224

Network Infrastructure
 
8,941

 
(3,447
)
 
5,494

Operating Equipment
 
7,217

 
(4,669
)
 
2,548

Furniture, Fixtures and Office Equipment
 
255

 
(177
)
 
78

Other
 
29

 
(21
)
 
8

Construction-in-Progress
 
293

 
—

 
293

 
 
$
19,489

 
$
(9,629
)
 
$
9,860

December 31, 2013
 
 
 
 
 
 
Land
 
$
193

 
$
—

 
$
193

Land Improvements
 
72

 
(47
)
 
25

Facility and Leasehold Improvements
 
2,207

 
(1,193
)
 
1,014

Network Infrastructure
 
8,505

 
(3,279
)
 
5,226

Operating Equipment
 
6,057

 
(4,381
)
 
1,676

Furniture, Fixtures and Office Equipment
 
196

 
(168
)
 
28

Other
 
22

 
(21
)
 
1

Construction-in-Progress
 
77

 
—

 
77

 
 
$
17,329

 
$
(9,089
)
 
$
8,240



Depreciation expense was $713 million in 2014, $727 million in 2013 and $659 million in 2012
Asset Retirement Obligations
Asset Retirement Obligations
Asset Retirement Obligations

The Company's asset retirement obligations consist of legal requirements to remove certain of its network infrastructure at the expiration of the underlying right-of-way ("ROW") term and restoration requirements for leased facilities. The Company recognizes its estimate of the fair value of its asset retirement obligations in the period incurred in other long-term liabilities. The fair value of the asset retirement obligation is also capitalized as property, plant and equipment and then amortized over the estimated remaining useful life of the associated asset.

As a result of a strategic review of the Company's real estate portfolio in the fourth quarter of 2012, the Company completed an updated analysis and revised its estimated future cash flows of its asset retirement obligations. The analysis required estimating the probability or likelihood that the Company will be required to remove certain of its network infrastructure and restore leased properties, and the timing and amount of eventual costs. The analysis resulted in the downward revision of the Company's asset retirement obligation liability. This change in the estimated cash flows resulted in a non-cash gain of $49 million recorded within network related expenses, and depreciation expense, or $0.23 basic and diluted net loss per share.

In conjunction with its review of the ROW asset retirement obligation, the Company identified an error in its assumptions used to estimate its ROW asset retirement obligation related to the extension of the useful lives of its conduit assets effective October 1, 2011 (See Note 1 - Organization and Summary of Significant Accounting Policies). The Company recorded a non-cash benefit of approximately $21 million within network related expenses, or $0.10 basic and diluted net loss per share during the fourth quarter of 2012 for the change in the ROW term used to estimate its ROW asset retirement obligation. The reduction in the asset retirement obligations liability includes the change in estimate of the ROW term that arose in prior periods, which did not materially affect any of the Company's previously reported results of operations or financial condition, or the current period results of operations or financial condition.

In 2012, as a result of the revisions in estimated amount and timing of cash flows for asset retirement obligations, the Company reduced its asset retirement obligations liability by $73 million with an offsetting reduction to property, plant and equipment of $24 million, network related expenses of $47 million and depreciation and amortization of $2 million. The Company first reduced property, plant and equipment to the extent of the carrying amount of the related asset initially recorded when the asset retirement obligations were established. The amount of the remaining reduction to the asset retirement obligations were recorded as a reduction to depreciation expense to the extent of historical deprecation of the related asset and then to selling, general and administrative expenses.

The following table provides asset retirement obligation activity for the years ended December 31, 2014 and 2013 (dollars in millions):
 
 
2014
 
2013
Asset retirement obligation at January 1
 
$
56

 
$
55

Accretion expense
 
8

 
7

Liabilities assumed in tw telecom acquisition
 
22

 
—

Liabilities settled
 
(7
)
 
(6
)
Revision in estimated cash flows
 
7

 
—

Effect of foreign currency rate change
 
(1
)
 
—

Asset retirement obligation at December 31
 
$
85

 
$
56

Goodwill
Goodwill
Goodwill

The changes in the carrying amount of goodwill during the years ended December 31, 2014 and 2013 are as follows (dollars in millions):
 
Total
Balance as of January 1, 2013
$
2,565

Goodwill adjustments
12

Balance as of December 31, 2013
2,577

Goodwill adjustments
(12
)
Goodwill acquired in tw telecom acquisition
5,124

Balance as of December 31, 2014
$
7,689



The Company conducted its annual goodwill impairment analysis as of October 1, 2014 and 2013. As a result of the Company's annual assessment, Level 3 concluded that its goodwill was not impaired in 2014 or 2013.
Acquired Intangible Assets
Acquired Intangible Assets
Acquired Intangible Assets

Identifiable acquisition-related intangible assets as of December 31, 2014 and 2013 were as follows (dollars in millions):

 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
December 31, 2014
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Customer Contracts and Relationships
$
1,977

 
$
(741
)
 
$
1,236

Trademarks
115

 
(47
)
 
68

Patents and Developed Technology
228

 
(133
)
 
95

 
2,320

 
(921
)
 
1,399

Indefinite-Lived Intangible Assets:
 
 
 
 
 
Trade Name
15

 
—

 
15

 
$
2,335

 
$
(921
)
 
$
1,414

December 31, 2013
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Customer Contracts and Relationships
$
786

 
$
(678
)
 
$
108

Trademarks
55

 
(31
)
 
24

Patents and Developed Technology
158

 
(117
)
 
41

 
999

 
(826
)
 
173

Indefinite-Lived Intangible Assets:
 
 
 
 
 
Trade Name
32

 
—

 
32

 
$
1,031

 
$
(826
)
 
$
205



During the fourth quarter of 2014 and 2013, the Company conducted its long-lived assets and indefinite-lived intangible assets impairment analysis and for 2014 concluded that there was impairment of $17 million in its trade name indefinite-lived intangible asset in 2014 and there was no impairment in 2013.

Acquired finite-lived intangible assets amortization expense was $95 million in 2014, $73 million in 2013 and $90 million in 2012.

At December 31, 2014, the weighted average remaining useful lives of the Company's acquired finite-lived intangible assets was 6.8 years for customer contracts and relationships, 4.2 years for trademarks and 4.0 years for patents and developed technology.




As of December 31, 2014, estimated amortization expense for the Company’s finite-lived acquisition-related intangible assets over the next five years and thereafter is as follows (dollars in millions):

2015
$
242

2016
223

2017
208

2018
205

2019
188

Thereafter
333

 
$
1,399




Restructuring Charges
Restructuring Charges
Restructuring Charges

Employee Separations

Changing economic and business conditions as well as organizational structure optimization efforts have caused the Company to initiate from time to time various workforce reductions resulting in involuntary employee terminations. The Company also has initiated workforce reductions resulting from the integration of previously acquired companies.

During 2014, as part of the Merger and organizational effectiveness, the Company initiated workforce reductions. During 2013 and 2012, the Company initiated workforce reductions primarily focused on labor cost savings and organizational effectiveness. Restructuring charges totaled $45 million, $47 million and $34 million in 2014, 2013 and 2012, respectively, of which $11 million, $12 million and $8 million in 2014, 2013 and 2012, respectively, were recorded in Network Related Expenses and $34 million, $35 million and $26 million in 2014, 2013 and 2012, respectively, were recorded in Selling, General and Administrative Expenses.

As of December 31, 2014 and 2013, the Company had $37 million and $8 million, respectively, of employee termination liabilities.

Facility Closings

The Company also has accrued contract termination costs of $20 million and $31 million as of December 31, 2014 and 2013, respectively, for facility lease costs that the Company continues to incur without economic benefit. Accrued contract termination costs are recorded in other liabilities (current and non-current) in the Consolidated Balance Sheets. The Company expects to pay the majority of these costs through 2025. The Company recognized a charge of less than $1 million, a charge of approximately $7 million and a benefit of $2 million in 2014, 2013 and 2012, respectively, as a result of facility lease costs. The Company records charges for contract termination costs within Selling, General and Administrative Expenses in the Consolidated Statements of Operations.
Fair Value of Financial Instruments
Fair Value of Financial Instruments
Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, restricted cash and securities, accounts receivable, accounts payable, capital leases, other liabilities, interest rate swaps and long-term debt (including the current portion). The carrying values of cash and cash equivalents, restricted cash and securities, accounts receivable, accounts payable, capital leases and other liabilities approximated their fair values at December 31, 2014 and 2013.

GAAP defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements and disclosures for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as interest and foreign exchange rates, transfer restrictions, and risk of nonperformance.

Fair Value Hierarchy

GAAP establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The fair value measurement of each class of assets and liabilities is dependent upon its categorization within the fair value hierarchy, based upon the lowest level of input that is significant to the fair value measurement of each class of asset and liability. GAAP establishes three levels of inputs that may be used to measure fair value:

Level 1— Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2— Unadjusted quoted prices for similar assets or liabilities in active markets, or
unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.

Level 3— Unobservable inputs for the asset or liability.

The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. There were no transfers within the fair value hierarchy during each of the years ended December 31, 2014 and 2013.

The table below presents the fair values for the Company’s long-term debt as well as the input levels used to determine these fair values as of December 31, 2014 and 2013:

 
 
 
 
 
 
Fair Value Measurement Using
 
 
Total Carrying Value in Consolidated Balance Sheets
 
Unadjusted Quoted Prices in Active
Markets for Identical Assets or Liabilities (Level 1)
 
Significant Other Observable Inputs (Level 2)
(dollars in millions)
 
December 31,
2014
 
December 31,
2013
 
December 31,
2014
 
December 31,
2013
 
December 31,
2014
 
December 31,
2013
Liabilities Not Recorded at Fair Value in the Financial Statements:
 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt, including the current portion:
 
 
 
 
 
 
 
 
 
 
 
 
Term Loans
 
$
4,590

 
$
2,604

 
$
4,593

 
$
2,633

 
$
—

 
$
—

Senior Notes
 
6,203

 
5,198

 
6,481

 
5,673

 
—

 
—

Convertible Notes
 
333

 
474

 
—

 
—

 
868

 
647

Capital Leases and Other
 
207

 
86

 
—

 
—

 
207

 
86

Total Long-term Debt, including the current portion:
 
$
11,333

 
$
8,362

 
$
11,074

 
$
8,306

 
$
1,075

 
$
733



The Company does not have any assets or liabilities where the fair value is measured using significant unobservable inputs (Level 3).

Term Loans

The fair value of the Term Loans referenced above was approximately $4.6 billion and $2.6 billion at December 31, 2014 and 2013, respectively. The fair value of each loan is based on quoted prices for identical terms and maturities. Each loan tranche is actively traded.

Senior Notes

The fair value of the Senior Notes referenced above was approximately $6.5 billion and $5.7 billion at December 31, 2014 and 2013, respectively, based on quoted prices for identical terms and maturities. Each series of notes is actively traded.

Convertible Notes

The fair value of the Company’s Convertible Notes that are not actively traded, which includes the 7% Convertible Senior Notes due 2015 and the 7% Convertible Senior Notes due 2015, Series B, was approximately $868 million and $647 million at December 31, 2014 and 2013, respectively. In the fourth quarter of 2014, the Company issued approximately 5 million shares of common stock when holders of approximately $142 million in the aggregate of its 7% Convertible Senior Notes due 2015 and 7% convertible Senior Notes due 2015, Series B converted these notes.

The estimated fair value of the Convertible Notes that are not actively traded is based on a Black-Scholes valuation model and an income approach using discounted cash flows. The most significant inputs affecting the valuation are the pricing quotes provided by market participants that incorporate spreads to the Treasury curve, security coupon (7%), convertible optionality, corporate and security credit ratings, maturity date, liquidity, and other equity option inputs, such as the risk-free rate, underlying stock price, strike price of the embedded derivative, estimated volatility and maturity inputs for the option component and for the bond component, among other security characteristics and relative value at both the borrower entity level and across other securities with similar terms. The fair value of each instrument is obtained by adding together the value derived by discounting the security’s coupon or interest payment using a risk-adjusted discount rate and the value calculated from the embedded equity option based on the estimated volatility of the Company’s stock price, conversion rate of the particular Convertible Note, remaining time to maturity, and risk-free rate. The Convertible Notes are unsecured obligations of Level 3 Communications, Inc. No subsidiary of Level 3 Communications, Inc. has provided a guarantee of the Convertible Notes.

Capital Leases

The fair value of the Company's capital leases are determined by discounting anticipated future cash flows derived from the contractual terms of the obligations and observable market interest and foreign exchange rates.
Derivative Financial Instruments
Derivative Financial Instruments
Derivative Financial Instruments

The Company has floating rate long-term debt (see Note 11 - Long-Term Debt). This type of debt exposes the Company to variability in interest payments due to changes in interest rates. If interest rates increase, interest expense increases. Conversely, if interest rates decrease, interest expense also generally decreases. The Company has used interest rate swaps, in an attempt to manage its exposure to fluctuations in interest rate movements. The Company’s primary objective in managing interest rate risk was to decrease the volatility of its earnings and cash flows affected by changes in the underlying rates. The Company does not use derivative financial instruments for speculative purposes.

In March 2007, Level 3 Financing, Inc. entered into two interest rate swap agreements to hedge the interest payments on $1 billion principal amount of floating rate debt. The Company had designated these interest rate swap agreements as cash flow hedges. The hedge designation was terminated in 2012 in connection with certain refinancing activities, and the instruments were settled upon maturity in 2014. Prior to the redesignation of the hedging relationship in 2012, the change in the fair value of the interest rate swap agreements was reflected in Accumulated Other Comprehensive Income (Loss) ("AOCI") and was subsequently reclassified into earnings through an interest expense yield adjustment, as interest expense on the hedged debt obligation was incurred.

Upon redesignation, the Company recognized a non-cash loss on these agreements of approximately $60 million (excluding accrued interest) in the third quarter of 2012, which represented the cumulative loss recorded in AOCI at the date the instruments ceased to qualify as hedges (see Note 11 - Long-Term Debt). After August 6, 2012, the Company recorded the change in the fair value of the swaps in Other, net in its Consolidated Statement of Operations until maturity of the swaps in early 2014. The Company recognized a loss of zero, $2 million and $4 million for the years ended December 31, 2014, 2013 and 2012, respectively.

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Consolidated Balance Sheets (dollars in millions):

 
 
Liability Derivatives
 
 
December 31, 2013
Derivatives not designated as
hedging instruments
 
Balance Sheet
Location
 
Fair
Value
Interest rate swap agreements
 
Other current liabilities
 
$
12



The amount of net gains recognized in AOCI, including reclassifications of unrealized losses, consists of the following (dollars in millions):

 
 
Year Ended December 31,
Derivatives designated as hedging instruments
 
2013
 
2012
Cash flow hedging contracts
 
$
—

 
$
90



The amount of losses reclassified from AOCI to earnings (effective portions) consists of the following (dollars in millions):

 
 
 
 
Year Ended December 31,
Derivatives designated as hedging instruments
 
Statement of Operations Location
 
2013
 
2012
Cash flow hedging contracts
 
Interest Expense
 
$
—

 
$
(26
)


The effect of the Company’s derivatives not designated as hedging instruments on net loss is as follows (dollars in millions):

 
 
 
 
Year Ended December 31,
Derivatives not designated as hedging instruments
 
Statement of Operations Location
 
2014
 
2013
 
2012
Interest rate swaps
 
Other Expense - Other, net
 
$
—

 
$
(2
)
 
$
(64
)
Long-Term Debt
Long-Term Debt
Long-Term Debt

As of December 31, 2014 and December 31, 2013, long-term debt was as follows:

(dollars in millions)
 
December 31,
2014
 
December 31,
2013
Senior Secured Term Loan*
 
$
4,611

 
$
2,611

Floating Rate Senior Notes due 2018 (3.826% as of December 31, 2014)
 
300

 
300

11.875% Senior Notes due 2019
 
—

 
605

9.375% Senior Notes due 2019
 
500

 
500

8.125% Senior Notes due 2019
 
1,200

 
1,200

8.875% Senior Notes due 2019
 
300

 
300

8.625% Senior Notes due 2020
 
900

 
900

7% Senior Notes due 2020
 
775

 
775

6.125% Senior Notes due 2021
 
640

 
640

5.375% Senior Notes due 2022
 
1,000

 
—

5.75% Senior Notes due 2022
 
600

 
—

7% Convertible Senior Notes due 2015
 
58

 
200

7% Convertible Senior Notes due 2015 Series B
 
275

 
275

Capital Leases
 
207

 
73

Other
 
—

 
13

Total Debt Obligations
 
11,366

 
8,392

Unamortized Discount:
 
 
 
 
Discount on Senior Secured Term Loan
 
(21
)
 
(7
)
Discount on 11.875% Senior Notes due 2019
 
—

 
(8
)
Discount on 9.375% Senior Notes due 2019
 
(6
)
 
(7
)
Discount on 8.125% Senior Notes due 2019
 
(6
)
 
(7
)
Discount on 7% Convertible Senior Notes due 2015
 
—

 
(1
)
Total Unamortized Discount
 
(33
)
 
(30
)
Carrying Value of Debt
 
11,333

 
8,362

Less current portion
 
(349
)
 
(31
)
Long-term Debt, less current portion
 
$
10,984

 
$
8,331


*The $2 billion Tranche B Term Loan due 2022 had an interest rate of 4.5% as of December 31, 2014. The $815 million Tranche B-III 2019 Term Loan due 2019 and the $1.796 billion Tranche B 2020 Term Loan due 2020 each had an interest rate of 4.00% as of December 31, 2014.










Senior Secured Term Loans

On March 13, 2007, Level 3 Communications, as guarantor, Level 3 Financing, as borrower, Merrill Lynch Capital Corporation, as administrative agent and collateral agent, and certain other agents and certain lenders entered into a Credit Agreement, pursuant to which the lenders extended a $1.4 billion senior secured term loan to Level 3 Financing. The $1.4 billion senior secured term loan (the "Tranche A Term Loan") had an interest rate of LIBOR plus an applicable margin of 2.25% per annum. In addition, during the second quarter of 2009, Level 3 Financing amended and restated its existing senior secured Credit Agreement to increase the borrowings through the creation of a $280 million Tranche B Term Loan (the "Tranche B Term Loan") and had an interest rate of LIBOR plus 8.50% per annum, with LIBOR set at a minimum of 3.00%. The Tranche A Term Loan and Tranche B Term Loan, which were to mature on March 13, 2014, were prepaid in August 2012 and November 2011, respectively. The $1.4 billion Tranche A Term Loan had an effective interest rate of 2.65% as of December 31, 2011, excluding the effect of the $1 billion notional amount interest rate swaps.

The Company used a portion of the original net proceeds after transaction costs to repay Level 3 Financing's $730 million Senior Secured Term Loan due 2011 under that certain Credit Agreement dated June 27, 2006. In addition, the Company used a portion of the net proceeds to fund the purchase of certain of its existing debt securities.

On October 4, 2011, in connection with the closing of the acquisition of Global Crossing Limited ("Global Crossing") (the "Amalgamation"), Level 3 Financing amended its existing Credit Agreement to incur an additional $650 million of borrowings through an additional tranche. The Company borrowed the Tranche B-II Term Loan from investors at a price of 99% of its principal amount. Debt issuance discount of approximately $7 million was reflected as a reduction in long-term debt. The Tranche B-II Term Loan accrued interest at 4.25% plus LIBOR, with a minimum LIBOR of 1.5%, with interest payments due quarterly. The Tranche B-II Term Loan, which was to mature on September 1, 2018, was prepaid in October 2012. The net proceeds from the Tranche B-II Term Loan were used to refinance certain existing indebtedness of Global Crossing Limited in connection with the consummation of the Amalgamation and for general corporate purposes.

Additionally, on November 10, 2011, Level 3 Financing amended its existing Credit Agreement to incur an additional $550 million of borrowings through an additional tranche. The Company borrowed the Tranche B-III Term Loan from investors at a price of 95% of its principal amount. Debt issuance discount of approximately $28 million was reflected as a reduction in long-term debt. The Tranche B-III Term Loan accrued interest at 4.25% plus LIBOR, with a minimum LIBOR of 1.5%, with interest payments due quarterly. The Tranche B-III Term Loan which was to mature on September 1, 2018, was prepaid in October 2012. The net proceeds from the Tranche B-III Term Loan were used along with cash on hand to prepay the $280 million Tranche B Term Loan that was outstanding under the existing senior secured credit facility and the $274 million aggregate principal amount of Level 3 Communications' 3.5% Convertible Senior Notes due 2012.

On August 6, 2012, Level 3 Financing refinanced its existing $1.4 billion Tranche A Term Loan under its existing senior secured credit facility through the creation of new term loans in the aggregate principal amount of $1.415 billion and cash on hand. The New Term Loans were borrowed pursuant to an amended and restated Credit Agreement. The New Term Loans consist of: (a) $600 million senior secured term loan (the "Tranche B 2016 Term Loan") due February 1, 2016, and (b) $815 million senior secured term loan (the "Tranche B 2019 Term Loan") due August 1, 2019. Both tranches were prepaid in August 2013. The Tranche B 2016 Term Loan required repayment of 0.25% of the aggregate principal amount on the last day of each March, June, September and December, beginning with December 31, 2012 and ending with such last day to occur prior to maturity. The interest rates on the loans were LIBOR plus 3.25% for the Tranche B 2016 Term Loan and LIBOR plus 3.75% for the Tranche B 2019 Term Loan, with LIBOR set at a minimum of 1.5% on both loans. The Tranche B 2016 Term Loan and the Tranche B 2019 Term Loan were priced at 99.5% and 99.0% of par, respectively. Debt issuance discounts of approximately $3 million and $8 million were reflected as a reduction in long-term debt. The Company used the net proceeds from the New Term Loans, along with cash on hand, to prepay Level 3 Financing's $1.4 billion Tranche A Term Loan under the existing Credit Agreement that was to mature in March 2014 and used remaining net proceeds to repay $15 million in principal amount plus premium for existing vendor financing obligations. Debt issuance costs for the Tranche B 2016 Term Loan and the Tranche B 2019 Term Loan of approximately $9 million and $12 million, respectively, were capitalized and amortized over the respective terms of those term loans as interest expense using the effective interest method until prepayment. The Company recognized a loss on extinguishment of debt of $9 million as a result of refinancing the Tranche A Term Loan. In connection with the refinancing of the Tranche A Term Loan, the Company recognized a $60 million non-cash loss on two interest rate swap agreements that had previously hedged changes in the interest rate on $1 billion notional amount of floating rate debt.

On October 4, 2012, Level 3 Financing refinanced its existing $650 million Tranche B-II Term Loan and $550 million Tranche B-III Term Loan under its existing senior secured credit facility through the creation of a new term loan in the aggregate principal amount of $1.2 billion. The Tranche B-II 2019 Term Loan was borrowed pursuant to an amended and restated Credit Agreement. The Tranche B-II 2019 Term Loan consisted of a $1.2 billion senior secured term loan that was to mature on August 1, 2019 and was prepaid in October 2013. The interest rate on the loan was LIBOR plus 3.25%, with LIBOR set at a minimum of 1.5%. The Tranche B-II 2019 Term Loan was priced at par. The Company used the net proceeds from the Tranche B-II 2019 Term Loan, along with cash on hand, to prepay Level 3 Financing's $650 million Tranche B-II Term Loan and $550 million Tranche B-III Term Loan under the existing Credit Agreement which were to mature in September 2018. Debt issuance costs of approximately $13 million were capitalized and amortized over the term of the Tranche B-II 2019 Term Loan as interest expense using the effective interest method until prepayment. The Company recognized a loss on extinguishment of debt of $50 million as a result of refinancing the Tranche B-II and Tranche B-III Term Loans.

On August 12, 2013, Level 3 Financing refinanced its existing $815 million Tranche B 2019 Term Loan under its existing senior credit facility through the creation of a new term loan in the aggregate principal amount of $815 million (the "Tranche B-III 2019 Term Loan"). The Tranche B-III 2019 Term Loan was borrowed pursuant to an amended and restated Credit Agreement. The Tranche B-III 2019 Term Loan has an interest rate of LIBOR plus 3.00%, with a minimum LIBOR of 1.00%, and will mature on August 1, 2019. The Tranche B-III 2019 Term Loan was priced to lenders at par. Debt issuance costs related to the Tranche B 2019 Term Loan of approximately $10 million were allocated to the Tranche B-III 2019 Term Loan and continue to be amortized as interest expense using the new effective interest rate over its new term. The Company expensed debt issuance costs of approximately $9 million as of result of this transaction.

Additionally on August 16, 2013, Level 3 Financing refinanced its existing $595.5 million Tranche B 2016 Term Loan under its existing senior credit facility through the creation of a new term loan in the aggregate principal amount of $595.5 million (the "Tranche B 2020 Term Loan"). The Tranche B 2020 Term Loan was borrowed pursuant to an amended and restated Credit Agreement. The Tranche B 2020 Term Loan has an interest rate of LIBOR plus 3.00%, with a minimum LIBOR of 1.00%, and will mature on January 15, 2020. The Tranche B 2020 Term Loan was priced to lenders at par. Debt issuance costs for the Tranche B 2020 Term Loan of approximately $7 million were capitalized and are being amortized as interest expense using the effective interest method over its term. The Company recognized a loss on extinguishment of debt of $8 million as of result of this transaction.

On October 4, 2013, Level 3 Financing refinanced its existing $1.2 billion Tranche B-II 2019 Term Loan under its existing senior credit facility by increasing the borrowings under the Tranche B 2020 Term Loan by an aggregate principal amount of $1.2 billion. The Tranche B 2020 Term Loan new aggregate principal amount is $1.796 billion. The $1.796 billion Tranche B 2020 Term Loan will continue to bear interest at LIBOR plus 3.00%, with a minimum LIBOR of 1.00%, and will mature on January 15, 2020. The additional portion of the Tranche B 2020 Term Loan was priced to lenders at par, with the payment to the lenders of an upfront 0.25% fee at closing. As a result of this transaction, the Company recognized a loss on the refinancing of approximately $10 million, additional debt discount costs of $3 million that are being amortized as interest expense using the effective interest method over its term and debt issuance costs related to the Tranche B-II 2019 Term Loan of approximately $11 million were assigned to the Tranche B 2020 Term Loan and continue to be amortized as interest expense using the new effective interest rate over its new term.

As a result of amortization, the capitalized debt issuance costs have been reduced to $8 million and $17 million for the Tranche B-III 2019 and Tranche B 2020 Term Loans, respectively, at December 31, 2014.

On October 31, 2014, Level 3 Financing entered into a ninth amendment agreement to the Existing Credit Agreement to incur $2 billion in aggregate borrowings under the Existing Credit Agreement through the creation of a new Tranche B 2022 Term Loan (the "Tranche B 2022 Term Loan"). The Tranche B 2022 Term Loan included an upfront payment to the lenders of 0.75% of par and will bear interest equal to LIBOR plus 3.50% with LIBOR set at a minimum of 1.00% percent. The Tranche B 2022 Term Loan will mature on January 31, 2022. Debt issuance costs of approximately $27 million were capitalized and are amortized over the term of the Tranche B 2022 Term Loan using the effective interest method.

As of December 31, 2014, the debt issuance discount for the Tranche B 2022 Term Loan remaining was $15 million. As a result of amortization, the capitalized debt issuance costs have been reduced to $26 million at December 31, 2014.

Upon closing of the Tranche B 2022 Term Loan, Level 3 Financing, Inc. used the gross proceeds to finance the cash portion of the merger consideration payable to tw telecom's stockholders in the Merger and to refinance certain existing indebtedness of tw telecom, including fees and premiums, in connection with the closing of that acquisition. See Note 2 - Events Associated with the Merger of tw telecom for additional information.

Level 3 Financing has the option of electing one, two, three or six month LIBOR at the end of each interest period and may elect different options with respect to different portions of the Senior Secured Term Loan. Interest is payable in cash at the end of each LIBOR period elected in arrears, provided that in the case of a six month interest period, interim interest payments are required at the end of the first three months.

The Senior Secured Term Loan is secured by a pledge of the equity interests in certain U.S.-based subsidiaries of Level 3 Financing, Inc.; 65% of the equity interests in each of Level 3 Financing, Inc.'s Canadian subsidiary and its Bermudan subsidiary that indirectly owns Global Crossing Limited's non-U.S. subsidiaries; and liens on the assets of Level 3 Communications, Inc. and certain U.S.-based subsidiaries of Level 3 Financing, Inc. In addition, Level 3 Communications, Inc. and certain U.S.-based subsidiaries of Level 3 Financing, Inc. have provided full and unconditional guarantees of the obligations under the Senior Secured Term Loan.

The Senior Secured Term Loan includes certain negative covenants which restrict the ability of the Company, Level 3 Financing and any restricted subsidiary to engage in certain activities. The Senior Secured Term Loan also contains certain events of default. It does not require the Company or Level 3 Financing to maintain specific financial ratios or other financial metrics.

Floating Rate Senior Notes due 2018

On November 26, 2013, Level 3 Financing completed the offering of $300 million aggregate principal amount of its Floating Rate Senior Notes due 2018 (the "2018 Floating Rate Notes"). Debt issuance costs of approximately $5 million were capitalized and are being amortized over the term of the 2018 Floating Rate Notes as interest expense using the effective interest method. The net proceeds from the offering, together with cash on hand, were used to redeem all of Level 3 Financing’s outstanding Floating Rate Senior Notes due 2015, including accrued interest and expenses. The Company recognized a loss on extinguishment of debt of $1 million as a result of this transaction. The 2018 Floating Rate Notes were priced at 100% of their principal amount and will mature on January 15, 2018. Interest on the notes is payable on May 15 and November 15 of each year, beginning on May 15, 2014. The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC.

The notes are unsecured, unsubordinated obligations of Level 3 Financing ranking equal in right of payment with all existing and future unsubordinated indebtedness of Level 3 Financing and are senior in right of payment to all existing and future indebtedness of Level 3 Financing expressly subordinated in right of payment to the notes.

As a result of amortization, the capitalized debt issuance costs have been reduced to $3 million at December 31, 2014.

Prior to May 15, 2015, at the option of Level 3 Financing, the 2018 Floating Rate Notes will be subject to redemption, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days prior notice, at 100% of the principal amount of 2018 Floating Rate Notes so redeemed plus (i) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (ii) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date. The 2018 Floating Rate Notes will be redeemable at the option of Level 3 Financing, in whole or in part, on or after May 15, 2015, upon not less than 30 nor more than 60 days prior notice, at the redemption prices set forth below (expressed as percentages of the principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, if redeemed during the periods set forth below:

Period
Redemption Price
May 15, 2015 - May 14, 2016
102.00
%
May 15, 2016 - November 14, 2016
101.00
%
November 15, 2016 and thereafter
100.00
%

In addition, at any time or from time to time on or prior to May 15, 2015, Level 3 Financing may redeem up to 35% of the original aggregate principal amount of the 2018 Floating Rate Notes at a redemption price equal to 100% of the principal amount of the 2018 Floating Rate Notes so redeemed, plus a premium equal to the interest rate per annum on the 2018 Floating Rate Notes in effect on the date that notice of redemption is given, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to the capital of Level 3 Financing from one or more private placements of common stock of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 65% of the original aggregate principal amount of the 2018 Floating Rate Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption is required to be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days prior notice.

The offering of the 2018 Floating Rate Notes was not originally registered under the Securities Act of 1933, as amended. During the fourth quarter of 2014, all of the originally placed notes were exchanged for a new issue of Floating Rate Senior Notes due 2018 with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

11.875% Senior Notes due 2019

In January 2011, in two separate transactions, Level 3 Communications issued a total of $605 million aggregate principal amount of its 11.875% Senior Notes due 2019. The Company issued its 11.875% Senior Notes due 2019 to investors at a price of 98.173% of their principal amount. Debt issuance costs of approximately $8 million were capitalized and were amortized over the term of the 11.875% Senior Notes as interest expense using the effective interest method. The net proceeds from the issuance of the 11.875% Senior Notes were used to redeem the Company’s 5.25% Convertible Senior Notes due 2011 and exchange the 9% Convertible Senior Discount Notes due 2013 during the first quarter of 2011. Debt issuance discount of approximately $11 million was reflected as a reduction in long-term debt and amortized as interest expense over the term of the 11.875% Senior Notes using the effective interest method. The 11.875% Senior Notes were due to mature on February 1, 2019.

In December 2014, the Company issued $600 million aggregate principal amount of its 5.75% Senior Notes due 2022. The net proceeds from the offering of the notes, together with cash on hand, were used to redeem the $605 million aggregate principal amount outstanding of the Company's 11.875% Senior Notes due 2019. The company recognized a debt extinguishment loss of $53 million associated with this transaction during the fourth quarter 2014.

9.375% Senior Notes due 2019

On March 4, 2011, Level 3 Financing issued $500 million aggregate principal amount of its 9.375% Senior Notes due 2019 at a price of 98.001% of their principal amount. Debt issuance discount of approximately $10 million was reflected as a reduction in long-term debt and is being amortized as interest expense over the term of the 9.375% Senior Notes using the effective interest method. Debt issuance costs of approximately $11 million were capitalized and are being amortized over the term of the 9.375% Senior Notes as interest expense using the effective interest method. The net proceeds from the offering, were used to redeem a portion of Level 3 Financing’s outstanding 9.25% Senior Notes due 2014 on April 4, 2011. The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC. The notes are unsecured, unsubordinated obligations of Level 3 Financing ranking equal in right of payment with all existing and future unsubordinated indebtedness of Level 3 Financing and are senior in right of payment to all existing and future indebtedness of Level 3 Financing expressly subordinated in right of payment to the notes. The 9.375% Senior Notes will mature on April 1, 2019. Interest on the Notes is payable on April 1 and October 1 of each year, beginning on October 1, 2011.

As of December 31, 2014, debt issuance discount remaining was $6 million. As a result of amortization, the capitalized debt issuance costs have been reduced to $7 million at December 31, 2014.

The 9.375% Senior Notes Due 2019 are subject to redemption at the option of Level 3 Financing in whole or in part, at any time or from time to time, prior to April 1, 2015, at 100% of the principal amount of 9.375% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and on or after April 1, 2015 at the redemption prices (expressed as a percentage of principal amount) set forth below, plus accrued and unpaid interest thereon to the redemption date, if redeemed during the twelve months beginning April 1, of the years indicated below:
Year
Redemption Price

2015
104.688
%
2016
102.344
%
2017
100.000
%


The offering of the 9.375% Senior Notes was not originally registered under the Securities Act of 1933, as amended, and included a registration rights agreement. In July 2011, all of the originally placed notes were exchanged for a new issue of 9.375% Senior Notes due 2019 with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

On January 29, 2015, Level 3 Financing issued $500 million aggregate principal amount of its 5.625% Senior Notes due 2023. The 5.625% Senior Notes were priced at par and mature February 1, 2023. The 5.625% Senior Notes will pay interest on June 15 and December 15 of each year beginning on June 15, 2015.

The net proceeds from the offering of the 5.625% Senior Notes, together with cash on hand, will be used to redeem all $500 million aggregate principal amount of Level 3 Financing, Inc.’s 9.375% Senior Notes due 2019.

8.125% Senior Notes due 2019

On June 9, 2011, Level 3 Escrow, Inc., an indirect, wholly owned subsidiary of Level 3 Communications, issued $600 million in aggregate principal amount of its 8.125% Senior Notes due 2019. Level 3 Escrow, Inc. issued the 8.125% Senior Notes to investors at a price of 99.264% of their principal amount. Debt issuance discount of approximately $4 million was reflected as a reduction in long-term debt and was amortized as interest expense over the beginning initial term of the 8.125% Senior Notes using the effective interest method. The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC. The notes are unsecured, unsubordinated obligations of Level 3 Financing ranking equal in right of payment with all existing and future unsubordinated indebtedness of Level 3 Financing and are senior in right of payment to all existing and future indebtedness of Level 3 Financing expressly subordinated in right of payment to the notes. The 8.125% Senior Notes will mature on July 1, 2019. Interest on the notes accrues at 8.125% per year and is payable on January 1 and July 1, beginning on January 1, 2012.

On July 28, 2011, Level 3 Escrow, Inc. issued an additional $600 million in aggregate principal amount of its 8.125% Senior Notes due 2019 ("Series B") under the same indenture as the 8.125% Senior Notes issued on June 9, 2011, which are treated under that indenture as a single series of notes. The new 8.125% Senior Notes due 2019 were priced to investors at 98.545% of their principal amount, plus accrued interest from June 9, 2011 when the original notes were issued, and will mature on July 1, 2019. Debt issuance discount of approximately $9 million was reflected as a reduction in long-term debt and is being amortized as interest expense over the beginning initial term of the 8.125% Senior Notes using the effective interest method.

The gross proceeds from the offering of the 8.125% Senior Notes were deposited into a segregated escrow account and were to remain in escrow until the date of the satisfaction of certain escrow conditions including, but not limited to, the substantially concurrent consummation of the Amalgamation and the assumption of the 8.125% Senior Notes by Level 3 Financing. In conjunction with the completion of the Amalgamation on October 4, 2011, the escrow conditions were satisfied. Debt issuance costs of approximately $32 million were capitalized and are being amortized over the term of the 8.125% Senior Notes using the effective interest method. Level 3 Financing assumed the obligations under the 8.125% Senior Notes and the notes were reclassified to long-term debt in the third quarter of 2011. Following the release of the escrowed funds in connection with the Notes Assumption, the escrowed funds were used to refinance certain existing indebtedness of Global Crossing in connection with the closing of the Amalgamation.

As of December 31, 2014, debt issuance discount remaining was $6 million. As a result of amortization, the capitalized debt issuance costs have been reduced to $22 million at December 31, 2014.

The 8.125% Senior Notes will be subject to redemption at the option of Level 3 Financing, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days prior notice, (i) prior to July 1, 2015, at 100% of the principal amount of 8.125% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and on and after July 1, 2015, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, if redeemed during the twelve months beginning July 1, of the years indicated below:

Year
Redemption Price

2015
104.063
%
2016
102.031
%
2017
100.000
%


The offering of the 8.125% Senior Notes was not originally registered under the Securities Act of 1933, as amended, and included a registration rights agreement. In April 2012, all of the originally placed notes were exchanged for a new issue of 8.125% Senior Notes due 2019 with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

8.875% Senior Notes due 2019

On August 1, 2012, Level 3 Communications completed the offering of $300 million aggregate principal amount of its 8.875% Senior Notes due 2019. Debt issuance costs of approximately $7 million were capitalized and are being amortized over the term of the 8.875% Senior Notes as interest expense using the effective interest method. The net proceeds from the offering of the notes was used for general corporate purposes, including the potential repurchase, redemption, repayment or refinancing of the Company's and its subsidiaries' existing indebtedness from time to time. The 8.875% Senior Notes were priced at 100% of their principal amount and will mature on June 1, 2019. Interest on the notes accrues from August 1, 2012 and is payable on June 1 and December 1 of each year, beginning on December 1, 2012. The notes are senior unsecured obligations of Level 3 Communications, ranking equal in right of payment with all other senior unsecured obligations of Level 3. The notes will not be guaranteed by any of the Company's subsidiaries.

As a result of amortization, the capitalized debt issuance costs have been reduced to $5 million at December 31, 2014.

The 8.875% Senior Notes are subject to redemption at the option of Level 3 in whole or in part, at any time before June 1, 2015 at the redemption price equal to 100% of their principal amount, plus a make-whole premium and accrued and unpaid interest. On and after June 1, 2015, Level 3 may redeem all or part of the 8.875% Senior Notes, upon not less than 30 nor more than 60 days prior notice, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) to, but not including, the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve months beginning June 1, of the years indicated below:
Year
Redemption Price

2015
104.438
%
2016
102.219
%
2017
100.000
%


In addition, at any time or from time to time on or prior to June 1, 2015, Level 3 may redeem up to 35% of the original aggregate principal amount of the 8.875% Senior Notes (including any additional 8.875% Senior Notes) at a redemption price equal to 108.875% of the principal amount of the 8.875% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) to the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), with the net cash proceeds contributed to the capital of Level 3 of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in aggregate; provided, however, that at least 65% of the original aggregate principal amount of the 8.875% Senior Notes (including any additional 8.875% Senior Notes) would remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days of such private placement or public offering upon not less than 30 nor more than 60 days prior notice.

The 8.875% Senior Notes were not originally registered under the Securities Act of 1933, as amended, and included a registration rights agreement. During the second quarter of 2013, all of the originally placed 8.875% Senior Notes due 2019 issued by Level 3 Communications, were exchanged for a new issue of 8.875% Senior Notes due 2019 with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

8.625% Senior Notes due 2020

On January 13, 2012, Level 3 Financing completed the offering of $900 million aggregate principal amount of its 8.625% Senior Notes due 2020. Debt issuance costs of approximately $20 million were capitalized and are being amortized over the term of the 8.625% Senior Notes as interest expense using the effective interest method. In February 2012, a portion of the net proceeds from the offering of the 8.625% Senior Notes were used to redeem all of Level 3 Financing's outstanding 9.25% Senior Notes due 2014 in aggregate principal amount of $807 million. Level 3 Financing redeemed its 9.25% Senior Notes due 2014 at a price of 102.313% of the principal amount and recognized a loss on extinguishment of debt of $22 million during the first quarter of 2012.

The remaining net proceeds constituted purchase money indebtedness under the existing senior secured credit agreement and indentures of the Company and Level 3 Financing and were used solely to fund the cost of construction, installation, acquisition, lease, development or improvement of any Telecommunications/IS assets (as defined in the existing senior secured credit agreement and indentures of Level 3).

The 8.625% Senior Notes will mature on July 15, 2020. Interest on the notes accrues from January 13, 2012 and is payable on January 15 and July 15 of each year, beginning on July 15, 2012. The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC. The notes are unsecured, unsubordinated obligations of Level 3 Financing ranking equal in right of payment with all existing and future unsubordinated indebtedness of Level 3 Financing and are senior in right of payment to all existing and future indebtedness of Level 3 Financing expressly subordinated in right of payment to the notes.

As a result of amortization, the capitalized debt issuance costs have been reduced to $14 million at December 31, 2014.

The 8.625% Senior Notes are subject to redemption at the option of Level 3 Financing in whole or in part, at any time before January 15, 2016 at the redemption price equal to 100% of their principal amount, plus a make-whole premium and accrued and unpaid interest. On and after January 15, 2016, Level 3 Financing may redeem all or part of the 8.625% Senior Notes, upon not less than 30 nor more than 60 days prior notice, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) to, but not including, the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve months beginning January 15, of the years indicated below:
Year
Redemption Price

2016
104.313
%
2017
102.156
%
2018
100.000
%


During the second quarter of 2012, all of the originally placed notes were exchanged for a new issue of 8.625% Senior Notes due 2020 with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

7% Senior Notes due 2020

On August 6, 2012, Level 3 Financing completed the offering of $775 million aggregate principal amount of its 7% Senior Notes due 2020. Debt issuance costs of approximately $15 million were capitalized and are being amortized over the term of the 7% Senior Notes as interest using the effective interest method. The net proceeds from the offering of the notes, along with cash on hand were used to redeem all of the outstanding 8.75% Senior Notes due 2017 issued by Level 3 Financing, including the payment of accrued interest and applicable premiums, and in connection with that redemption, the indenture relating to the 8.75% Senior Notes due 2017 was discharged. Level 3 Financing redeemed its 8.75% Senior Notes due 2017 at a price of 104.375% of the principal amount and recognized a loss on extinguishment of debt of $40 million. The 7% Senior Notes were priced at 100% of their principal amount and will mature on June 1, 2020. Interest on the notes accrues from August 6, 2012 and is payable on June 1 and December 1 of each year, beginning on December 1, 2012.The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC. The notes are unsecured, unsubordinated obligations of Level 3 Financing ranking equal in right of payment with all existing and future unsubordinated indebtedness of Level 3 Financing and are senior in right of payment to all existing and future indebtedness of Level 3 Financing expressly subordinated in right of payment to the notes.

As a result of amortization, the capitalized debt issuance costs have been reduced to $11 million at December 31, 2014.

The 7% Senior Notes are subject to redemption at the option of Level 3 Financing in whole or in part, at any time before June 1, 2016 at the redemption price equal to 100% of their principal amount, plus a make-whole premium and accrued and unpaid interest. On or after June 1, 2016, Level 3 Financing may redeem all or part of the 7% Senior Notes, upon not less than 30 nor more than 60 days prior notice, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) to, but not including, the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve months beginning June 1, of the years indicated below:
Year
Redemption Price

2016
103.500
%
2017
101.750
%
2018
100.000
%


In addition, at any time or from time to time on or prior to June 1, 2015, Level 3 Financing may redeem up to 35% of the original aggregate principal amount of the 7% Senior Notes (including any additional 7% Senior Notes) at a redemption price equal to 107% of the principal amount of the 7% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) to the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), with the net cash proceeds contributed to the capital of Level 3 Financing of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in aggregate; provided, however, that at least 65% of the original aggregate principal amount of the 7% Senior Notes (including any additional 7% Senior Notes) would remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days of such private placement or public offering upon not less than 30 nor more than 60 days prior notice.

The 7% Senior Notes were not originally registered under the Securities Act of 1933, as amended, and included a registration rights agreement. During the second quarter of 2013, all of the originally placed 7% Senior Notes due 2020 issued by Level 3 Financing, were exchanged for a new issue of 7% Senior Notes due 2020 with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

6.125% Senior Notes due 2021

On November 14, 2013, Level 3 Financing completed the offering of $640 million aggregate principal amount of its 6.125% Senior Notes due 2021 (the "6.125% Senior Notes"). Debt issuance costs of approximately $12 million were capitalized and are being amortized over the term of the 6.125% Senior Notes as interest using the effective interest method.The net proceeds from the offering, together with cash on hand, were used to redeem all of Level 3 Financing’s outstanding 10% Senior Notes due 2018, including accrued interest, applicable premiums and expenses. The Company recognized a loss on extinguishment of debt of $56 million as a result of this transaction. The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC.

The notes are unsecured, unsubordinated obligations of Level 3 Financing ranking equal in right of payment with all existing and future unsubordinated indebtedness of Level 3 Financing and are senior in right of payment to all existing and future indebtedness of Level 3 Financing expressly subordinated in right of payment to the notes. The 6.125% Senior Notes were priced at 100% of their principal amount and will mature on January 15, 2021. Interest on the Notes is payable on April 15 and October 15 of each year, beginning on April 15, 2014.

As a result of amortization, the capitalized debt issuance costs have been reduced to $11 million at December 31, 2014.

Prior to November 15, 2016, at the option of Level 3 Financing, the 6.125% Senior Notes will be subject to redemption, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days prior notice, at 100% of the principal amount of 6.125% Senior Notes so redeemed plus (i) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (ii) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date. On and after November 15, 2016, at the option of Level 3 Financing, the 6.125% Senior Notes will be subject to redemption, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days prior notice at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date. The redemption price for the 6.125% Senior Notes if redeemed during the twelve months beginning November 15, of the years indicated below:

Year
Redemption Price

2016
103.063
%
2017
101.531
%
2018
100.000
%

In addition, at any time or from time to time on or prior to November 15, 2016, Level 3 Financing may redeem up to 35% of the original aggregate principal amount of the 6.125% Senior Notes at a redemption price equal to 106.125% of the principal amount of the 6.125% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to the capital of Level 3 Financing from one or more private placements of common stock of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 65% of the original aggregate principal amount of the 6.125% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption is required to be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days prior notice.

The offering of the 6.125% Senior Notes was not originally registered under the Securities Act of 1933, as amended. During the fourth quarter of 2014, all of the originally placed notes were exchanged for a new issue of 6.125% Senior Notes due 2021 with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

5.375% Senior Notes due 2022

On August 12, 2014, Level 3 Escrow II, Inc. (“Level 3 Escrow”), an indirect, wholly owned subsidiary of Level 3 Communications, Inc., issued $1.0 billion in aggregate principal amount of its 5.375% Senior Notes due 2022 (the “5.375% Senior Notes”). The 5.375% Senior Notes will mature on August 15, 2022. Interest on the 5.375% Senior Notes is payable on May 15 and November 15 of each year, beginning on November 15, 2014. Debt issuance costs of approximately $17 million were capitalized and are amortized over the term of the 5.375% Notes as interest expense using the effective interest method.

As a result of amortization, the capitalized debt issuance costs have been reduced to $12 million at December 31, 2014.

The gross proceeds from the offering of the 5.375% Senior Notes were deposited into a segregated escrow account and were to remain in escrow until the date of the satisfaction of certain escrow conditions including, but not limited to, the substantially concurrent consummation of the acquisition by Level 3 of tw telecom pursuant to the Merger and the assumption of the 5.375% Senior Notes by Level 3 Financing, Inc. (the “Notes Assumption”). In conjunction with the completion of the Merger on October 31, 2014 (see Note 2 — Events Associated with the Merger of tw telecom), the escrow conditions were satisfied. Following the Notes Assumption, Level 3 and Level 3 Communications, LLC guaranteed the 5.375% Senior Notes on an unsecured basis. Following the Notes Assumption, Level 3 and Level 3 Communications, LLC guaranteed the 5.375% Senior Notes on an unsecured basis. Following the release of the escrowed funds in connection with the Notes Assumption, the escrowed funds were used to finance the cash portion of the merger consideration payable to tw telecom stockholders and to refinance certain existing indebtedness of tw telecom, including fees and premiums, in connection with the closing of the Merger.

The 5.375% Senior Notes are subject to redemption at the option of Level 3 Financing, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days’ prior notice, (i) prior to August 15, 2017, at 100% of the principal amount of 5.375% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and (ii) on and after August 15, 2017, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, if redeemed during the twelve months beginning August 15, of the years indicated below:

Year
Redemption Price

2017
102.688
%
2018
101.344
%
2019
100.000
%

At any time or from time to time on or prior to August 15, 2017, Level 3 Financing may redeem up to 40% of the original aggregate principal amount of the 5.375% Senior Notes at a redemption price equal to 105.375% of the principal amount of the 5.375% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to Level 3 Financing of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 60% of the original aggregate principal amount of the 5.375% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days following such private placement or public offering upon not less than 30 days nor more than 60 days’ prior notice.

The offering of the 5.375% Senior Notes were not originally registered under the Securities Act of 1933, as amended, and the 5.375% Senior Notes may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The 5.375% Senior Notes were sold to persons reasonably believed to be “qualified institutional buyers” as defined in Rule 144A under the Securities Act of 1933, as amended, and non-U.S. persons outside the United States under Regulation S under the Securities Act of 1933, as amended. The registration rights agreement became effective as of October 31, 2014. During the first quarter of 2015, all of the originally placed notes were exchanged for a new issue of 5.375% Senior Notes with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

5.75% Senior Notes due 2022

On December 1, 2014, Level 3 issued a total of $600 million aggregate principal amount of its 5.75% Senior Notes due 2022 (the “5.75% Senior Notes”). Debt issuance costs of approximately $10 million were capitalized and are being amortized over the term of the 5.75% Senior Notes as interest expense using the effective interest method. The net proceeds from the offering of the notes, together with cash on hand were used to redeem all of the outstanding 11.875% Senior Notes due 2019 issued by Level 3 Financing, including the payment of accrued interest and applicable premiums, and in connection with that redemption, the indenture relating to the 11.875% Senior Notes due 2019 was discharged on December 31, 2014. Level 3 Financing redeemed its 11.875% Senior Notes due 2017 at a price of 106.859% of the principal amount and recognized a loss on extinguishment of debt of $53 million.

The 5.75% Senior Notes will mature on December 1, 2022. Interest on the 5.75% Senior Notes accrues at 5.75% per year and is payable on March 1 and September 1 of each year, beginning on March 1, 2015.

The capitalized debt issuance costs were not reduced significantly as a result of amortization and remain at $10 million at December 31, 2014.

The 5.75% Senior Notes will be subject to redemption at the option of Level 3, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days’ prior notice, (i) prior to December 1, 2017 at 100% of the principal amount of 5.75% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and (ii) on and after December 1, 2017, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date. The redemption price for the 5.75% Senior Notes if redeemed during the twelve months beginning December 1, of years indicated below:
Year
Redemption Price

2017
102.8750
%
2018
101.4375
%
2019 and thereafter
100.0000
%

At any time or from time to time on or prior to December 1, 2017, Level 3 may redeem up to 40% of the original aggregate principal amount of the 5.75% Senior Notes at a redemption price equal to 105.75% of the principal amount of the 5.75% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to the capital of Level 3 from one or more private placements of Level 3 to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 60% of the original aggregate principal amount of the 5.75% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days’ prior notice.

The offering of the 5.75% Senior Notes was not registered under the Securities Act of 1933, as amended, and the 5.75% Senior Notes may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The 5.75% Senior Notes were sold to “qualified institutional buyers” as defined in Rule 144A under the Securities Act of 1933, as amended, and non-U.S. persons outside the United States under Regulation S under the Securities Act of 1933, as amended. The registration rights agreement became effective as of December 1, 2014. During the first quarter of 2015, all of the originally placed notes were exchanged for a new issue of 5.75% Senior Notes with identical terms and conditions, other than those related to registration rights, in a registered exchange offer and are now freely tradeable.

7% Convertible Senior Notes due 2015

On June 26, 2009, Level 3 Communications issued $200 million aggregate principal amount of 7% Convertible Senior Notes due 2015 under an indenture between Level 3 and The Bank of New York, as trustee. The 7% Convertible Senior Notes due 2015 were issued in conjunction with the exchange of approximately $142 million aggregate principal amount of the Company's 6% Convertible Subordinated Notes due 2010 and approximately $140 million aggregate principal amount of its 2.875% Convertible Senior Notes due 2010. As part of this exchange, Level 3 also paid $78 million in cash, including accrued and unpaid interest for the notes exchanged.

On October 15, 2009, Level 3 issued $275 million aggregate principal amount of 7% Convertible Senior due 2015, Series B under a second supplemental indenture between Level 3 and The Bank of New York, as trustee. The 7% Convertible Senior Notes due 2015, Series B are substantially similar in all respects to the 7% Convertible Senior Notes due 2015. The 7% Convertible Senior Notes due 2015, together with the 7% Convertible Senior Notes due 2015, Series B are referred to as the "7% Convertible Senior Notes due 2015".

The 7% Convertible Senior Notes due 2015 mature on March 15, 2015 and bear interest at a rate of 7% per annum, payable semiannually in arrears on March 15 and September 15. Interest payments commenced for the 7% Convertible Senior Notes due 2015 on September 15, 2009 and on March 15, 2010 for the 7% Convertible Senior Notes due 2015, Series B. The notes are fully and unconditionally guaranteed on an unsubordinated unsecured basis by the Company and Level 3 Communications, LLC. The notes are unsecured, unsubordinated obligations of Level 3 Financing ranking equal in right of payment with all existing and future unsubordinated indebtedness of Level 3 Financing and are senior in right of payment to all existing and future indebtedness of Level 3 Financing expressly subordinated in right of payment to the notes.

The 7% Convertible Senior Notes due 2015 are convertible into shares of Level 3 common stock, at the option of the holder, at any time prior to maturity, unless previously repurchased or redeemed, or unless Level 3 has caused the conversion rights to expire. The 7% Convertible Senior Notes due 2015 may be converted at the rate of approximately 37 shares of common stock per each $1,000 principal amount of notes, subject to adjustment in certain circumstances. This is equivalent to a conversion price of approximately $27 per share.

Upon the occurrence of a designated event (a change of control or a termination of trading), holders of the 7% Convertible Senior Notes due 2015 will have the right, subject to certain exceptions and conditions, to require Level 3 to repurchase all or any part of the 7% Convertible Senior Notes due 2015 at a repurchase price equal to 100% of the principal amount plus accrued and unpaid interest thereon (if any) to, but excluding, the designated event purchase date. In addition, if an event treated as a change in control of Level 3 occurs, Level 3 will be obligated, subject to certain conditions, to offer to purchase all of the outstanding 7% Convertible Senior Notes due 2015 at a purchase price of 100% of the principal amount, plus a "make-whole" premium, by increasing the conversion rate applicable to such 7% Convertible Senior Notes due 2015.

During the fourth quarter of 2014, certain holders converted approximately $142 million of the 7% Convertible Senior Notes to common equity. Upon conversion, the Company issued an aggregate of approximately 5 million shares of Level 3 common stock, representing the approximately 37 shares per $1,000 note into which the notes were then convertible.

As of December 31, 2014, the debt issuance discount remaining was nil. Debt issuance costs of $4 million were originally capitalized and were being amortized over the term of the 7% Convertible Senior Notes due 2015 as interest expense using the effective interest method. The capitalized unamortized debt issuance costs were also nil at December 31, 2014.

Capital Leases

As of December 31, 2014, the Company had $207 million of capital leases. The Company leases property, equipment, certain dark fiber facilities and metro fiber under non-cancelable IRU agreements that are accounted for as capital leases. Interest rates on these capital leases approximated 6.2% on average as of December 31, 2014.

Other Debt

As of December 31, 2014, the Company had less than $1 million of other debt with an average interest rate of 5.0%.

Covenant Compliance

At December 31, 2014 and 2013, the Company was in compliance with the covenants on all outstanding debt issuances.

Long-Term Debt Maturities

Aggregate future contractual maturities of long-term debt and capital leases (excluding discounts and fair value adjustments) were as follows as of December 31, 2014 (dollars in millions):

2015
$
349

2016
9

2017
8

2018
308

2019
2,823

Thereafter
7,869

 
$
11,366




Accumulated Other Comprehensive Income (Loss) (Notes)
Comprehensive Income (Loss) Note [Text Block]
Accumulated Other Comprehensive Income (Loss)

The accumulated balances for each classification of other comprehensive income (loss) are as follows:

(dollars in millions)
 
Net Foreign Currency Translation Adjustment
 
Holding Gain (Loss) on Interest Rate Swaps
 
Defined Benefit Pension Plans
 
Total
Balance at January 1, 2012
 
$
39

 
$
(90
)
 
$
(29
)
 
$
(80
)
Other comprehensive income (loss) before reclassifications
 
17

 
25

 
(4
)
 
38

Amounts reclassified from accumulated other comprehensive loss
 
—

 
65

 
3

 
68

Balance at December 31, 2012
 
56

 
—

 
(30
)
 
26

Other comprehensive income (loss) before reclassifications
 
11

 
—

 
(3
)
 
8

Amounts reclassified from accumulated other comprehensive loss
 
—

 
—

 
2

 
2

Balance at December 31, 2013
 
67

 
—

 
(31
)
 
36

Other comprehensive income (loss) before reclassifications
 
(178
)
 
—

 
(9
)
 
(187
)
Amounts reclassified from accumulated other comprehensive loss
 
—

 
—

 
4

 
4

Balance at December 31, 2014
 
$
(111
)
 
$
—

 
$
(36
)
 
$
(147
)
Employee Benefit Benefits and Stock-Based Compensation
Stock-Based Compensation
Employee Benefits and Stock-Based Compensation

The Company records non-cash compensation expense for its outperform stock appreciation rights, performance restricted stock units, restricted stock units, 401(k) matching contributions, and, prior to 2014, other stock-based compensation expense associated with the Company's discretionary bonus grants. Total non-cash compensation expense related to these equity awards was $73 million in 2014, $151 million in 2013 and $135 million in 2012.

The following table summarizes non-cash compensation expense and capitalized non-cash compensation for each of the three years ended December 31, 2014, 2013 and 2012 (dollars in millions):

 
 
2014
 
2013
 
2012
OSOs
 
$
8

 
$
21

 
$
14

Restricted Stock Units
 
34

 
38

 
40

Performance Restricted Stock Units
 
14

 
—

 
—

401(k) Match Expense
 
23

 
24

 
23

Restricted Stock Unit Bonus Grant
 
(5
)
 
59

 
46

Management Incentive and Retention Plan
 
—

 
10

 
13

 
 
74

 
152

 
136

Capitalized Non-Cash Compensation
 
(1
)
 
(1
)
 
(1
)
 
 
$
73

 
$
151

 
$
135



The Company capitalizes non-cash compensation for those employees directly involved in the construction of the network, installation of services for customers or the development of business support systems.

OSO and restricted stock units are granted under the Level 3 Communications, Inc. Stock Plan, as amended (the "Stock Plan"), which term extends through May 20, 2020. The Stock Plan provides for accelerated vesting of stock awards upon retirement if an employee meets certain age and years of service requirements and certain other requirements. Under the Stock Compensation guidance, if an employee meets the age and years of service requirements under the accelerated vesting provision, the award would be expensed at grant or expensed over the period from the grant date to the date the employee meets the requirements, even if the employee has not actually retired. The Company recognized non-cash compensation expense for employees that met the age and years of service requirements for accelerated vesting at retirement of $4 million, $5 million and $9 million in 2014, 2013 and 2012, respectively.

Outperform Stock Options

OSOs were awarded through the end of 2013, and will continue to be outstanding through 2016. The Company's OSO program was designed so that the Company's stockholders would receive a market return on their investment before OSO holders receive any return on their OSOs. The Company believes that the OSO program directly aligned management's and stockholders' interests by basing stock option value on the Company's ability to outperform the market in general, as measured by the Standard & Poor's ("S&P") 500® Index. Participants in the OSO program do not realize any value from awards unless the Company's common stock price outperforms the S&P 500® Index during the life of the grant. When the stock price gain is greater than the corresponding gain on the S&P 500® Index, the value received for awards under the OSO plan is based on a formula involving a multiplier related to the level by which the Company's common stock outperforms the S&P 500® Index. To the extent that Level 3's common stock outperforms the S&P 500® Index, the value of OSO units to a holder may exceed the value of non-qualified stock options.

The initial strike price, as determined on the day prior to the OSO grant date, is adjusted over time (the "Adjusted Strike Price"), until the settlement date. The adjustment is an amount equal to the percentage appreciation or depreciation in the value of the S&P 500® Index from the date of grant to the date of exercise. The value of the OSO increased for increasing levels of outperformance. OSO units had a multiplier range from zero to four depending upon the performance of Level 3 common stock relative to the S&P 500® Index as shown in the following table.

If Level 3 Stock Outperforms the S&P 500® Index by:
 
Then the Pre-multiplier Gain Multiplied by a Success Multiplier of:
0% or Less
 
—
More than 0% but Less than 11%
 
Outperformance percentage multiplied by 4/11
11% or More
 
4.00

The Pre-multiplier Gain is the Level 3 common stock price minus the Adjusted Strike Price on the date of settlement.

Upon settlement of an OSO, the Company shall deliver or pay to the grantee the difference between the fair market value of a share of Level 3 common stock as of the day prior to the settlement date, less the Adjusted Strike Price (the "Exercise Consideration"). The Exercise Consideration may be paid in cash, Level 3 common stock or any combination of cash or Level 3 common stock at the Company's discretion. The number of shares of Level 3 common stock to be delivered by the Company to the grantee is determined by dividing the Exercise Consideration to be paid in Level 3 common stock by the fair market value of a share of Level 3 common stock as of the date prior to the settlement date. Fair market value was defined in the OSO agreement as the closing price per share of Level 3 common stock on the national securities exchange on which the common stock is traded. Settlement of the OSO units does not require any cash outlay by the employee.

Beginning with awards made on or after April 1, 2007, OSO units were awarded monthly to employees in mid-management level and higher positions, had a three year life, vested 100% and fully settled on the third anniversary of the date of the award and were valued as of the first day of each month. Recipients have no discretion on the timing to exercise OSO units granted on or after April 1, 2007, thus the expected life of all such OSO units was three years. During the first quarter of 2010, the Company revised the eligibility criteria and grant schedule for its non-cash compensation. Effective April 1, 2010, the Company's OSOs were granted quarterly to certain levels of management. There were no changes to the vesting schedule, or any other aspects of the non-cash compensation plans.

As of December 31, 2014, there was $7 million of unamortized compensation expense related to granted OSO units. The weighted average period over which this cost will be recognized is 1.26 years.

The fair value of the OSO units granted was calculated by applying a modified Black-Scholes model with the assumptions identified below. The Company utilized a modified Black-Scholes model due to the additional variables required to calculate the effect of the market conditions and success multiplier of the OSO program. The Company believes that given the relative short life of the OSOs and the other variables used in the model, the modified Black-Scholes model provides a reasonable estimate of the fair value of the OSO units at the time of grant.

 
Year Ended December 31,
 
 
2013
 
2012
S&P 500 Expected Dividend Yield Rate
 
2.24%
 
2.05%
Expected Life
 
3 years
 
3 years
S&P 500 Expected Volatility Rate
 
19%
 
23%
Level 3 Common Stock Expected Volatility Rate
 
39%
 
39%
Expected S&P 500 Correlation Factor
 
0.44
 
0.32
Calculated Theoretical Value
 
101%
 
110%
Estimated Forfeiture Rate
 
15%
 
20%


The fair value of each OSO unit equaled the calculated theoretical value multiplied by the Level 3 common stock price on the grant date.

As described above, recipients have no discretion on the timing to exercise OSO units. Thus the expected life of all such OSO units was three years. The Company estimates the stock price volatility using a combination of historical and implied volatility as Level 3 believes it is consistent with the approach most marketplace participants would consider using all available information to estimate expected volatility. The Company has determined that expected volatility is more reflective of market conditions and provides a more accurate indication of volatility than using solely historical volatility. In reaching this conclusion, the Company has considered many factors including the extent to which its future expectations of volatility over the respective term is likely to differ from historical measures.

The fair value for OSO units awarded to participants during the years ended December 31, 2013 and 2012 was approximately $17 million and $29 million, respectively.

Transactions involving OSO units awarded are summarized in the table below. The Option Price Per Unit identified in the table below represents the initial strike price, as determined on the day prior to the OSO grant date for those grants.
 
 
Units
 
Initial Strike Price Per Unit
 
Weighted
Average
Initial
Strike
Price
 
Aggregate
Intrinsic
Value
 
Weighted
Average
Remaining
Contractual
Term (years)
 
 
 
 
 
 
 
 
 
 
(in millions)
 
 
Balance January 1, 2012
 
1,288,712

 
$
10.50

-
$
36.60

 
$
20.51

 
$
1.8

 
1.53
OSOs granted
 
1,195,452

 
$
16.99

-
$
27.53

 
$
24.65

 
 
 
 
OSOs forfeited
 
(72,335
)
 
$
12.00

-
$
36.60

 
$
21.80

 
 
 
 
OSOs expired
 
(278,111
)
 
$
15.00

-
$
22.65

 
$
18.45

 
 
 
 
OSOs exercised
 
(67,299
)
 
$
10.50

-
$
13.80

 
$
12.48

 
 
 
 
Balance December 31, 2012
 
2,066,419

 
$
14.10

-
$
36.60

 
$
23.40

 
$
6.6

 
1.73
OSOs granted
 
748,481

 
$
20.29

-
$
26.69

 
$
22.64

 
 
 
 
OSOs forfeited
 
(271,883
)
 
$
14.10

-
$
36.60

 
$
22.33

 
 
 
 
OSOs expired
 
(286,924
)
 
$
16.35

-
$
24.30

 
$
21.48

 
 
 
 
OSOs exercised
 
(107,228
)
 
$
14.10

-
$
14.10

 
$
14.10

 
 
 
 
Balance December 31, 2013
 
2,148,865

 
$
14.10

-
$
36.60

 
$
23.99

 
$
31.6

 
1.46
OSOs granted
 
—

 
$
—

-
$
—

 
$
—

 
 
 
 
OSOs forfeited
 
(52,901
)
 
$
16.99

-
$
27.53

 
$
22.99

 
 
 
 
OSOs expired
 
(106,844
)
 
$
36.60

-
$
36.60

 
$
36.60

 
 
 
 
OSOs exercised
 
(771,251
)
 
$
14.70

-
$
27.53

 
$
24.26

 
 
 
 
Balance December 31, 2014
 
1,217,869

 
$
16.99

-
$
27.53

 
$
22.76

 
$
88.0

 
0.90


 
 
 
 
OSO Units Outstanding
at December 31, 2014
 
OSO units Exercisable
at December 31, 2014
Range of Exercise Prices
 
Number
Outstanding
 
Weighted
Average
Remaining
Life (years)
 
Weighted
Average
Initial
Strike Price
 
Number
Exercisable
 
Weighted
Average
Initial
Strike Price
$
16.99

-
$
27.53

 
1,217,869

 
0.90
 
$
22.76

 
—

 
$
—



In the table above, the weighted average initial strike price represents the values used to calculate the theoretical value of OSO units on the grant date and the intrinsic value represents the value of OSO units that have outperformed the S&P 500® Index as of December 31, 2014, 2013 and 2012, respectively. As noted above, all of the outstanding OSO units granted have an expected life at the grant date of three years.

The total realized value of OSO units settled was $18.7 million, $1.5 million and $0.8 million for the years ended December 31, 2014, 2013 and 2012, respectively. The Company issued 732,593, 90,879 and zero shares of Level 3 common stock upon the exercise of OSO units for the years ended December 31, 2014, 2013 and 2012, respectively. The Company paid cash in lieu of shares of Level 3 common stock for the realized value of OSO units settled for the year ended December 31, 2012. The number of shares of Level 3 common stock issued upon settlement of an OSO unit varies based upon the relative performance of Level 3 stock price and the S&P 500® Index between the initial grant date and settlement date of the OSO unit.

Restricted Stock and Units and Performance Restricted Stock Units

Restricted stock units are annually granted on July 1 to certain eligible recipients, including the Board of Directors, at no cost. Restrictions on transfer lapse over one to four year periods.

Effective April 2014, the Company's Board of Directors approved the Restricted Stock Unit and
Performance Restricted Stock Unit ("PRSUs") Master Award Agreement ("the Agreement"), which provides for the ability to award participants PRSUs instead of the historical award of OSOs. PRSUs are designed to provide participants with a long-term stake in the Company’s success with both retention and performance components. Under the Agreement, a participant becomes vested in a number of PRSUs based on the Company's achievement of specified levels of financial performance during the performance period set forth in the applicable award letter issued pursuant to the Agreement, so long as the participant remains continuously employed by the Company until the applicable scheduled vesting date, subject to certain change in control provisions as outlined in the Agreement. The performance objective is based on the Company’s financial performance measures. Participants will be entitled to an award within a range of 50% at a minimum achievement level and 200% at a maximum achievement level.

The fair value of restricted stock units awarded totaled $96 million, $34 million and $69 million for the years ended December 31, 2014, 2013 and 2012, respectively. The fair value of these awards was calculated using the value of Level 3 common stock on the grant date and are being amortized over the periods in which the restrictions lapse. As of December 31, 2014, unamortized compensation cost related to nonvested restricted stock and restricted stock units was $85 million and the weighted average period over which this cost will be recognized is 3.18 years.

The changes in nonvested restricted stock, restricted stock units and nonvested performance restricted stock units are shown in the following table:
 
 
Number
 
Weighted Average
Grant Date
Fair Value
Nonvested at January 1, 2012
 
2,030,783

 
$
26.25

Stock and units granted
 
2,869,584

 
$
24.13

Lapse of restrictions
 
(1,048,757
)
 
$
26.06

Stock and units forfeited
 
(214,634
)
 
$
24.92

Nonvested at December 31, 2012
 
3,636,976

 
$
24.71

Stock and units granted
 
1,617,592

 
$
21.26

Lapse of restrictions
 
(1,841,757
)
 
$
25.19

Stock and units forfeited
 
(488,461
)
 
$
23.10

Nonvested at December 31, 2013
 
2,924,350

 
$
22.77

Stock and units granted
 
2,255,883

 
$
42.36

Lapse of restrictions
 
(1,151,830
)
 
$
22.94

Stock and units forfeited
 
(241,785
)
 
$
28.90

Nonvested at December 31, 2014
 
3,786,618

 
$
33.91



The total fair value of restricted stock and restricted stock units and PRSUs whose restrictions lapsed in the years ended December 31, 2014, 2013 and 2012 was $27 million, $46 million and $27 million, respectively.

Management Incentive and Retention Plan

Effective March 2012, the Company adopted a Management Incentive and Retention Plan ("MIRP") as a means of encouraging key management personnel to remain employed with the Company or one of its subsidiaries and to reward the achievement of established performance criteria. The MIRP provided an opportunity to receive two types of awards: a retention award and an incentive award. Participants' retention and incentive awards had a cash component only or a cash component and an equity component. The equity component was granted in the form of restricted stock units under the Stock Plan. The MIRP has terminated pursuant to its terms and there are no remaining unamortized compensation costs related to MIRP.

A summary of the retention restricted stock units granted under the MIRP is shown in the following table:
 
 
Number
 
Weighted Average
Grant Date
Fair Value
Nonvested at January 1, 2012
 
—

 
$
—

Stock and units granted
 
465,000

 
$
25.92

Lapse of restrictions
 
—

 
$
—

Stock and units forfeited
 
—

 
$
—

Nonvested at December 31, 2012
 
465,000

 
$
25.92

Stock and units granted
 
—

 
$
—

Lapse of restrictions
 
(270,000
)
 
$
25.92

Stock and units forfeited
 
—

 
$
—

Nonvested at December 31, 2013
 
195,000

 
$
25.92

Stock and units granted
 
—

 


Lapse of restrictions
 
(195,000
)
 
$
25.92

Stock and units forfeited
 
—

 


Nonvested at December 31, 2014
 
—

 




No retention restricted stock units were awarded during the year ended December 31, 2014 under the MIRP, and all prior awards were vested as of December 31, 2014.

Warrants

As of December 31, 2012, there were warrants to purchase 45,593 shares of Level 3 common stock outstanding with an exercise price of $73.50, which expired in January 2013. All of the warrants were fully vested and compensation expense had been fully recognized in the Consolidated Statements of Operations.



Defined Contribution Plans

The Company sponsors a number of defined contribution plans. The principal defined contribution plans are discussed individually below. Other defined contribution plans are not individually significant and therefore have been summarized in aggregate below.

The Company and its subsidiaries offer their qualified employees the opportunity to participate in a defined contribution retirement plan qualifying under the provisions of Section 401(k) of the Internal Revenue Code ("401(k) Plan"). Each employee is eligible to contribute, on a tax deferred basis, a portion of annual earnings generally not to exceed $17,500 in 2014 and $18,000 in 2015. Effective January 1, 2012, the Company matches 100% of employee contributions up to 4% of eligible earnings or applicable regulatory limits.

The Company's matching contributions are made with Level 3 common stock based on the closing stock price on each pay date. The Company's matching contributions are made through units in the Level 3 Stock Fund, which represent shares of Level 3 common stock. The Level 3 Stock Fund is the mechanism that is used for Level 3 to make employer matching and other contributions to employees through the Level 3 401(k) Plan. Employees are not able to purchase units in the Level 3 Stock Fund. Employees are able to diversify the Company's matching contribution as soon as it is made, even if they are not fully vested, subject to insider trading rules and regulations. The Company's matching contributions will vest ratably over the first three years of service or over such shorter period until the employee has completed three years of service at such time the employee is then 100% vested in all Company matching contributions, including future contributions. The Company made 401(k) Plan matching contributions of $23 million, $24 million and $23 million for the years ended December 31, 2014, 2013 and 2012, respectively. The Company's matching contributions are recorded as non-cash compensation and included in network related expenses of $4 million, $4 million and $4 million for the years ended December 31, 2014, 2013 and 2012, respectively, and in selling, general and administrative expenses of $19 million, $20 million and $19 million for the years ended December 31, 2014, 2013 and 2012, respectively. Former U.S.-based Global Crossing employees became eligible to participate in the Level 3 401(k) Plan starting January 1, 2012 and former tw telecom employees became eligible to participate in the Level 3 401(k) Plan starting January 1, 2015.

The tw telecom 401(k) Plan ("tw telecom 401(k) Plan") provided 100% matching cash contributions up to a maximum 5% of eligible compensation. The Company's contributions to the tw telecom 401(k) Plan vest immediately. Expenses recorded by the Company relating to the tw telecom 401(k) Plan for the two months in 2014 subsequent to the completion of the Merger were approximately $2 million. Former tw telecom employees are eligible to participate in the Level 3 401(k) Plan starting January 1, 2015.

Other defined contribution plans sponsored by the Company are individually not significant. On an aggregate basis the expenses recorded by the Company relating to these plans was approximately $6 million, $5 million and $7 million for the years ended December 31, 2014, 2013 and 2012, respectively.

Defined Benefit Plans

The Company has certain contributory and non-contributory employee pension plans, which are not significant to the financial position or operating results of the Company. The Company recognizes in its balance sheet the funded status of its defined benefit post-retirement plans, which is measured as the difference between the fair value of the plan assets and the benefit obligation. The Company is also required to recognize changes in the funded status within accumulated other comprehensive income, net of tax to the extent such changes are not recognized in earnings as components of periodic net benefit cost. The fair value of the plan assets was $151 million and $148 million as of December 31, 2014 and 2013, respectively. The total benefit obligation was $176 million and $165 million as of December 31, 2014 and 2013, respectively. Therefore, the total funded status was an obligation of $25 million as of December 31, 2014. The total funded status was an obligation of $17 million as of December 31, 2013.

Annual Discretionary Bonus Grant

The Company's annual discretionary bonus program is intended to motivate employees to achieve the Company's financial and business goals. Each participant is provided a target award expressed as a percentage of base salary. Actual awards under the program are based on corporate results as well as achievement of specific individual performance criteria during the bonus plan period, and may be paid in cash, restricted stock units, or a combination of the two, at the sole discretion of the Compensation Committee of the Board of Directors.

As of December 31, 2014, $167 million had been accrued in current liabilities for this bonus plan, including employer liability for payroll taxes and charges. The Company generally expects to pay out 100% in cash in the first quarter of 2015.

As of December 31, 2013, $124 million was accrued in current liabilities for this bonus plan, including employer liability for payroll taxes and charges. The Company paid out $57 million cash and 1.4 million immediately-vested restricted stock units in 2014 for this plan.

As of December 31, 2012, $103 million was accrued in current liabilities for this bonus plan, including employer liability for payroll taxes and charges. The Company paid out $50 million cash and 2.1 million immediately-vested restricted stock units in 2013 for this plan.
Income Taxes
Income Taxes
Income Taxes

The following table summarizes the income tax benefit (provision) attributable to the income (loss) before income taxes for each of the three years ended December 31, 2014, 2013 and 2012:

 
 
2014
 
2013
 
2012
(dollars in millions)
Current:
 
 
 
 
 
 
United States federal
 
$
—

 
$
9

 
$
—

State
 
(1
)
 
(1
)
 
(2
)
Foreign
 
(40
)
 
(37
)
 
(36
)
 
 
(41
)
 
(29
)
 
(38
)
Deferred, net of changes in valuation allowances:
 
 
 
 
 
 
United States federal
 
6

 
(3
)
 
(3
)
State
 
15

 
—

 
—

Foreign
 
96

 
(6
)
 
(7
)
Income tax benefit (provision)
 
$
76

 
$
(38
)
 
$
(48
)










The United States and Foreign components of income (loss) before income taxes for each of the three years ended December 31, 2014, 2013 and 2012 are as follows (some of the income (loss) is subject to taxation in multiple jurisdictions):

 
 
2014
 
2013
 
2012
(dollars in millions)
United States
 
$
207

 
$
(122
)
 
$
(434
)
Foreign
 
31

 
51

 
60

 
 
$
238

 
$
(71
)
 
$
(374
)


A reconciliation of the actual income tax benefit (provision) and the tax computed by applying the U.S. federal rate (35%) to the income (loss) before income taxes for each of the three years ended December 31, 2014, 2013 and 2012 is shown in the following table:

 
 
2014
 
2013
 
2012
 
 
(dollars in millions)
Computed tax (provision) benefit at statutory rate
 
$
(83
)
 
$
25

 
$
131

Effect of earnings in jurisdictions outside of US
 
13

 
12

 
25

Change in valuation allowance
 
197

 
(27
)
 
(145
)
Permanent items
 
(44
)
 
(44
)
 
(48
)
Indefinite-lived assets
 
2

 
(3
)
 
(3
)
Uncertain tax positions
 
3

 
9

 
(3
)
Changes in tax rates
 
(7
)
 
(7
)
 
(4
)
Other, net
 
(5
)
 
(3
)
 
(1
)
Income tax benefit (provision)
 
$
76

 
$
(38
)
 
$
(48
)






















The components of the net deferred tax assets (liabilities) as of December 31, 2014 and 2013 are as follows:

 
 
2014
 
2013
 
 
(dollars in millions)
Deferred Tax Assets:
 
 
 
 
Accrued payroll and related benefits
 
$
113

 
$
132

Deferred revenue
 
322

 
336

Unutilized tax net operating loss carry forwards
 
5,218

 
4,791

Fixed assets and intangible assets
 
90

 
102

Intercompany loss
 
128

 
139

Other
 
174

 
144

Total Deferred Tax Assets
 
6,045

 
5,644

Deferred Tax Liabilities:
 
 
 
 
Fixed assets and intangible assets
 
(1,371
)
 
(790
)
Deferred revenue
 
(73
)
 
(76
)
Other
 
(59
)
 
(33
)
Foreign branch income
 
(130
)
 
(163
)
Total Deferred Tax Liabilities
 
(1,633
)
 
(1,062
)
Net Deferred Tax Assets before valuation allowance
 
4,412

 
4,582

Valuation Allowance
 
(4,437
)
 
(4,698
)
Net Deferred Tax Liability after Valuation Allowance
 
$
(25
)
 
$
(116
)
Balance sheet classification of deferred taxes:
 
 
 
 
Net current deferred income tax asset
 
$
8

 
$
9

Net current deferred income tax liability
 
—

 
(2
)
Net non-current deferred income tax asset
 
292

 
211

Net non-current deferred income tax liability
 
(325
)
 
(334
)
Net Deferred Tax Liability after Valuation Allowance
 
$
(25
)
 
$
(116
)



On October 31, 2014, the Company completed its acquisition of tw telecom. The Merger qualified as a tax-free reorganization within the meaning of Section 368(a) of the Internal Revenue Code, and therefore the Company assumed the carryover tax basis of the acquired assets and liabilities of tw telecom. As a result, the Company recorded a net deferred tax liability of $15 million as the acquired deferred tax assets, net of valuation allowance, were offset by the deferred tax liabilities created by the additional financial reporting basis of the identifiable intangible assets. Simultaneously, the Company released $15 million of valuation allowance against its deferred tax assets as the acquired deferred tax liabilities serve as a source of taxable income to support such release. The final identification of tw telecom’s deferred taxes and the final determination of the purchase price allocation may be significantly different from the preliminary amounts reflected herein.

As of December 31, 2014, the Company had net operating loss carry forwards of approximately $10.3 billion (net of IRC Section 382 limitation) for U.S. federal income tax purposes, including $1 billion from the tw telecom acquisition. Although the tw telecom acquisition triggered an ownership change under Section 382 of the Internal Revenue Code, the Company has determined that its loss carryforwards should not be mathematically limited based on its value at the time of the ownership change and the expiration dates of its net operating losses.

The Company’s loss carry forwards expire in future years through 2034 and are subject to examination by the tax authorities until three years after the carry forwards are utilized. The U.S. federal tax loss carry forwards expire as follows (dollars in millions):

Expiring December 31,
Amount
2022
$
186

2023
380

2024
1,456

2025
1,299

2026
1,244

2027
1,615

2028
482

2029
694

2030
664

2031
827

2032
730

2033
289

2034
438

 
$
10,304



Under the rules prescribed by Internal Revenue Code Section 382 and applicable regulations, if certain transactions occur with respect to an entity's capital stock that result in a cumulative ownership shift of more than 50 percentage points by 5% stockholders over a three-year testing period, annual limitations are imposed with respect to the entity's ability to utilize its net operating loss carry forwards and certain current deductions against any taxable income the entity achieves in future periods. Level 3 extended the term of its Stockholder Rights Plan, which was adopted to protect its U.S. federal net operating loss carry forwards from these limitations. This plan was designed to deter trading that would result in a change of control (as defined in Section 382) without the limitations imposed by Section 382, and therefore protect the Company's ability to use its historical U.S. federal net operating loss carry forwards in the future.

As of December 31, 2014, the Company had state net operating loss carry forwards of approximately $7.9 billion that are subject to limitations on their utilization and have various expiration periods through 2034. The Company had approximately $6.1 billion of foreign jurisdiction net operating loss carry forwards that are subject to limitations on their utilization. The majority of these foreign jurisdiction tax loss carry forwards have no expiration period.

The Company recognizes deferred tax assets and liabilities for its domestic and non-U.S. operations, for operating loss and other credit carry forwards and the expected tax consequences of temporary differences between the tax basis of assets and liabilities and their reported amounts using enacted tax rates in effect for the year the differences are expected to reverse. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. This assessment requires judgment as to the likelihood and amounts of future taxable income by tax jurisdiction. To date, the Company has provided a valuation allowance to reduce the deferred tax assets of most of its businesses in North America and certain other jurisdictions to the amount that is more likely than not to be realized as it believes the objective evidence of its historical pretax net losses in those jurisdictions outweighs the positive evidence of its forecasted future results. However, in 2014, the Company released approximately $100 million of deferred tax valuation allowance primarily related to its business in the UK due to consolidation of legal entities whereby one UK entity with a full valuation allowance was merged with an entity that had no valuation allowance against its deferred tax assets.   As a result, management projects  future profitability of that business. Although the Company believes its estimates are reasonable, the ultimate determination of the appropriate amount of valuation allowance involves significant judgment.

The Company monitors its cumulative loss position and other evidence each quarter to determine the appropriateness of its valuation allowance. If the Company continues to generate income before taxes in future periods, the conclusion about the appropriateness of the valuation allowance could change in a future period, and the Company could record a substantial benefit in its consolidated statement of operations when that occurs.

The valuation allowance for deferred tax assets was approximately $4.4 billion as of December 31, 2014 and $4.7 billion as of December 31, 2013. The change in valuation allowance is primarily due to the income before taxes in the United States and a valuation allowance release in the United Kingdom. In making the determination to release the valuation allowance, the Company analyzed, among other things, the tax-paying entity’s recent history of earnings, its cumulative earnings for the last 12 quarters, and forecasts of future earnings.

The Company provides for U.S. income taxes on the undistributed earnings and the other outside basis temporary differences of foreign corporations unless they are considered indefinitely reinvested outside the United States. The amount of temporary differences related to undistributed earnings and other outside basis temporary differences of investments in foreign subsidiaries upon which U.S. income taxes have not been provided was immaterial.

The Company's liability for uncertain income tax positions totaled $17 million at December 31, 2014 and $13 million at December 31, 2013. If the remaining balance of unrecognized tax benefits were realized in a future period, it would result in a tax benefit of $14 million ($13 million as of December 31, 2013) and a reduction in the effective tax rate. The Company does not expect that the liability for uncertain tax positions will materially increase or decrease during the twelve months ended December 31, 2015. A reconciliation of the beginning and ending balance of unrecognized income tax benefits follows (dollars in millions):

 
Amount
Balance as of January 1, 2012
$
15

Gross increases - tax positions of prior years
4

Gross increases - tax positions during 2012
1

Gross decreases - lapse of statute of limitations
(1
)
Gross decreases - settlement with taxing authorities
(1
)
Balance as of December 31, 2012
18

Gross increases - tax positions of prior years
—

Gross increases - tax positions during 2013
1

Gross decreases - lapse of statute of limitations
(6
)
Gross decreases - settlement with taxing authorities
—

Balance as of December 31, 2013
13

Tax positions of prior years netted against deferred tax assets
5

Gross increases - tax positions of prior years
1

Gross increases - tax positions during 2014
—

Gross decreases - lapse of statute of limitations
(2
)
Gross decreases - settlement with taxing authorities
—

Balance as of December 31, 2014
$
17



The unrecognized tax benefits in the table above do not include accrued interest and penalties of $17 million, $18 million and $22 million as of December 31, 2014, 2013 and 2012, respectively. The Company's policy is to record interest and penalties related to uncertain tax positions in income tax expense. The Company recognized accrued interest and penalties related to uncertain tax positions in income tax expense in its Consolidated Statements of Operations of a benefit of approximately $1 million, a benefit of approximately $4 million and charges of approximately $3 million for the years ended December 31, 2014, 2013 and 2012, respectively.

The Company, or at least one of its subsidiaries, files income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2003. The Internal Revenue Service and state and local taxing authorities reserve the right to audit any period where net operating loss carry forwards are available.

Income Tax Expense/(Benefit) was ($76) million in 2014 compared to $38 million in 2013 and $48 million in 2012. Income tax (benefit) or expense in all periods is primarily related to taxes in foreign jurisdictions.

The Company incurs tax expense attributable to income in various subsidiaries that are required to file state or foreign income tax returns on a separate legal entity basis. The Company also recognizes accrued interest and penalties in income tax expense related to uncertain tax benefits. Our tax rate is volatile and may move up or down with changes in, among other things, the amount and source of income or loss, our ability to utilize foreign tax credits, changes in tax laws, and the movement of liabilities established for uncertain tax positions as statutes of limitations expire or positions are otherwise effectively settled.
Segment Information
Segment Information
Segment Information

Operating segments are defined under GAAP as components of an enterprise for which separate financial information is available and evaluated regularly by the Company's chief operating decision maker ("CODM") in deciding how to allocate resources and assess performance. The Company's CODM is Jeff K. Storey, President and Chief Executive Officer. Historically, Mr. Storey has monitored performance and allocated resources based on the three separate geographic regions in which the Company operates. Accordingly, the Company's reportable segments have consisted of 1) North America, 2) Europe, the Middle East and Africa (EMEA), 3) and Latin America. As a result of the Merger (see Note 2 - Events Associated with the Merger of tw telecom), Mr. Storey also monitors performance of the former tw telecom business. Therefore, the Company is now comprised of the following four reportable segments for financial reporting purposes until the tw telecom segment can be fully integrated into North America, 1) North America, 2) EMEA, 3) Latin America, 4) and tw telecom, which represents the standalone operations of the former tw telecom business. Other separate business interests that are not segments include interest, certain corporate assets and overhead costs, and certain other general and administrative costs that are not allocated to any of the operating segments. Historical presentation of segment information has been retrospectively reclassified to conform to the new geographical presentation.

The CODM measures and evaluates segment performance primarily based upon revenue, revenue growth and Adjusted EBITDA. Adjusted EBITDA, as defined by the Company, is equal to net income (loss) from the Consolidated Statements of Operations before (1) income tax benefit (expense), (2) total other income (expense), (3) non-cash impairment charges included within selling, general and administrative expenses and network related expenses, (4) depreciation and amortization expense, and (5) non-cash stock-based compensation expense included within selling, general and administrative expenses and network related expenses.

Adjusted EBITDA is not a measurement under GAAP and may not be used in the same way by other companies. Management believes that Adjusted EBITDA is an important part of the Company's internal reporting and is a key measure used by management to evaluate profitability and operating performance of the Company and to make resource allocation decisions. Management believes such measurement is especially important in a capital-intensive industry such as telecommunications. Management also uses Adjusted EBITDA to compare the Company's performance to that of its competitors and to eliminate certain non-cash and non-operating items in order to consistently measure from period to period its ability to fund capital expenditures, fund growth, service debt and determine bonuses.

Adjusted EBITDA excludes non-cash impairment charges and non-cash stock-based compensation expense because of the non-cash nature of these items. Adjusted EBITDA also excludes interest income, interest expense and income tax benefit (expense) because these items are associated with the Company's capitalization and tax structures. Adjusted EBITDA also excludes depreciation and amortization expense because these non-cash expenses reflect the effect of capital investments which management believes are better evaluated through cash flow measures. Adjusted EBITDA excludes net other income (expense) because these items are not related to the primary operations of the Company.

There are limitations to using non-GAAP financial measures such as Adjusted EBITDA, including the difficulty associated with comparing companies that use similar performance measures whose calculations may differ from the Company's calculations. Additionally, this financial measure does not include certain significant items such as interest income, interest expense, income tax benefit (expense), depreciation and amortization expense, non-cash impairment charges, non-cash stock-based compensation expense, and net other income (expense). Adjusted EBITDA should not be considered a substitute for other measures of financial performance reported in accordance with GAAP.

Revenue and the related expenses are attributed to regions based on where services are provided. Revenue and costs for services provided in more than one region are allocated equally between the regions, and the Company does not otherwise charge for services between reportable segments. Therefore, segment results do not include any intercompany revenue. The operating activities of the separate regions along with the activities that are not attributable to a segment are interdependent, and the regional results in the tables below do not include all intercompany charges and allocations that would be necessary to report the regional results on a standalone basis.

Total revenue consists of:

•
Core Network Services revenue from colocation and data center services; transport and fiber; IP and data services; and local and enterprise voice services.

•
Wholesale Voice Services and Other revenue from sales to other carriers of long distance voice services, revenue from managed modem and its related intercarrier compensation services and revenue from the SBC Master Services Agreement, which was obtained through an acquisition in 2005 (managed modem was discontinued after 2012).

Core Network Services revenue represents higher profit services and Wholesale Voice Services and Other revenue represents lower profit services. Core Network Services revenue requires different levels of investment and focus and provides different contributions to the Company's operating results than Wholesale Voice Services and Other revenue. Management of the Company believes that growth in revenue from its Core Network Services is critical to the long-term success of its business. The Company also believes it must continue to effectively manage the profitability of the Wholesale Voice Services component and the positive cash flows from the Other revenue component. The Company believes that trends in its communications business are best gauged by analyzing revenue changes in Core Network Services.

The following table presents revenue by segment for each of the years ended December 31,

(dollars in millions)
 
2014
 
2013
 
2012
Core Network Services Revenue:
 
 
 
 
 
 
North America
 
$
4,240

 
$
3,949

 
$
3,840

EMEA
 
891

 
888

 
911

Latin America
 
779

 
754

 
712

tw telecom
 
285

 
—

 
—

Total Core Network Services Revenue
 
$
6,195

 
$
5,591

 
$
5,463

 
 
 
 
 
 
 
Wholesale Voice Services and Other Revenue:
 
 
 
 
 
 
North America
 
$
530

 
$
681

 
$
863

EMEA
 
19

 
31

 
40

Latin America
 
33

 
10

 
10

Total Wholesale Voice Services and Other Revenue
 
$
582

 
$
722

 
$
913

 
 
 
 
 
 
 
Total Consolidated Revenue
 
$
6,777

 
$
6,313

 
$
6,376




The following table presents Adjusted EBITDA by segment and reconciles Adjusted EBITDA to net income (loss) for each of the years ended December 31,

(dollars in millions)
 
2014
 
2013
 
2012
Adjusted EBITDA:
 
 
 
 
 
 
North America
 
$
1,960

 
$
1,799

 
$
1,708

EMEA
 
214

 
226

 
195

Latin America
 
348

 
313

 
278

tw telecom
 
105

 
—

 
—

Unallocated Corporate Expenses
 
(732
)
 
(714
)
 
(722
)
Consolidated Adjusted EBITDA
 
$
1,895

 
$
1,624

 
$
1,459

Income Tax Benefit (Expense)
 
76

 
(38
)
 
(48
)
Total Other Expense
 
(775
)
 
(737
)
 
(949
)
Depreciation and Amortization
 
(808
)
 
(800
)
 
(749
)
Non-Cash Stock Compensation
 
(73
)
 
(151
)
 
(135
)
Non-Cash Impairment
 
(1
)
 
(7
)
 
—

Total Consolidated Net Income (Loss)
 
$
314

 
$
(109
)

$
(422
)


The following table presents capital expenditures by segment and reconciles capital expenditures to consolidated capital expenditures for each of the years ended December 31:

(dollars in millions)
 
2014
 
2013
 
2012
Capital Expenditures:
 
 
 
 
 
 
North America
 
$
432

 
$
398

 
$
407

EMEA
 
117

 
128

 
115

Latin America
 
153

 
134

 
122

tw telecom
 
63

 
—

 
—

Unallocated Corporate Capital Expenditures
 
145

 
100

 
99

Consolidated Capital Expenditures
 
$
910

 
$
760

 
$
743



The following table presents total assets by segment:

 
 
As of December 31,
(dollars in millions)
 
2014
 
2013
Assets:
 
 
 
 
North America
 
$
8,082

 
$
8,133

EMEA
 
1,970

 
2,030

Latin America
 
2,451

 
2,445

tw telecom
 
8,160

 
—

Other
 
284

 
266

Total Consolidated Assets
 
$
20,947

 
$
12,874

Commitments, Contingencies and Other Items
Commitments, Contingencies and Other Items
Commitments, Contingencies and Other Items

The Company is subject to various legal proceedings and other contingent liabilities that individually or in aggregate could materially affect its financial condition, future results of operations or cash flows. Amounts accrued for such contingencies aggregate to $171 million and are included in "Other" current liabilities and "Other liabilities" in the Company's Consolidated Balance Sheet at December 31, 2014. The establishment of an accrual does not mean that actual funds have been set aside to satisfy a given contingency. Thus, the resolution of a particular contingency for the amount accrued may have no effect on the Company's results of operations but could materially adversely affect its cash flows for the affected period.

In accordance with the accounting guidance for contingencies, the Company accrues its estimate of a contingent liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Where it is probable that a liability has been incurred and there is a range of expected loss for which no amount in the range is more likely than any other amount, the Company accrues at the low end of the range. The Company reviews its accruals at least quarterly and adjusts them to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular matter.

Below is a description of material legal proceedings and other contingencies pending at December 31, 2014. Although the Company believes it has accrued for these matters in accordance with the accounting guidance for contingencies, contingencies are inherently unpredictable and it is possible that results of operations or cash flows could be materially and adversely affected in any particular period by unfavorable developments in, or resolution or disposition of, one or more of these matters. For those contingencies in respect of which the Company believes that it is reasonably possible that a loss may result that is materially in excess of the accrual (if any) established for the matter, the Company has either provided an estimate of such possible loss or range of loss or included a statement that such an estimate cannot be made. In addition to the contingencies described below, the Company is party to many other legal proceedings and contingencies, the resolution of which is not expected to materially affect its financial condition or future results of operations beyond the amounts accrued.

Rights-of-Way Litigation

The Company is party to a number of purported class action lawsuits involving its right to install fiber optic cable network in railroad right-of-ways adjacent to plaintiffs' land. In general, the Company obtained the rights to construct its networks from railroads, utilities, and others, and has installed its networks along the rights-of-way so granted. Plaintiffs in the purported class actions assert that they are the owners of lands over which the fiber optic cable networks pass, and that the railroads, utilities, and others who granted the Company the right to construct and maintain its network did not have the legal authority to do so. The complaints seek damages on theories of trespass, unjust enrichment and slander of title and property, as well as punitive damages. The Company has also received, and may in the future receive, claims and demands related to rights-of-way issues similar to the issues in these cases that may be based on similar or different legal theories. The Company has defeated motions for class certification in a number of these actions but expects that, absent settlement of these actions, plaintiffs in the pending lawsuits will continue to seek certification of statewide or multi-state classes. The only lawsuit in which a class was certified against the Company, absent an agreed upon settlement, occurred in Koyle, et. al. v. Level 3 Communications, Inc., et. al., a purported two state class action filed in the United States District Court for the District of Idaho. The Koyle lawsuit has been dismissed pursuant to a settlement reached in November 2010 as described further below.

The Company negotiated a series of class settlements affecting all persons who own or owned land next to or near railroad rights of way in which it has installed its fiber optic cable networks. The United States District Court for the District of Massachusetts in Kingsborough v. Sprint Communications Co. L.P. granted preliminary approval of the proposed settlement; however, on September 10, 2009, the court denied a motion for final approval of the settlement on the basis that the court lacked subject matter jurisdiction and dismissed the case.

In November 2010, the Company negotiated revised settlement terms for a series of state class settlements affecting all persons who own or owned land next to or near railroad rights of way in which the Company has installed its fiber optic cable networks. The Company is currently pursuing presentment of the settlement in applicable jurisdictions. The settlements affecting current and former landowners have received final federal court approval in multiple states and the parties are engaged in the claims process for those states. The settlement has also been presented to federal courts in additional states and approval is pending.

Management believes that the Company has substantial defenses to the claims asserted in all of these actions and intends to defend them vigorously if a satisfactory settlement is not ultimately approved for all affected landowners.

Peruvian Tax Litigation

Beginning in 2005, one of the Company's Peruvian subsidiaries received a number of assessments for tax, penalties and interest for calendar years 2001 and 2002. Peruvian tax authorities ("SUNAT") took the position that the Peruvian subsidiary incorrectly documented its importations resulting in additional income tax withholding and value-added taxes ("VAT"). The total amount of the asserted claims, including potential interest and penalties, was $26 million, consisting of $3 million for income tax withholding in connection with the import of services for calendar years 2001 and 2002, $7 million for VAT in connection with the import of services for calendar years 2001 and 2002, and $16 million in connection with the disallowance of VAT credits for periods beginning in 2005. Due to accrued interest and foreign exchange effects, and taking into account the developments described below, the total amount of exposure is $55 million at December 31, 2014.

The Company challenged the tax assessments during 2005 by filing administrative claims before SUNAT. During August 2006 and June 2007, SUNAT rejected the Company's administrative claims, thereby confirming the assessments. Appeals were filed in September 2006 and July 2007 with the Tribunal Fiscal, the highest level of administrative review, which is not part of the Peru judiciary (the "Tribunal"). The 2001 and 2002 assessed withholding tax assessments were resolved in favor of the Company in separate administrative resolutions; however, the penalties with respect to withholding tax remain at issue in the administrative appeals.

In October 2011, the Tribunal issued its administrative resolution with respect to the calendar year 2002 tax period regarding VAT, associated penalties and penalties associated with withholding taxes, deciding the central issue underlying the assessments in the government's favor, while confirming the assessment in part and denying a portion of the assessment on procedural grounds. The Company appealed the Tribunal's October 2011 administrative resolutions to the judicial court in Peru. During the fourth quarter of 2013, the Company released a reserve of $28 million for tax, penalty and associated interest related to calendar year 2002 due to the expiration of the statute of limitations. In September 2014, the first judicial court rendered a decision largely in the Company’s favor on the central issue underlying the assessments. SUNAT has appealed the court’s decision to the next judicial level.

In October 2013, the Tribunal notified the Company of its July 2013 administrative resolution with respect to the calendar year 2001 tax period regarding VAT, associated penalties and penalties associated with withholding taxes, determining the central issue underlying the assessments in the government's favor, while confirming the assessment in part and denying a portion of the assessment on procedural grounds. The Company has appealed the Tribunal's July 2013 administrative resolutions to the judicial court in Peru.
In December 2013, SUNAT initiated an audit of calendar year 2001. In June 2014, the Company was served with SUNAT’s assessments of the 2001 amounts declared null by the Tribunal. In July 2014, the Company appealed these assessments with SUNAT.

Employee Severance and Contractor Termination Disputes

A number of former employees and third-party contractors have asserted a variety of claims in litigation against certain Latin American subsidiaries of the Company for separation pay, severance, commissions, pension benefits, unpaid vacation pay, breach of employment contracts, unpaid performance bonuses, property damages, moral damages and related statutory penalties, fines, costs and expenses (including accrued interest, attorneys fees and statutorily mandated inflation adjustments) as a result of their separation from the Company or termination of service relationships. The Company is vigorously defending itself against the asserted claims, which aggregate to approximately $44 million at December 31, 2014.

Brazilian Tax Claims

In December 2004, March 2009, April 2009 and July 2014, the São Paulo state tax authorities issued tax assessments against one of the Company's Brazilian subsidiaries for the Tax on Distribution of Goods and Services ("ICMS") with respect to revenue from leasing movable properties (in the case of the December 2004, March 2009 and July 2014 assessments) and revenue from the provision of Internet access services (in the case of the April 2009 and July 2014 assessments), by treating such activities as the provision of communications services, to which the ICMS tax applies. During the third quarter of 2014, the Company released a reserve of $6 million for tax, penalty and associated interest corresponding to the ICMS applicable on the provision of Internet access services due to the expiration of the statute of limitations for the January 2008 to June 2009 tax periods. In September 2002, July 2009 and May 2012, the Rio de Janeiro state tax authorities issued tax assessments to the same Brazilian subsidiary on similar issues. The Company has filed objections to these assessments, arguing that the lease of assets and the provision of Internet access are not communication services subject to ICMS. The objections to the September 2002, December 2004 and March 2009 assessments were rejected by the respective state administrative courts, and the Company has appealed those decisions to the judicial courts. In October 2012 and June 2014, the Company received favorable rulings from the lower court on the December 2004 and March 2009 assessments regarding equipment leasing, but those rulings are subject to appeal by the state. No ruling has been obtained with respect to the September 2002 assessment. The objections to the April and July 2009 and May 2012 assessments are still pending final administrative decisions. The July 2014 assessment was confirmed during the fourth quarter of 2014 at the first administrative level and the Company appealed this decision to the second administrative level. During the fourth quarter of 2014, the Company entered into an amnesty with the Rio de Janeiro state tax authorities with respect to potential ICMS liability for the 2008 tax period. As a result, the Company paid $5 million and released a reserve of $3 million of tax corresponding to the ICMS applicable on the provision of Internet access services.

The Company is vigorously contesting all such assessments in both states, and in particular, views the assessment of ICMS on revenue from leasing movable properties to be without merit. Nevertheless, the Company believes that it is reasonably possible that these assessments could result in a loss of up to $57 million at December 31, 2014 in excess of the accruals established for these matters.

Letters of Credit

It is customary for the Company to use various financial instruments in the normal course of business. These instruments include letters of credit. Letters of credit are conditional commitments issued on behalf of the Company in accordance with specified terms and conditions. As of December 31, 2014 and December 31, 2013, the Company had outstanding letters of credit or other similar obligations of approximately $28 million and $29 million, respectively, of which $23 million and $25 million, are collateralized by cash, that is reflected on the Consolidated Balance Sheets as restricted cash. The Company does not believe exposure to loss related to its letters of credit is material.

Operating Leases

The Company is leasing rights-of-way, facilities and other assets under various operating leases which, in addition to rental payments, may require payments for insurance, maintenance, property taxes and other executory costs related to the lease. Certain leases provide for adjustments in lease cost based upon adjustments in various price indexes and increases in the landlord's management costs.

The right-of-way agreements have various expiration dates through 2050. Payments under these right-of-way agreements were $173 million in 2014, $161 million in 2013 and $172 million in 2012.

The Company has obligations under non-cancelable operating leases for certain colocation, office facilities and other assets, including lease obligations for which facility related restructuring charges have been recorded. The lease agreements have various expiration dates through 2119. Rent expense, including common area maintenance, under non-cancelable lease agreements was $318 million in 2014, $311 million in 2013 and $308 million in 2012.

Certain non-cancelable right of way agreements provide for automatic renewal on a periodic basis. The Company includes payments due during these automatic renewal periods given the significant cost to relocate the Company's network and other facilities.

Future minimum payments for the next five years and thereafter under network and related right-of-way agreements and non-cancelable operating leases for facilities and other assets consist of the following as of December 31, 2014 (dollars in millions):

 
 
Right-of-Way
Agreements
 
Facilities and Other Assets
 
Total
 
Future Minimum Sublease Receipts
2015
 
$
118

 
$
302

 
$
420

 
$
5

2016
 
58

 
244

 
302

 
4

2017
 
53

 
207

 
260

 
4

2018
 
51

 
174

 
225

 
1

2019
 
42

 
142

 
184

 
1

Thereafter
 
315

 
655

 
970

 
—

 
 
$
637

 
$
1,724

 
$
2,361

 
$
15



Certain right-of-way agreements include provisions for increases in payments in future periods based on the rate of inflation as measured by various price indexes. The Company has not included estimates for these increases in future periods in the amounts included above.

Certain other right-of-way agreements are cancelable or can be terminated under certain conditions by the Company. The Company includes the payments under such cancelable right-of-way agreements in the table above for a period of 1 year from January 1, 2015, if the Company does not consider it likely that it will cancel the right of way agreement within the next year.

Cost of Access and Third-Party Maintenance

In addition, the Company has purchase commitments with third-party access vendors that require it to make payments to purchase network services, capacity and telecommunications equipment. Some of these access vendor commitments require the Company to maintain minimum monthly and/or annual billings, in certain cases based on usage. In addition, the Company has purchase commitments with third parties that require it to make payments for maintenance services for certain portions of its network.

The following table summarizes the Company's purchase commitments at December 31, 2014 (dollars in millions):

 
 
Total
 
Less than
1 Year
 
2 - 3
Years
 
4 - 5
Years
 
After 5
Years
Cost of Access Services
 
$
710

 
$
378

 
$
262

 
$
51

 
$
19

Third-Party Maintenance Services
 
329

 
67

 
55

 
51

 
156

 
 
$
1,039

 
$
445

 
$
317

 
$
102

 
$
175

Condensed Consolidating Financial Information
Condensed Consolidating Financial Information
Condensed Consolidating Financial Information (as revised)

Level 3 Financing has issued Senior Notes that are unsecured obligations of Level 3 Financing, Inc.; however, they are also fully and unconditionally and jointly and severally guaranteed on an unsecured senior basis by Level 3 Communications, Inc. and Level 3 Communications, LLC.

In conjunction with the registration of the Level 3 Financing, Inc. Senior Notes, the accompanying condensed consolidating financial information has been prepared and presented pursuant to SEC Regulation S-X Rule 3-10 "Financial statements of guarantors and affiliates whose securities collateralize an issue registered or being registered."

The operating activities of the separate legal entities included in the Company’s Consolidated Financial Statements are interdependent. The accompanying condensed consolidating financial information presents the statements of operations, balance sheets and statements of cash flows of each legal entity and, on an aggregate basis, the other non-guarantor subsidiaries based on amounts incurred by such entities, and is not intended to present the operating results of those legal entities on a stand-alone basis. Level 3 Communications, LLC leases equipment and certain facilities from other wholly owned subsidiaries of Level 3 Communications, Inc. These transactions are eliminated in the consolidated results of the Company.
Condensed Consolidating Statements of Operations
For the year ended December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Revenue
$
—

 
$
—

 
$
3,073

 
$
3,918

 
$
(214
)
 
$
6,777

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
1,177

 
1,566

 
(214
)
 
2,529

Network Related Expenses
—

 
—

 
762

 
484

 
—

 
1,246

Depreciation and Amortization
—

 
—

 
277

 
531

 
—

 
808

Selling, General and Administrative Expenses
21

 
2

 
735

 
423

 
—

 
1,181

Total Costs and Expenses
21

 
2

 
2,951

 
3,004

 
(214
)
 
5,764

Operating Income (Loss)
(21
)
 
(2
)
 
122

 
914

 
—

 
1,013

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(143
)
 
(492
)
 
(2
)
 
(17
)
 
—

 
(654
)
Interest income (expense) affiliates, net
1,227

 
1,827

 
(2,890
)
 
(164
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(710
)
 
(2,047
)
 
663

 
—

 
2,094

 
—

Other, net
(53
)
 
—

 
7

 
(76
)
 
—

 
(122
)
Total Other Expense
321

 
(712
)
 
(2,222
)
 
(256
)
 
2,094

 
(775
)
Income (Loss) before Income Taxes
300

 
(714
)
 
(2,100
)
 
658

 
2,094

 
238

Income Tax Expense
14

 
4

 
(1
)
 
59

 
—

 
76

Net Income (Loss)
314

 
(710
)
 
(2,101
)
 
717

 
2,094

 
314

Other Comprehensive Loss, Net of Income Taxes
(183
)
 
—

 
—

 
(183
)
 
183

 
(183
)
Comprehensive Income (Loss)
$
131

 
$
(710
)
 
$
(2,101
)
 
$
534

 
$
2,277

 
$
131



Condensed Consolidating Statements of Operations
For the year ended December 31, 2013 (as revised)

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,825

 
$
3,734

 
$
(246
)
 
$
6,313

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
1,068

 
1,649

 
(246
)
 
2,471

Network Related Expenses
—

 
—

 
753

 
461

 
—

 
1,214

Depreciation and Amortization
—

 
—

 
289

 
511

 
—

 
800

Selling, General and Administrative Expenses
3

 
1

 
791

 
367

 
—

 
1,162

Total Costs and Expenses
3

 
1

 
2,901

 
2,988

 
(246
)
 
5,647

Operating Income (Loss)
(3
)
 
(1
)
 
(76
)
 
746

 
—

 
666

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
—

 
—

 
—

Interest expense
(151
)
 
(497
)
 
(3
)
 
2

 
—

 
(649
)
Interest income (expense) affiliates, net
1,091

 
1,706

 
(2,679
)
 
(118
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(1,039
)
 
(2,164
)
 
550

 
—

 
2,653

 
—

Other, net
—

 
(85
)
 
4

 
(7
)
 
—

 
(88
)
Total Other Expense
(99
)
 
(1,040
)
 
(2,128
)
 
(123
)
 
2,653

 
(737
)
Income (Loss) before Income Taxes
(102
)
 
(1,041
)
 
(2,204
)
 
623

 
2,653

 
(71
)
Income Tax Expense
(7
)
 
2

 
—

 
(33
)
 
—

 
(38
)
Net Income (Loss)
(109
)
 
(1,039
)
 
(2,204
)
 
590

 
2,653

 
(109
)
Other Comprehensive Income, Net of Income Taxes
10

 
10

 
—

 
10

 
(20
)
 
10

Comprehensive Income (Loss)
$
(99
)
 
$
(1,029
)
 
$
(2,204
)
 
$
600

 
$
2,633

 
$
(99
)
Condensed Consolidating Statements of Operations
For the year ended December 31, 2012 (as revised)

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,657

 
$
3,975

 
$
(256
)
 
$
6,376

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
996

 
1,854

 
(248
)
 
2,602

Network Related Expenses
—

 
—

 
741

 
508

 
—

 
1,249

Depreciation and Amortization
—

 
—

 
260

 
489

 
—

 
749

Selling, General and Administrative Expenses
2

 
1

 
818

 
388

 
(8
)
 
1,201

Total Costs and Expenses
2

 
1

 
2,815

 
3,239

 
(256
)
 
5,801

Operating Income (Loss)
(2
)
 
(1
)
 
(158
)
 
736

 
—

 
575

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
1

 
1

 
—

 
2

Interest expense
(168
)
 
(535
)
 
(3
)
 
(27
)
 
—

 
(733
)
Interest income (expense) affiliates, net
976

 
1,598

 
(2,233
)
 
(341
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(1,188
)
 
(2,066
)
 
92

 
—

 
3,162

 
—

Other, net
(39
)
 
(184
)
 
6

 
(1
)
 
—

 
(218
)
Total Other Expense
(419
)
 
(1,187
)
 
(2,137
)
 
(368
)
 
3,162

 
(949
)
Income (Loss) before Income Taxes
(421
)
 
(1,188
)
 
(2,295
)
 
368

 
3,162

 
(374
)
Income Tax Expense
(1
)
 
—

 
(4
)
 
(43
)
 
—

 
(48
)
Net Income (Loss)
(422
)
 
(1,188
)
 
(2,299
)
 
325

 
3,162

 
(422
)
Other Comprehensive Income (Loss), Net of Income Taxes
106

 
106

 
—

 
16

 
(122
)
 
106

Comprehensive Income (Loss)
$
(316
)
 
$
(1,082
)
 
$
(2,299
)
 
$
341

 
$
3,040

 
$
(316
)
Condensed Consolidating Balance Sheets
December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
7

 
$
5

 
$
307

 
$
261

 
$
—

 
$
580

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
34

 
703

 
—

 
737

Due from affiliates
14,522

 
21,270

 
—

 
—

 
(35,792
)
 
—

Other
2

 
21

 
45

 
97

 
—

 
165

Total Current Assets
14,531

 
21,296

 
387

 
1,067

 
(35,792
)
 
1,489

Property, plant, and equipment, net
—

 
—

 
3,152

 
6,708

 
—

 
9,860

Restricted cash and securities
3

 
—

 
16

 
1

 
—

 
20

Goodwill and other intangibles, net
—

 
—

 
373

 
8,730

 
—

 
9,103

Investment in subsidiaries
16,686

 
14,777

 
3,729

 
—

 
(35,192
)
 
—

Other assets, net
28

 
129

 
9

 
309

 
—

 
475

Total Assets
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
—

 
$
215

 
$
449

 
$
—

 
$
664

Current portion of long-term debt
333

 
—

 
3

 
13

 
—

 
349

Accrued payroll and employee benefits
—

 
—

 
174

 
99

 
—

 
273

Accrued interest
12

 
158

 
—

 
4

 
—

 
174

Current portion of deferred revenue
—

 
—

 
118

 
169

 
—

 
287

Due to affiliates
—

 
—

 
34,401

 
1,391

 
(35,792
)
 
—

Other
—

 
2

 
62

 
103

 
—

 
167

Total Current Liabilities
345

 
160

 
34,973

 
2,228

 
(35,792
)
 
1,914

Long-term debt, less current portion
900

 
9,893

 
16

 
175

 
—

 
10,984

Deferred revenue, less current portion
—

 
—

 
617

 
304

 
—

 
921

Other liabilities
16

 
24

 
125

 
600

 
—

 
765

Commitments and Contingencies
 
 
 
 
 
 
 
 
 
 
 
Stockholders' Equity (Deficit)
29,987

 
26,125

 
(28,065
)
 
13,508

 
(35,192
)
 
6,363

Total Liabilities and Stockholders' Equity (Deficit)
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

Condensed Consolidating Balance Sheets
December 31, 2013

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
8

 
$
6

 
$
347

 
$
270

 
$
—

 
$
631

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
79

 
594

 
—

 
673

Due from affiliates
15,507

 
16,886

 
—

 
—

 
(32,393
)
 
—

Other
2

 
15

 
47

 
79

 
—

 
143

Total Current Assets
15,517

 
16,907

 
474

 
949

 
(32,393
)
 
1,454

Property, plant, and equipment, net
—

 
—

 
3,028

 
5,212

 
—

 
8,240

Restricted cash and securities
3

 
—

 
18

 
2

 
—

 
23

Goodwill and other intangibles, net
—

 
—

 
395

 
2,387

 
—

 
2,782

Investment in subsidiaries
10,039

 
27,014

 
3,735

 
—

 
(40,788
)
 
—

Other assets, net
10

 
113

 
11

 
241

 
—

 
375

Total Assets
$
25,569

 
$
44,034

 
$
7,661

 
$
8,791

 
$
(73,181
)
 
$
12,874

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
2

 
$
42

 
$
581

 
$
—

 
$
625

Current portion of long-term debt
—

 
—

 
3

 
28

 
—

 
31

Accrued payroll and employee benefits
—

 
—

 
171

 
38

 
—

 
209

Accrued interest
30

 
129

 
—

 
1

 
—

 
160

Current portion of deferred revenue
—

 
—

 
131

 
122

 
—

 
253

Due to affiliates
—

 
—

 
32,165

 
228

 
(32,393
)
 
—

Other
—

 
13

 
74

 
81

 
—

 
168

Total Current Liabilities
30

 
144

 
32,586

 
1,079

 
(32,393
)
 
1,446

Long-term debt, less current portion
1,370

 
6,905

 
17

 
39

 
—

 
8,331

Deferred revenue, less current portion
—

 
—

 
603

 
303

 
—

 
906

Other liabilities
15

 
27

 
135

 
603

 
—

 
780

Commitments and Contingencies
 
 
 
 
 
 
 
 
 
 
 
Stockholders' Equity (Deficit)
24,154

 
36,958

 
(25,680
)
 
6,767

 
(40,788
)
 
1,411

Total Liabilities and Stockholders' Equity (Deficit)
$
25,569

 
$
44,034

 
$
7,661

 
$
8,791

 
$
(73,181
)
 
$
12,874

Condensed Consolidating Statements of Cash Flows
For the year ended December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(178
)
 
$
(458
)
 
$
625

 
$
1,172

 
$
—

 
$
1,161

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures
—

 
—

 
(362
)
 
(548
)
 
—

 
(910
)
Change in restricted cash and securities, net
—

 
—

 
2

 
(12
)
 
—

 
(10
)
Proceeds from sale of property, plant and equipment and other assets
—

 
—

 
—

 
3

 
—

 
3

Investment in tw telecom, net of cash acquired
(474
)
 
—

 
—

 
307

 
—

 
(167
)
Other
—

 
—

 
—

 
(2
)
 
—

 
(2
)
Net Cash Provided by (Used in) Investing Activities
(474
)
 
—

 
(360
)
 
(252
)
 
—

 
(1,086
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
590

 
—

 
—

 
(1
)
 
—

 
589

Payments on and repurchases of long-term debt, including current portion and refinancing costs
(647
)
 
—

 
—

 
(24
)
 
—

 
(671
)
Increase (decrease) due from/to affiliates, net
708

 
457

 
(305
)
 
(860
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
651

 
457

 
(305
)
 
(885
)
 
—

 
(82
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(44
)
 
—

 
(44
)
Net Change in Cash and Cash Equivalents
(1
)
 
(1
)
 
(40
)
 
(9
)
 
—

 
(51
)
Cash and Cash Equivalents at Beginning of Year
8

 
6

 
347

 
270

 
—

 
631

Cash and Cash Equivalents at End of Year
$
7

 
$
5

 
$
307

 
$
261

 
$
—

 
$
580


Condensed Consolidating Statements of Cash Flows
For the year ended December 31, 2013

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(169
)
 
$
(557
)
 
$
710

 
$
729

 
$
—

 
$
713

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures
—

 
—

 
(312
)
 
(448
)
 
—

 
(760
)
Change in restricted cash and securities, net
9

 
—

 
(1
)
 
5

 
—

 
13

Other
—

 
—

 
1

 
1

 
—

 
2

Net Cash Provided by (Used in) Investing Activities
9

 
—

 
(312
)
 
(442
)
 
—

 
(745
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
—

 
1,502

 
—

 
—

 
—

 
1,502

Payments on and repurchases of long-term debt, including current portion and refinancing costs
(173
)
 
(1,586
)
 
(4
)
 
(33
)
 
—

 
(1,796
)
Increase (decrease) due from/to affiliates, net
88

 
642

 
(433
)
 
(297
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
(85
)
 
558

 
(437
)
 
(330
)
 
—

 
(294
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(22
)
 
—

 
(22
)
Net Change in Cash and Cash Equivalents
(245
)
 
1

 
(39
)
 
(65
)
 
—

 
(348
)
Cash and Cash Equivalents at Beginning of Year
253

 
5

 
386

 
335

 
—

 
979

Cash and Cash Equivalents at End of Year
$
8

 
$
6

 
$
347

 
$
270

 
$
—

 
$
631

Condensed Consolidating Statements of Cash Flows
For the year ended December 31, 2012

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities of Continuing Operations
$
(165
)
 
$
(520
)
 
$
140

 
$
1,123

 
$
—

 
$
578

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures
—

 
—

 
(276
)
 
(467
)
 
—

 
(743
)
Change in restricted cash and securities, net
6

 
—

 
2

 
12

 
—

 
20

Other
—

 
—

 
—

 
(2
)
 
—

 
(2
)
Net Cash Used in Investing Activities of Continuing Operations
6

 
—

 
(274
)
 
(457
)
 
—

 
(725
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
293

 
4,211

 
—

 
—

 
—

 
4,504

Payments on and repurchases of long-term debt, including current portion and refinancing costs
—

 
(4,161
)
 
—

 
(141
)
 
—

 
(4,302
)
Proceeds from stock options exercised
5

 
—

 
—

 
—

 
—

 
5

Increase (decrease) due from affiliates, net
112

 
469

 
(98
)
 
(483
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities of Continuing Operations
410

 
519

 
(98
)
 
(624
)
 
—

 
207

Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
1

 
—

 
1

Net Change in Cash and Cash Equivalents
251

 
(1
)
 
(232
)
 
43

 
—

 
61

Cash and Cash Equivalents at Beginning of Year
2

 
6

 
618

 
292

 
—

 
918

Cash and Cash Equivalents at End of Year
$
253

 
$
5

 
$
386

 
$
335

 
$
—

 
$
979

Unaudited Quarterly Financial Data
Unaudited Quarterly Financial Data
Unaudited Quarterly Financial Data (as revised)
 
 
Three Months Ended
 
 
March 31,
 
June 30,
 
September 30,
 
December 31,
 
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
 
(as revised)
 
(as revised)
 
 
 
(as revised)
 
 
 
(as revised)
(dollars in millions except per share data)
Revenue
 
$
1,609

 
$
1,577

 
$
1,625

 
$
1,565

 
$
1,629

 
$
1,569

 
$
1,914

 
$
1,602

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
 
614

 
629

 
613

 
616

 
607

 
608

 
695

 
618

Network Related Expenses
 
292

 
302

 
302

 
300

 
307

 
314

 
345

 
298

Depreciation and Amortization
 
184

 
194

 
187

 
199

 
187

 
203

 
250

 
204

Selling, General and Administrative Expenses
 
255

 
297

 
267

 
310

 
266

 
292

 
393

 
263

Total Costs and Expenses
 
1,345

 
1,422

 
1,369

 
1,425

 
1,367

 
1,417

 
1,683

 
1,383

Operating Income
 
264

 
155

 
256

 
140

 
262

 
152

 
231

 
219

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Income
 
—

 
—

 
—

 
—

 
1

 
—

 
—

 
—

Interest expense
 
(151
)
 
(169
)
 
(149
)
 
(167
)
 
(159
)
 
(165
)
 
(195
)
 
(148
)
Gain (Loss) on extinguishments of debt, net
 
—

 
—

 
—

 
—

 
—

 
(17
)
 
(53
)
 
(67
)
Other, net
 
6

 
(50
)
 
(44
)
 
14

 
(11
)
 
23

 
(20
)
 
9

Total Other Expense
 
(145
)
 
(219
)
 
(193
)
 
(153
)
 
(169
)
 
(159
)
 
(268
)
 
(206
)
Income (Loss) Before Income Taxes
 
119

 
(64
)
 
63

 
(13
)
 
93

 
(7
)
 
(37
)
 
13

Income Tax (Expense) Benefit
 
(7
)
 
(14
)
 
(12
)
 
(11
)
 
(8
)
 
(14
)
 
103

 
1

Net Income (Loss)
 
$
112

 
$
(78
)
 
$
51

 
$
(24
)
 
$
85

 
$
(21
)
 
$
66

 
$
14

Net Income (Loss) Per Share - Basic
 
$
0.48

 
$
(0.36
)
 
$
0.21

 
$
(0.11
)
 
$
0.36

 
$
(0.09
)
 
$
0.22

 
$
0.06

Net Income (Loss) Per Share - Diluted
 
$
0.47

 
$
(0.36
)
 
$
0.21

 
$
(0.11
)
 
$
0.35

 
$
(0.09
)
 
$
0.21

 
$
0.06



Net income (loss) per share for each quarter is computed using the weighted-average number of shares outstanding during that quarter, while net income (loss) per share for the year is computed using the weighted-average number of shares outstanding during the year. Thus, the sum of the income (loss) per share for each of the four quarters may not equal the net income (loss) per share for the year.

During the fourth quarter of 2014, the Company recognized a loss on extinguishment of debt of $53 million, related to the refinancing of the 11.875% Senior Notes due 2019.

During the fourth quarter of 2014, the Company completed its acquisition of tw telecom and therefore the results of operations for the fourth quarter of 2014 include the results of tw telecom for November and December. Additionally, the Company incurred $70 million in expenses related to the acquisition of tw telecom.

During the fourth quarter of 2014, the Company increased its senior secured credit facility by adding a $2 billion Tranche B 2022 Term Loan. The proceeds were used for the tw telecom acquisition.

During the fourth quarter of 2014, the Company also recognized a $100 million income tax benefit primarily related to the release of a foreign deferred tax valuation allowance.

During the third quarter of 2014, the Company entered into an indenture totaling $1 billion for 5.375% Senior Notes due 2022. The proceeds were used for the tw telecom acquisition.

During the second quarter of 2014. the Company recognized a loss of approximately $34 million resulting from the devaluation of Venezuelan bolivar denominated monetary assets and liabilities from the official rate of 6.3 to the SICAD 1 rate of 10.6.

During the fourth quarter of 2013, the Company recognized a loss on extinguishment of debt of $67 million including $10 million related to the refinancing of the Tranche B-II 2019 Term Loan, $56 million related to the refinancing of the 10% Senior Notes due 2018 and $1 million related to the refinancing of the Floating Rate Senior Notes due 2015.

During the third quarter of 2013, the Company recognized a loss on extinguishment of debt of $17 million, related to the refinancing of the $596 million Tranche B 2016 and the $815 million Tranche B 2019 Term Loans.

During the first quarter of 2013, the Venezuelan government devalued the Venezuelan bolivar by increasing the official rate from 4.30 Venezuelan bolivares to the U.S. dollar to 6.30 Venezuelan bolivares to the U.S. dollar. The devaluation of the Company's net monetary assets resulted in a charge of $22 million.
Subsequent Events
Subsequent Events [Text Block]
Subsequent Events

On January 29, 2015, Level 3 Financing issued $500 million aggregate principal amount of its 5.625% Senior Notes due 2023. The 5.625% Senior Notes were priced at par and mature February 1, 2023. The 5.625% Senior Notes will pay interest on June 15 and December 15 of each year beginning on June 15, 2015.

The net proceeds from the offering of the 5.625% Senior Notes due 2023 together with cash on hand, will be used to redeem all $500 million aggregate principal amount of Level 3 Financing, Inc.’s 9.375% Senior Notes due 2019. In the second quarter 2015, the Company expects to recognize a loss of approximately $40 million on the extinguishment of debt associated with this transaction that will be recognized in Other Expense.
Organization and Summary of Significant Accounting Policies (Policies)
Restatement of Previously Issued Financial Statements [Policy Text Block] 
(dollars in millions)
As Previously Reported
Adjustment
Revised Reporting (1)
Year Ended December 31, 2013
 
 
 
Cost of Revenue
$
2,471

$
(2,471
)
$
—

Network Access Costs
—

2,471

2,471

Network Related Expenses
—

1,214

1,214

Selling, General and Administrative Expenses
2,376

(1,214
)
1,162

Total Costs and Expenses
5,647

—

5,647

 
 
 
 
Year Ended December 31, 2012
 
 
 
Cost of Revenue
2,602

(2,602
)
—

Network Access Costs
—

2,602

2,602

Network Related Expenses
—

1,249

1,249

Selling, General and Administrative Expenses
2,450

(1,249
)
1,201

Total Costs and Expenses
5,801

—

5,801


(1) The description of "Cost of Revenue" has been changed to "Network Access Costs" and the
presentation of "Network Related Expenses" has been disaggregated from "Selling, General and
Administrative Expenses" in the Consolidated Statements of Operations for the years ended December 31, 2013 and 2012.

As a result of the above, the Company also revised the Condensed Consolidating Statements of Operations for the years ended December 31, 2013 and 2012 in Note 17 Condensed Consolidating Financial Information, and the presentation for all periods within 2013 and 2012 included in Note 18 Unaudited Quarterly Financial Data.
Principles of Consolidation and Basis of Presentation 
Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of Level 3 Communications, Inc. and subsidiaries in which it has a controlling interest. All significant intercompany accounts and transactions have been eliminated. The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP").

As part of its consolidation policy, the Company considers its controlled subsidiaries, investments in businesses in which the Company is not the primary beneficiary or does not have effective control but has the ability to significantly influence operating and financial policies, and variable interests resulting from economic arrangements that give the Company rights to economic risks or rewards of a legal entity. The Company does not have variable interests in a variable interest entity where it is required to consolidate the entity as the primary beneficiary or where it has concluded it is not the primary beneficiary.
Foreign Currency Translation 
Foreign Currency Translation

Local currencies of foreign subsidiaries are the functional currencies for financial reporting purposes except for certain foreign subsidiaries in Latin America. For operations outside the United States that have functional currencies other than the U.S. dollar, assets and liabilities are translated to U.S. dollars at period-end exchange rates, and revenue, expenses and cash flows are translated using average exchange rates prevailing during the year. A significant portion of the Company's non-United States subsidiaries have either the British pound, the euro or the Brazilian real as the functional currency, each of which experienced significant fluctuations against the U.S. dollar during 2014, 2013 and 2012. Foreign currency translation gains and losses are recognized as a component of accumulated other comprehensive income (loss) in stockholders' equity and in the Consolidated Statements of Comprehensive Income (Loss) in accordance with accounting guidance for foreign currency translation. The Company considers the majority of its investments in its foreign subsidiaries to be long-term in nature. The Company's non-United States exchange transaction gains (losses), including where transactions with its non-United States subsidiaries are not considered to be long-term in nature, are included within other income (expense) in Other, net on the Consolidated Statements of Operations.
Reclassifications 
Reclassifications

Certain amounts in the prior year Consolidated Financial Statements and accompanying footnotes have been reclassified to conform to the current year's presentation.
Use of Estimates 
Use of Estimates

The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. The accounting estimates that require management's judgments include revenue recognition, revenue reserves, network access costs, network access cost dispute reserves, determination of the useful lives of long-lived assets, measurement and recognition of stock-based compensation expense, valuation of long-lived assets, goodwill and acquired indefinite-lived intangible assets for purposes of impairment testing, valuation of asset retirement obligations, allowance for doubtful accounts, measurement of the fair value of assets acquired and liabilities assumed in business combinations, accruals for estimated tax and legal liabilities, and valuation allowance for deferred tax assets. Actual results could differ from these estimates under different assumptions or conditions and such differences could be material.
Revenue and Cost of Revenue for Communications Services 

Revenue

Revenue is recognized monthly as the services are provided based on contractual amounts expected to be collected. Management establishes appropriate revenue reserves at the time services are rendered based on an analysis of historical credit activity to address, where significant, situations in which collection is not reasonably assured as a result of credit risk, potential billing disputes or other reasons. Actual results may differ from these estimates under different assumptions or conditions and these differences could be material.

Intercarrier compensation revenue is recognized when an interconnection agreement is in place with another carrier, or if an agreement has expired, when the parties have agreed to continue operating under the previous agreement until a new agreement is negotiated and executed, or at rates mandated by the Federal Communications Commission (the "FCC").

For certain sale and long-term indefeasible right of use, or IRU, contracts involving private line, wavelengths and dark fiber services, the Company may receive upfront payments for services to be delivered for a period of up to 25 years. In these situations, the Company defers the revenue and amortizes it on a straight-line basis to earnings over the term of the contract.

Termination revenue is recognized when a customer discontinues service prior to the end of the contract period for which Level 3 had previously received consideration and for which revenue recognition was deferred. Termination revenue also is recognized when customers are required to make termination penalty payments to Level 3 to settle contractually committed purchase amounts that the customer no longer expects to meet or when a customer and Level 3 renegotiate a contract under which Level 3 is no longer obligated to provide services for consideration previously received and for which revenue recognition has been deferred.

The Company is obligated under dark fiber IRUs and other capacity agreements to maintain its network in efficient working order and in accordance with industry standards. Customers are obligated for the term of the agreement to pay for their allocable share of the costs for operating and maintaining the network. The Company recognizes this revenue monthly as services are provided.

Level 3's customer contracts require the Company to meet certain service level commitments. If Level 3 does not meet the required service levels, it may be obligated to provide credits, usually in the form of free service, for a short period of time. The credits are a reduction to revenue and, to date, have not been material.

Network Access Costs

Network Access Costs for the communications business include leased capacity, right-of-way costs, access charges, satellite transponder lease costs and other third party costs directly attributable to providing access to customer locations from the Level 3 network, but excludes Network Related Expenses, and depreciation and amortization. Network Access Costs do not include any employee expenses or impairment expenses; these expenses are allocated to Network Related Expenses or Selling, General and Administrative Expenses.

The Company recognizes the network access costs as they are incurred in accordance with contractual requirements. The Company disputes incorrect billings from its suppliers of network services. The most prevalent types of disputes include disputes for circuits that are not disconnected by the supplier on a timely basis and usage bills with incorrect or inadequate information. Depending on the type and complexity of the issues involved, it may and often does take several quarters to resolve the disputes. The Company establishes appropriate network access costs reserves for disputed supplier billings based on an analysis of historical experience in resolving disputes with its suppliers.

In determining the amount of the network access costs and related accrued liabilities to reflect in its Consolidated Financial Statements, the Company considers the adequacy of documentation of disconnect notices, compliance with prevailing contractual requirements for submitting these disconnect notices and disputes to the provider of the network services, and compliance with its interconnection agreements with these carriers. Judgment is required in estimating the ultimate outcome of the dispute resolution process, as well as any other amounts that may be incurred to conclude the negotiations or settle any litigation. Actual results may differ from these estimates under different assumptions or conditions and these differences could be material.
Selling, General and Administrative Expenses, Policy [Policy Text Block] 
Network Related Expenses

Network Related Expenses includes certain expenses associated with the delivery of services to customers and the operation and maintenance of the Level 3 network, such as facility rent, utilities, maintenance and other costs, each related to the operation of its communications network, as well as salaries, wages and related benefits (including non-cash stock-based compensation expenses) associated with personnel who are responsible for the delivery of services, operation and maintenance of its communications network, and accretion expense on asset retirement obligations, but excludes depreciation and amortization.

Selling, General and Administrative Expenses

Selling, General and Administrative Expenses
USF and Gross Receipts Taxes 
USF and Gross Receipts Taxes

The revenue recognition standards include guidance relating to any tax assessed by a governmental authority that is directly imposed on a revenue-producing transaction between a seller and a customer and may include, but is not limited to, gross receipts taxes and certain state regulatory fees. The Company records Universal Service Fund ("USF") contributions where the Company is the primary obligor for the taxes assessed in each jurisdiction where it does business on a gross basis in its Consolidated Statements of Operations, but generally records gross receipts taxes and certain state regulatory fees billed to its customers on a net basis in its Consolidated Statements of Operations. Total revenue and network access cost on the Consolidated Statements of Operations includes USF contributions totaling $234 million, $194 million and $191 million for the years ended December 31, 2014, 2013 and 2012, respectively.
Share-Based Compensation 
Stock-Based Compensation

The Company recognizes the estimated fair value of stock-based compensation costs, net of an estimated forfeiture rate, over the requisite service period of the award, which is generally the vesting term or term for restrictions on transfer that lapse, as the case may be. The Company funded a portion of its 2013 and 2012 discretionary bonus in restricted stock unit awards that vested upon issuance. The Company estimates forfeiture rates based on its historical experience for the type of award, adjusted for expected activities as necessary.
Income Taxes 
Income Taxes

Cash and Cash Equivalents 
Cash and Cash Equivalents

The Company classifies investments as cash equivalents if they are readily convertible to cash and have original maturities of three months or less at the time of acquisition. Cash and cash equivalents consist primarily of highly liquid investments in government and government agency securities and money market funds issued or managed by financial institutions in the U.S., Europe and Latin America and commercial paper depending on liquidity requirements. As of December 31, 2014, 2013 and 2012, the carrying value of cash and cash equivalents approximates fair value due to the short period of time to maturity.
Restricted Cash and Securities 
Restricted Cash and Securities

Restricted cash and securities consists primarily of cash and investments that serve to collateralize outstanding letters of credit and certain performance and operating obligations of the Company. Restricted cash and securities are recorded as current or non-current assets in the Consolidated Balance Sheets depending on the duration of the restriction and the purpose for which the restriction exists. Restricted cash and securities are stated at cost which approximates fair value as of December 31, 2014 and 2013.
Allowance for Doubtful Accounts 
Allowance for Doubtful Accounts

Trade accounts receivable are recorded at the invoiced amount and can bear interest. The Company establishes an allowance for doubtful accounts for accounts receivable amounts that may not be collectible. The Company determines the allowance for doubtful accounts based on the aging of its accounts receivable balances, the credit quality of its customers and an analysis of its historical experience of bad debt write-offs. Accounts receivable balances are written off against the allowance for doubtful accounts after all means of collection have been exhausted and the potential for recovery is considered remote. The Company recognized bad debt expense, net of recoveries, of approximately $22 million in 2014, $17 million in 2013 and $15 million in 2012
Property, Plant and Equipment 
Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation and amortization for the Company's property, plant and equipment are computed using the straight-line method based on the following estimated useful lives:

Facility and Leasehold Improvements
15
-
40
years
Network Infrastructure (including fiber and conduit)
25
-
50
years
Operating Equipment
5
-
15
years
Furniture, Fixtures, Office Equipment and Other
3
-
7
years


The Company performs internal reviews to evaluate the depreciable lives of its property, plant and equipment annually, or more frequently if new facts and circumstances arise, that may affect management's original estimates. Due to the rapid changes in technology and the competitive environment, selecting the estimated economic life of telecommunications property, plant, and equipment requires a significant amount of judgment. The Company's internal reviews take into account input from the Company's global engineering and network services personnel, actual usage, the physical condition of the Company's property, plant, and equipment, industry data, and other relevant factors. In connection with its periodic review of the estimated useful lives of property, plant and equipment, the Company may determine that the period it expects to use certain assets is different than the remaining previously estimated useful lives. The Company completed an evaluation in the first quarter 2014 and revised its estimated useful lives for: IP equipment from its historical estimate of four years to a revised estimate of seven years; racks and cabinets from its historical estimate of seven years to a revised estimate of 15 years; and facility equipment from its historical estimate of 10 years to its revised estimate of 15 years. In determining the change in estimated useful lives, the Company, with input from its engineering team, considered its historical usage patterns and retirements, estimates of technological obsolescence and expected usage and maintenance. The change in the estimated useful lives of the Company’s property, plant and equipment was accounted for as a change in accounting estimate on a prospective basis effective January 1, 2014 under the accounting standard related to changes in accounting estimates.

The carrying values of assets subject to these revisions were (in millions):
 
 
January 1, 2014
IP Equipment
 
$
222

Racks and Cabinets
 
114

Facility Equipment
 
151

 
 
$
487


The change in estimated useful lives of the Company’s property, plant and equipment resulted in less depreciation expense than would have otherwise been recorded and in the following increase in net income and net income per share for the year ended December 31, 2014 (in millions, except per share amounts):

Net Income
 
$
90

Basic Net Income per Share
 
$
0.35

Diluted Net Income per Share
 
$
0.35



Leasehold improvements are depreciated over the shorter of their estimated useful lives or lease terms that are reasonably assured.

The Company capitalizes costs directly associated with expansions and improvements of the Company's communications network and customer installations, including employee-related costs, and generally capitalizes costs associated with network construction and provisioning of services. The Company amortizes such costs over an estimated useful life of 3 to 7 years.

In addition, the Company continues to develop business support systems required for its business. The external direct costs of software, materials and services, and payroll and payroll-related expenses for employees directly associated with business support systems projects are capitalized. The total cost of the business support system is amortized over an estimated useful life of 3 years.
Impairment of Finite Lived Intangible Assets and Property Plant and Equipment 
Long-Lived Assets Including Finite-Lived Purchased Intangible Assets

The Company amortizes acquired intangible assets with finite lives using the straight-line method over the estimated economic lives of the assets, ranging from 4 to 12 years.

The Company evaluates long-lived assets, such as property, plant and equipment and acquired intangible assets with finite lives, for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the asset groups are expected to generate and recognizes an impairment loss when estimated undiscounted future cash flows expected to result from the use of the assets plus net proceeds expected from disposition of the assets, if any, are less than the carrying value of the assets. If an asset is deemed to be impaired, the amount of the impairment loss is the excess of the asset's carrying value over its estimated fair value.
Asset Retirement Obligations 
Asset Retirement Obligations

The Company recognizes a liability for the estimated fair value of legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or the normal operation of a long-lived asset in the period incurred. The fair value of the obligation is also capitalized as property, plant and equipment and then amortized over the estimated remaining useful life of the associated asset. Increases to the asset retirement obligation liability due to the passage of time are recognized as accretion expense and included within network related expenses. Changes in the liability due to revisions to the amount or timing of future cash flows are recognized by increasing or decreasing the liability with the offset adjusting the carrying amount of the related long-lived asset. To the extent that the downward revisions exceed the carrying amount of the related long-lived asset initially recorded when the asset retirement obligation liability was established, the Company records the remaining adjustment as a reduction to depreciation expense, to the extent of historical depreciation of the related long-lived asset, and then to network related expenses.

Goodwill and Acquired Indefinite-Lived Intangible Assets 
Goodwill and Acquired Indefinite-Lived Intangible Assets

Accounting guidance prohibits the amortization of goodwill and purchased intangible assets with indefinite useful lives. The Company reviews goodwill and purchased intangible assets with indefinite lives for impairment annually as of October 1st and whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable.

The Company's goodwill impairment review process considers the fair value of each reporting unit relative to its carrying value. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired and no further testing is performed. If the carrying value of the reporting unit exceeds its fair value, then a second step must be performed, and the implied fair value of the reporting unit's goodwill must be determined and compared to the carrying value of the reporting unit's goodwill. If the carrying value of a reporting unit's goodwill exceeds its implied fair value, then an impairment loss equal to the difference will be recorded. Prior to performing the two step evaluation, an assessment of qualitative factors may be performed to determine whether it is more likely than not that the fair value of a reporting unit exceeds the carrying value. If it is determined that it is unlikely that the carrying value exceeds the fair value, the Company is not required to complete the two step goodwill impairment evaluation.

At the time of each impairment assessment date in 2014, 2013 and 2012, the Company's reporting units consisted of its three regional operating units in: North America; Europe, the Middle East and Africa ("EMEA"); and Latin America.


The Company's indefinite-lived intangible assets impairment review process compares the estimated fair value of the indefinite-lived intangible assets to their respective carrying values. If the fair value of the indefinite-lived intangible assets exceeds their carrying values, then the indefinite-lived intangible assets are not impaired. If the carrying value of the indefinite-lived intangible assets exceeds their fair value, then an impairment loss equal to the difference will be recorded. In accordance with applicable accounting guidance, an entity may assess qualitative factors to determine whether it is more likely than not that the fair value exceeds the carrying value prior to performing the two step evaluation. If it is determined that it is unlikely the carrying value exceeds the fair value, then the entity is not required to complete the two step indefinite-lived intangible assets impairment evaluation.

Concentration of Credit Risk 
Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash equivalents, accounts receivable, restricted cash and securities and derivatives. The Company maintains its cash equivalents, restricted cash and securities and derivatives with various financial institutions. These financial institutions are primarily located in the United States, Europe and Latin America and the Company's policy is to limit exposure with any one institution. As part of its cash and risk management processes, the Company performs periodic evaluations of the relative credit standing of the financial institutions. The Company also has established guidelines relative to financial instrument credit ratings, diversification and maturities that seek to maintain safety and liquidity. The Company's investment strategy generally results in lower yields on investments but reduces the risk to principal in the short term prior to these funds being used in the Company's business. Notwithstanding the devaluation of the Venezuelan bolivar, the Company has not experienced any material losses on financial instruments held at financial institutions.

The Company provides communications services to a wide range of wholesale and enterprise customers, ranging from well capitalized national carriers to small early stage companies primarily in the United States, Europe, and Latin America. Credit risk with respect to accounts receivable is generally diversified due to the large number of entities comprising Level 3's customer base and their dispersion across many different industries and geographical regions. The Company performs ongoing credit evaluations of its customers' financial condition and generally requires no collateral from its customers, although letters of credit and deposits are required in certain limited circumstances. The Company has from time to time entered into agreements with value-added resellers and other channel partners to reach consumer and enterprise markets for voice services. The Company has policies and procedures in place
to evaluate the financial condition of these resellers prior to initiating service to the final customer. The Company maintains an allowance for doubtful accounts based upon the expected collectability of accounts receivable. Due to the Company's credit evaluation and collection process, bad debt expenses have not been significant; however, the Company is not able to predict changes in the financial stability of its customers. Any material change in the financial status of any one or a particular group of customers may cause the Company to adjust its estimate of the recoverability of receivables and could have a material adverse effect on the Company's results of operations. Fair values of accounts receivable approximate carrying amount due to the short period of time to collection.
Organization and Summary of Significant Accounting Policies (Tables)
12 Months Ended
Dec. 31, 2014
Dec. 31, 2012
Accounting Policies [Abstract]
 
 
Schedule of Error Corrections and Prior Period Adjustments [Table Text Block]
Text Block 
 
Property, Plant and Equipment
Text Block 
 
Change in Accounting Estimate
 
Text Block 
Schedule of Error Corrections and Prior Period Adjustments [Table Text Block] 
(dollars in millions)
As Previously Reported
Adjustment
Revised Reporting (1)
Year Ended December 31, 2013
 
 
 
Cost of Revenue
$
2,471

$
(2,471
)
$
—

Network Access Costs
—

2,471

2,471

Network Related Expenses
—

1,214

1,214

Selling, General and Administrative Expenses
2,376

(1,214
)
1,162

Total Costs and Expenses
5,647

—

5,647

 
 
 
 
Year Ended December 31, 2012
 
 
 
Cost of Revenue
2,602

(2,602
)
—

Network Access Costs
—

2,602

2,602

Network Related Expenses
—

1,249

1,249

Selling, General and Administrative Expenses
2,450

(1,249
)
1,201

Total Costs and Expenses
5,801

—

5,801

Property, Plant and Equipment 
Depreciation and amortization for the Company's property, plant and equipment are computed using the straight-line method based on the following estimated useful lives:

Facility and Leasehold Improvements
15
-
40
years
Network Infrastructure (including fiber and conduit)
25
-
50
years
Operating Equipment
5
-
15
years
Furniture, Fixtures, Office Equipment and Other
3
-
7
years
The components of the Company's property, plant and equipment as of December 31, 2014 and 2013 are as follows (dollars in millions):
 
 
Cost
 
Accumulated
Depreciation
 
Net
December 31, 2014
 
 
 
 
 
 
Land
 
$
192

 
$
—

 
$
192

Land Improvements
 
73

 
(50
)
 
23

Facility and Leasehold Improvements
 
2,489

 
(1,265
)
 
1,224

Network Infrastructure
 
8,941

 
(3,447
)
 
5,494

Operating Equipment
 
7,217

 
(4,669
)
 
2,548

Furniture, Fixtures and Office Equipment
 
255

 
(177
)
 
78

Other
 
29

 
(21
)
 
8

Construction-in-Progress
 
293

 
—

 
293

 
 
$
19,489

 
$
(9,629
)
 
$
9,860

December 31, 2013
 
 
 
 
 
 
Land
 
$
193

 
$
—

 
$
193

Land Improvements
 
72

 
(47
)
 
25

Facility and Leasehold Improvements
 
2,207

 
(1,193
)
 
1,014

Network Infrastructure
 
8,505

 
(3,279
)
 
5,226

Operating Equipment
 
6,057

 
(4,381
)
 
1,676

Furniture, Fixtures and Office Equipment
 
196

 
(168
)
 
28

Other
 
22

 
(21
)
 
1

Construction-in-Progress
 
77

 
—

 
77

 
 
$
17,329

 
$
(9,089
)
 
$
8,240

Change in Accounting Estimate 

The carrying values of assets subject to these revisions were (in millions):
 
 
January 1, 2014
IP Equipment
 
$
222

Racks and Cabinets
 
114

Facility Equipment
 
151

 
 
$
487


The change in estimated useful lives of the Company’s property, plant and equipment resulted in less depreciation expense than would have otherwise been recorded and in the following increase in net income and net income per share for the year ended December 31, 2014 (in millions, except per share amounts):

Net Income
 
$
90

Basic Net Income per Share
 
$
0.35

Diluted Net Income per Share
 
$
0.35

Events Associated with the Merger of tw telecom inc. (Tables)
Schedule of the Final Purchase Price Allocation 


 
Initial Purchase Price Allocation
 
(dollars in millions)
Assets:
 
Cash, Cash Equivalents and Restricted Cash
$
309

Property, Plant and Equipment
1,555

Goodwill
5,124

Identifiable Intangible Assets
1,323

Other Assets
138

Total Assets
8,449

 
 
Liabilities:
 
Long-Term Debt
(2,099
)
Deferred Revenue
(60
)
Other Liabilities
(279
)
Total Liabilities
(2,438
)
Total Consideration to be Allocated
$
6,011

Schedule of Unaudited Pro Forma Financial Information for the Amalgamation 
The following unaudited pro forma financial information presents the combined results of Level 3 and tw telecom as if the completion of the Merger had occurred as of January 1, 2013 (dollars in millions, except per share data).
 
Year Ended December 31,
 
2014
 
2013
Total Revenue
$
8,123

 
$
7,825

Net Income (Loss)
$
141

 
$
(165
)
Net Income (Loss) per Share- Basic
$
0.42

 
$
(0.52
)
Net Income (Loss) per Share - Diluted
$
0.42

 
$
(0.52
)
Property, Plant and Equipment (Tables)
Property, Plant and Equipment
Depreciation and amortization for the Company's property, plant and equipment are computed using the straight-line method based on the following estimated useful lives:

Facility and Leasehold Improvements
15
-
40
years
Network Infrastructure (including fiber and conduit)
25
-
50
years
Operating Equipment
5
-
15
years
Furniture, Fixtures, Office Equipment and Other
3
-
7
years
The components of the Company's property, plant and equipment as of December 31, 2014 and 2013 are as follows (dollars in millions):
 
 
Cost
 
Accumulated
Depreciation
 
Net
December 31, 2014
 
 
 
 
 
 
Land
 
$
192

 
$
—

 
$
192

Land Improvements
 
73

 
(50
)
 
23

Facility and Leasehold Improvements
 
2,489

 
(1,265
)
 
1,224

Network Infrastructure
 
8,941

 
(3,447
)
 
5,494

Operating Equipment
 
7,217

 
(4,669
)
 
2,548

Furniture, Fixtures and Office Equipment
 
255

 
(177
)
 
78

Other
 
29

 
(21
)
 
8

Construction-in-Progress
 
293

 
—

 
293

 
 
$
19,489

 
$
(9,629
)
 
$
9,860

December 31, 2013
 
 
 
 
 
 
Land
 
$
193

 
$
—

 
$
193

Land Improvements
 
72

 
(47
)
 
25

Facility and Leasehold Improvements
 
2,207

 
(1,193
)
 
1,014

Network Infrastructure
 
8,505

 
(3,279
)
 
5,226

Operating Equipment
 
6,057

 
(4,381
)
 
1,676

Furniture, Fixtures and Office Equipment
 
196

 
(168
)
 
28

Other
 
22

 
(21
)
 
1

Construction-in-Progress
 
77

 
—

 
77

 
 
$
17,329

 
$
(9,089
)
 
$
8,240

Asset Retirement Obligations (Tables)
Schedule of Asset Retirement Obligations [Table Text Block]
The following table provides asset retirement obligation activity for the years ended December 31, 2014 and 2013 (dollars in millions):
 
 
2014
 
2013
Asset retirement obligation at January 1
 
$
56

 
$
55

Accretion expense
 
8

 
7

Liabilities assumed in tw telecom acquisition
 
22

 
—

Liabilities settled
 
(7
)
 
(6
)
Revision in estimated cash flows
 
7

 
—

Effect of foreign currency rate change
 
(1
)
 
—

Asset retirement obligation at December 31
 
$
85

 
$
56

Goodwill (Tables)
Schedule of changes in carrying amount of goodwill
The changes in the carrying amount of goodwill during the years ended December 31, 2014 and 2013 are as follows (dollars in millions):
 
Total
Balance as of January 1, 2013
$
2,565

Goodwill adjustments
12

Balance as of December 31, 2013
2,577

Goodwill adjustments
(12
)
Goodwill acquired in tw telecom acquisition
5,124

Balance as of December 31, 2014
$
7,689

Acquired Intangible Assets (Tables)
Schedule of acquisition-related intangible assets 
Identifiable acquisition-related intangible assets as of December 31, 2014 and 2013 were as follows (dollars in millions):

 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
December 31, 2014
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Customer Contracts and Relationships
$
1,977

 
$
(741
)
 
$
1,236

Trademarks
115

 
(47
)
 
68

Patents and Developed Technology
228

 
(133
)
 
95

 
2,320

 
(921
)
 
1,399

Indefinite-Lived Intangible Assets:
 
 
 
 
 
Trade Name
15

 
—

 
15

 
$
2,335

 
$
(921
)
 
$
1,414

December 31, 2013
 
 
 
 
 
Finite-Lived Intangible Assets:
 
 
 
 
 
Customer Contracts and Relationships
$
786

 
$
(678
)
 
$
108

Trademarks
55

 
(31
)
 
24

Patents and Developed Technology
158

 
(117
)
 
41

 
999

 
(826
)
 
173

Indefinite-Lived Intangible Assets:
 
 
 
 
 
Trade Name
32

 
—

 
32

 
$
1,031

 
$
(826
)
 
$
205

Schedule of estimated amortization expense of acquired finite-lived intangible asset 
As of December 31, 2014, estimated amortization expense for the Company’s finite-lived acquisition-related intangible assets over the next five years and thereafter is as follows (dollars in millions):

2015
$
242

2016
223

2017
208

2018
205

2019
188

Thereafter
333

 
$
1,399

Fair Value of Financial Instruments (Tables)
Schedule of fair value of liabilities measured on a recurring basis
The table below presents the fair values for the Company’s long-term debt as well as the input levels used to determine these fair values as of December 31, 2014 and 2013:

 
 
 
 
 
 
Fair Value Measurement Using
 
 
Total Carrying Value in Consolidated Balance Sheets
 
Unadjusted Quoted Prices in Active
Markets for Identical Assets or Liabilities (Level 1)
 
Significant Other Observable Inputs (Level 2)
(dollars in millions)
 
December 31,
2014
 
December 31,
2013
 
December 31,
2014
 
December 31,
2013
 
December 31,
2014
 
December 31,
2013
Liabilities Not Recorded at Fair Value in the Financial Statements:
 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt, including the current portion:
 
 
 
 
 
 
 
 
 
 
 
 
Term Loans
 
$
4,590

 
$
2,604

 
$
4,593

 
$
2,633

 
$
—

 
$
—

Senior Notes
 
6,203

 
5,198

 
6,481

 
5,673

 
—

 
—

Convertible Notes
 
333

 
474

 
—

 
—

 
868

 
647

Capital Leases and Other
 
207

 
86

 
—

 
—

 
207

 
86

Total Long-term Debt, including the current portion:
 
$
11,333

 
$
8,362

 
$
11,074

 
$
8,306

 
$
1,075

 
$
733



The Company does not have any assets or liabilities where the fair value is measured using significant unobservable inputs (Level 3).
Derivative Financial Instruments (Tables)
Schedule of outstanding interest rate derivatives designated as cash flow hedges 
In March 2007, Level 3 Financing, Inc. entered into two interest rate swap agreements to hedge the interest payments on $1 billion principal amount of floating rate debt. The Company had designated these interest rate swap agreements as cash flow hedges. The hedge designation was terminated in 2012 in connection with certain refinancing activities, and the instruments were settled upon maturity in 2014. Prior to the redesignation of the hedging relationship in 2012,
Schedule of fair value of derivative financial instruments 
The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Consolidated Balance Sheets (dollars in millions):

 
 
Liability Derivatives
 
 
December 31, 2013
Derivatives not designated as
hedging instruments
 
Balance Sheet
Location
 
Fair
Value
Interest rate swap agreements
 
Other current liabilities
 
$
12

Schedule of the amount of gains (losses) recognized in Other Comprehensive Loss 
The amount of net gains recognized in AOCI, including reclassifications of unrealized losses, consists of the following (dollars in millions):

 
 
Year Ended December 31,
Derivatives designated as hedging instruments
 
2013
 
2012
Cash flow hedging contracts
 
$
—

 
$
90

Schedule of the amount of gains (losses) reclassified from AOCI to Income/Loss 
The amount of losses reclassified from AOCI to earnings (effective portions) consists of the following (dollars in millions):

 
 
 
 
Year Ended December 31,
Derivatives designated as hedging instruments
 
Statement of Operations Location
 
2013
 
2012
Cash flow hedging contracts
 
Interest Expense
 
$
—

 
$
(26
)
Schedule of effect of derivatives not designated as hedging instruments on net loss 
The effect of the Company’s derivatives not designated as hedging instruments on net loss is as follows (dollars in millions):

 
 
 
 
Year Ended December 31,
Derivatives not designated as hedging instruments
 
Statement of Operations Location
 
2014
 
2013
 
2012
Interest rate swaps
 
Other Expense - Other, net
 
$
—

 
$
(2
)
 
$
(64
)
Long-Term Debt (Tables)
Schedule of long-term debt 
As of December 31, 2014 and December 31, 2013, long-term debt was as follows:

(dollars in millions)
 
December 31,
2014
 
December 31,
2013
Senior Secured Term Loan*
 
$
4,611

 
$
2,611

Floating Rate Senior Notes due 2018 (3.826% as of December 31, 2014)
 
300

 
300

11.875% Senior Notes due 2019
 
—

 
605

9.375% Senior Notes due 2019
 
500

 
500

8.125% Senior Notes due 2019
 
1,200

 
1,200

8.875% Senior Notes due 2019
 
300

 
300

8.625% Senior Notes due 2020
 
900

 
900

7% Senior Notes due 2020
 
775

 
775

6.125% Senior Notes due 2021
 
640

 
640

5.375% Senior Notes due 2022
 
1,000

 
—

5.75% Senior Notes due 2022
 
600

 
—

7% Convertible Senior Notes due 2015
 
58

 
200

7% Convertible Senior Notes due 2015 Series B
 
275

 
275

Capital Leases
 
207

 
73

Other
 
—

 
13

Total Debt Obligations
 
11,366

 
8,392

Unamortized Discount:
 
 
 
 
Discount on Senior Secured Term Loan
 
(21
)
 
(7
)
Discount on 11.875% Senior Notes due 2019
 
—

 
(8
)
Discount on 9.375% Senior Notes due 2019
 
(6
)
 
(7
)
Discount on 8.125% Senior Notes due 2019
 
(6
)
 
(7
)
Discount on 7% Convertible Senior Notes due 2015
 
—

 
(1
)
Total Unamortized Discount
 
(33
)
 
(30
)
Carrying Value of Debt
 
11,333

 
8,362

Less current portion
 
(349
)
 
(31
)
Long-term Debt, less current portion
 
$
10,984

 
$
8,331


*The $2 billion Tranche B Term Loan due 2022 had an interest rate of 4.5% as of December 31, 2014. The $815 million Tranche B-III 2019 Term Loan due 2019 and the $1.796 billion Tranche B 2020 Term Loan due 2020 each had an interest rate of 4.00% as of December 31, 2014.
Schedule of aggregate future contractual maturities of long-term debt and capital leases (excluding issue discounts and fair value adjustments) 
ong-Term Debt Maturities

Aggregate future contractual maturities of long-term debt and capital leases (excluding discounts and fair value adjustments) were as follows as of December 31, 2014 (dollars in millions):

2015
$
349

2016
9

2017
8

2018
308

2019
2,823

Thereafter
7,869

 
$
11,366

Schedule of redemption prices of Senior Notes 
The 5.375% Senior Notes are subject to redemption at the option of Level 3 Financing, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days’ prior notice, (i) prior to August 15, 2017, at 100% of the principal amount of 5.375% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and (ii) on and after August 15, 2017, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, if redeemed during the twelve months beginning August 15, of the years indicated below:

Year
Redemption Price

2017
102.688
%
2018
101.344
%
2019
100.000
%

At any time or from time to time on or prior to August 15, 2017, Level 3 Financing may redeem up to 40% of the original aggregate principal amount of the 5.375% Senior Notes at a redemption price equal to 105.375% of the principal amount of the 5.375% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to Level 3 Financing of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 60% of the original aggregate principal amount of the 5.375% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days following such private placement or public offering upon not less than 30 days nor more than 60 days’ prior notice.
Schedule of redemption prices of Senior Notes 
Prior to May 15, 2015, at the option of Level 3 Financing, the 2018 Floating Rate Notes will be subject to redemption, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days prior notice, at 100% of the principal amount of 2018 Floating Rate Notes so redeemed plus (i) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (ii) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date. The 2018 Floating Rate Notes will be redeemable at the option of Level 3 Financing, in whole or in part, on or after May 15, 2015, upon not less than 30 nor more than 60 days prior notice, at the redemption prices set forth below (expressed as percentages of the principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, if redeemed during the periods set forth below:

Period
Redemption Price
May 15, 2015 - May 14, 2016
102.00
%
May 15, 2016 - November 14, 2016
101.00
%
November 15, 2016 and thereafter
100.00
%

In addition, at any time or from time to time on or prior to May 15, 2015, Level 3 Financing may redeem up to 35% of the original aggregate principal amount of the 2018 Floating Rate Notes at a redemption price equal to 100% of the principal amount of the 2018 Floating Rate Notes so redeemed, plus a premium equal to the interest rate per annum on the 2018 Floating Rate Notes in effect on the date that notice of redemption is given, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to the capital of Level 3 Financing from one or more private placements of common stock of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 65% of the original aggregate principal amount of the 2018 Floating Rate Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption is required to be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days prior notice.
Schedule of redemption prices of Senior Notes 
The 9.375% Senior Notes Due 2019 are subject to redemption at the option of Level 3 Financing in whole or in part, at any time or from time to time, prior to April 1, 2015, at 100% of the principal amount of 9.375% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and on or after April 1, 2015 at the redemption prices (expressed as a percentage of principal amount) set forth below, plus accrued and unpaid interest thereon to the redemption date, if redeemed during the twelve months beginning April 1, of the years indicated below:
Year
Redemption Price

2015
104.688
%
2016
102.344
%
2017
100.000
%


Schedule of redemption prices of Senior Notes 
The 8.125% Senior Notes will be subject to redemption at the option of Level 3 Financing, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days prior notice, (i) prior to July 1, 2015, at 100% of the principal amount of 8.125% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and on and after July 1, 2015, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, if redeemed during the twelve months beginning July 1, of the years indicated below:

Year
Redemption Price

2015
104.063
%
2016
102.031
%
2017
100.000
%


Schedule of redemption prices of Senior Notes 
The 8.875% Senior Notes are subject to redemption at the option of Level 3 in whole or in part, at any time before June 1, 2015 at the redemption price equal to 100% of their principal amount, plus a make-whole premium and accrued and unpaid interest. On and after June 1, 2015, Level 3 may redeem all or part of the 8.875% Senior Notes, upon not less than 30 nor more than 60 days prior notice, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) to, but not including, the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve months beginning June 1, of the years indicated below:
Year
Redemption Price

2015
104.438
%
2016
102.219
%
2017
100.000
%


In addition, at any time or from time to time on or prior to June 1, 2015, Level 3 may redeem up to 35% of the original aggregate principal amount of the 8.875% Senior Notes (including any additional 8.875% Senior Notes) at a redemption price equal to 108.875% of the principal amount of the 8.875% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) to the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), with the net cash proceeds contributed to the capital of Level 3 of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in aggregate; provided, however, that at least 65% of the original aggregate principal amount of the 8.875% Senior Notes (including any additional 8.875% Senior Notes) would remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days of such private placement or public offering upon not less than 30 nor more than 60 days prior notice.
Schedule of redemption prices of Senior Notes 
The 8.625% Senior Notes are subject to redemption at the option of Level 3 Financing in whole or in part, at any time before January 15, 2016 at the redemption price equal to 100% of their principal amount, plus a make-whole premium and accrued and unpaid interest. On and after January 15, 2016, Level 3 Financing may redeem all or part of the 8.625% Senior Notes, upon not less than 30 nor more than 60 days prior notice, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) to, but not including, the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve months beginning January 15, of the years indicated below:
Year
Redemption Price

2016
104.313
%
2017
102.156
%
2018
100.000
%


Schedule of redemption prices of Senior Notes 
The 7% Senior Notes are subject to redemption at the option of Level 3 Financing in whole or in part, at any time before June 1, 2016 at the redemption price equal to 100% of their principal amount, plus a make-whole premium and accrued and unpaid interest. On or after June 1, 2016, Level 3 Financing may redeem all or part of the 7% Senior Notes, upon not less than 30 nor more than 60 days prior notice, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) to, but not including, the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve months beginning June 1, of the years indicated below:
Year
Redemption Price

2016
103.500
%
2017
101.750
%
2018
100.000
%


In addition, at any time or from time to time on or prior to June 1, 2015, Level 3 Financing may redeem up to 35% of the original aggregate principal amount of the 7% Senior Notes (including any additional 7% Senior Notes) at a redemption price equal to 107% of the principal amount of the 7% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) to the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), with the net cash proceeds contributed to the capital of Level 3 Financing of one or more private placements to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in aggregate; provided, however, that at least 65% of the original aggregate principal amount of the 7% Senior Notes (including any additional 7% Senior Notes) would remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days of such private placement or public offering upon not less than 30 nor more than 60 days prior notice.
Schedule of redemption prices of Senior Notes 
Prior to November 15, 2016, at the option of Level 3 Financing, the 6.125% Senior Notes will be subject to redemption, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days prior notice, at 100% of the principal amount of 6.125% Senior Notes so redeemed plus (i) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (ii) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date. On and after November 15, 2016, at the option of Level 3 Financing, the 6.125% Senior Notes will be subject to redemption, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days prior notice at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date. The redemption price for the 6.125% Senior Notes if redeemed during the twelve months beginning November 15, of the years indicated below:

Year
Redemption Price

2016
103.063
%
2017
101.531
%
2018
100.000
%

In addition, at any time or from time to time on or prior to November 15, 2016, Level 3 Financing may redeem up to 35% of the original aggregate principal amount of the 6.125% Senior Notes at a redemption price equal to 106.125% of the principal amount of the 6.125% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to the capital of Level 3 Financing from one or more private placements of common stock of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 65% of the original aggregate principal amount of the 6.125% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption is required to be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days prior notice.
Schedule of redemption prices of Senior Notes 
The 5.75% Senior Notes will be subject to redemption at the option of Level 3, in whole or in part, at any time or from time to time, upon not less than 30 nor more than 60 days’ prior notice, (i) prior to December 1, 2017 at 100% of the principal amount of 5.75% Senior Notes so redeemed plus (A) the applicable make-whole premium set forth in the Indenture, as of the redemption date and (B) accrued and unpaid interest thereon (if any) up to, but not including, the redemption date, and (ii) on and after December 1, 2017, at the redemption prices set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date. The redemption price for the 5.75% Senior Notes if redeemed during the twelve months beginning December 1, of years indicated below:
Year
Redemption Price

2017
102.8750
%
2018
101.4375
%
2019 and thereafter
100.0000
%

At any time or from time to time on or prior to December 1, 2017, Level 3 may redeem up to 40% of the original aggregate principal amount of the 5.75% Senior Notes at a redemption price equal to 105.75% of the principal amount of the 5.75% Senior Notes so redeemed, plus accrued and unpaid interest thereon (if any) up to, but not including the redemption date, with the net cash proceeds contributed to the capital of Level 3 from one or more private placements of Level 3 to persons other than affiliates of Level 3 or underwritten public offerings of common stock of Level 3 resulting, in each case, in gross proceeds of at least $100 million in the aggregate. However, at least 60% of the original aggregate principal amount of the 5.75% Senior Notes must remain outstanding immediately after giving effect to such redemption. Any such redemption shall be made within 90 days following such private placement or public offering upon not less than 30 nor more than 60 days’ prior notice.
Accumulated Other Comprehensive Income (Loss) (Tables)
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]
The accumulated balances for each classification of other comprehensive income (loss) are as follows:

(dollars in millions)
 
Net Foreign Currency Translation Adjustment
 
Holding Gain (Loss) on Interest Rate Swaps
 
Defined Benefit Pension Plans
 
Total
Balance at January 1, 2012
 
$
39

 
$
(90
)
 
$
(29
)
 
$
(80
)
Other comprehensive income (loss) before reclassifications
 
17

 
25

 
(4
)
 
38

Amounts reclassified from accumulated other comprehensive loss
 
—

 
65

 
3

 
68

Balance at December 31, 2012
 
56

 
—

 
(30
)
 
26

Other comprehensive income (loss) before reclassifications
 
11

 
—

 
(3
)
 
8

Amounts reclassified from accumulated other comprehensive loss
 
—

 
—

 
2

 
2

Balance at December 31, 2013
 
67

 
—

 
(31
)
 
36

Other comprehensive income (loss) before reclassifications
 
(178
)
 
—

 
(9
)
 
(187
)
Amounts reclassified from accumulated other comprehensive loss
 
—

 
—

 
4

 
4

Balance at December 31, 2014
 
$
(111
)
 
$
—

 
$
(36
)
 
$
(147
)
Employee Benefit Benefits and Stock-Based Compensation (Tables)
Schedule of non-cash compensation expense and capitalized non-cash compensation 
The following table summarizes non-cash compensation expense and capitalized non-cash compensation for each of the three years ended December 31, 2014, 2013 and 2012 (dollars in millions):

 
 
2014
 
2013
 
2012
OSOs
 
$
8

 
$
21

 
$
14

Restricted Stock Units
 
34

 
38

 
40

Performance Restricted Stock Units
 
14

 
—

 
—

401(k) Match Expense
 
23

 
24

 
23

Restricted Stock Unit Bonus Grant
 
(5
)
 
59

 
46

Management Incentive and Retention Plan
 
—

 
10

 
13

 
 
74

 
152

 
136

Capitalized Non-Cash Compensation
 
(1
)
 
(1
)
 
(1
)
 
 
$
73

 
$
151

 
$
135

Schedule of performance benchmark 
ility to outperform the market in general, as measured by the Standard & Poor's ("S&P") 500® Index. Participants in the OSO program do not realize any value from awards unless the Company's common stock price outperforms the S&P 500® Index duri
Schedule of OSO valuation assumptions 
The Company believes that given the relative short life of the OSOs and the other variables used in the model, the modified Black-Scholes model provides a reasonable estimate of the fair value of the OSO units at the time of grant.

 
Year Ended December 31,
 
 
2013
 
2012
S&P 500 Expected Dividend Yield Rate
 
2.24%
 
2.05%
Expected Life
 
3 years
 
3 years
S&P 500 Expected Volatility Rate
 
19%
 
23%
Level 3 Common Stock Expected Volatility Rate
 
39%
 
39%
Expected S&P 500 Correlation Factor
 
0.44
 
0.32
Calculated Theoretical Value
 
101%
 
110%
Estimated Forfeiture Rate
 
15%
 
20%
Schedule of restricted stock and restricted stock units 
The changes in nonvested restricted stock, restricted stock units and nonvested performance restricted stock units are shown in the following table:
 
 
Number
 
Weighted Average
Grant Date
Fair Value
Nonvested at January 1, 2012
 
2,030,783

 
$
26.25

Stock and units granted
 
2,869,584

 
$
24.13

Lapse of restrictions
 
(1,048,757
)
 
$
26.06

Stock and units forfeited
 
(214,634
)
 
$
24.92

Nonvested at December 31, 2012
 
3,636,976

 
$
24.71

Stock and units granted
 
1,617,592

 
$
21.26

Lapse of restrictions
 
(1,841,757
)
 
$
25.19

Stock and units forfeited
 
(488,461
)
 
$
23.10

Nonvested at December 31, 2013
 
2,924,350

 
$
22.77

Stock and units granted
 
2,255,883

 
$
42.36

Lapse of restrictions
 
(1,151,830
)
 
$
22.94

Stock and units forfeited
 
(241,785
)
 
$
28.90

Nonvested at December 31, 2014
 
3,786,618

 
$
33.91

Schedule OSO activity 
Transactions involving OSO units awarded are summarized in the table below. The Option Price Per Unit identified in the table below represents the initial strike price, as determined on the day prior to the OSO grant date for those grants.
 
 
Units
 
Initial Strike Price Per Unit
 
Weighted
Average
Initial
Strike
Price
 
Aggregate
Intrinsic
Value
 
Weighted
Average
Remaining
Contractual
Term (years)
 
 
 
 
 
 
 
 
 
 
(in millions)
 
 
Balance January 1, 2012
 
1,288,712

 
$
10.50

-
$
36.60

 
$
20.51

 
$
1.8

 
1.53
OSOs granted
 
1,195,452

 
$
16.99

-
$
27.53

 
$
24.65

 
 
 
 
OSOs forfeited
 
(72,335
)
 
$
12.00

-
$
36.60

 
$
21.80

 
 
 
 
OSOs expired
 
(278,111
)
 
$
15.00

-
$
22.65

 
$
18.45

 
 
 
 
OSOs exercised
 
(67,299
)
 
$
10.50

-
$
13.80

 
$
12.48

 
 
 
 
Balance December 31, 2012
 
2,066,419

 
$
14.10

-
$
36.60

 
$
23.40

 
$
6.6

 
1.73
OSOs granted
 
748,481

 
$
20.29

-
$
26.69

 
$
22.64

 
 
 
 
OSOs forfeited
 
(271,883
)
 
$
14.10

-
$
36.60

 
$
22.33

 
 
 
 
OSOs expired
 
(286,924
)
 
$
16.35

-
$
24.30

 
$
21.48

 
 
 
 
OSOs exercised
 
(107,228
)
 
$
14.10

-
$
14.10

 
$
14.10

 
 
 
 
Balance December 31, 2013
 
2,148,865

 
$
14.10

-
$
36.60

 
$
23.99

 
$
31.6

 
1.46
OSOs granted
 
—

 
$
—

-
$
—

 
$
—

 
 
 
 
OSOs forfeited
 
(52,901
)
 
$
16.99

-
$
27.53

 
$
22.99

 
 
 
 
OSOs expired
 
(106,844
)
 
$
36.60

-
$
36.60

 
$
36.60

 
 
 
 
OSOs exercised
 
(771,251
)
 
$
14.70

-
$
27.53

 
$
24.26

 
 
 
 
Balance December 31, 2014
 
1,217,869

 
$
16.99

-
$
27.53

 
$
22.76

 
$
88.0

 
0.90
Schedule of OSO by exercise price range 
 
 
 
 
OSO Units Outstanding
at December 31, 2014
 
OSO units Exercisable
at December 31, 2014
Range of Exercise Prices
 
Number
Outstanding
 
Weighted
Average
Remaining
Life (years)
 
Weighted
Average
Initial
Strike Price
 
Number
Exercisable
 
Weighted
Average
Initial
Strike Price
$
16.99

-
$
27.53

 
1,217,869

 
0.90
 
$
22.76

 
—

 
$
—

Schedule of restricted stock and restricted stock units 
A summary of the retention restricted stock units granted under the MIRP is shown in the following table:
 
 
Number
 
Weighted Average
Grant Date
Fair Value
Nonvested at January 1, 2012
 
—

 
$
—

Stock and units granted
 
465,000

 
$
25.92

Lapse of restrictions
 
—

 
$
—

Stock and units forfeited
 
—

 
$
—

Nonvested at December 31, 2012
 
465,000

 
$
25.92

Stock and units granted
 
—

 
$
—

Lapse of restrictions
 
(270,000
)
 
$
25.92

Stock and units forfeited
 
—

 
$
—

Nonvested at December 31, 2013
 
195,000

 
$
25.92

Stock and units granted
 
—

 


Lapse of restrictions
 
(195,000
)
 
$
25.92

Stock and units forfeited
 
—

 


Nonvested at December 31, 2014
 
—

 


Income Taxes (Tables)
Components of income tax expense (benefit) 
The following table summarizes the income tax benefit (provision) attributable to the income (loss) before income taxes for each of the three years ended December 31, 2014, 2013 and 2012:

 
 
2014
 
2013
 
2012
(dollars in millions)
Current:
 
 
 
 
 
 
United States federal
 
$
—

 
$
9

 
$
—

State
 
(1
)
 
(1
)
 
(2
)
Foreign
 
(40
)
 
(37
)
 
(36
)
 
 
(41
)
 
(29
)
 
(38
)
Deferred, net of changes in valuation allowances:
 
 
 
 
 
 
United States federal
 
6

 
(3
)
 
(3
)
State
 
15

 
—

 
—

Foreign
 
96

 
(6
)
 
(7
)
Income tax benefit (provision)
 
$
76

 
$
(38
)
 
$
(48
)
Schedule of income before income tax, domestic and foreign 
The United States and Foreign components of income (loss) before income taxes for each of the three years ended December 31, 2014, 2013 and 2012 are as follows (some of the income (loss) is subject to taxation in multiple jurisdictions):

 
 
2014
 
2013
 
2012
(dollars in millions)
United States
 
$
207

 
$
(122
)
 
$
(434
)
Foreign
 
31

 
51

 
60

 
 
$
238

 
$
(71
)
 
$
(374
)
Schedule of effective income tax rate reconciliation 
A reconciliation of the actual income tax benefit (provision) and the tax computed by applying the U.S. federal rate (35%) to the income (loss) before income taxes for each of the three years ended December 31, 2014, 2013 and 2012 is shown in the following table:

 
 
2014
 
2013
 
2012
 
 
(dollars in millions)
Computed tax (provision) benefit at statutory rate
 
$
(83
)
 
$
25

 
$
131

Effect of earnings in jurisdictions outside of US
 
13

 
12

 
25

Change in valuation allowance
 
197

 
(27
)
 
(145
)
Permanent items
 
(44
)
 
(44
)
 
(48
)
Indefinite-lived assets
 
2

 
(3
)
 
(3
)
Uncertain tax positions
 
3

 
9

 
(3
)
Changes in tax rates
 
(7
)
 
(7
)
 
(4
)
Other, net
 
(5
)
 
(3
)
 
(1
)
Income tax benefit (provision)
 
$
76

 
$
(38
)
 
$
(48
)
Deferred tax assets and liabilities 
The components of the net deferred tax assets (liabilities) as of December 31, 2014 and 2013 are as follows:

 
 
2014
 
2013
 
 
(dollars in millions)
Deferred Tax Assets:
 
 
 
 
Accrued payroll and related benefits
 
$
113

 
$
132

Deferred revenue
 
322

 
336

Unutilized tax net operating loss carry forwards
 
5,218

 
4,791

Fixed assets and intangible assets
 
90

 
102

Intercompany loss
 
128

 
139

Other
 
174

 
144

Total Deferred Tax Assets
 
6,045

 
5,644

Deferred Tax Liabilities:
 
 
 
 
Fixed assets and intangible assets
 
(1,371
)
 
(790
)
Deferred revenue
 
(73
)
 
(76
)
Other
 
(59
)
 
(33
)
Foreign branch income
 
(130
)
 
(163
)
Total Deferred Tax Liabilities
 
(1,633
)
 
(1,062
)
Net Deferred Tax Assets before valuation allowance
 
4,412

 
4,582

Valuation Allowance
 
(4,437
)
 
(4,698
)
Net Deferred Tax Liability after Valuation Allowance
 
$
(25
)
 
$
(116
)
Balance sheet classification of deferred taxes:
 
 
 
 
Net current deferred income tax asset
 
$
8

 
$
9

Net current deferred income tax liability
 
—

 
(2
)
Net non-current deferred income tax asset
 
292

 
211

Net non-current deferred income tax liability
 
(325
)
 
(334
)
Net Deferred Tax Liability after Valuation Allowance
 
$
(25
)
 
$
(116
)
Operating loss carryforwards 
As of December 31, 2014, the Company had net operating loss carry forwards of approximately $10.3 billion (net of IRC Section 382 limitation) for U.S. federal income tax purposes, including $1 billion from the tw telecom acquisition. Although the tw telecom acquisition triggered an ownership change under Section 382 of the Internal Revenue Code, the Company has determined that its loss carryforwards should not be mathematically limited based on its value at the time of the ownership change and the expiration dates of its net operating losses.

The Company’s loss carry forwards expire in future years through 2034 and are subject to examination by the tax authorities until three years after the carry forwards are utilized. The U.S. federal tax loss carry forwards expire as follows (dollars in millions):

Expiring December 31,
Amount
2022
$
186

2023
380

2024
1,456

2025
1,299

2026
1,244

2027
1,615

2028
482

2029
694

2030
664

2031
827

2032
730

2033
289

2034
438

 
$
10,304

Uncertain tax benefits 
A reconciliation of the beginning and ending balance of unrecognized income tax benefits follows (dollars in millions):

 
Amount
Balance as of January 1, 2012
$
15

Gross increases - tax positions of prior years
4

Gross increases - tax positions during 2012
1

Gross decreases - lapse of statute of limitations
(1
)
Gross decreases - settlement with taxing authorities
(1
)
Balance as of December 31, 2012
18

Gross increases - tax positions of prior years
—

Gross increases - tax positions during 2013
1

Gross decreases - lapse of statute of limitations
(6
)
Gross decreases - settlement with taxing authorities
—

Balance as of December 31, 2013
13

Tax positions of prior years netted against deferred tax assets
5

Gross increases - tax positions of prior years
1

Gross increases - tax positions during 2014
—

Gross decreases - lapse of statute of limitations
(2
)
Gross decreases - settlement with taxing authorities
—

Balance as of December 31, 2014
$
17

Segment Information (Tables)
Reconciliation of Revenue from Segments to Consolidated [Table Text Block] 
The following table presents revenue by segment for each of the years ended December 31,

(dollars in millions)
 
2014
 
2013
 
2012
Core Network Services Revenue:
 
 
 
 
 
 
North America
 
$
4,240

 
$
3,949

 
$
3,840

EMEA
 
891

 
888

 
911

Latin America
 
779

 
754

 
712

tw telecom
 
285

 
—

 
—

Total Core Network Services Revenue
 
$
6,195

 
$
5,591

 
$
5,463

 
 
 
 
 
 
 
Wholesale Voice Services and Other Revenue:
 
 
 
 
 
 
North America
 
$
530

 
$
681

 
$
863

EMEA
 
19

 
31

 
40

Latin America
 
33

 
10

 
10

Total Wholesale Voice Services and Other Revenue
 
$
582

 
$
722

 
$
913

 
 
 
 
 
 
 
Total Consolidated Revenue
 
$
6,777

 
$
6,313

 
$
6,376

Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Table Text Block] 
The following table presents Adjusted EBITDA by segment and reconciles Adjusted EBITDA to net income (loss) for each of the years ended December 31,

(dollars in millions)
 
2014
 
2013
 
2012
Adjusted EBITDA:
 
 
 
 
 
 
North America
 
$
1,960

 
$
1,799

 
$
1,708

EMEA
 
214

 
226

 
195

Latin America
 
348

 
313

 
278

tw telecom
 
105

 
—

 
—

Unallocated Corporate Expenses
 
(732
)
 
(714
)
 
(722
)
Consolidated Adjusted EBITDA
 
$
1,895

 
$
1,624

 
$
1,459

Income Tax Benefit (Expense)
 
76

 
(38
)
 
(48
)
Total Other Expense
 
(775
)
 
(737
)
 
(949
)
Depreciation and Amortization
 
(808
)
 
(800
)
 
(749
)
Non-Cash Stock Compensation
 
(73
)
 
(151
)
 
(135
)
Non-Cash Impairment
 
(1
)
 
(7
)
 
—

Total Consolidated Net Income (Loss)
 
$
314

 
$
(109
)

$
(422
)
Summary of segment information 
The following table presents capital expenditures by segment and reconciles capital expenditures to consolidated capital expenditures for each of the years ended December 31:

(dollars in millions)
 
2014
 
2013
 
2012
Capital Expenditures:
 
 
 
 
 
 
North America
 
$
432

 
$
398

 
$
407

EMEA
 
117

 
128

 
115

Latin America
 
153

 
134

 
122

tw telecom
 
63

 
—

 
—

Unallocated Corporate Capital Expenditures
 
145

 
100

 
99

Consolidated Capital Expenditures
 
$
910

 
$
760

 
$
743

Reconciliation of Assets from Segment to Consolidated [Table Text Block] 
The following table presents total assets by segment:

 
 
As of December 31,
(dollars in millions)
 
2014
 
2013
Assets:
 
 
 
 
North America
 
$
8,082

 
$
8,133

EMEA
 
1,970

 
2,030

Latin America
 
2,451

 
2,445

tw telecom
 
8,160

 
—

Other
 
284

 
266

Total Consolidated Assets
 
$
20,947

 
$
12,874

Commitments, Contingencies and Other Items (Tables)
Schedule of Operating Leases, Future Minimum Payments Due and Unrecorded Unconditional Purchase Obligation 
Future minimum payments for the next five years and thereafter under network and related right-of-way agreements and non-cancelable operating leases for facilities and other assets consist of the following as of December 31, 2014 (dollars in millions):

 
 
Right-of-Way
Agreements
 
Facilities and Other Assets
 
Total
 
Future Minimum Sublease Receipts
2015
 
$
118

 
$
302

 
$
420

 
$
5

2016
 
58

 
244

 
302

 
4

2017
 
53

 
207

 
260

 
4

2018
 
51

 
174

 
225

 
1

2019
 
42

 
142

 
184

 
1

Thereafter
 
315

 
655

 
970

 
—

 
 
$
637

 
$
1,724

 
$
2,361

 
$
15

Schedule of long-term purchase commitments 
The following table summarizes the Company's purchase commitments at December 31, 2014 (dollars in millions):

 
 
Total
 
Less than
1 Year
 
2 - 3
Years
 
4 - 5
Years
 
After 5
Years
Cost of Access Services
 
$
710

 
$
378

 
$
262

 
$
51

 
$
19

Third-Party Maintenance Services
 
329

 
67

 
55

 
51

 
156

 
 
$
1,039

 
$
445

 
$
317

 
$
102

 
$
175

Condensed Consolidating Financial Information (Tables)
Schedule of Condensed Consolidating Statements of Operations 
Condensed Consolidating Statements of Operations
For the year ended December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Revenue
$
—

 
$
—

 
$
3,073

 
$
3,918

 
$
(214
)
 
$
6,777

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
1,177

 
1,566

 
(214
)
 
2,529

Network Related Expenses
—

 
—

 
762

 
484

 
—

 
1,246

Depreciation and Amortization
—

 
—

 
277

 
531

 
—

 
808

Selling, General and Administrative Expenses
21

 
2

 
735

 
423

 
—

 
1,181

Total Costs and Expenses
21

 
2

 
2,951

 
3,004

 
(214
)
 
5,764

Operating Income (Loss)
(21
)
 
(2
)
 
122

 
914

 
—

 
1,013

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
1

 
—

 
1

Interest expense
(143
)
 
(492
)
 
(2
)
 
(17
)
 
—

 
(654
)
Interest income (expense) affiliates, net
1,227

 
1,827

 
(2,890
)
 
(164
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(710
)
 
(2,047
)
 
663

 
—

 
2,094

 
—

Other, net
(53
)
 
—

 
7

 
(76
)
 
—

 
(122
)
Total Other Expense
321

 
(712
)
 
(2,222
)
 
(256
)
 
2,094

 
(775
)
Income (Loss) before Income Taxes
300

 
(714
)
 
(2,100
)
 
658

 
2,094

 
238

Income Tax Expense
14

 
4

 
(1
)
 
59

 
—

 
76

Net Income (Loss)
314

 
(710
)
 
(2,101
)
 
717

 
2,094

 
314

Other Comprehensive Loss, Net of Income Taxes
(183
)
 
—

 
—

 
(183
)
 
183

 
(183
)
Comprehensive Income (Loss)
$
131

 
$
(710
)
 
$
(2,101
)
 
$
534

 
$
2,277

 
$
131

Condensed Consolidating Statements of Operations
For the year ended December 31, 2013 (as revised)

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,825

 
$
3,734

 
$
(246
)
 
$
6,313

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
1,068

 
1,649

 
(246
)
 
2,471

Network Related Expenses
—

 
—

 
753

 
461

 
—

 
1,214

Depreciation and Amortization
—

 
—

 
289

 
511

 
—

 
800

Selling, General and Administrative Expenses
3

 
1

 
791

 
367

 
—

 
1,162

Total Costs and Expenses
3

 
1

 
2,901

 
2,988

 
(246
)
 
5,647

Operating Income (Loss)
(3
)
 
(1
)
 
(76
)
 
746

 
—

 
666

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
—

 
—

 
—

 
—

Interest expense
(151
)
 
(497
)
 
(3
)
 
2

 
—

 
(649
)
Interest income (expense) affiliates, net
1,091

 
1,706

 
(2,679
)
 
(118
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(1,039
)
 
(2,164
)
 
550

 
—

 
2,653

 
—

Other, net
—

 
(85
)
 
4

 
(7
)
 
—

 
(88
)
Total Other Expense
(99
)
 
(1,040
)
 
(2,128
)
 
(123
)
 
2,653

 
(737
)
Income (Loss) before Income Taxes
(102
)
 
(1,041
)
 
(2,204
)
 
623

 
2,653

 
(71
)
Income Tax Expense
(7
)
 
2

 
—

 
(33
)
 
—

 
(38
)
Net Income (Loss)
(109
)
 
(1,039
)
 
(2,204
)
 
590

 
2,653

 
(109
)
Other Comprehensive Income, Net of Income Taxes
10

 
10

 
—

 
10

 
(20
)
 
10

Comprehensive Income (Loss)
$
(99
)
 
$
(1,029
)
 
$
(2,204
)
 
$
600

 
$
2,633

 
$
(99
)
Condensed Consolidating Statements of Operations
For the year ended December 31, 2012 (as revised)

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Revenue
$
—

 
$
—

 
$
2,657

 
$
3,975

 
$
(256
)
 
$
6,376

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
—

 
—

 
996

 
1,854

 
(248
)
 
2,602

Network Related Expenses
—

 
—

 
741

 
508

 
—

 
1,249

Depreciation and Amortization
—

 
—

 
260

 
489

 
—

 
749

Selling, General and Administrative Expenses
2

 
1

 
818

 
388

 
(8
)
 
1,201

Total Costs and Expenses
2

 
1

 
2,815

 
3,239

 
(256
)
 
5,801

Operating Income (Loss)
(2
)
 
(1
)
 
(158
)
 
736

 
—

 
575

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest income
—

 
—

 
1

 
1

 
—

 
2

Interest expense
(168
)
 
(535
)
 
(3
)
 
(27
)
 
—

 
(733
)
Interest income (expense) affiliates, net
976

 
1,598

 
(2,233
)
 
(341
)
 
—

 
—

Equity in net earnings (losses) of subsidiaries
(1,188
)
 
(2,066
)
 
92

 
—

 
3,162

 
—

Other, net
(39
)
 
(184
)
 
6

 
(1
)
 
—

 
(218
)
Total Other Expense
(419
)
 
(1,187
)
 
(2,137
)
 
(368
)
 
3,162

 
(949
)
Income (Loss) before Income Taxes
(421
)
 
(1,188
)
 
(2,295
)
 
368

 
3,162

 
(374
)
Income Tax Expense
(1
)
 
—

 
(4
)
 
(43
)
 
—

 
(48
)
Net Income (Loss)
(422
)
 
(1,188
)
 
(2,299
)
 
325

 
3,162

 
(422
)
Other Comprehensive Income (Loss), Net of Income Taxes
106

 
106

 
—

 
16

 
(122
)
 
106

Comprehensive Income (Loss)
$
(316
)
 
$
(1,082
)
 
$
(2,299
)
 
$
341

 
$
3,040

 
$
(316
)


Schedule of Condensed Consolidating Balance Sheets 
Condensed Consolidating Balance Sheets
December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
7

 
$
5

 
$
307

 
$
261

 
$
—

 
$
580

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
34

 
703

 
—

 
737

Due from affiliates
14,522

 
21,270

 
—

 
—

 
(35,792
)
 
—

Other
2

 
21

 
45

 
97

 
—

 
165

Total Current Assets
14,531

 
21,296

 
387

 
1,067

 
(35,792
)
 
1,489

Property, plant, and equipment, net
—

 
—

 
3,152

 
6,708

 
—

 
9,860

Restricted cash and securities
3

 
—

 
16

 
1

 
—

 
20

Goodwill and other intangibles, net
—

 
—

 
373

 
8,730

 
—

 
9,103

Investment in subsidiaries
16,686

 
14,777

 
3,729

 
—

 
(35,192
)
 
—

Other assets, net
28

 
129

 
9

 
309

 
—

 
475

Total Assets
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
—

 
$
215

 
$
449

 
$
—

 
$
664

Current portion of long-term debt
333

 
—

 
3

 
13

 
—

 
349

Accrued payroll and employee benefits
—

 
—

 
174

 
99

 
—

 
273

Accrued interest
12

 
158

 
—

 
4

 
—

 
174

Current portion of deferred revenue
—

 
—

 
118

 
169

 
—

 
287

Due to affiliates
—

 
—

 
34,401

 
1,391

 
(35,792
)
 
—

Other
—

 
2

 
62

 
103

 
—

 
167

Total Current Liabilities
345

 
160

 
34,973

 
2,228

 
(35,792
)
 
1,914

Long-term debt, less current portion
900

 
9,893

 
16

 
175

 
—

 
10,984

Deferred revenue, less current portion
—

 
—

 
617

 
304

 
—

 
921

Other liabilities
16

 
24

 
125

 
600

 
—

 
765

Commitments and Contingencies
 
 
 
 
 
 
 
 
 
 
 
Stockholders' Equity (Deficit)
29,987

 
26,125

 
(28,065
)
 
13,508

 
(35,192
)
 
6,363

Total Liabilities and Stockholders' Equity (Deficit)
$
31,248

 
$
36,202

 
$
7,666

 
$
16,815

 
$
(70,984
)
 
$
20,947

Condensed Consolidating Balance Sheets
December 31, 2013

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
8

 
$
6

 
$
347

 
$
270

 
$
—

 
$
631

Restricted cash and securities
—

 
—

 
1

 
6

 
—

 
7

Receivables, less allowances for doubtful accounts
—

 
—

 
79

 
594

 
—

 
673

Due from affiliates
15,507

 
16,886

 
—

 
—

 
(32,393
)
 
—

Other
2

 
15

 
47

 
79

 
—

 
143

Total Current Assets
15,517

 
16,907

 
474

 
949

 
(32,393
)
 
1,454

Property, plant, and equipment, net
—

 
—

 
3,028

 
5,212

 
—

 
8,240

Restricted cash and securities
3

 
—

 
18

 
2

 
—

 
23

Goodwill and other intangibles, net
—

 
—

 
395

 
2,387

 
—

 
2,782

Investment in subsidiaries
10,039

 
27,014

 
3,735

 
—

 
(40,788
)
 
—

Other assets, net
10

 
113

 
11

 
241

 
—

 
375

Total Assets
$
25,569

 
$
44,034

 
$
7,661

 
$
8,791

 
$
(73,181
)
 
$
12,874

 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity (Deficit)
 
 
 
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
2

 
$
42

 
$
581

 
$
—

 
$
625

Current portion of long-term debt
—

 
—

 
3

 
28

 
—

 
31

Accrued payroll and employee benefits
—

 
—

 
171

 
38

 
—

 
209

Accrued interest
30

 
129

 
—

 
1

 
—

 
160

Current portion of deferred revenue
—

 
—

 
131

 
122

 
—

 
253

Due to affiliates
—

 
—

 
32,165

 
228

 
(32,393
)
 
—

Other
—

 
13

 
74

 
81

 
—

 
168

Total Current Liabilities
30

 
144

 
32,586

 
1,079

 
(32,393
)
 
1,446

Long-term debt, less current portion
1,370

 
6,905

 
17

 
39

 
—

 
8,331

Deferred revenue, less current portion
—

 
—

 
603

 
303

 
—

 
906

Other liabilities
15

 
27

 
135

 
603

 
—

 
780

Commitments and Contingencies
 
 
 
 
 
 
 
 
 
 
 
Stockholders' Equity (Deficit)
24,154

 
36,958

 
(25,680
)
 
6,767

 
(40,788
)
 
1,411

Total Liabilities and Stockholders' Equity (Deficit)
$
25,569

 
$
44,034

 
$
7,661

 
$
8,791

 
$
(73,181
)
 
$
12,874

Schedule of Condensed Consolidating Statements of Cash Flows 
Condensed Consolidating Statements of Cash Flows
For the year ended December 31, 2014

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(178
)
 
$
(458
)
 
$
625

 
$
1,172

 
$
—

 
$
1,161

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures
—

 
—

 
(362
)
 
(548
)
 
—

 
(910
)
Change in restricted cash and securities, net
—

 
—

 
2

 
(12
)
 
—

 
(10
)
Proceeds from sale of property, plant and equipment and other assets
—

 
—

 
—

 
3

 
—

 
3

Investment in tw telecom, net of cash acquired
(474
)
 
—

 
—

 
307

 
—

 
(167
)
Other
—

 
—

 
—

 
(2
)
 
—

 
(2
)
Net Cash Provided by (Used in) Investing Activities
(474
)
 
—

 
(360
)
 
(252
)
 
—

 
(1,086
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
590

 
—

 
—

 
(1
)
 
—

 
589

Payments on and repurchases of long-term debt, including current portion and refinancing costs
(647
)
 
—

 
—

 
(24
)
 
—

 
(671
)
Increase (decrease) due from/to affiliates, net
708

 
457

 
(305
)
 
(860
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
651

 
457

 
(305
)
 
(885
)
 
—

 
(82
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(44
)
 
—

 
(44
)
Net Change in Cash and Cash Equivalents
(1
)
 
(1
)
 
(40
)
 
(9
)
 
—

 
(51
)
Cash and Cash Equivalents at Beginning of Year
8

 
6

 
347

 
270

 
—

 
631

Cash and Cash Equivalents at End of Year
$
7

 
$
5

 
$
307

 
$
261

 
$
—

 
$
580


Condensed Consolidating Statements of Cash Flows
For the year ended December 31, 2013

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities
$
(169
)
 
$
(557
)
 
$
710

 
$
729

 
$
—

 
$
713

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures
—

 
—

 
(312
)
 
(448
)
 
—

 
(760
)
Change in restricted cash and securities, net
9

 
—

 
(1
)
 
5

 
—

 
13

Other
—

 
—

 
1

 
1

 
—

 
2

Net Cash Provided by (Used in) Investing Activities
9

 
—

 
(312
)
 
(442
)
 
—

 
(745
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
—

 
1,502

 
—

 
—

 
—

 
1,502

Payments on and repurchases of long-term debt, including current portion and refinancing costs
(173
)
 
(1,586
)
 
(4
)
 
(33
)
 
—

 
(1,796
)
Increase (decrease) due from/to affiliates, net
88

 
642

 
(433
)
 
(297
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities
(85
)
 
558

 
(437
)
 
(330
)
 
—

 
(294
)
Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
(22
)
 
—

 
(22
)
Net Change in Cash and Cash Equivalents
(245
)
 
1

 
(39
)
 
(65
)
 
—

 
(348
)
Cash and Cash Equivalents at Beginning of Year
253

 
5

 
386

 
335

 
—

 
979

Cash and Cash Equivalents at End of Year
$
8

 
$
6

 
$
347

 
$
270

 
$
—

 
$
631

Condensed Consolidating Statements of Cash Flows
For the year ended December 31, 2012

 
Level 3 Communications, Inc.
 
Level 3 Financing, Inc.
 
Level 3 Communications, LLC
 
Other Non-Guarantor Subsidiaries
 
Eliminations
 
Total
(dollars in millions)
Net Cash Provided by (Used in) Operating Activities of Continuing Operations
$
(165
)
 
$
(520
)
 
$
140

 
$
1,123

 
$
—

 
$
578

Cash Flows from Investing Activities:
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures
—

 
—

 
(276
)
 
(467
)
 
—

 
(743
)
Change in restricted cash and securities, net
6

 
—

 
2

 
12

 
—

 
20

Other
—

 
—

 
—

 
(2
)
 
—

 
(2
)
Net Cash Used in Investing Activities of Continuing Operations
6

 
—

 
(274
)
 
(457
)
 
—

 
(725
)
Cash Flows from Financing Activities:
 
 
 
 
 
 
 
 
 
 
 
Long-term debt borrowings, net of issuance costs
293

 
4,211

 
—

 
—

 
—

 
4,504

Payments on and repurchases of long-term debt, including current portion and refinancing costs
—

 
(4,161
)
 
—

 
(141
)
 
—

 
(4,302
)
Proceeds from stock options exercised
5

 
—

 
—

 
—

 
—

 
5

Increase (decrease) due from affiliates, net
112

 
469

 
(98
)
 
(483
)
 
—

 
—

Net Cash Provided by (Used in) Financing Activities of Continuing Operations
410

 
519

 
(98
)
 
(624
)
 
—

 
207

Effect of Exchange Rates on Cash and Cash Equivalents
—

 
—

 
—

 
1

 
—

 
1

Net Change in Cash and Cash Equivalents
251

 
(1
)
 
(232
)
 
43

 
—

 
61

Cash and Cash Equivalents at Beginning of Year
2

 
6

 
618

 
292

 
—

 
918

Cash and Cash Equivalents at End of Year
$
253

 
$
5

 
$
386

 
$
335

 
$
—

 
$
979

Unaudited Quarterly Financial Data (Tables)
Unaudited Quarterly Financial Data
 
 
Three Months Ended
 
 
March 31,
 
June 30,
 
September 30,
 
December 31,
 
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
 
 
(as revised)
 
(as revised)
 
 
 
(as revised)
 
 
 
(as revised)
(dollars in millions except per share data)
Revenue
 
$
1,609

 
$
1,577

 
$
1,625

 
$
1,565

 
$
1,629

 
$
1,569

 
$
1,914

 
$
1,602

Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Network Access Costs
 
614

 
629

 
613

 
616

 
607

 
608

 
695

 
618

Network Related Expenses
 
292

 
302

 
302

 
300

 
307

 
314

 
345

 
298

Depreciation and Amortization
 
184

 
194

 
187

 
199

 
187

 
203

 
250

 
204

Selling, General and Administrative Expenses
 
255

 
297

 
267

 
310

 
266

 
292

 
393

 
263

Total Costs and Expenses
 
1,345

 
1,422

 
1,369

 
1,425

 
1,367

 
1,417

 
1,683

 
1,383

Operating Income
 
264

 
155

 
256

 
140

 
262

 
152

 
231

 
219

Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Income
 
—

 
—

 
—

 
—

 
1

 
—

 
—

 
—

Interest expense
 
(151
)
 
(169
)
 
(149
)
 
(167
)
 
(159
)
 
(165
)
 
(195
)
 
(148
)
Gain (Loss) on extinguishments of debt, net
 
—

 
—

 
—

 
—

 
—

 
(17
)
 
(53
)
 
(67
)
Other, net
 
6

 
(50
)
 
(44
)
 
14

 
(11
)
 
23

 
(20
)
 
9

Total Other Expense
 
(145
)
 
(219
)
 
(193
)
 
(153
)
 
(169
)
 
(159
)
 
(268
)
 
(206
)
Income (Loss) Before Income Taxes
 
119

 
(64
)
 
63

 
(13
)
 
93

 
(7
)
 
(37
)
 
13

Income Tax (Expense) Benefit
 
(7
)
 
(14
)
 
(12
)
 
(11
)
 
(8
)
 
(14
)
 
103

 
1

Net Income (Loss)
 
$
112

 
$
(78
)
 
$
51

 
$
(24
)
 
$
85

 
$
(21
)
 
$
66

 
$
14

Net Income (Loss) Per Share - Basic
 
$
0.48

 
$
(0.36
)
 
$
0.21

 
$
(0.11
)
 
$
0.36

 
$
(0.09
)
 
$
0.22

 
$
0.06

Net Income (Loss) Per Share - Diluted
 
$
0.47

 
$
(0.36
)
 
$
0.21

 
$
(0.11
)
 
$
0.35

 
$
(0.09
)
 
$
0.21

 
$
0.06

Organization and Summary of Significant Accounting Policies (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Jan. 1, 2014
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Effective Date of Acquisition
Oct. 31, 2014 
 
 
 
 
 
 
 
Oct. 31, 2014 
 
 
 
IP Equipment
 
 
 
 
 
 
 
 
 
 
 
$ 222 
New Accounting Pronouncement or Change in Accounting Principle, Effect of Change on Net Income
 
 
 
 
 
 
 
 
90 
 
 
 
Period company may receive up front payments for services to be provided in the future (in years)
 
 
 
 
 
 
 
 
25 
 
 
 
USF contributions
 
 
 
 
 
 
 
 
234 
194 
191 
 
Bad debt expense
 
 
 
 
 
 
 
 
22 
17 
15 
 
Net Income (Loss)
66 
85 
51 
112 
14 
(21)
(24)
(78)
314 
(109)
(422)
 
Capitalized labor and related costs associated with employee and contract labor working on capital projects
 
 
 
 
 
 
 
 
187 
164 
146 
 
Impairment of Intangible Assets (Excluding Goodwill)
 
 
 
 
 
 
 
 
17 
 
 
 
New Accounting Pronouncement or Change in Accounting Principle, Effect of Change on Basic Earnings Per Share
 
 
 
 
 
 
 
 
$ 0.35 
 
 
 
Network Access Costs
695 
607 
613 
614 
618 
608 
616 
629 
2,529 
2,471 
2,602 
 
Network Related Expenses
345 
307 
302 
292 
298 
314 
300 
302 
1,246 
1,214 
1,249 
 
Selling, General and Administrative Expenses
393 
266 
267 
255 
263 
292 
310 
297 
1,181 
1,162 
1,201 
 
Total Costs and Expenses
1,683 
1,367 
1,369 
1,345 
1,383 
1,417 
1,425 
1,422 
5,764 
5,647 
5,801 
 
Racks and Cabinets
 
 
 
 
 
 
 
 
 
 
 
114 
Facility Equipment
 
 
 
 
 
 
 
 
 
 
 
151 
Fixtures and Equipment, Gross
 
 
 
 
 
 
 
 
 
 
 
487 
New Accounting Pronouncement or Change in Accounting Principle, Effect of Change on Diluted Earnings Per Share
 
 
 
 
 
 
 
 
$ 0.35 
 
 
 
Sales Revenue |
Customer Concentration Risk
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of communications revenue from top ten customers
 
 
 
 
 
 
 
 
17.00% 
17.00% 
17.00% 
 
Minimum [Member]
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Finite-lived intangible assets, useful life, minimum (in years)
 
 
 
 
 
 
 
 
4 years 
 
 
 
Minimum [Member] |
Facility and Leasehold Improvements
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
15 years 
 
 
 
Minimum [Member] |
Network infrastructure (including fiber and conduit)
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
25 years 
 
 
 
Minimum [Member] |
Operating Equipment
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
5 years 
 
 
 
Minimum [Member] |
Office Equipment [Member]
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
3 years 
 
 
 
Minimum [Member] |
Expansion and improvements of communications network and customer installations
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
3 years 
 
 
 
Maximum
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Finite-lived intangible assets, useful life, minimum (in years)
 
 
 
 
 
 
 
 
12 years 
 
 
 
Maximum |
Facility and Leasehold Improvements
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
40 years 
 
 
 
Maximum |
Network infrastructure (including fiber and conduit)
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
50 years 
 
 
 
Maximum |
Operating Equipment
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
15 years 
 
 
 
Maximum |
Office Equipment [Member]
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
7 years 
 
 
 
Maximum |
Expansion and improvements of communications network and customer installations
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
7 years 
 
 
 
Maximum |
Software development
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, useful life, minimum (in years)
 
 
 
 
 
 
 
 
3 years 
 
 
 
Scenario, Previously Reported [Member]
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Cost of Revenue
 
 
 
 
 
 
 
 
 
2,471 
2,602 
 
Network Access Costs
 
 
 
 
 
 
 
 
 
0 
0 
 
Network Related Expenses
 
 
 
 
 
 
 
 
 
0 
0 
 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
 
2,376 
2,450 
 
Total Costs and Expenses
 
 
 
 
 
 
 
 
 
5,647 
5,801 
 
Restatement Adjustment [Member]
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Cost of Revenue
 
 
 
 
 
 
 
 
 
(2,471)
(2,602)
 
Network Access Costs
 
 
 
 
 
 
 
 
 
2,471 
2,602 
 
Network Related Expenses
 
 
 
 
 
 
 
 
 
1,214 
1,249 
 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
 
(1,214)
(1,249)
 
Total Costs and Expenses
 
 
 
 
 
 
 
 
 
0 
0 
 
As Restated [Member]
 
 
 
 
 
 
 
 
 
 
 
 
Description of Business
 
 
 
 
 
 
 
 
 
 
 
 
Cost of Revenue
 
 
 
 
 
 
 
 
 
0 
0 
 
Network Access Costs
 
 
 
 
 
 
 
 
 
2,471 
2,602 
 
Network Related Expenses
 
 
 
 
 
 
 
 
 
1,214 
1,249 
 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
 
1,162 
1,201 
 
Total Costs and Expenses
 
 
 
 
 
 
 
 
 
$ 5,647 
$ 5,801 
 
Events Associated with the Merger of tw telecom inc. (Details) (USD $)
3 Months Ended 12 Months Ended 3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Oct. 31, 2014
Oct. 30, 2014
Dec. 31, 2014
TrancheB2022TermLoanTotal [Member]
Dec. 31, 2014
Term Loans
Dec. 31, 2013
Term Loans
Dec. 31, 2014
Senior Notes due 2019 (8.125%)
Dec. 31, 2013
Senior Notes due 2019 (8.125%)
Dec. 31, 2011
Senior Notes due 2019 (8.125%)
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Aug. 12, 2014
Senior Notes 5.375percent Due 2022 [Member]
Dec. 31, 2014
tw telecom [Member]
Dec. 31, 2014
Guarantor Subsidiaries [Member]
Dec. 31, 2013
Guarantor Subsidiaries [Member]
Dec. 31, 2012
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Guarantor Subsidiaries [Member]
TrancheB2022TermLoanTotal [Member]
Acquisition
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Effective Date of Acquisition
Oct. 31, 2014 
 
 
 
 
 
 
 
Oct. 31, 2014 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock consideration per share
0.7 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
business acquisition, cash consideration per share
$ 10 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt, Gross
11,366,000,000 
 
 
 
8,392,000,000 
 
 
 
11,366,000,000 
8,392,000,000 
 
 
 
2,000,000,000 
4,611,000,000 1
2,611,000,000 1
1,200,000,000 
1,200,000,000 
 
 
 
 
 
 
 
2,000,000,000 
Debt Instrument, Face Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,000,000,000 
1,000,000,000 
 
 
 
 
 
Revenue
1,914,000,000 
1,629,000,000 
1,625,000,000 
1,609,000,000 
1,602,000,000 
1,569,000,000 
1,565,000,000 
1,577,000,000 
6,777,000,000 
6,313,000,000 
6,376,000,000 
 
 
 
 
 
 
 
 
 
 
285,000,000 
0 
0 
0 
 
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets
 
 
 
 
 
 
 
 
 
 
 
138,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, stated interest rate (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8.125% 
 
8.125% 
5.375% 
 
 
 
 
 
 
Common Stock, Shares Authorized
433,333,333 
 
 
 
343,333,333 
 
 
 
433,333,333 
343,333,333 
 
 
433,333,333 
 
 
 
 
 
 
 
 
 
 
 
 
 
Shares issued in Amalgamation transaction (in shares)
96,900,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Debt Assumed
 
 
 
 
 
 
 
 
 
 
 
1,793,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Estimated total Amalgamation transaction consideration
 
 
 
 
 
 
 
 
 
 
 
6,011,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Final Purchase Price Allocation [Abstract]
 
 
 
 
 
 
 
 
Text Block 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents
 
 
 
 
 
 
 
 
 
 
 
309,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Purchase Price Allocation, Property and Equipment
 
 
 
 
 
 
 
 
 
 
 
1,555,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Purchase Price Allocation, Goodwill
7,689,000,000 
 
 
 
2,577,000,000 
 
 
 
7,689,000,000 
2,577,000,000 
2,565,000,000 
5,124,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Purchase Price Allocation, Intangible Assets not Goodwill
 
 
 
 
 
 
 
 
 
 
 
1,323,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Purchase Price Allocation, Other Assets Acquired
 
 
 
 
 
 
 
 
 
 
 
8,449,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt
 
 
 
 
 
 
 
 
 
 
 
(2,099,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Purchase Price Allocation, Noncurrent Liabilities, Deferred Revenue
 
 
 
 
 
 
 
 
 
 
 
(60,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Purchase Price Allocation, Other Liabilities Assumed
 
 
 
 
 
 
 
 
 
 
 
(279,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Purchase Price Allocation, Total Liabilities Assumed
 
 
 
 
 
 
 
 
 
 
 
2,438,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
business combination debt premiums incurred
 
 
 
 
 
 
 
 
154,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Capital Lease Obligation
 
 
 
 
 
 
 
 
 
 
 
152,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Share Price
 
 
 
 
 
 
 
 
 
 
 
$ 46.91 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Consideration Transferred
8,100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Pro Forma Financial Information [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Revenue
 
 
 
 
 
 
 
 
8,123,000,000 
7,825,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Loss
 
 
 
 
 
 
 
 
141,000,000 
(165,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Loss per share (in dollars per share)
 
 
 
 
 
 
 
 
$ 0.42 
$ (0.52)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Combination, Integration Related Costs
$ 70,000,000 
 
 
 
 
 
 
 
$ 81,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Business Acquisition, Pro Forma Earnings Per Share, Diluted
 
 
 
 
 
 
 
 
$ 0.42 
$ (0.52)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Final Purchase Price Allocation [Abstract] 


 
Initial Purchase Price Allocation
 
(dollars in millions)
Assets:
 
Cash, Cash Equivalents and Restricted Cash
$
309

Property, Plant and Equipment
1,555

Goodwill
5,124

Identifiable Intangible Assets
1,323

Other Assets
138

Total Assets
8,449

 
 
Liabilities:
 
Long-Term Debt
(2,099
)
Deferred Revenue
(60
)
Other Liabilities
(279
)
Total Liabilities
(2,438
)
Total Consideration to be Allocated
$
6,011

Earnings Per Share (Details)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Convertible Senior Notes
 
 
 
Loss per share
 
 
 
Securities not included in computation of diluted loss per share (in millions of shares)
17 
18 
35 
Stock options, restricted stock units and warrants
 
 
 
Loss per share
 
 
 
Securities not included in computation of diluted loss per share (in millions of shares)
 
6 
7 
Property, Plant and Equipment (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
$ 19,489 
$ 17,329 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
(9,629)
(9,089)
 
Net
9,860 
8,240 
 
Depreciation expense
713 
727 
659 
Land
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
192 
193 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
0 
0 
 
Net
192 
193 
 
Land Improvements
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
73 
72 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
(50)
(47)
 
Net
23 
25 
 
Facility and Leasehold Improvements
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
2,489 
2,207 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
(1,265)
(1,193)
 
Net
1,224 
1,014 
 
Network infrastructure
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
8,941 
8,505 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
(3,447)
(3,279)
 
Net
5,494 
5,226 
 
Operating Equipment
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
7,217 
6,057 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
(4,669)
(4,381)
 
Net
2,548 
1,676 
 
Furniture, Fixtures and Office Equipment
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
255 
196 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
(177)
(168)
 
Net
78 
28 
 
Other
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
29 
22 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
(21)
(21)
 
Net
8 
1 
 
Construction-in-Progress
 
 
 
Property, Plant and Equipment, Net [Abstract]
 
 
 
Property, Plant and Equipment, Gross
293 
77 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
0 
0 
 
Net
$ 293 
$ 77 
 
Asset Retirement Obligations (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Asset Retirement Obligation, Change in Accounting Estimate
 
 
 
 
 
 
 
 
 
 
 
Property, Plant and Equipment, Gross
$ (19,489)
 
 
 
$ (17,329)
 
 
 
$ (19,489)
$ (17,329)
 
Selling, General and Administrative and Depreciation Expense
(1,683)
(1,367)
(1,369)
(1,345)
(1,383)
(1,417)
(1,425)
(1,422)
(5,764)
(5,647)
(5,801)
Selling, General and Administrative Expenses
(393)
(266)
(267)
(255)
(263)
(292)
(310)
(297)
(1,181)
(1,162)
(1,201)
Depreciation and Amortization
(250)
(187)
(187)
(184)
(204)
(203)
(199)
(194)
(808)
(800)
(749)
Network Related Expenses
345 
307 
302 
292 
298 
314 
300 
302 
1,246 
1,214 
1,249 
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
Asset retirement obligation, beginning balance
 
 
 
56 
 
 
 
55 
56 
55 
 
Accretion expense
 
 
 
 
 
 
 
 
8 
7 
 
ARO liabilities assumed in acquisition
 
 
 
 
 
 
 
 
22 
0 
 
Liabilities settled
 
 
 
 
 
 
 
 
(7)
(6)
 
Effect of foreign currency rate change
 
 
 
 
 
 
 
 
(1)
0 
 
Asset retirement obligation, ending balance
85 
 
 
 
56 
 
 
 
85 
56 
55 
Asset Retirement Obligation Change in Estimate
 
 
 
 
 
 
 
 
 
 
 
Asset Retirement Obligation, Change in Accounting Estimate
 
 
 
 
 
 
 
 
 
 
 
Property, Plant and Equipment, Gross
 
 
 
 
 
 
 
 
 
 
(24)
Selling, General and Administrative and Depreciation Expense
 
 
 
 
 
 
 
 
 
(49)
 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
 
 
(47)
Depreciation and Amortization
 
 
 
 
 
 
 
 
 
 
(2)
Earnings Per Share, Basic and Diluted Changes in Accounting Estimates
 
 
 
 
 
 
 
 
 
$ 0.23 
 
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
Asset retirement obligation, beginning balance
 
 
 
 
 
 
 
73 
 
73 
 
Asset retirement obligation, ending balance
 
 
 
 
 
 
 
 
 
 
73 
Asset Retirement Obligation, Change in Estimate Right-of-way
 
 
 
 
 
 
 
 
 
 
 
Asset Retirement Obligation, Change in Accounting Estimate
 
 
 
 
 
 
 
 
 
 
 
Earnings Per Share, Basic and Diluted Changes in Accounting Estimates
 
 
 
 
 
 
 
 
 
$ 0.10 
 
Network Related Expenses
 
 
 
 
 
 
 
 
 
$ 21 
 
Goodwill (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Oct. 31, 2014
Changes in carrying amount of goodwill
 
 
 
Balance at the beginning of the period
$ 2,577 
$ 2,565 
$ 5,124 
Goodwill adjustments
(12)
12 
 
Balance at the end of the period
7,689 
2,577 
5,124 
Goodwill, Acquired During Period
$ 5,124 
 
 
Acquired Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Finite-Lived Intangible Assets:
 
 
 
Finite-Lived Intangible Assets, Gross Carrying Amount
$ 2,320 
$ 999 
 
Finite-Lived Intangible Assets, Accumulated Amortization
(921)
(826)
 
Finite-Lived Intangible Assets, Net
1,399 
173 
 
Impairment of Intangible Assets (Excluding Goodwill)
17 
 
 
Acquired finite-lived intangible asset amortization expense
95 
73 
90 
Total Acquired Intangible Assets
 
 
 
Total Intangible assets, Gross Carrying Amount
2,335 
1,031 
 
Total intangible assets, Net
1,414 
205 
 
Estimated amortization expense of acquired finite-lived intangible asset
 
 
 
2013
242 
 
 
2014
223 
 
 
2015
208 
 
 
2016
205 
 
 
2017
188 
 
 
Thereafter
333 
 
 
Finite-Lived Intangible Assets, Net
1,399 
173 
 
Vyvx Trade Name
 
 
 
Indefinite-Lived Intangible Assets:
 
 
 
Indefinite-Lived Intangible Assets, Net
15 
32 
 
Customer Contracts and Relationships
 
 
 
Finite-Lived Intangible Assets:
 
 
 
Finite-Lived Intangible Assets, Gross Carrying Amount
1,977 
786 
 
Finite-Lived Intangible Assets, Accumulated Amortization
(741)
(678)
 
Finite-Lived Intangible Assets, Net
1,236 
108 
 
Acquired finite-lived intangible assets, amortization period (in years)
6 years 9 months 18 days 
 
 
Estimated amortization expense of acquired finite-lived intangible asset
 
 
 
Finite-Lived Intangible Assets, Net
1,236 
108 
 
Trademarks
 
 
 
Finite-Lived Intangible Assets:
 
 
 
Finite-Lived Intangible Assets, Gross Carrying Amount
115 
55 
 
Finite-Lived Intangible Assets, Accumulated Amortization
(47)
(31)
 
Finite-Lived Intangible Assets, Net
68 
24 
 
Acquired finite-lived intangible assets, amortization period (in years)
4 years 2 months 12 days 
 
 
Estimated amortization expense of acquired finite-lived intangible asset
 
 
 
Finite-Lived Intangible Assets, Net
68 
24 
 
Patents and Developed Technology
 
 
 
Finite-Lived Intangible Assets:
 
 
 
Finite-Lived Intangible Assets, Gross Carrying Amount
228 
158 
 
Finite-Lived Intangible Assets, Accumulated Amortization
(133)
(117)
 
Finite-Lived Intangible Assets, Net
95 
41 
 
Acquired finite-lived intangible assets, amortization period (in years)
4 years 
 
 
Estimated amortization expense of acquired finite-lived intangible asset
 
 
 
Finite-Lived Intangible Assets, Net
$ 95 
$ 41 
 
Restructuring Charges (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended 144 Months Ended
Dec. 31, 2014
Employee Separations
Dec. 31, 2013
Employee Separations
Dec. 31, 2012
Employee Separations
Dec. 31, 2014
Facility Closings
Dec. 31, 2013
Facility Closings
Dec. 31, 2012
Facility Closings
Dec. 31, 2014
Network Related Expenses [Member]
Employee Separations
Dec. 31, 2013
Network Related Expenses [Member]
Employee Separations
Dec. 31, 2012
Network Related Expenses [Member]
Employee Separations
Dec. 31, 2014
General and Administrative Expense [Member]
Employee Separations
Dec. 31, 2013
General and Administrative Expense [Member]
Employee Separations
Dec. 31, 2012
General and Administrative Expense [Member]
Employee Separations
Dec. 31, 2025
Subsequent Event [Member]
Restructuring charge and reserve
 
 
 
 
 
 
 
 
 
 
 
 
 
Restructuring reserve
$ 37 
$ 8 
 
$ 20 
$ 31 
 
 
 
 
 
 
 
 
Restructuring and Related Activities, Description
 
 
 
 
 
 
 
 
 
 
 
 
2025 
Restructuring charges
45 
47 
34 
 
 
 
11 
12 
8 
34 
35 
26 
 
Benefit (loss) recognized as a result of lease modification
 
 
 
$ 1 
$ 7 
$ (2)
 
 
 
 
 
 
 
Fair Value of Financial Instruments - Liabilities, Recurring (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended 65 Months Ended 12 Months Ended 24 Months Ended 11 Months Ended 12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2014
Fair Value, Measurements, Recurring
Total Carrying Value in Consolidated Balance Sheet
Dec. 31, 2013
Fair Value, Measurements, Recurring
Total Carrying Value in Consolidated Balance Sheet
Dec. 31, 2014
Fair Value, Measurements, Recurring
Unadjusted quoted prices in active markets for identical assets or liabilities (Level 1)
Dec. 31, 2013
Fair Value, Measurements, Recurring
Unadjusted quoted prices in active markets for identical assets or liabilities (Level 1)
Dec. 31, 2014
Fair Value, Measurements, Recurring
Significant Other Observable Inputs (Level 2)
Dec. 31, 2013
Fair Value, Measurements, Recurring
Significant Other Observable Inputs (Level 2)
Dec. 31, 2014
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2011
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2014
Term Loans
Estimate of Fair Value Measurement [Member]
Dec. 31, 2013
Term Loans
Estimate of Fair Value Measurement [Member]
Dec. 31, 2011
Tranche A Term Loan [Member]
Jul. 31, 2012
Tranche A Term Loan [Member]
Dec. 31, 2011
Tranche B II Term Loan Six Hundred Fifty Million Dollars [Member]
Oct. 4, 2013
Tranche B II Term Loan Six Hundred Fifty Million Dollars [Member]
Sep. 30, 2012
Tranche B III Term Loan Five Hundred Fifty Million Dollars [Member]
Dec. 31, 2011
Tranche B III Term Loan Five Hundred Fifty Million Dollars [Member]
Dec. 31, 2014
Tranche B 2016 Term Loan [Member]
Aug. 1, 2013
Tranche B 2016 Term Loan [Member]
Dec. 31, 2014
Tranche B 2019 Term Loan [Member]
Aug. 1, 2013
Tranche B 2019 Term Loan [Member]
Dec. 31, 2014
TrancheBII2019TermLoan [Member]
Oct. 4, 2013
TrancheBII2019TermLoan [Member]
Dec. 31, 2014
Senior Notes
Fair Value, Measurements, Recurring
Estimate of Fair Value Measurement [Member]
Dec. 31, 2013
Senior Notes
Fair Value, Measurements, Recurring
Estimate of Fair Value Measurement [Member]
Fair Value Disclosures [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Carrying value of long-term debt, including current portion
$ 11,333 
$ 8,362 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities measured on a recurring basis
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Description of Variable Rate Basis
 
 
 
 
 
 
 
 
 
 
 
 
LIBOR 
 
LIBOR 
 
 
LIBOR 
LIBOR 
 
LIBOR 
 
LIBOR 
 
 
 
Debt Instrument, Basis Spread on Variable Rate
 
 
 
 
 
 
 
 
 
 
 
 
 
2.25% 
 
4.25% 
4.25% 
 
 
3.25% 
 
3.75% 
 
3.25% 
 
 
Long-term Debt, including the current portion:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Term Loans
 
 
4,590 
2,604 
4,593 
2,633 
0 
0 
 
 
4,600 
2,600 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior Notes
 
 
6,203 
5,198 
6,481 
5,673 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6,500 
5,700 
Convertible Notes
 
 
333 
474 
0 
0 
868 
647 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Capital Leases and Other
 
 
207 
86 
0 
0 
207 
86 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Long-term Debt, including the current portion:
 
 
11,333 
8,362 
11,074 
8,306 
1,075 
733 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt conversion, shares issued upon conversion (in shares)
 
 
 
 
 
 
 
 
5 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Conversion, Original Debt, Amount
 
 
 
 
 
 
 
 
$ 142 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Basis Floor
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.50% 
 
 
1.50% 
1.50% 
 
1.50% 
 
1.50% 
 
 
 
Debt Instrument, Interest Rate, Stated Percentage
 
 
 
 
 
 
 
 
7.00% 
7.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair Value of Financial Instruments - Liabilities, Non Recurring (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended 12 Months Ended 12 Months Ended 11 Months Ended 24 Months Ended 65 Months Ended 12 Months Ended
Oct. 4, 2013
Tranche B-II 2019 Term Loan
Dec. 31, 2014
Tranche B-II 2019 Term Loan
Aug. 1, 2013
Tranche B 2019 Term Loan
Dec. 31, 2014
Tranche B 2019 Term Loan
Aug. 1, 2013
Tranche B 2016 Term Loan
Dec. 31, 2014
Tranche B 2016 Term Loan
Sep. 30, 2012
Tranche B III Term Loan
Dec. 31, 2011
Tranche B III Term Loan
Oct. 4, 2013
Tranche B II Term Loan
Dec. 31, 2011
Tranche B II Term Loan
Jul. 31, 2012
Tranche A Term Loan
Dec. 31, 2014
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2011
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2014
Senior Notes due 2019 (8.875%)
Dec. 31, 2014
Convertible Senior Notes due 2016 (6.5%)
Dec. 31, 2011
Convertible Senior Notes due 2016 (6.5%)
Dec. 31, 2014
Not actively traded convertible notes
Dec. 31, 2014
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2011
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2014
Convertible Senior Notes due 2015 Series B (7.0%)
Dec. 31, 2011
Convertible Senior Notes due 2015 Series B (7.0%)
Dec. 31, 2014
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2011
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2014
Estimate of Fair Value, Fair Value Disclosure
Term Loans
Dec. 31, 2013
Estimate of Fair Value, Fair Value Disclosure
Term Loans
Dec. 31, 2014
Estimate of Fair Value, Fair Value Disclosure
Not actively traded convertible notes
Dec. 31, 2013
Estimate of Fair Value, Fair Value Disclosure
Not actively traded convertible notes
Dec. 31, 2014
Fair Value, Measurements, Recurring
Estimate of Fair Value, Fair Value Disclosure
Senior Notes
Dec. 31, 2013
Fair Value, Measurements, Recurring
Estimate of Fair Value, Fair Value Disclosure
Senior Notes
Liabilities measured on a recurring basis
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Term Loans
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 4,600 
$ 2,600 
 
 
 
 
Debt instrument, Interest spread on debt (as percent)
3.25% 
 
3.75% 
 
3.25% 
 
4.25% 
 
4.25% 
 
2.25% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, basis floor (as percent)
 
1.50% 
 
1.50% 
 
1.50% 
 
1.50% 
 
1.50% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior Notes
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6,500 
5,700 
Convertible Notes
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 868 
$ 647 
 
 
Debt instrument, stated interest rate (as a percent)
 
 
 
 
 
 
 
 
 
 
 
11.875% 
11.875% 
8.875% 
6.50% 
6.50% 
 
7.00% 
7.00% 
7.00% 
7.00% 
15.00% 
15.00% 
 
 
 
 
 
 
Security coupon rates used for valuation, lowest interest rate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7.00% 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Financial Instruments (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended 1 Months Ended 12 Months Ended 1 Months Ended 12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2013
Interest Rate Swap
Dec. 31, 2012
Interest Rate Swap
Mar. 31, 2007
Parent Company [Member]
Dec. 31, 2014
Parent Company [Member]
Mar. 31, 2007
Parent Company [Member]
Interest Rate Swap, Agreement One
Mar. 31, 2007
Parent Company [Member]
Interest Rate Swap, Agreement Two
Dec. 31, 2013
Interest Expense
Dec. 31, 2012
Interest Expense
Dec. 31, 2013
Other Current Liabilities [Member]
Derivative
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate swaps, number of instruments
 
 
 
 
 
2 
 
 
 
 
 
 
Interest rate swaps, notional amount
 
 
 
 
 
$ 1,000 
 
 
$ 500 
 
 
 
Basis of interest payment
 
 
 
 
 
three month LIBOR 
three month LIBOR 
three month LIBOR 
three month LIBOR 
 
 
 
Loss on Cash Flow Hedge Ineffectiveness
 
 
 
 
(60)
 
 
 
 
 
 
 
Interest rate swap agreements - Other noncurrent liabilities
 
 
 
 
 
 
 
 
 
 
 
12 
Cash flow hedging contracts, gains (losses) recognized in Other Comprehensive Income (Loss)
 
0 
90 
 
 
 
 
 
 
 
 
 
Cash flow hedging contracts, amount of gains (losses) reclassified from AOCI to Interest Expense
 
 
 
 
 
 
 
 
 
0 
26 
 
Gain (Loss) on interest rate swap agreements not designated as hedging instruments
$ 0 
$ (2)
$ (64)
$ (2)
$ (4)
 
 
 
 
 
 
 
Long-Term Debt - Schedule of Long Term Debt (Details) (USD $)
In Millions, unless otherwise specified
0 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2014
Tranche B III 2019 and Tranche B 2020 Term Loans [Member]
Dec. 31, 2014
Term Loans
Dec. 31, 2013
Term Loans
Dec. 31, 2014
Floating Rate Senior Notes due 2015
Dec. 31, 2011
Floating Rate Senior Notes due 2015
Dec. 31, 2014
Senior Notes due 2018 (10.0%)
Dec. 31, 2013
Senior Notes due 2018 (10.0%)
Dec. 31, 2011
Senior Notes due 2018 (10.0%)
Dec. 31, 2014
Floating Rate Senior Notes due 2018 [Member]
Dec. 31, 2013
Floating Rate Senior Notes due 2018 [Member]
Dec. 31, 2014
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2013
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2011
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2014
Senior Notes due 2019 (9.375%)
Dec. 31, 2013
Senior Notes due 2019 (9.375%)
Dec. 31, 2011
Senior Notes due 2019 (9.375%)
Dec. 31, 2014
Senior Notes due 2019 (8.125%)
Dec. 31, 2013
Senior Notes due 2019 (8.125%)
Dec. 31, 2011
Senior Notes due 2019 (8.125%)
Dec. 31, 2014
Senior Notes due 2019 (8.875%)
Dec. 31, 2013
Senior Notes due 2019 (8.875%)
Dec. 31, 2014
Senior Notes due 2020 (8.625%)
Dec. 31, 2013
Senior Notes due 2020 (8.625%)
Dec. 31, 2014
Senior Notes due 2020 (7.0%)
Dec. 31, 2013
Senior Notes due 2020 (7.0%)
Dec. 31, 2014
Senior Notes due 2021 (6.125%)
Dec. 31, 2013
Senior Notes due 2021 (6.125%)
Dec. 31, 2014
5point375SeniorNotesdue2022 [Member]
Dec. 31, 2013
5point375SeniorNotesdue2022 [Member]
Dec. 31, 2014
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2011
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2014
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2013
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2011
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2014
Convertible Senior Notes due 2015 Series B (7.0%)
Dec. 31, 2013
Convertible Senior Notes due 2015 Series B (7.0%)
Dec. 31, 2011
Convertible Senior Notes due 2015 Series B (7.0%)
Dec. 31, 2014
Convertible Senior Notes due 2016 (6.5%)
Dec. 31, 2011
Convertible Senior Notes due 2016 (6.5%)
Dec. 31, 2014
Capital Leases
Dec. 31, 2013
Capital Leases
Dec. 31, 2014
Other
Dec. 31, 2013
Other
Aug. 16, 2013
Tranche B 2016 Term Loan [Member]
Aug. 12, 2013
Tranche B 2019 Term Loan [Member]
Dec. 31, 2014
Guarantor Subsidiaries [Member]
Dec. 31, 2013
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Guarantor Subsidiaries [Member]
TrancheB2020TermLoanTotal [Member]
Long-term debt
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Debt Obligations
$ 11,366 
$ 8,392 
 
$ 4,611 1
$ 2,611 1
 
 
 
 
 
$ 300 
$ 300 
$ 0 
$ 605 
 
$ 500 
$ 500 
 
$ 1,200 
$ 1,200 
 
$ 300 
$ 300 
$ 900 
$ 900 
$ 775 
$ 775 
$ 640 
$ 640 
$ 1,000 
$ 0 
 
 
$ 58 
$ 200 
 
$ 275 
$ 275 
 
 
 
$ 207 
$ 73 
$ 0 
$ 13 
 
 
 
 
$ 1,796 
Debt Instrument, Interest Rate, Stated Percentage
 
 
4.00% 
 
 
3.846% 
4.202% 
10.00% 
10.00% 
10.00% 
 
 
11.875% 
 
11.875% 
9.375% 
 
9.375% 
8.125% 
 
8.125% 
8.875% 
 
8.625% 
 
7.00% 
 
 
 
 
 
15.00% 
15.00% 
7.00% 
 
7.00% 
7.00% 
 
7.00% 
6.50% 
6.50% 
 
 
 
 
 
 
 
 
 
Total Unamortized (Discount) Premium
(33)
(30)
 
(21)
(7)
 
 
 
 
 
 
 
0 
(8)
 
(6)
(7)
 
(6)
(7)
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Carrying Value of Debt
11,333 
8,362 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Less current portion
(349)
(31)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
0 
 
Long-Term Debt, less current portion
10,984 
8,331 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9,893 
6,905 
 
Repayments of Debt
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 595.5 
$ 815.0 
 
 
 
Long-Term Debt - Textuals (Details) (USD $)
3 Months Ended 12 Months Ended 0 Months Ended 12 Months Ended 3 Months Ended 12 Months Ended 0 Months Ended 0 Months Ended 12 Months Ended 1 Months Ended 12 Months Ended 3 Months Ended 65 Months Ended 3 Months Ended 28 Months Ended 24 Months Ended 3 Months Ended 24 Months Ended 11 Months Ended 3 Months Ended 11 Months Ended 3 Months Ended 0 Months Ended 12 Months Ended 1 Months Ended 12 Months Ended 0 Months Ended 0 Months Ended 12 Months Ended 1 Months Ended 12 Months Ended 0 Months Ended 3 Months Ended 12 Months Ended 0 Months Ended 12 Months Ended 0 Months Ended 0 Months Ended 12 Months Ended 3 Months Ended 1 Months Ended 3 Months Ended 3 Months Ended 3 Months Ended 3 Months Ended 1 Months Ended 3 Months Ended 12 Months Ended 12 Months Ended 12 Months Ended 1 Months Ended 3 Months Ended 1 Months Ended 12 Months Ended 12 Months Ended 12 Months Ended 12 Months Ended 12 Months Ended 3 Months Ended 0 Months Ended 12 Months Ended 0 Months Ended 3 Months Ended 1 Months Ended 3 Months Ended 0 Months Ended 0 Months Ended 3 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Jun. 26, 2009
Level 3 Communications, Inc.
Dec. 31, 2014
Level 3 Communications, Inc.
Dec. 31, 2013
Level 3 Communications, Inc.
Dec. 31, 2012
Level 3 Communications, Inc.
Sep. 30, 2014
Level 3 Financing [Member]
Mar. 31, 2007
Level 3 Financing [Member]
Dec. 31, 2014
Guarantor Subsidiaries [Member]
Dec. 31, 2013
Guarantor Subsidiaries [Member]
Dec. 31, 2012
Guarantor Subsidiaries [Member]
Dec. 31, 2014
TrancheB2022TermLoanTotal [Member]
Dec. 31, 2014
TrancheB2022TermLoanTotal [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Tranche B 2022 Term Loans [Member]
Nov. 1, 2014
Tranche B 2022 Term Loans [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Tranche B 2022 Term Loans [Member]
Guarantor Subsidiaries [Member]
Oct. 31, 2014
Tranche B 2022 Term Loans [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
SeniorNotes6Point125PercentDue2021 [Member]
Dec. 31, 2013
SeniorNotes6Point125PercentDue2021 [Member]
Nov. 14, 2013
SeniorNotes6Point125PercentDue2021 [Member]
Level 3 Financing [Member]
Dec. 31, 2014
SeniorNotes6Point125PercentDue2021 [Member]
Level 3 Financing [Member]
Dec. 31, 2014
SeniorNotes6Point125PercentDue2021 [Member]
Level 3 Financing [Member]
Twelve Months Beginning November 15, 2016 [Member]
Dec. 31, 2014
SeniorNotes6Point125PercentDue2021 [Member]
Level 3 Financing [Member]
Twelve Months Beginning November 15, 2017 [Member]
Dec. 31, 2014
SeniorNotes6Point125PercentDue2021 [Member]
Level 3 Financing [Member]
Prior to June 2015
Dec. 31, 2014
SeniorNotes6Point125PercentDue2021 [Member]
Level 3 Financing [Member]
Prior to June 2016
Dec. 31, 2014
SeniorNotes6Point125PercentDue2021 [Member]
Level 3 Financing [Member]
Prior to November 2015 [Member]
days
Dec. 31, 2014
SeniorNotes6Point125PercentDue2021 [Member]
Level 3 Financing [Member]
Twelve Months Beginning November 15, 2018 [Member]
Dec. 31, 2014
Senior Notes 7 Percent Due 2020 [Member]
Dec. 31, 2013
Senior Notes 7 Percent Due 2020 [Member]
Aug. 31, 2012
Senior Notes 7 Percent Due 2020 [Member]
Level 3 Financing [Member]
Dec. 31, 2014
Senior Notes 7 Percent Due 2020 [Member]
Level 3 Financing [Member]
Aug. 6, 2012
Senior Notes 7 Percent Due 2020 [Member]
Level 3 Financing [Member]
Dec. 31, 2014
Senior Notes 7 Percent Due 2020 [Member]
Level 3 Financing [Member]
Twelve Months Beginning June 1, 2016 [Member]
Dec. 31, 2014
Senior Notes 7 Percent Due 2020 [Member]
Level 3 Financing [Member]
Twelve Months Beginning June 1, 2017
Dec. 31, 2014
Senior Notes 7 Percent Due 2020 [Member]
Level 3 Financing [Member]
Twelve Months Beginning June 1, 2018
Dec. 31, 2014
Senior Notes 7 Percent Due 2020 [Member]
Level 3 Financing [Member]
Prior to June 2015
days
Dec. 31, 2014
Senior Notes 7 Percent Due 2020 [Member]
Level 3 Financing [Member]
Prior to June 2016
days
Dec. 31, 2014
TrancheB2020TermLoanTotal [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Term Loans
Dec. 31, 2013
Term Loans
Jun. 30, 2009
Senior Secured Term Loan 2011
Level 3 Financing [Member]
Sep. 30, 2014
Tranche A Term Loan
Jul. 31, 2012
Tranche A Term Loan
Jul. 31, 2012
Tranche A Term Loan
Level 3 Financing [Member]
Dec. 31, 2011
Tranche A Term Loan
Level 3 Financing [Member]
Nov. 10, 2011
Tranche A Term Loan
Level 3 Financing [Member]
Mar. 13, 2007
Tranche A Term Loan
Level 3 Financing [Member]
Dec. 31, 2011
Tranche B Term Loan
Level 3 Financing [Member]
Oct. 31, 2011
Tranche B Term Loan
Level 3 Financing [Member]
Jun. 30, 2009
Tranche B Term Loan
Level 3 Financing [Member]
Oct. 4, 2013
Tranche B II Term Loan
Dec. 31, 2011
Tranche B II Term Loan
Dec. 31, 2011
Tranche B II Term Loan
Level 3 Financing [Member]
Oct. 4, 2013
Tranche B II Term Loan
Level 3 Financing [Member]
Dec. 31, 2014
Tranche B II Term Loan
Level 3 Financing [Member]
Oct. 4, 2011
Tranche B II Term Loan
Level 3 Financing [Member]
Sep. 30, 2012
Tranche B III Term Loan
Dec. 31, 2011
Tranche B III Term Loan
Dec. 31, 2011
Tranche B III Term Loan
Level 3 Financing [Member]
Sep. 30, 2012
Tranche B III Term Loan
Level 3 Financing [Member]
Dec. 31, 2014
Tranche B III Term Loan
Level 3 Financing [Member]
Nov. 10, 2011
Tranche B III Term Loan
Level 3 Financing [Member]
Dec. 31, 2014
Tranche B II and Tranche B III Term Loans
Dec. 31, 2013
Tranche B II and Tranche B III Term Loans
Aug. 16, 2013
Tranche B 2016 Term Loan
Aug. 1, 2013
Tranche B 2016 Term Loan
Dec. 31, 2014
Tranche B 2016 Term Loan
Aug. 31, 2012
Tranche B 2016 Term Loan
Level 3 Financing [Member]
Aug. 1, 2013
Tranche B 2016 Term Loan
Level 3 Financing [Member]
Aug. 6, 2012
Tranche B 2016 Term Loan
Level 3 Financing [Member]
Aug. 16, 2013
Tranche B 2016 Term Loan
Guarantor Subsidiaries [Member]
Aug. 16, 2013
TrancheB2020TermLoan [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
TrancheB2020TermLoan [Member]
Guarantor Subsidiaries [Member]
Aug. 12, 2013
Tranche B 2019 Term Loan
Aug. 1, 2013
Tranche B 2019 Term Loan
Dec. 31, 2014
Tranche B 2019 Term Loan
Aug. 31, 2012
Tranche B 2019 Term Loan
Level 3 Financing [Member]
Aug. 1, 2013
Tranche B 2019 Term Loan
Level 3 Financing [Member]
Aug. 6, 2012
Tranche B 2019 Term Loan
Level 3 Financing [Member]
Aug. 12, 2013
Tranche B 2019 Term Loan
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Tranche B 2019 Term Loan
Guarantor Subsidiaries [Member]
Dec. 31, 2014
TrancheBIII2019TermLoan [Member]
Guarantor Subsidiaries [Member]
Aug. 12, 2013
TrancheBIII2019TermLoan [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Tranche B 2016 Term Loan and Tranche B 2019 Term Loan
Level 3 Financing [Member]
Aug. 6, 2012
Tranche B 2016 Term Loan and Tranche B 2019 Term Loan
Level 3 Financing [Member]
Dec. 31, 2013
Tranche B-II 2019 Term Loan
Oct. 4, 2013
Tranche B-II 2019 Term Loan
Dec. 31, 2014
Tranche B-II 2019 Term Loan
Oct. 4, 2013
Tranche B-II 2019 Term Loan
Level 3 Financing [Member]
Oct. 4, 2013
Tranche B-II 2019 Term Loan
Level 3 Financing [Member]
Oct. 4, 2012
Tranche B-II 2019 Term Loan
Level 3 Financing [Member]
Aug. 6, 2012
Tranche B-II 2019 Term Loan
Level 3 Financing [Member]
Oct. 4, 2013
Tranche B-II 2019 Term Loan
Guarantor Subsidiaries [Member]
Oct. 4, 2013
TrancheB2020TermLoanAdd-on [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Floating Rate Senior Notes due 2018 [Member]
Dec. 31, 2013
Floating Rate Senior Notes due 2018 [Member]
Nov. 26, 2013
Floating Rate Senior Notes due 2018 [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Floating Rate Senior Notes due 2018 [Member]
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Floating Rate Senior Notes due 2018 [Member]
Guarantor Subsidiaries [Member]
May 2016 through November 2016 [Member]
Dec. 31, 2014
Floating Rate Senior Notes due 2018 [Member]
Guarantor Subsidiaries [Member]
May 2015 through May 2016 [Member]
Dec. 31, 2014
Floating Rate Senior Notes due 2018 [Member]
Guarantor Subsidiaries [Member]
Prior to May 2015 [Member] [Member]
days
Dec. 31, 2014
Floating Rate Senior Notes due 2018 [Member]
Guarantor Subsidiaries [Member]
November 2016 and Thereafter [Member]
Mar. 31, 2012
Senior Notes due 2014 (9.25%)
Dec. 31, 2011
Senior Notes due 2014 (9.25%)
Feb. 28, 2012
Senior Notes due 2014 (9.25%)
Level 3 Financing [Member]
Mar. 31, 2012
Senior Notes due 2014 (9.25%)
Level 3 Financing [Member]
Dec. 31, 2011
Senior Notes due 2014 (9.25%)
Level 3 Financing [Member]
Dec. 31, 2013
Floating Rate Senior Notes due 2015
Dec. 31, 2014
Floating Rate Senior Notes due 2015
Dec. 31, 2011
Floating Rate Senior Notes due 2015
Sep. 30, 2014
Senior Notes due 2017 (8.75%)
Dec. 31, 2011
Senior Notes due 2017 (8.75%)
Sep. 30, 2014
Senior Notes due 2017 (8.75%)
Level 3 Financing [Member]
Dec. 31, 2013
Senior Notes due 2018 (10.0%)
Dec. 31, 2014
Senior Notes due 2018 (10.0%)
Dec. 31, 2011
Senior Notes due 2018 (10.0%)
Dec. 31, 2014
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2013
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2011
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Jan. 31, 2011
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Level 3 Communications, Inc.
Dec. 31, 2014
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Level 3 Communications, Inc.
Dec. 1, 2014
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Level 3 Communications, Inc.
Dec. 31, 2014
Senior Notes due 2019 (9.375%)
Dec. 31, 2013
Senior Notes due 2019 (9.375%)
Dec. 31, 2011
Senior Notes due 2019 (9.375%)
Dec. 31, 2014
Senior Notes due 2019 (9.375%)
Level 3 Financing [Member]
Mar. 4, 2011
Senior Notes due 2019 (9.375%)
Level 3 Financing [Member]
Dec. 31, 2014
Senior Notes due 2019 (9.375%)
Level 3 Financing [Member]
Twelve Months Beginning April 1, 2015
Dec. 31, 2014
Senior Notes due 2019 (9.375%)
Level 3 Financing [Member]
Twelve Months Beginning April 1, 2016
Dec. 31, 2014
Senior Notes due 2019 (9.375%)
Level 3 Financing [Member]
Twelve Months Beginning April 1, 2017
Dec. 31, 2014
Senior Notes due 2019 (9.375%)
Level 3 Financing [Member]
Prior to April 2015
Dec. 31, 2014
Senior Notes due 2019 (8.125%)
Dec. 31, 2013
Senior Notes due 2019 (8.125%)
Dec. 31, 2011
Senior Notes due 2019 (8.125%)
Dec. 31, 2014
Senior Notes due 2019 (8.125%)
Level 3 Financing [Member]
Apr. 10, 2012
Senior Notes due 2019 (8.125%)
Level 3 Financing [Member]
Oct. 4, 2011
Senior Notes due 2019 (8.125%)
Level 3 Financing [Member]
Dec. 31, 2014
Senior Notes due 2019 (8.125%)
Level 3 Financing [Member]
Twelve Months Beginning July 1, 2015
Dec. 31, 2014
Senior Notes due 2019 (8.125%)
Level 3 Financing [Member]
Twelve Months Beginning July 1, 2016
Dec. 31, 2014
Senior Notes due 2019 (8.125%)
Level 3 Financing [Member]
Twelve Months Beginning July 1, 2017
Dec. 31, 2014
Senior Notes due 2019 (8.125%)
Level 3 Financing [Member]
Prior to July 2015
days
Jul. 31, 2011
Senior Notes due 2019 (8.125%)
Level 3 Escrow Inc [Member]
Jun. 30, 2011
Senior Notes due 2019 (8.125%)
Level 3 Escrow Inc [Member]
Jun. 9, 2011
Senior Notes due 2019 (8.125%)
Level 3 Escrow Inc [Member]
Dec. 31, 2014
Senior Notes due 2019 (8.875%)
Dec. 31, 2013
Senior Notes due 2019 (8.875%)
Aug. 31, 2012
Senior Notes due 2019 (8.875%)
Level 3 Communications, Inc.
Dec. 31, 2014
Senior Notes due 2019 (8.875%)
Level 3 Communications, Inc.
Jul. 31, 2012
Senior Notes due 2019 (8.875%)
Level 3 Communications, Inc.
Dec. 31, 2014
Senior Notes due 2019 (8.875%)
Level 3 Communications, Inc.
Twelve Months Beginning June 1, 2016 [Member]
Dec. 31, 2014
Senior Notes due 2019 (8.875%)
Level 3 Communications, Inc.
Twelve Months Beginning June 1, 2015
Dec. 31, 2014
Senior Notes due 2019 (8.875%)
Level 3 Communications, Inc.
Twelve Months Beginning June 1, 2017
Dec. 31, 2014
Senior Notes due 2019 (8.875%)
Level 3 Communications, Inc.
Prior to June 2015
days
Dec. 31, 2014
Senior Notes due 2020 (8.625%)
Dec. 31, 2013
Senior Notes due 2020 (8.625%)
Dec. 31, 2014
Senior Notes due 2020 (8.625%)
Level 3 Financing [Member]
Jan. 13, 2012
Senior Notes due 2020 (8.625%)
Level 3 Financing [Member]
Dec. 31, 2014
Senior Notes due 2020 (8.625%)
Level 3 Financing [Member]
Twelve Months Beginning January 15, 2016
Dec. 31, 2014
Senior Notes due 2020 (8.625%)
Level 3 Financing [Member]
Twelve Months Beginning January 15, 2017
Dec. 31, 2014
Senior Notes due 2020 (8.625%)
Level 3 Financing [Member]
Twelve Months Beginning January 15, 2018
Dec. 31, 2014
Senior Notes due 2020 (8.625%)
Level 3 Financing [Member]
Prior to January 2016
days
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Aug. 12, 2014
Senior Notes 5.375percent Due 2022 [Member]
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Level 3 Financing [Member]
Aug. 12, 2014
Senior Notes 5.375percent Due 2022 [Member]
Level 3 Financing [Member]
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Level 3 Financing [Member]
Twelve Months Beginning August 15, 2017 [Member]
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Level 3 Financing [Member]
Twelve Months Beginning August 15, 2018 [Member]
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Level 3 Financing [Member]
Twelve Months Beginning August 15, 2019 [Member]
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Level 3 Financing [Member]
Prior To August 15, 2017 [Member]
days
Aug. 12, 2014
Senior Notes 5.375percent Due 2022 [Member]
Level 3 Escrow II, Inc. [Member]
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Level 3 Escrow II, Inc. [Member]
Prior To August 15, 2017 [Member]
Dec. 31, 2014
Senior Notes 5point75Percent Due 2022 [Member]
Level 3 Communications, Inc.
Dec. 1, 2014
Senior Notes 5point75Percent Due 2022 [Member]
Level 3 Communications, Inc.
Aug. 12, 2014
Senior Notes 5point75Percent Due 2022 [Member]
Level 3 Communications, Inc.
Dec. 31, 2014
Senior Notes 5point75Percent Due 2022 [Member]
Level 3 Communications, Inc.
Twelve Months Beginning June 1, 2016
Dec. 31, 2014
Senior Notes 5point75Percent Due 2022 [Member]
Level 3 Communications, Inc.
Twelve Months Beginning December 1, 2018 [Member]
Dec. 31, 2014
Senior Notes 5point75Percent Due 2022 [Member]
Level 3 Communications, Inc.
Prior To December 1, 2017 [Member]
days
Dec. 31, 2014
Senior Notes 5point75Percent Due 2022 [Member]
Level 3 Communications, Inc.
Twelve Months Beginning December 1, 2019 [Member]
Dec. 31, 2014
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2011
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2014
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2013
Convertible Senior Notes 7 Percent Due 2015 [Member]
Dec. 31, 2011
Convertible Senior Notes 7 Percent Due 2015 [Member]
Oct. 15, 2009
Convertible Senior Notes 7 Percent Due 2015 [Member]
Level 3 Communications, Inc.
Dec. 31, 2014
Convertible Senior Notes 7 Percent Due 2015 [Member]
Level 3 Communications, Inc.
Jun. 26, 2009
Convertible Senior Notes 7 Percent Due 2015 [Member]
Level 3 Communications, Inc.
Dec. 31, 2014
Convertible Senior Notes due 2015 Series B (7.0%)
Dec. 31, 2013
Convertible Senior Notes due 2015 Series B (7.0%)
Dec. 31, 2011
Convertible Senior Notes due 2015 Series B (7.0%)
Dec. 31, 2014
Convertible Senior Notes due 2015 Series B (7.0%)
Level 3 Communications, Inc.
Dec. 31, 2014
Convertible Senior Notes due 2016 (6.5%)
Dec. 31, 2011
Convertible Senior Notes due 2016 (6.5%)
Jun. 26, 2009
Convertible Subordinated Notes due 2010 (6.0%)
Level 3 Communications, Inc.
Jun. 26, 2009
Convertible Senior Notes due 2010 (2.875%)
Level 3 Communications, Inc.
Mar. 31, 2011
Convertible Senior Notes due 2011 (5.25%)
Level 3 Communications, Inc.
Dec. 31, 2011
Convertible Senior Notes due 2012 (3.5%)
Level 3 Communications, Inc.
Dec. 31, 2014
Convertible Senior Notes due 2012 (3.5%)
Level 3 Communications, Inc.
Dec. 31, 2014
Convertible Senior Discount Notes due 2013 (9.0%)
Level 3 Communications, Inc.
Dec. 31, 2011
Commercial Mortgage due 2015 (9.86%)
Dec. 31, 2014
Capital Leases
Dec. 31, 2013
Capital Leases
Dec. 31, 2014
Other
Dec. 31, 2013
Other
Aug. 31, 2012
Other
Level 3 Financing [Member]
Dec. 31, 2014
London Interbank Offered Rate (LIBOR) [Member]
Tranche B 2022 Term Loans [Member]
Guarantor Subsidiaries [Member]
Oct. 31, 2014
London Interbank Offered Rate (LIBOR) [Member]
Tranche B 2022 Term Loans [Member]
Guarantor Subsidiaries [Member]
Minimum [Member]
Oct. 4, 2013
London Interbank Offered Rate (LIBOR) [Member]
TrancheB2020TermLoan [Member]
Guarantor Subsidiaries [Member]
Oct. 4, 2013
London Interbank Offered Rate (LIBOR) [Member]
TrancheB2020TermLoan [Member]
Guarantor Subsidiaries [Member]
Minimum [Member]
Aug. 12, 2013
London Interbank Offered Rate (LIBOR) [Member]
TrancheBIII2019TermLoan [Member]
Guarantor Subsidiaries [Member]
Aug. 12, 2013
London Interbank Offered Rate (LIBOR) [Member]
TrancheBIII2019TermLoan [Member]
Guarantor Subsidiaries [Member]
Minimum [Member]
Jun. 30, 2015
Subsequent Event [Member]
Senior Notes due 2019 (9.375%)
Level 3 Financing [Member]
Jan. 29, 2015
Subsequent Event [Member]
Senior Notes due 2019 (9.375%)
Level 3 Financing [Member]
Jan. 29, 2015
Subsequent Event [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Level 3 Financing [Member]
Long-term debt
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Face Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 640,000,000 
 
 
 
 
 
 
 
 
 
 
 
$ 775,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 1,400,000,000 
$ 1,400,000,000 
 
 
$ 280,000,000 
 
 
 
 
$ 650,000,000 
 
 
 
 
 
$ 550,000,000 
 
 
 
 
 
 
 
 
$ 600,000,000 
 
$ 595,500,000 
 
 
 
 
 
 
$ 815,000,000 
 
 
 
$ 815,000,000 
 
$ 1,415,000,000 
 
 
 
 
 
 
 
 
$ 1,200,000,000 
 
 
$ 300,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 605,000,000 
 
$ 0 
 
 
 
 
$ 500,000,000 
 
 
 
 
 
 
 
 
$ 1,200,000,000 
 
 
 
 
 
 
 
$ 600,000,000 
 
 
 
 
$ 300,000,000 
 
 
 
 
 
 
 
$ 900,000,000 
 
 
 
 
$ 1,000,000,000 
$ 1,000,000,000 
 
 
 
 
 
 
$ 1,000,000,000 
 
 
$ 600,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
$ 200,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 500,000,000 
$ 500,000,000 
Debt Instrument, Additional Borrowings
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
650,000,000 
 
 
 
 
 
550,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
600,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
275,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, stated interest rate (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4.50% 
 
 
 
 
 
 
6.125% 
 
 
 
 
 
 
7.00% 
 
 
7.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9.25% 
 
9.25% 
9.25% 
 
3.846% 
4.202% 
 
8.75% 
8.75% 
10.00% 
10.00% 
10.00% 
11.875% 
 
11.875% 
 
11.875% 
 
9.375% 
 
9.375% 
9.375% 
 
 
 
 
 
8.125% 
 
8.125% 
8.125% 
 
 
 
 
 
 
 
 
8.125% 
8.875% 
 
 
8.875% 
 
 
 
 
 
8.625% 
 
8.625% 
 
 
 
 
 
5.375% 
 
5.375% 
 
 
 
 
 
 
 
5.75% 
 
 
 
 
 
 
15.00% 
15.00% 
7.00% 
 
7.00% 
 
7.00% 
 
7.00% 
 
7.00% 
7.00% 
6.50% 
6.50% 
6.00% 
2.875% 
5.25% 
 
3.50% 
9.00% 
9.86% 
 
 
 
 
 
 
1.00% 
 
1.00% 
 
1.00% 
 
9.375% 
5.625% 
Debt Conversion, Original Debt, Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
142,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument Redemption Minimum Gross Proceeds from Private or Public Offering
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000,000 
 
 
 
 
 
 
 
100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Redemption Price, Percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
106.859% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Conversion, Converted Instrument, Amount
 
 
 
 
 
 
 
 
142,000,000 
200,000,000 
100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Issuance Cost
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
27,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7,000,000 
 
 
 
 
 
 
 
10,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
11,000,000 
3,000,000 
 
 
5,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, basis floor (as percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3.00% 
 
1.50% 
 
 
1.50% 
 
 
1.50% 
 
 
1.50% 
 
 
 
 
 
1.50% 
 
 
 
 
 
 
 
 
1.50% 
 
 
 
 
 
 
 
1.50% 
 
 
 
1.50% 
 
 
1.50% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, Interest spread on debt (as percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.25% 
2.25% 
 
 
 
 
8.50% 
 
4.25% 
 
 
4.25% 
 
 
4.25% 
 
 
4.25% 
 
 
 
 
 
3.25% 
 
 
3.25% 
 
 
 
 
 
3.75% 
 
 
3.75% 
 
 
 
 
 
 
 
 
3.25% 
 
 
3.25% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3.50% 
 
3.00% 
 
3.00% 
 
 
 
 
Debt instrument, weighted average interest rate (as percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6.20% 
9.20% 
5.00% 
4.00% 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Unamortized Discount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
15,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7,000,000 
 
 
 
 
 
28,000,000 
 
 
 
 
 
 
 
3,000,000 
 
 
 
 
 
 
 
 
8,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.0025 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
11,000,000 
 
 
 
 
 
6,000,000 
10,000,000 
 
 
 
 
 
 
 
6,000,000 
 
 
 
 
 
 
9,000,000 
 
4,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Unamortized Debt Issuance Costs
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
26,000,000 
 
 
 
12,000,000 
11,000,000 
 
 
 
 
 
 
 
 
 
11,000,000 
15,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9,000,000 
 
 
17,000,000 
 
 
 
 
 
12,000,000 
 
9,000,000 
8,000,000 
 
 
 
 
 
 
 
 
 
13,000,000 
 
 
 
 
 
3,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,000,000 
 
 
 
 
 
7,000,000 
11,000,000 
 
 
 
 
 
 
 
22,000,000 
 
32,000,000 
 
 
 
 
 
 
 
 
 
 
5,000,000 
7,000,000 
 
 
 
 
 
 
14,000,000 
20,000,000 
 
 
 
 
 
 
12,000,000 
17,000,000 
 
 
 
 
 
 
 
 
10,000,000 
 
 
 
 
 
 
 
 
 
 
0 
4,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Net Proceeds
 
 
 
 
 
 
 
 
589,000,000 
1,502,000,000 
4,504,000,000 
 
590,000,000 
0 
293,000,000 
 
 
0 
1,502,000,000 
4,211,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Repayments of Long-term Debt
 
 
 
 
 
 
 
 
 
 
 
78,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
730,000,000 
 
 
 
 
 
 
280,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
807,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
274,000,000 
 
 
 
 
 
 
 
15,000,000 
 
 
 
 
 
 
 
 
 
Debt Instrument, Principal amount exchanged
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
142,000,000 
140,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Principal amount used for conversion
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accrued interest conversion into equity
 
 
 
 
 
 
 
 
2,000,000 
3,000,000 
2,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss on extinguishment of debt
(53,000,000)
0 
0 
0 
(67,000,000)
(17,000,000)
0 
0 
(53,000,000)
(84,000,000)
(160,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
56,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(9,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(50,000,000)
(67,000,000)
 
 
 
 
 
 
8,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
10,000,000 
 
 
 
 
 
 
10,000,000 
 
 
 
1,000,000 
 
 
 
 
 
(22,000,000)
 
 
 
 
1,000,000 
 
 
(40,000,000)
 
 
56,000,000 
 
 
 
 
 
 
(53,000,000)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
40,000,000 
 
 
Repayments of Debt
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
595,500,000 
 
 
 
 
 
 
 
 
815,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,200,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss on Cash Flow Hedge Ineffectiveness
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, redemption price of principal amount (as percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
103.063% 
101.531% 
 
100.00% 
 
100.00% 
 
 
100.00% 
 
 
103.50% 
101.75% 
100.00% 
 
100.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
99.00% 
 
 
 
 
 
95.00% 
 
 
 
 
 
 
 
 
99.50% 
 
 
 
 
 
 
 
 
99.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
101.00% 
102.00% 
 
100.00% 
 
 
 
102.313% 
 
 
 
 
 
 
104.375% 
 
 
 
 
 
 
98.173% 
 
 
 
 
 
 
 
104.688% 
102.344% 
100.00% 
100.00% 
 
 
 
 
 
 
104.063% 
102.031% 
100.00% 
100.00% 
98.545% 
99.264% 
 
 
 
100.00% 
 
 
102.219% 
104.438% 
100.00% 
100.00% 
 
 
 
 
104.313% 
102.156% 
100.00% 
100.00% 
 
 
 
 
102.688% 
101.344% 
100.00% 
100.00% 
 
 
 
 
 
102.875% 
101.4375% 
100.00% 
100.00% 
 
 
 
 
 
 
100.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, redemption minimum gross proceeds from equity offering ($100 million)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument issuance price as a percentage of the principal amount (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
98.001% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, Trance B 2016 Term Loan annual repayment (as percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.25% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, effective interest rate at end of period (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.65% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative, Notional Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,000,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, redemption with net proceeds from equity offerings of original principal (as percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
35.00% 
 
 
 
 
 
 
 
 
 
 
 
35.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
35.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
35.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
40.00% 
 
 
 
 
 
40.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, redemption price with net proceeds from equity offerings of original principal (as percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
106.125% 
 
 
 
 
 
 
 
 
 
 
 
107.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
108.875% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
105.375% 
 
 
 
 
 
105.75% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, minimum percentage of original principal amount outstanding after redemption from equity offerings (as percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
65.00% 
 
 
 
 
 
 
 
 
 
 
 
65.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
65.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
65.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60.00% 
 
 
 
 
 
 
 
60.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, convertible, conversion (price per share)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 27 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt conversion, shares issued upon conversion (in shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Conversion of Stock, Shares Converted
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
37 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, number of shares converted for each $1000 principal amount (in shares)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
37 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, issuance transactions (number)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, redemption period maximum following receipt of proceeds from equity offerings (number of days)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
90 
 
 
 
 
 
 
 
 
 
90 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
90 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
90 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
90 
 
 
 
 
 
 
 
90 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, redemption period notice minimum (number of days)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
30 
 
 
 
 
 
 
 
 
 
30 
30 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
30 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
30 
 
 
 
 
 
 
 
 
 
 
 
30 
 
 
 
 
 
 
 
30 
 
 
 
 
 
 
 
30 
 
 
 
 
 
 
 
30 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, redemption period notice maximum (number of days)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60 
 
 
 
 
 
 
 
 
 
60 
60 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60 
 
 
 
 
 
 
 
 
 
 
 
60 
 
 
 
 
 
 
 
60 
 
 
 
 
 
 
 
60 
 
 
 
 
 
 
 
60 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Future contractual maturities of long-term debt and capital leases (excluding issue discounts, premiums and fair value adjustments)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2013
349,000,000 
 
 
 
 
 
 
 
349,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2014
9,000,000 
 
 
 
 
 
 
 
9,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2015
8,000,000 
 
 
 
 
 
 
 
8,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2016
308,000,000 
 
 
 
 
 
 
 
308,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2017
2,823,000,000 
 
 
 
 
 
 
 
2,823,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Thereafter
7,869,000,000 
 
 
 
 
 
 
 
7,869,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Debt Obligations
11,366,000,000 
 
 
 
 
 
 
 
11,366,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
207,000,000 
 
1,000,000 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt, Gross
$ 11,366,000,000 
 
 
 
$ 8,392,000,000 
 
 
 
$ 11,366,000,000 
$ 8,392,000,000 
 
 
 
 
 
 
 
 
 
 
$ 2,000,000,000 
$ 2,000,000,000 
 
 
 
 
$ 640,000,000 
$ 640,000,000 
 
 
 
 
 
 
 
 
$ 775,000,000 
$ 775,000,000 
 
 
 
 
 
 
 
 
$ 1,796,000,000 
$ 4,611,000,000 1
$ 2,611,000,000 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 300,000,000 
$ 300,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 0 
$ 605,000,000 
 
 
 
 
$ 500,000,000 
$ 500,000,000 
 
 
 
 
 
 
 
$ 1,200,000,000 
$ 1,200,000,000 
 
 
 
 
 
 
 
 
 
 
 
$ 300,000,000 
$ 300,000,000 
 
 
 
 
 
 
 
$ 900,000,000 
$ 900,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 58,000,000 
$ 200,000,000 
 
 
 
 
$ 275,000,000 
$ 275,000,000 
 
 
 
 
 
 
 
 
 
 
 
$ 207,000,000 
$ 73,000,000 
$ 0 
$ 13,000,000 
 
 
 
 
 
 
 
 
 
 
Tranche B Term Loan 2022 upfront payment percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.75% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated Other Comprehensive Income (Loss) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2011
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax
$ (147)
$ 36 
$ 26 
$ (80)
Other comprehensive income before reclassifications
(187)
8 
38 
 
Amounts reclassified from accumulated other comprehensive income
4 
2 
68 
 
Accumulated Translation Adjustment [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax
(111)
67 
56 
39 
Other comprehensive income before reclassifications
(178)
11 
17 
 
Amounts reclassified from accumulated other comprehensive income
0 
0 
0 
 
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax
0 
0 
0 
(90)
Other comprehensive income before reclassifications
0 
0 
25 
 
Amounts reclassified from accumulated other comprehensive income
0 
0 
65 
 
Accumulated Defined Benefit Plans Adjustment [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax
(36)
(31)
(30)
(29)
Other comprehensive income before reclassifications
(9)
(3)
(4)
 
Amounts reclassified from accumulated other comprehensive income
$ 4 
$ 2 
$ 3 
 
Employee Benefit Benefits and Stock-Based Compensation - Non-cash compensation expensed and capitalized (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Stock-based compensation expense
 
 
 
Stock- based compensation expense
$ 74 
$ 152 
$ 136 
Capitalized Noncash Compensation
(1)
(1)
(1)
Non-cash compensation expense
73 
151 
135 
Share-based Compensation Arrangement by Share-based Payment Award Accelerated Compensation Cost
4 
5 
9 
Outperform Stock Options
 
 
 
Stock-based compensation expense
 
 
 
Stock- based compensation expense
8 
21 
14 
Restricted Stock Units and Shares
 
 
 
Stock-based compensation expense
 
 
 
Stock- based compensation expense
34 
38 
40 
401(k) Match Expense
 
 
 
Stock-based compensation expense
 
 
 
Stock- based compensation expense
23 
24 
23 
Restricted Stock Unit Bonus Grant
 
 
 
Stock-based compensation expense
 
 
 
Stock- based compensation expense
(5)
59 
46 
Management Incentive and Retention Plan
 
 
 
Stock-based compensation expense
 
 
 
Stock- based compensation expense
$ 0 
$ 10 
$ 13 
Employee Benefit Benefits and Stock-Based Compensation - Outperform Stock Options (Details) (Outperform Stock Options, USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value
$ 18.7 
$ 1.5 
$ 0.8 
 
 
Unamortized compensation expense
7 
 
 
 
 
Weighted average period over which unamortized compensation cost will be recognized (in years)
1 year 3 months 4 days 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology
 
 
 
 
 
Expected Dividend Yield Rate
 
2.24% 
2.05% 
 
 
Expected Life (in years)
 
3 years 
3 years 
 
 
Expected Correlation Factor
 
0.44 
0.32 
 
 
Theoretical Value
 
101.00% 
110.00% 
 
 
Estimated Forfeiture Rate
 
15.00% 
20.00% 
 
 
Fair value of OSO units awarded
 
17 
29 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding
 
 
 
 
 
Options outstanding, beginning (in shares)
2,148,865 
2,066,419 
1,288,712 
 
 
Options granted (in shares)
0 
748,481 
1,195,452 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period
(52,901)
(271,883)
(72,335)
 
 
Options expired (in shares)
(106,844)
(286,924)
(278,111)
 
 
Options exercised (in shares)
(771,251)
(107,228)
(67,299)
 
 
Options outstanding, ending (in shares)
1,217,869 
2,148,865 
2,066,419 
1,288,712 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures
 
 
 
 
 
Options, Beginning, Initial Strike Price Per Unit, Minimum (in dollars per share)
$ 14.1 
$ 14.10 
$ 10.50 
 
 
Options, Beginning, Initial Strike Price Per Unit, Maximum (in dollars per share)
$ 36.60 
$ 36.60 
$ 36.60 
 
 
Options, Beginning, Weighted Average Initial Strike Price (in dollars per share)
$ 23.99 
$ 23.40 
$ 20.51 
 
 
Options, Beginning, Aggregate Intrinsic Value
$ 31.6 
$ 6.6 
$ 1.8 
 
$ 88.0 
Options, Beginning, Average Remaining Contractual Term (in years)
10 months 24 days 
1 year 5 months 15 days 
1 year 8 months 23 days 
1 year 6 months 11 days 
 
Options granted, Initial Strike Price Per Unit, Minimum (in dollars per share)
$ 0 
$ 20.29 
$ 16.99 
 
 
Options granted, Initial Strike Price Per Unit, Maximum (in dollars per share)
$ 0 
$ 26.69 
$ 27.53 
 
 
Options granted, Weighted Average Initial Strike Price (in dollars per share)
$ 0.00 
$ 22.64 
$ 24.65 
 
 
Options forfeited, Initial Strike Price Per Unit, Minimum (in dollars per share)
$ 16.99 
$ 14.10 
$ 12 
 
 
Options forfeited, Initial Strike Price Per Unit, Maximum (in dollars per share)
$ 27.53 
$ 36.60 
$ 36.60 
 
 
Options forfeited, Weighted Average Initial Strike Price (in dollars per share)
$ 22.99 
$ 22.33 
$ 21.80 
 
 
Options expired, Initial Strke Price Per Unit, Minimum (in dollars per share)
$ 36.6 
$ 16.35 
$ 15 
 
 
Options expired, Initial Strke Price Per Unit, Maximum (in dollars per share)
$ 36.6 
$ 24.30 
$ 22.65 
 
 
Options expired, Weighted Average Initial Strike Price (in dollars per share)
$ 36.60 
$ 21.48 
$ 18.45 
 
 
Options exercised, Initial Strike Price Per Unit, Minimum (in dollars per share)
$ 14.7 
$ 14.10 
$ 10.50 
 
 
Options exercised, Initial Strike Price Per Unit, Maximum (in dollars per share)
$ 27.53 
$ 14.10 
$ 13.80 
 
 
Options exercised, Weighted Average Initial Strike Price (in dollars per share)
$ 24.26 
$ 14.10 
$ 12.48 
 
 
Options, Ending, Initial Strike Price Per Unit, Minimum (in dollars per share)
$ 16.99 
$ 14.1 
$ 14.10 
$ 10.50 
 
Options, Ending, Initial Strike Price Per Unit, Maximum (in dollars per share)
$ 27.53 
$ 36.60 
$ 36.60 
$ 36.60 
 
Options, Ending, Weighted Average Initial Strike Price (in dollars per share)
$ 22.76 
$ 23.99 
$ 23.40 
$ 20.51 
 
Options, Ending, Average Remaining Contractual Term (in years)
10 months 24 days 
1 year 5 months 15 days 
1 year 8 months 23 days 
1 year 6 months 11 days 
 
On or After April 1, 2007
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Life of Award
3 
 
 
 
 
Percent vested after three years
100.00% 
 
 
 
 
S and P 500 Index
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology
 
 
 
 
 
Expected volatility rate
 
19.00% 
23.00% 
 
 
Level 3 Communications, Inc.
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology
 
 
 
 
 
Expected volatility rate
 
39.00% 
39.00% 
 
 
Performance Range 1
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Performance Qualifier to Index, Maximum
0.00% 
 
 
 
0.00% 
Share-based Compensation Arrangement by Share-based Payment Award, Success Multiplier of Pre Multiplier Gain
0.00 
 
 
 
0.00 
Performance Range 2
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Performance Qualifier to Index, Minimum
0.00% 
 
 
 
0.00% 
Share-based Compensation Arrangement by Share-based Payment Award, Performance Qualifier to Index, Maximum
11.00% 
 
 
 
11.00% 
Share-based Compensation Arrangement by Share-based Payment Award, Success Multiplier of Pre Multiplier Gain
0.36 
 
 
 
0.36 
Performance Range 3
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Performance Qualifier to Index, Minimum
11.00% 
 
 
 
11.00% 
Share-based Compensation Arrangement by Share-based Payment Award, Success Multiplier of Pre Multiplier Gain
4.00 
 
 
 
4.00 
Employee Benefit Benefits and Stock-Based Compensation - Range of OSO Exercise Prices (Details) (Outperform Stock Options, USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2011
Outperform Stock Options
 
 
 
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range
 
 
 
 
Options exercised, Weighted Average Initial Strike Price (in dollars per share)
$ 24.26 
$ 14.10 
$ 12.48 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number
1,217,869 
2,148,865 
2,066,419 
1,288,712 
Total realized value of OSO units
$ 18.7 
$ 1.5 
$ 0.8 
 
OSO units Outstanding, Range of Exercise Prices, Minimum (in dollars per share)
$ 16.99 
$ 14.1 
$ 14.10 
$ 10.50 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Initial Exercise Price, Maximum
$ 27.53 
$ 36.60 
$ 36.60 
$ 36.60 
OSO units Outstanding, Number Outstanding (in shares)
1,217,869 
 
 
 
OSO units Outstanding, Average Remaining Contractual Term
10 months 24 days 
1 year 5 months 15 days 
1 year 8 months 23 days 
1 year 6 months 11 days 
OSO units Outstanding, Weighted Average Initial Strike Price (in dollars per share)
$ 22.76 
$ 23.99 
$ 23.40 
$ 20.51 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period
(771,251)
(107,228)
(67,299)
 
OSO units Exercisable, Number Exercisable (in shares)
0 
 
 
 
OSO units Exercisable, Weighted Average Initial Strike Price (in dollars per share)
$ 0.00 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period
(52,901)
(271,883)
(72,335)
 
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period
732,593 
90,879 
0 
 
Employee Benefit Benefits and Stock-Based Compensation - Restricted Stock and Units (Details) (Restricted Stock Units and Shares, USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Dec. 31, 2014
year
Dec. 31, 2013
Dec. 31, 2012
Restricted Stock Units and Shares
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award
 
 
 
Restrictions on transfer lapse, minimum (in years)
1 
 
 
Restrictions on transfer lapse, maximum (in years)
4 
 
 
Fair value of units and shares awarded
$ 96 
$ 34 
$ 69 
Unamortized compensation expense
85 
 
 
Weighted average period over which unamortized compensation cost will be recognized (in years)
3 years 2 months 5 days 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares
 
 
 
Nonvested, Beginning balance (in shares)
2,924,350 
3,636,976 
2,030,783 
Stock and units granted (in shares)
2,255,883 
1,617,592 
2,869,584 
Lapse of restrictions (in shares)
(1,151,830)
(1,841,757)
(1,048,757)
Stock and units forfeited (in shares)
(241,785)
(488,461)
(214,634)
Nonvested, Ending balance (in shares)
3,786,618 
2,924,350 
3,636,976 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures
 
 
 
Nonvested, Beginning balance, Weighted Average Grant Date Fair Value (in dollars per share)
$ 22.77 
$ 24.71 
$ 26.25 
Stock and units granted, Weighted Average Grant Date Fair Value (in dollars per share)
$ 42.36 
$ 21.26 
$ 24.13 
Lapse of restrictions, Weighted Average Grant Date Fair Value (in dollars per share)
$ 22.94 
$ 25.19 
$ 26.06 
Stock and units forfeited, Weighted Average Grant Date Fair Value (in dollars per share)
$ 28.90 
$ 23.10 
$ 24.92 
Nonvested, Ending balance, Weighted Average Grant Date Fair Value (in dollars per share)
$ 33.91 
$ 22.77 
$ 24.71 
Total fair value of restricted stock and restricted stock units whose restriction lapsed
$ 27 
$ 46 
$ 27 
Employee Benefit Benefits and Stock-Based Compensation - MIRP Stock and Units (Details) (Management Incentive and Retention Plan, USD $)
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Management Incentive and Retention Plan
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares
 
 
 
Nonvested, Beginning balance (in shares)
195,000 
465,000 
0 
Stock and units granted (in shares)
0 
0 
465,000 
Lapse of restrictions (in shares)
(195,000)
(270,000)
0 
Stock and units forfeited (in shares)
0 
0 
0 
Nonvested, Ending balance (in shares)
0 
195,000 
465,000 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures
 
 
 
Nonvested, Beginning balance, Weighted Average Grant Date Fair Value (in dollars per share)
$ 25.92 
$ 25.92 
$ 0.00 
Stock and units granted, Weighted Average Grant Date Fair Value (in dollars per share)
   
$ 0.00 
$ 25.92 
Lapse of restrictions, Weighted Average Grant Date Fair Value (in dollars per share)
$ 25.92 
$ 25.92 
$ 0.00 
Stock and units forfeited, Weighted Average Grant Date Fair Value (in dollars per share)
   
$ 0.00 
$ 0.00 
Nonvested, Ending balance, Weighted Average Grant Date Fair Value (in dollars per share)
    
$ 25.92 
$ 25.92 
Employee Benefit Benefits and Stock-Based Compensation - Warrants (Details) (Warrant [Member], USD $)
Dec. 31, 2012
Warrant [Member]
 
Class of Warrant or Right
 
Warrants outstanding (in shares)
45,593 
Warrants outstanding, exercise price (in dollars per share)
$ 73.50 
Employee Benefit Benefits and Stock-Based Compensation - Defined Contribution (Details) (USD $)
12 Months Ended 3 Months Ended 12 Months Ended
Dec. 31, 2014
year
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2014
After January 1, 2012
Dec. 31, 2014
tw telecom 401(K) Plan [Member]
Dec. 31, 2014
tw telecom 401(K) Plan [Member]
Dec. 31, 2014
All Other Defined Contribution
Dec. 31, 2013
All Other Defined Contribution
Dec. 31, 2012
All Other Defined Contribution
Dec. 31, 2014
Network Related Expenses [Member]
Dec. 31, 2013
Network Related Expenses [Member]
Dec. 31, 2012
Network Related Expenses [Member]
Dec. 31, 2014
Selling, General and Administrative Expenses [Member]
Dec. 31, 2013
Selling, General and Administrative Expenses [Member]
Dec. 31, 2012
Selling, General and Administrative Expenses [Member]
Schedule of Defined Contribution Plans Disclosures
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Defined Contribution Plan, Maximum Annual Contribution Per Employee
$ 17,500 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Defined Contribution Plan, Maximum Annual Contribution Per Employee, Percentage
 
 
 
100.00% 
 
100.00% 
 
 
 
 
 
 
 
 
 
Defined Contribution Plan, Employer Matching Contribution, Percentage
 
 
 
4.00% 
 
5.00% 
 
 
 
 
 
 
 
 
 
Defined Contribution Plan, Vesting Period (in years)
3 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Defined Contribution Plan, Vesting Percentage After Vesting Period
100.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Defined Contribution Plan, Cost Recognized
$ 23,000,000 
$ 24,000,000 
$ 23,000,000 
 
$ 2,000,000 
 
$ 6,000,000 
$ 5,000,000 
$ 7,000,000 
$ 4,000,000 
$ 4,000,000 
$ 4,000,000 
$ 19,000,000 
$ 20,000,000 
$ 19,000,000 
Employee Benefit Benefits and Stock-Based Compensation - Defined Benefits (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Defined Benefit Plan Disclosure
 
 
Defined Benefit Plan, Fair Value of Plan Assets
$ 151 
$ 148 
Defined Benefit Plan, Benefit Obligation
176 
165 
Defined Benefit Plan, Funded Status of Plan
$ 25 
$ 17 
Employee Benefit Benefits and Stock-Based Compensation - Annual Discretionary Bonus Grant (Details) (USD $)
Share data in Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2013
Restricted Stock Unit Bonus Grant
Dec. 31, 2012
Restricted Stock Unit Bonus Grant
Dec. 31, 2015
Subsequent Event [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits
 
 
 
 
 
 
Defined Contribution Plan, Maximum Annual Contribution Per Employee
$ 17,500 
 
 
 
 
$ 18,000 
Accrued Bonuses, Current
167,000,000 
124,000,000 
103,000,000 
 
 
 
Cash Payments for Employee Bonus
 
$ 57,000,000 
$ 50,000,000 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Granted or Expected to Be Granted in Next Fiscal Period
 
 
 
1.4 
2.1 
 
Expected Percent of Bonus Paid in Cash
100.00% 
 
 
 
 
 
Income Taxes - Income Tax Expense (Benefit) by Current and Deferred (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Current:
 
 
 
 
 
 
 
 
 
 
 
United States federal
 
 
 
 
 
 
 
 
$ 0 
$ (9)
$ 0 
State
 
 
 
 
 
 
 
 
1 
1 
2 
Foreign
 
 
 
 
 
 
 
 
40 
37 
36 
Current income tax provision (benefit)
 
 
 
 
 
 
 
 
41 
29 
38 
Deferred, net of changes in valuation allowances:
 
 
 
 
 
 
 
 
 
 
 
United States federal
 
 
 
 
 
 
 
 
(6)
3 
3 
State
 
 
 
 
 
 
 
 
(15)
0 
0 
Foreign
 
 
 
 
 
 
 
 
(96)
6 
7 
Income Tax Benefit (Expense)
$ 103 
$ (8)
$ (12)
$ (7)
$ 1 
$ (14)
$ (11)
$ (14)
$ 76 
$ (38)
$ (48)
Income Taxes - Income (Loss) by Geographic Region (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Income Tax Disclosure [Abstract]
 
 
 
 
 
 
 
 
 
 
 
United States
 
 
 
 
 
 
 
 
$ 207 
$ (122)
$ (434)
Foreign
 
 
 
 
 
 
 
 
31 
51 
60 
Income (Loss) Before Income Taxes
$ (37)
$ 93 
$ 63 
$ 119 
$ 13 
$ (7)
$ (13)
$ (64)
$ 238 
$ (71)
$ (374)
Income Taxes - Reconciliation of Income Tax Expense (Benefit) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Income Tax Reconciliation [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent
 
 
 
 
 
 
 
 
35.00% 
35.00% 
35.00% 
Effective Income Tax Rate Reconciliation, Amount [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Computed tax benefit at statutory rate
 
 
 
 
 
 
 
 
$ 83 
$ (25)
$ (131)
Effects of earnings in jurisdictions outside of U.S.
 
 
 
 
 
 
 
 
(13)
(12)
(25)
Change in valuation allowance
 
 
 
 
 
 
 
 
(197)
27 
145 
Permanent Items
 
 
 
 
 
 
 
 
44 
44 
48 
Indefinite-lived assets
 
 
 
 
 
 
 
 
(2)
3 
3 
Effective Income Tax Rate Reconciliation, Tax Contingency, Amount
 
 
 
 
 
 
 
 
3 
9 
(3)
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount
 
 
 
 
 
 
 
 
(7)
(7)
(4)
Other, net
 
 
 
 
 
 
 
 
5 
3 
1 
Income Tax (Expense) Benefit
$ (103)
$ 8 
$ 12 
$ 7 
$ (1)
$ 14 
$ 11 
$ 14 
$ (76)
$ 38 
$ 48 
Income Taxes - Deferred Tax Assets (Liabilities) (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Oct. 31, 2014
Dec. 31, 2013
Dec. 31, 2014
U.S. Internal Revenue Service (IRS)
Dec. 31, 2013
U.S. Internal Revenue Service (IRS)
Deferred Tax Assets (Liabilities) [Line Items]
 
 
 
 
 
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount
 
 
 
$ 100 
 
Deferred Tax Liabilities, Intangible Assets
 
15 
 
 
 
Deferred Tax Assets:
 
 
 
 
 
Accrued payroll and related benefits
113 
 
132 
 
 
Deferred revenue
322 
 
336 
 
 
Unutilized tax net operating loss carry forwards
5,218 
 
4,791 
 
 
Fixed assets and intangible assets
90 
 
102 
 
 
Intercompany loss
128 
 
139 
 
 
Other
174 
 
144 
 
 
Total Deferred Tax Assets
6,045 
 
5,644 
 
 
Deferred Tax Liabilities:
 
 
 
 
 
Fixed assets and intangible assets
(1,371)
 
(790)
 
 
Deferred revenue
(73)
 
(76)
 
 
Other
(59)
 
(33)
 
 
Foreign branch income
(130)
 
(163)
 
 
Total Deferred Tax Liabilities
(1,633)
 
(1,062)
 
 
Net Deferred Tax Assets before valuation allowance
4,412 
 
4,582 
 
 
Valuation Allowance
(4,437)
 
(4,698)
(4,400)
(4,700)
Net Deferred Tax (Liability) Asset after Valuation Allowance
25 
 
116 
 
 
Net current deferred income tax asset
8 
 
9 
 
 
Net current deferred income tax liability
0 
 
(2)
 
 
Net non-current deferred income tax asset
292 
 
211 
 
 
Net non-current deferred income tax liability
(325)
 
(334)
 
 
Operating Loss Carryforwards
 
 
 
10,304 
 
Deferred Tax Assets, Net of Valuation Allowance
 
$ 15 
 
 
 
Income Taxes - Operating Loss Carryforward (Details) (USD $)
Dec. 31, 2014
Dec. 31, 2013
Operating Loss Carryforwards [Line Items]
 
 
Deferred Tax Assets, Valuation Allowance
$ 4,437,000,000 
$ 4,698,000,000 
U.S. Internal Revenue Service (IRS)
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
10,304,000,000 
 
Deferred Tax Assets, Valuation Allowance
4,400,000,000 
4,700,000,000 
U.S. Internal Revenue Service (IRS) |
Operating Loss Expiring, 2022 [Member]
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
186,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2023
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
380,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2024
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
1,456,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2025
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
1,299,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2026
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
1,244,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2027
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
1,615,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2028
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
482,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2029
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
694,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2030
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
664,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2031
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
827,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2032
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
730,000,000 
 
U.S. Internal Revenue Service (IRS) |
Expiring, 2033
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
289,000,000 
 
U.S. Internal Revenue Service (IRS) |
Operating Loss Expiring, 2034 [Member]
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
438,000,000 
 
Foreign jurisdiction
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforward, Disregarded for Domestic Country Tax Purposes
6,100,000,000 
 
State jurisdiction
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
7,900,000,000 
 
tw telecom [Member] |
U.S. Internal Revenue Service (IRS)
 
 
Operating Loss Carryforwards [Line Items]
 
 
Operating Loss Carryforwards
$ 1,000,000,000 
 
Income Taxes - Unrecognized Tax Benefits (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Operating Loss Carryforwards [Line Items]
 
 
 
Unrecognized tax benefits, increase from prior years positions netted against DTA
$ 5 
 
 
Unrecognized Tax Benefits that Would Impact Effective Tax Rate
14 
 
 
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions
1 
0 
4 
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
 
 
 
Unrecognized tax benefits, Beginning balance
13 
18 
15 
Gross increases - tax positions during 2012
0 
(1)
(1)
Gross decreases - lapse of statue of limitations
(2)
(6)
(1)
Gross decreases - settlements with taxing authorities
0 
0 
(1)
Unrecognized tax benefits, Ending Balance
17 
13 
18 
Accrued interest and penalties in the Company's liability for uncertain tax positions
(17)
(18)
(22)
Unrecognized Tax Benefits, Interest on Income Taxes Expense
(1)
 
 
Accrued interest and penalties related to uncertain tax positions in income tax expense in its consolidated statements of operation
 
$ (4)
$ (3)
Segment Information Summarized Segment Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Net Income (Loss) Available to Common Stockholders, Basic
 
 
 
 
 
 
 
 
$ 314 
$ (109)
$ (422)
Other Nonoperating Income (Expense)
 
 
 
 
 
 
 
 
(775)
(737)
(949)
Adjusted EBITDA by Segment [Line Items]
 
 
 
 
 
 
 
 
1,895 
1,624 
1,459 
Income Tax Benefit (Expense)
103 
(8)
(12)
(7)
1 
(14)
(11)
(14)
76 
(38)
(48)
Revenue
1,914 
1,629 
1,625 
1,609 
1,602 
1,569 
1,565 
1,577 
6,777 
6,313 
6,376 
Capital expenditures
 
 
 
 
 
 
 
 
(910)
(760)
(743)
Depreciation and amortization
(250)
(187)
(187)
(184)
(204)
(203)
(199)
(194)
(808)
(800)
(749)
Total Assets
20,947 
 
 
 
12,874 
 
 
 
20,947 
12,874 
 
Share-based Compensation
 
 
 
 
 
 
 
 
(73)
(151)
(135)
non-cash impairment
 
 
 
 
 
 
 
 
(1)
(7)
0 
Corporate and Other [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA by Segment [Line Items]
 
 
 
 
 
 
 
 
(732)
(714)
(722)
Capital expenditures
 
 
 
 
 
 
 
 
(145)
(100)
(99)
Total Assets
284 
 
 
 
266 
 
 
 
284 
266 
 
North America [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA by Segment [Line Items]
 
 
 
 
 
 
 
 
1,960 
1,799 
1,708 
Capital expenditures
 
 
 
 
 
 
 
 
(432)
(398)
(407)
Total Assets
8,082 
 
 
 
8,133 
 
 
 
8,082 
8,133 
 
Europe [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA by Segment [Line Items]
 
 
 
 
 
 
 
 
214 
226 
195 
Capital expenditures
 
 
 
 
 
 
 
 
(117)
(128)
(115)
Total Assets
1,970 
 
 
 
2,030 
 
 
 
1,970 
2,030 
 
Latin America [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA by Segment [Line Items]
 
 
 
 
 
 
 
 
348 
313 
278 
Capital expenditures
 
 
 
 
 
 
 
 
(153)
(134)
(122)
Total Assets
2,451 
 
 
 
2,445 
 
 
 
2,451 
2,445 
 
tw telecom [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting Information
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures
 
 
 
 
 
 
 
 
(63)
0 
 
Total Assets
$ 8,160 
 
 
 
$ 0 
 
 
 
$ 8,160 
$ 0 
 
Segment Information Revenue From External Customers (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
$ 1,914 
$ 1,629 
$ 1,625 
$ 1,609 
$ 1,602 
$ 1,569 
$ 1,565 
$ 1,577 
$ 6,777 
$ 6,313 
$ 6,376 
Core Network Service [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
6,195 
5,591 
5,463 
Core Network Service [Member] |
North America
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
4,240 
3,949 
3,840 
Core Network Service [Member] |
Europe
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
891 
888 
911 
Core Network Service [Member] |
Latin America
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
779 
754 
712 
tw telecom [Member] |
Latin America
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
285 
0 
 
Wholesale Voice Services and Other [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
582 
722 
913 
Wholesale Voice Services and Other [Member] |
North America
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
530 
681 
863 
Wholesale Voice Services and Other [Member] |
Europe
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
19 
31 
40 
Wholesale Voice Services and Other [Member] |
Latin America
 
 
 
 
 
 
 
 
 
 
 
Segment information
 
 
 
 
 
 
 
 
 
 
 
Revenue from external customers
 
 
 
 
 
 
 
 
$ 33 
$ 10 
$ 10 
Segment Information Revenue By Service Offering (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Revenue from External Customer
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 1,914 
$ 1,629 
$ 1,625 
$ 1,609 
$ 1,602 
$ 1,569 
$ 1,565 
$ 1,577 
$ 6,777 
$ 6,313 
$ 6,376 
Core Network Service
 
 
 
 
 
 
 
 
 
 
 
Revenue from External Customer
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
6,195 
5,591 
5,463 
Wholesale Voice Services and Other
 
 
 
 
 
 
 
 
 
 
 
Revenue from External Customer
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
$ 582 
$ 722 
$ 913 
Commitments, Contingencies and Other Items - Lawsuits (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended 3 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Peruvian Tax Litigation
Pending Litigation
Dec. 31, 2014
Peruvian Tax Litigation
Pending Litigation
Dec. 31, 2014
Peruvian Tax Litigation, Before Interest
Pending Litigation
Dec. 31, 2014
Peruvian Tax Litigation, Income Taxwitholding 2001 and 2002
Pending Litigation
Dec. 31, 2014
Peruvian Tax Litigation, Disallowance of VAT in 2005
Pending Litigation
Dec. 31, 2014
Peruvian Tax Litigation, Vat for 2001 and 2002
Pending Litigation
Dec. 31, 2014
Employee Severance and Contractor Termination Disputes
Pending Litigation
Dec. 31, 2014
Maximum
Brazilian Tax Claims
Pending Litigation
Dec. 31, 2014
Brazilian Tax Reserve Release [Member]
Brazilian Tax Claims
Pending Litigation
Sep. 30, 2014
Brazilian Tax Reserve Release [Member]
Brazilian Tax Claims
Pending Litigation
Loss Contingencies
 
 
 
 
 
 
 
 
 
 
 
Estimated Litigation Liability
$ 171 
 
 
 
 
 
 
 
 
 
 
Loss Contingency, Asserted Claim
 
 
55 
26 
3 
16 
7 
44 
 
 
 
Loss Contingency Accrual, Period Increase (Decrease)
 
28 
 
 
 
 
 
 
 
3 
6 
Loss Contingency Accrual, Payments
 
 
 
 
 
 
 
 
 
5 
 
Loss Contingency, Range of Possible Loss, Portion Not Accrued
 
 
 
 
 
 
 
 
$ 57 
 
 
Commitments, Contingencies and Other Items - Other Commitments (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
year
Dec. 31, 2013
Dec. 31, 2012
Commitments and Contingencies Disclosure [Abstract]
 
 
 
Amount outstanding under letters of credit
$ 28 
$ 29 
 
Collateralized Financings
23 
25 
 
Payments under these right-of-way agreements
173 
161 
172 
Rent expense, including common area maintenance, under non-cancelable lease agreements
318 
311 
308 
Right-of-Way Agreements
 
 
 
Right-of-Way Agreements, 2013
118 
 
 
Right-of-Way Agreements, 2014
58 
 
 
Right-of-Way Agreements, 2015
53 
 
 
Right-of-Way Agreements, 2016
51 
 
 
Right-of-Way Agreements, 2017
42 
 
 
Right-of-Way Agreements, Thereafter
315 
 
 
Right-of-Way Agreements, Total
637 
 
 
Facilities
 
 
 
Facilities, 2013
302 
 
 
Facilities, 2014
244 
 
 
Facilities, 2015
207 
 
 
Facilities, 2016
174 
 
 
Facilities, 2017
142 
 
 
Facilities, Thereafter
655 
 
 
Facilities, Total
1,724 
 
 
Total
 
 
 
Right-of-Way Agreements and Facilities, 2013
420 
 
 
Right-of-Way Agreements and Facilities, 2014
302 
 
 
Right-of-Way Agreements and Facilities, 2015
260 
 
 
Right-of-Way Agreements and Facilities, 2016
225 
 
 
Right-of-Way Agreements and Facilities, 2017
184 
 
 
Right-of-Way Agreements and Facilities, Thereafter
970 
 
 
Right-of-Way Agreements and Facilities, Total
2,361 
 
 
Future Minimum Sublease Receipts
 
 
 
2013
5 
 
 
2014
4 
 
 
2015
4 
 
 
2016
1 
 
 
2017
1 
 
 
Thereafter
0 
 
 
Total
$ 15 
 
 
Period of Right-of-Way Agreements with cancelable agreements (in years)
1 
 
 
Commitments, Contingencies and Other Items - Purchase Commitments (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Long-term Purchase Commitment
 
Total
$ 1,039 
Less than 1 Year
445 
2 - 3 Years
317 
4 - 5 Years
102 
After 5 Years
175 
Cost of Access Services
 
Long-term Purchase Commitment
 
Total
710 
Less than 1 Year
378 
2 - 3 Years
262 
4 - 5 Years
51 
After 5 Years
19 
Third Party Maintenance Services
 
Long-term Purchase Commitment
 
Total
329 
Less than 1 Year
67 
2 - 3 Years
55 
4 - 5 Years
51 
After 5 Years
$ 156 
Condensed Consolidating Financial Information - Narrative (Details) (Senior Notes due 2020 (7.0%))
Dec. 31, 2014
Long-term debt
 
Debt instrument, stated interest rate (as a percent)
7.00% 
Level 3 Financing [Member]
 
Long-term debt
 
Debt instrument, stated interest rate (as a percent)
7.00% 
Condensed Consolidating Financial Information - Statements of Operations (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Condensed Consolidating Financial Information
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 1,914 
$ 1,629 
$ 1,625 
$ 1,609 
$ 1,602 
$ 1,569 
$ 1,565 
$ 1,577 
$ 6,777 
$ 6,313 
$ 6,376 
Network Access Costs
695 
607 
613 
614 
618 
608 
616 
629 
2,529 
2,471 
2,602 
Network Related Expenses
345 
307 
302 
292 
298 
314 
300 
302 
1,246 
1,214 
1,249 
Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Depreciation and Amortization
250 
187 
187 
184 
204 
203 
199 
194 
808 
800 
749 
Selling, General and Administrative Expenses
393 
266 
267 
255 
263 
292 
310 
297 
1,181 
1,162 
1,201 
Total Costs and Expenses
1,683 
1,367 
1,369 
1,345 
1,383 
1,417 
1,425 
1,422 
5,764 
5,647 
5,801 
Operating Income (Loss)
231 
262 
256 
264 
219 
152 
140 
155 
1,013 
666 
575 
Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
0 
1 
0 
0 
0 
0 
0 
0 
1 
0 
2 
Interest expense
(195)
(159)
(149)
(151)
(148)
(165)
(167)
(169)
(654)
(649)
(733)
Interest income (expense) affiliates, net
 
 
 
 
 
 
 
 
0 
0 
0 
Equity in net earnings (losses) of subsidiaries
 
 
 
 
 
 
 
 
0 
0 
0 
Other income (expense), net
 
 
 
 
 
 
 
 
(122)
(88)
(218)
Total Other Expense
(268)
(169)
(193)
(145)
(206)
(159)
(153)
(219)
(775)
(737)
(949)
Income (Loss) Before Income Taxes
(37)
93 
63 
119 
13 
(7)
(13)
(64)
238 
(71)
(374)
Income Tax Benefit (Expense)
103 
(8)
(12)
(7)
1 
(14)
(11)
(14)
76 
(38)
(48)
Net income (loss)
 
 
 
 
 
 
 
 
314 
(109)
(422)
Net Income (Loss)
66 
85 
51 
112 
14 
(21)
(24)
(78)
314 
(109)
(422)
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
(183)
10 
106 
Comprehensive Income (Loss), Net of Tax, Attributable to Parent
 
 
 
 
 
 
 
 
131 
(99)
(316)
Level 3 Communications, Inc.
 
 
 
 
 
 
 
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
0 
0 
0 
Network Access Costs
 
 
 
 
 
 
 
 
0 
0 
0 
Network Related Expenses
 
 
 
 
 
 
 
 
0 
0 
0 
Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Depreciation and Amortization
 
 
 
 
 
 
 
 
0 
0 
0 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
21 
3 
2 
Total Costs and Expenses
 
 
 
 
 
 
 
 
21 
3 
2 
Operating Income (Loss)
 
 
 
 
 
 
 
 
(21)
(3)
(2)
Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
 
 
 
 
 
 
 
 
0 
0 
0 
Interest expense
 
 
 
 
 
 
 
 
(143)
(151)
(168)
Interest income (expense) affiliates, net
 
 
 
 
 
 
 
 
1,227 
1,091 
976 
Equity in net earnings (losses) of subsidiaries
 
 
 
 
 
 
 
 
(710)
(1,039)
(1,188)
Other income (expense), net
 
 
 
 
 
 
 
 
(53)
0 
(39)
Total Other Expense
 
 
 
 
 
 
 
 
321 
(99)
(419)
Income (Loss) Before Income Taxes
 
 
 
 
 
 
 
 
300 
(102)
(421)
Income Tax Benefit (Expense)
 
 
 
 
 
 
 
 
14 
(7)
(1)
Net income (loss)
 
 
 
 
 
 
 
 
 
 
(422)
Net Income (Loss)
 
 
 
 
 
 
 
 
314 
(109)
 
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
(183)
10 
106 
Comprehensive Income (Loss), Net of Tax, Attributable to Parent
 
 
 
 
 
 
 
 
131 
(99)
(316)
Level 3 Financing, Inc.
 
 
 
 
 
 
 
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
0 
0 
0 
Network Access Costs
 
 
 
 
 
 
 
 
0 
0 
0 
Network Related Expenses
 
 
 
 
 
 
 
 
0 
0 
0 
Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Depreciation and Amortization
 
 
 
 
 
 
 
 
0 
0 
0 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
2 
1 
1 
Total Costs and Expenses
 
 
 
 
 
 
 
 
2 
1 
1 
Operating Income (Loss)
 
 
 
 
 
 
 
 
(2)
(1)
(1)
Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
 
 
 
 
 
 
 
 
0 
0 
0 
Interest expense
 
 
 
 
 
 
 
 
(492)
(497)
(535)
Interest income (expense) affiliates, net
 
 
 
 
 
 
 
 
1,827 
1,706 
1,598 
Equity in net earnings (losses) of subsidiaries
 
 
 
 
 
 
 
 
(2,047)
(2,164)
(2,066)
Other income (expense), net
 
 
 
 
 
 
 
 
0 
(85)
(184)
Total Other Expense
 
 
 
 
 
 
 
 
(712)
(1,040)
(1,187)
Income (Loss) Before Income Taxes
 
 
 
 
 
 
 
 
(714)
(1,041)
(1,188)
Income Tax Benefit (Expense)
 
 
 
 
 
 
 
 
4 
2 
0 
Net income (loss)
 
 
 
 
 
 
 
 
 
 
(1,188)
Net Income (Loss)
 
 
 
 
 
 
 
 
(710)
(1,039)
 
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
0 
10 
106 
Comprehensive Income (Loss), Net of Tax, Attributable to Parent
 
 
 
 
 
 
 
 
(710)
(1,029)
(1,082)
Level 3 Communications, LLC
 
 
 
 
 
 
 
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
3,073 
2,825 
2,657 
Network Access Costs
 
 
 
 
 
 
 
 
1,177 
1,068 
996 
Network Related Expenses
 
 
 
 
 
 
 
 
762 
753 
741 
Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Depreciation and Amortization
 
 
 
 
 
 
 
 
277 
289 
260 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
735 
791 
818 
Total Costs and Expenses
 
 
 
 
 
 
 
 
2,951 
2,901 
2,815 
Operating Income (Loss)
 
 
 
 
 
 
 
 
122 
(76)
(158)
Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
 
 
 
 
 
 
 
 
0 
0 
1 
Interest expense
 
 
 
 
 
 
 
 
(2)
(3)
(3)
Interest income (expense) affiliates, net
 
 
 
 
 
 
 
 
(2,890)
(2,679)
(2,233)
Equity in net earnings (losses) of subsidiaries
 
 
 
 
 
 
 
 
663 
550 
92 
Other income (expense), net
 
 
 
 
 
 
 
 
7 
4 
6 
Total Other Expense
 
 
 
 
 
 
 
 
(2,222)
(2,128)
(2,137)
Income (Loss) Before Income Taxes
 
 
 
 
 
 
 
 
(2,100)
(2,204)
(2,295)
Income Tax Benefit (Expense)
 
 
 
 
 
 
 
 
(1)
0 
(4)
Net income (loss)
 
 
 
 
 
 
 
 
 
 
(2,299)
Net Income (Loss)
 
 
 
 
 
 
 
 
(2,101)
(2,204)
 
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
0 
0 
0 
Comprehensive Income (Loss), Net of Tax, Attributable to Parent
 
 
 
 
 
 
 
 
(2,101)
(2,204)
(2,299)
Other Non-Guarantor Subsidiaries
 
 
 
 
 
 
 
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
3,918 
3,734 
3,975 
Network Access Costs
 
 
 
 
 
 
 
 
1,566 
1,649 
1,854 
Network Related Expenses
 
 
 
 
 
 
 
 
484 
461 
508 
Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Depreciation and Amortization
 
 
 
 
 
 
 
 
531 
511 
489 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
423 
367 
388 
Total Costs and Expenses
 
 
 
 
 
 
 
 
3,004 
2,988 
3,239 
Operating Income (Loss)
 
 
 
 
 
 
 
 
914 
746 
736 
Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
 
 
 
 
 
 
 
 
1 
0 
1 
Interest expense
 
 
 
 
 
 
 
 
(17)
2 
(27)
Interest income (expense) affiliates, net
 
 
 
 
 
 
 
 
(164)
(118)
(341)
Equity in net earnings (losses) of subsidiaries
 
 
 
 
 
 
 
 
0 
0 
0 
Other income (expense), net
 
 
 
 
 
 
 
 
(76)
(7)
(1)
Total Other Expense
 
 
 
 
 
 
 
 
(256)
(123)
(368)
Income (Loss) Before Income Taxes
 
 
 
 
 
 
 
 
658 
623 
368 
Income Tax Benefit (Expense)
 
 
 
 
 
 
 
 
59 
(33)
(43)
Net income (loss)
 
 
 
 
 
 
 
 
 
 
325 
Net Income (Loss)
 
 
 
 
 
 
 
 
717 
590 
 
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
(183)
10 
16 
Comprehensive Income (Loss), Net of Tax, Attributable to Parent
 
 
 
 
 
 
 
 
534 
600 
341 
Eliminations
 
 
 
 
 
 
 
 
 
 
 
Condensed Consolidating Financial Information
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
(214)
(246)
(256)
Network Access Costs
 
 
 
 
 
 
 
 
(214)
(246)
(248)
Network Related Expenses
 
 
 
 
 
 
 
 
0 
0 
0 
Costs and Expenses:
 
 
 
 
 
 
 
 
 
 
 
Depreciation and Amortization
 
 
 
 
 
 
 
 
0 
0 
0 
Selling, General and Administrative Expenses
 
 
 
 
 
 
 
 
0 
0 
(8)
Total Costs and Expenses
 
 
 
 
 
 
 
 
(214)
(246)
(256)
Operating Income (Loss)
 
 
 
 
 
 
 
 
0 
0 
0 
Other Income (Expense):
 
 
 
 
 
 
 
 
 
 
 
Interest Income
 
 
 
 
 
 
 
 
0 
0 
0 
Interest expense
 
 
 
 
 
 
 
 
0 
0 
0 
Interest income (expense) affiliates, net
 
 
 
 
 
 
 
 
0 
0 
0 
Equity in net earnings (losses) of subsidiaries
 
 
 
 
 
 
 
 
2,094 
2,653 
3,162 
Other income (expense), net
 
 
 
 
 
 
 
 
0 
0 
0 
Total Other Expense
 
 
 
 
 
 
 
 
2,094 
2,653 
3,162 
Income (Loss) Before Income Taxes
 
 
 
 
 
 
 
 
2,094 
2,653 
3,162 
Income Tax Benefit (Expense)
 
 
 
 
 
 
 
 
0 
0 
0 
Net income (loss)
 
 
 
 
 
 
 
 
 
 
3,162 
Net Income (Loss)
 
 
 
 
 
 
 
 
2,094 
2,653 
 
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent
 
 
 
 
 
 
 
 
183 
(20)
(122)
Comprehensive Income (Loss), Net of Tax, Attributable to Parent
 
 
 
 
 
 
 
 
$ 2,277 
$ 2,633 
$ 3,040 
Condensed Consolidating Financial Information - Balance Sheets (Details) (USD $)
In Millions, unless otherwise specified
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Jan. 1, 2012
Dec. 31, 2011
Dec. 31, 2010
Current Assets:
 
 
 
 
 
 
Cash and cash equivalents
$ 580 
$ 631 
$ 979 
 
$ 918 
$ 918 
Restricted cash and securities
7 
7 
 
 
 
 
Receivables, less allowances for doubtful accounts
737 
673 
 
 
 
 
Due from affiliates
0 
0 
 
 
 
 
Other
165 
143 
 
 
 
 
Total Current Assets
1,489 
1,454 
 
 
 
 
Property, Plant and Equipment, net
9,860 
8,240 
 
 
 
 
Restricted Cash and Securities
20 
23 
 
 
 
 
Goodwill and Other Intangibles Assets, net
9,103 
2,782 
 
 
 
 
Investment in Subsidiaries
0 
0 
 
 
 
 
Other Assets, net
475 
375 
 
 
 
 
Total Assets
20,947 
12,874 
 
 
 
 
Liabilities:
 
 
 
 
 
 
Accounts payable
664 
625 
 
 
 
 
Current portion of long-term debt
349 
31 
 
 
 
 
Accrued payroll and employee benefits
273 
209 
 
 
 
 
Accrued interest
174 
160 
 
 
 
 
Current portion of deferred revenue
287 
253 
 
 
 
 
Due to affiliates
0 
0 
 
 
 
 
Other
167 
168 
 
 
 
 
Total Current Liabilities
1,914 
1,446 
 
 
 
 
Long-Term Debt, less current portion
10,984 
8,331 
 
 
 
 
Deferred Revenue, less current portion
921 
906 
 
 
 
 
Other Liabilities
765 
780 
 
 
 
 
Commitments and Contingencies
0 
0 
 
 
 
 
Stockholders' Equity (Deficit)
6,363 
1,411 
1,171 
1,193 
 
 
Total Liabilities and Stockholders’ Equity
20,947 
12,874 
 
 
 
 
Level 3 Communications, Inc.
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
Cash and cash equivalents
7 
8 
253 
 
 
2 
Restricted cash and securities
0 
0 
 
 
 
 
Receivables, less allowances for doubtful accounts
0 
0 
 
 
 
 
Due from affiliates
14,522 
15,507 
 
 
 
 
Other
2 
2 
 
 
 
 
Total Current Assets
14,531 
15,517 
 
 
 
 
Property, Plant and Equipment, net
0 
0 
 
 
 
 
Restricted Cash and Securities
3 
3 
 
 
 
 
Goodwill and Other Intangibles Assets, net
0 
0 
 
 
 
 
Investment in Subsidiaries
16,686 
10,039 
 
 
 
 
Other Assets, net
28 
10 
 
 
 
 
Total Assets
31,248 
25,569 
 
 
 
 
Liabilities:
 
 
 
 
 
 
Accounts payable
0 
0 
 
 
 
 
Current portion of long-term debt
333 
0 
 
 
 
 
Accrued payroll and employee benefits
0 
0 
 
 
 
 
Accrued interest
12 
30 
 
 
 
 
Current portion of deferred revenue
0 
0 
 
 
 
 
Due to affiliates
0 
0 
 
 
 
 
Other
0 
0 
 
 
 
 
Total Current Liabilities
345 
30 
 
 
 
 
Long-Term Debt, less current portion
900 
1,370 
 
 
 
 
Deferred Revenue, less current portion
0 
0 
 
 
 
 
Other Liabilities
16 
15 
 
 
 
 
Stockholders' Equity (Deficit)
29,987 
24,154 
 
 
 
 
Total Liabilities and Stockholders’ Equity
31,248 
25,569 
 
 
 
 
Level 3 Financing, Inc.
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
Cash and cash equivalents
5 
6 
5 
 
 
6 
Restricted cash and securities
0 
0 
 
 
 
 
Receivables, less allowances for doubtful accounts
0 
0 
 
 
 
 
Due from affiliates
21,270 
16,886 
 
 
 
 
Other
21 
15 
 
 
 
 
Total Current Assets
21,296 
16,907 
 
 
 
 
Property, Plant and Equipment, net
0 
0 
 
 
 
 
Restricted Cash and Securities
0 
0 
 
 
 
 
Goodwill and Other Intangibles Assets, net
0 
0 
 
 
 
 
Investment in Subsidiaries
14,777 
27,014 
 
 
 
 
Other Assets, net
129 
113 
 
 
 
 
Total Assets
36,202 
44,034 
 
 
 
 
Liabilities:
 
 
 
 
 
 
Accounts payable
0 
2 
 
 
 
 
Current portion of long-term debt
0 
0 
 
 
 
 
Accrued payroll and employee benefits
0 
0 
 
 
 
 
Accrued interest
158 
129 
 
 
 
 
Current portion of deferred revenue
0 
0 
 
 
 
 
Due to affiliates
0 
0 
 
 
 
 
Other
2 
13 
 
 
 
 
Total Current Liabilities
160 
144 
 
 
 
 
Long-Term Debt, less current portion
9,893 
6,905 
 
 
 
 
Deferred Revenue, less current portion
0 
0 
 
 
 
 
Other Liabilities
24 
27 
 
 
 
 
Stockholders' Equity (Deficit)
26,125 
36,958 
 
 
 
 
Total Liabilities and Stockholders’ Equity
36,202 
44,034 
 
 
 
 
Level 3 Communications, LLC
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
Cash and cash equivalents
307 
347 
386 
 
 
618 
Restricted cash and securities
1 
1 
 
 
 
 
Receivables, less allowances for doubtful accounts
34 
79 
 
 
 
 
Due from affiliates
0 
0 
 
 
 
 
Other
45 
47 
 
 
 
 
Total Current Assets
387 
474 
 
 
 
 
Property, Plant and Equipment, net
3,152 
3,028 
 
 
 
 
Restricted Cash and Securities
16 
18 
 
 
 
 
Goodwill and Other Intangibles Assets, net
373 
395 
 
 
 
 
Investment in Subsidiaries
3,729 
3,735 
 
 
 
 
Other Assets, net
9 
11 
 
 
 
 
Total Assets
7,666 
7,661 
 
 
 
 
Liabilities:
 
 
 
 
 
 
Accounts payable
215 
42 
 
 
 
 
Current portion of long-term debt
3 
3 
 
 
 
 
Accrued payroll and employee benefits
174 
171 
 
 
 
 
Accrued interest
0 
0 
 
 
 
 
Current portion of deferred revenue
118 
131 
 
 
 
 
Due to affiliates
34,401 
32,165 
 
 
 
 
Other
62 
74 
 
 
 
 
Total Current Liabilities
34,973 
32,586 
 
 
 
 
Long-Term Debt, less current portion
16 
17 
 
 
 
 
Deferred Revenue, less current portion
617 
603 
 
 
 
 
Other Liabilities
125 
135 
 
 
 
 
Stockholders' Equity (Deficit)
(28,065)
(25,680)
 
 
 
 
Total Liabilities and Stockholders’ Equity
7,666 
7,661 
 
 
 
 
Other Non-Guarantor Subsidiaries
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
Cash and cash equivalents
261 
270 
335 
 
 
292 
Restricted cash and securities
6 
6 
 
 
 
 
Receivables, less allowances for doubtful accounts
703 
594 
 
 
 
 
Due from affiliates
0 
0 
 
 
 
 
Other
97 
79 
 
 
 
 
Total Current Assets
1,067 
949 
 
 
 
 
Property, Plant and Equipment, net
6,708 
5,212 
 
 
 
 
Restricted Cash and Securities
1 
2 
 
 
 
 
Goodwill and Other Intangibles Assets, net
8,730 
2,387 
 
 
 
 
Investment in Subsidiaries
0 
0 
 
 
 
 
Other Assets, net
309 
241 
 
 
 
 
Total Assets
16,815 
8,791 
 
 
 
 
Liabilities:
 
 
 
 
 
 
Accounts payable
449 
581 
 
 
 
 
Current portion of long-term debt
13 
28 
 
 
 
 
Accrued payroll and employee benefits
99 
38 
 
 
 
 
Accrued interest
4 
1 
 
 
 
 
Current portion of deferred revenue
169 
122 
 
 
 
 
Due to affiliates
1,391 
228 
 
 
 
 
Other
103 
81 
 
 
 
 
Total Current Liabilities
2,228 
1,079 
 
 
 
 
Long-Term Debt, less current portion
175 
39 
 
 
 
 
Deferred Revenue, less current portion
304 
303 
 
 
 
 
Other Liabilities
600 
603 
 
 
 
 
Stockholders' Equity (Deficit)
13,508 
6,767 
 
 
 
 
Total Liabilities and Stockholders’ Equity
16,815 
8,791 
 
 
 
 
Eliminations
 
 
 
 
 
 
Current Assets:
 
 
 
 
 
 
Cash and cash equivalents
0 
0 
0 
 
 
0 
Restricted cash and securities
0 
0 
 
 
 
 
Receivables, less allowances for doubtful accounts
0 
0 
 
 
 
 
Due from affiliates
(35,792)
(32,393)
 
 
 
 
Other
0 
0 
 
 
 
 
Total Current Assets
(35,792)
(32,393)
 
 
 
 
Property, Plant and Equipment, net
0 
0 
 
 
 
 
Restricted Cash and Securities
0 
0 
 
 
 
 
Goodwill and Other Intangibles Assets, net
0 
0 
 
 
 
 
Investment in Subsidiaries
(35,192)
(40,788)
 
 
 
 
Other Assets, net
0 
0 
 
 
 
 
Total Assets
(70,984)
(73,181)
 
 
 
 
Liabilities:
 
 
 
 
 
 
Accounts payable
0 
0 
 
 
 
 
Current portion of long-term debt
0 
0 
 
 
 
 
Accrued payroll and employee benefits
0 
0 
 
 
 
 
Accrued interest
0 
0 
 
 
 
 
Current portion of deferred revenue
0 
0 
 
 
 
 
Due to affiliates
(35,792)
(32,393)
 
 
 
 
Other
0 
0 
 
 
 
 
Total Current Liabilities
(35,792)
(32,393)
 
 
 
 
Long-Term Debt, less current portion
0 
0 
 
 
 
 
Deferred Revenue, less current portion
0 
0 
 
 
 
 
Other Liabilities
0 
0 
 
 
 
 
Stockholders' Equity (Deficit)
(35,192)
(40,788)
 
 
 
 
Total Liabilities and Stockholders’ Equity
$ (70,984)
$ (73,181)
 
 
 
 
Condensed Consolidating Financial Information - Statements of Cash Flows (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Condensed Consolidating Financial Information
 
 
 
Net Cash Provided by (Used in) Operating Activities
$ 1,161 
$ 713 
$ 578 
Cash Flows from Investing Activities:
 
 
 
Capital expenditures
(910)
(760)
(743)
Increase (Decrease) in Restricted Cash and Investments
(10)
13 
20 
Proceeds from sale of property, plant and equipment and other assets
3 
0 
0 
Payments to Acquire Businesses, Net of Cash Acquired
(167)
0 
0 
Other
(2)
2 
(2)
Net Cash Used in Investing Activities
(1,086)
(745)
(725)
Cash Flows from Financing Activities:
 
 
 
Long-term debt borrowings, net of issuance costs
589 
1,502 
4,504 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
(671)
(1,796)
(4,302)
Proceeds from Stock Options Exercised
0 
0 
5 
Increase (decrease) due from affiliates, net
0 
0 
0 
Net Cash Provided by (Used in) Financing Activities
(82)
(294)
207 
Effect of Exchange Rates on Cash and Cash Equivalents
(44)
(22)
1 
Net Change in Cash and Cash Equivalents
(51)
(348)
61 
Cash and Cash Equivalents at Beginning of Year
631 
979 
918 
Cash and Cash Equivalents at End of Year
580 
631 
979 
Level 3 Communications, Inc.
 
 
 
Condensed Consolidating Financial Information
 
 
 
Net Cash Provided by (Used in) Operating Activities
(178)
(169)
(165)
Cash Flows from Investing Activities:
 
 
 
Capital expenditures
0 
0 
0 
Increase (Decrease) in Restricted Cash and Investments
0 
9 
6 
Proceeds from sale of property, plant and equipment and other assets
0 
 
 
Payments to Acquire Businesses, Net of Cash Acquired
(474)
 
 
Other
0 
0 
0 
Net Cash Used in Investing Activities
(474)
9 
6 
Cash Flows from Financing Activities:
 
 
 
Long-term debt borrowings, net of issuance costs
590 
0 
293 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
(647)
(173)
0 
Proceeds from Stock Options Exercised
 
 
5 
Increase (decrease) due from affiliates, net
708 
88 
112 
Net Cash Provided by (Used in) Financing Activities
651 
(85)
410 
Effect of Exchange Rates on Cash and Cash Equivalents
0 
0 
0 
Net Change in Cash and Cash Equivalents
(1)
(245)
251 
Cash and Cash Equivalents at Beginning of Year
8 
253 
 
Cash and Cash Equivalents at End of Year
7 
8 
253 
Level 3 Financing, Inc.
 
 
 
Condensed Consolidating Financial Information
 
 
 
Net Cash Provided by (Used in) Operating Activities
(458)
(557)
(520)
Cash Flows from Investing Activities:
 
 
 
Capital expenditures
0 
0 
0 
Increase (Decrease) in Restricted Cash and Investments
0 
0 
0 
Proceeds from sale of property, plant and equipment and other assets
0 
 
 
Payments to Acquire Businesses, Net of Cash Acquired
0 
 
 
Other
0 
0 
0 
Net Cash Used in Investing Activities
0 
0 
0 
Cash Flows from Financing Activities:
 
 
 
Long-term debt borrowings, net of issuance costs
0 
1,502 
4,211 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
0 
(1,586)
(4,161)
Proceeds from Stock Options Exercised
 
 
0 
Increase (decrease) due from affiliates, net
457 
642 
469 
Net Cash Provided by (Used in) Financing Activities
457 
558 
519 
Effect of Exchange Rates on Cash and Cash Equivalents
0 
0 
0 
Net Change in Cash and Cash Equivalents
(1)
1 
(1)
Cash and Cash Equivalents at Beginning of Year
6 
5 
 
Cash and Cash Equivalents at End of Year
5 
6 
5 
Level 3 Communications, LLC
 
 
 
Condensed Consolidating Financial Information
 
 
 
Net Cash Provided by (Used in) Operating Activities
625 
710 
140 
Cash Flows from Investing Activities:
 
 
 
Capital expenditures
(362)
(312)
(276)
Increase (Decrease) in Restricted Cash and Investments
2 
(1)
2 
Proceeds from sale of property, plant and equipment and other assets
0 
 
 
Payments to Acquire Businesses, Net of Cash Acquired
0 
 
 
Other
0 
1 
0 
Net Cash Used in Investing Activities
(360)
(312)
(274)
Cash Flows from Financing Activities:
 
 
 
Long-term debt borrowings, net of issuance costs
0 
0 
0 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
0 
(4)
0 
Proceeds from Stock Options Exercised
 
 
0 
Increase (decrease) due from affiliates, net
(305)
(433)
(98)
Net Cash Provided by (Used in) Financing Activities
(305)
(437)
(98)
Effect of Exchange Rates on Cash and Cash Equivalents
0 
0 
0 
Net Change in Cash and Cash Equivalents
(40)
(39)
(232)
Cash and Cash Equivalents at Beginning of Year
347 
386 
 
Cash and Cash Equivalents at End of Year
307 
347 
386 
Other Non-Guarantor Subsidiaries
 
 
 
Condensed Consolidating Financial Information
 
 
 
Net Cash Provided by (Used in) Operating Activities
1,172 
729 
1,123 
Cash Flows from Investing Activities:
 
 
 
Capital expenditures
(548)
(448)
(467)
Increase (Decrease) in Restricted Cash and Investments
(12)
5 
12 
Proceeds from sale of property, plant and equipment and other assets
3 
 
 
Payments to Acquire Businesses, Net of Cash Acquired
307 
 
 
Other
(2)
1 
(2)
Net Cash Used in Investing Activities
(252)
(442)
(457)
Cash Flows from Financing Activities:
 
 
 
Long-term debt borrowings, net of issuance costs
(1)
0 
0 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
(24)
(33)
(141)
Proceeds from Stock Options Exercised
 
 
0 
Increase (decrease) due from affiliates, net
(860)
(297)
(483)
Net Cash Provided by (Used in) Financing Activities
(885)
(330)
(624)
Effect of Exchange Rates on Cash and Cash Equivalents
(44)
(22)
1 
Net Change in Cash and Cash Equivalents
(9)
(65)
43 
Cash and Cash Equivalents at Beginning of Year
270 
335 
 
Cash and Cash Equivalents at End of Year
261 
270 
335 
Eliminations
 
 
 
Condensed Consolidating Financial Information
 
 
 
Net Cash Provided by (Used in) Operating Activities
0 
0 
0 
Cash Flows from Investing Activities:
 
 
 
Capital expenditures
0 
0 
0 
Increase (Decrease) in Restricted Cash and Investments
0 
0 
0 
Proceeds from sale of property, plant and equipment and other assets
0 
 
 
Payments to Acquire Businesses, Net of Cash Acquired
0 
 
 
Other
0 
0 
0 
Net Cash Used in Investing Activities
0 
0 
0 
Cash Flows from Financing Activities:
 
 
 
Long-term debt borrowings, net of issuance costs
0 
0 
0 
Payments on and repurchases of long-term debt, including current portions and refinancing costs
0 
0 
0 
Proceeds from Stock Options Exercised
 
 
0 
Increase (decrease) due from affiliates, net
0 
0 
0 
Net Cash Provided by (Used in) Financing Activities
0 
0 
0 
Effect of Exchange Rates on Cash and Cash Equivalents
0 
0 
0 
Net Change in Cash and Cash Equivalents
0 
0 
0 
Cash and Cash Equivalents at Beginning of Year
0 
0 
 
Cash and Cash Equivalents at End of Year
$ 0 
$ 0 
$ 0 
Unaudited Quarterly Financial Data (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended 3 Months Ended 3 Months Ended 3 Months Ended 3 Months Ended 3 Months Ended 12 Months Ended 12 Months Ended 0 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2014
Tranche B-II Term Loans and Senior Notes [Member]
Dec. 31, 2014
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2013
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2011
Senior Notes 11 Point 875 Percent Due 2019 [Member]
Dec. 31, 2014
TrancheB2022TermLoanTotal [Member]
Dec. 31, 2014
Senior Notes 5.375percent Due 2022 [Member]
Aug. 12, 2014
Senior Notes 5.375percent Due 2022 [Member]
Dec. 31, 2013
TrancheBII2019TermLoan [Member]
Dec. 31, 2013
Senior Notes 10 Point 0 Percent Due 2018 [Member]
Dec. 31, 2014
Senior Notes 10 Point 0 Percent Due 2018 [Member]
Dec. 31, 2011
Senior Notes 10 Point 0 Percent Due 2018 [Member]
Dec. 31, 2013
Floating Rate Senior Notes due 2015 [Member]
Dec. 31, 2014
Floating Rate Senior Notes due 2015 [Member]
Dec. 31, 2011
Floating Rate Senior Notes due 2015 [Member]
Sep. 30, 2014
Tranche A Term Loan
Dec. 31, 2014
Tranche B II and Tranche B III Term Loans
Dec. 31, 2013
Tranche B II and Tranche B III Term Loans
Sep. 30, 2014
Senior Notes due 2017 (8.75%)
Dec. 31, 2011
Senior Notes due 2017 (8.75%)
Dec. 31, 2014
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2011
Convertible Senior Notes due 2013 (15.0%)
Mar. 31, 2012
Senior Notes due 2014 (9.25%)
Dec. 31, 2011
Senior Notes due 2014 (9.25%)
Dec. 31, 2013
Asset Retirement Obligation Change in Estimate
Dec. 31, 2012
Asset Retirement Obligation Change in Estimate
Aug. 12, 2014
Level 3 Escrow II, Inc. [Member]
Senior Notes 5.375percent Due 2022 [Member]
Dec. 31, 2014
Guarantor Subsidiaries [Member]
Dec. 31, 2013
Guarantor Subsidiaries [Member]
Dec. 31, 2012
Guarantor Subsidiaries [Member]
Dec. 31, 2014
Guarantor Subsidiaries [Member]
TrancheB2022TermLoanTotal [Member]
Oct. 4, 2013
Guarantor Subsidiaries [Member]
TrancheBII2019TermLoan [Member]
Selected Quarterly Financial Information [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 1,914 
$ 1,629 
$ 1,625 
$ 1,609 
$ 1,602 
$ 1,569 
$ 1,565 
$ 1,577 
$ 6,777 
$ 6,313 
$ 6,376 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 0 
$ 0 
$ 0 
 
 
Network Access Costs
695 
607 
613 
614 
618 
608 
616 
629 
2,529 
2,471 
2,602 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
0 
0 
 
 
Network Related Expenses
345 
307 
302 
292 
298 
314 
300 
302 
1,246 
1,214 
1,249 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
0 
0 
 
 
Operating Income (Loss)
231 
262 
256 
264 
219 
152 
140 
155 
1,013 
666 
575 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(2)
(1)
(1)
 
 
Interest Income
0 
1 
0 
0 
0 
0 
0 
0 
1 
0 
2 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0 
0 
0 
 
 
Interest Expense
(195)
(159)
(149)
(151)
(148)
(165)
(167)
(169)
(654)
(649)
(733)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(492)
(497)
(535)
 
 
Net Income (Loss)
66 
85 
51 
112 
14 
(21)
(24)
(78)
314 
(109)
(422)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(710)
(1,039)
 
 
 
Earnings Per Share, Basic
$ 0.22 
$ 0.36 
$ 0.21 
$ 0.48 
$ 0.06 
$ (0.09)
$ (0.11)
$ (0.36)
$ 1.23 
$ (0.49)
$ (1.96)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings Per Share, Diluted
$ 0.21 
$ 0.35 
$ 0.21 
$ 0.47 
$ 0.06 
$ (0.09)
$ (0.11)
$ (0.36)
$ 1.21 
$ (0.49)
$ (1.96)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Selling, General and Administrative Expenses
393 
266 
267 
255 
263 
292 
310 
297 
1,181 
1,162 
1,201 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
47 
 
2 
1 
1 
 
 
Total Costs and Expenses
1,683 
1,367 
1,369 
1,345 
1,383 
1,417 
1,425 
1,422 
5,764 
5,647 
5,801 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
49 
 
 
2 
1 
1 
 
 
Depreciation expense
 
 
 
 
 
 
 
 
713 
727 
659 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciation and Amortization
250 
187 
187 
184 
204 
203 
199 
194 
808 
800 
749 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2 
 
0 
0 
0 
 
 
Impairment of Intangible Assets (Excluding Goodwill)
 
 
 
 
 
 
 
 
17 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss on modification and extinguishment of debt, net
(53)
0 
0 
0 
(67)
(17)
0 
0 
(53)
(84)
(160)
53 
 
 
 
 
 
 
10 
56 
 
 
1 
 
 
(9)
(50)
(67)
(40)
 
 
 
(22)
 
 
 
 
 
 
 
 
10 
Business Combination, Integration Related Costs
70 
 
 
 
 
 
 
 
81 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other, net
(20)
(11)
(44)
6 
9 
23 
14 
(50)
(69)
(4)
(58)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Other Expense
(268)
(169)
(193)
(145)
(206)
(159)
(153)
(219)
(775)
(737)
(949)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(712)
(1,040)
(1,187)
 
 
Income (Loss) Before Income Taxes
(37)
93 
63 
119 
13 
(7)
(13)
(64)
238 
(71)
(374)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(714)
(1,041)
(1,188)
 
 
Income Tax Expense (Benefit)
(103)
8 
12 
7 
(1)
14 
11 
14 
(76)
38 
48 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(4)
(2)
0 
 
 
Recognized Income Tax Benefit
100 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Face Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,000.0 
1,000.0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,000.0 
 
 
 
 
 
Debt instrument, stated interest rate (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
11.875% 
 
11.875% 
 
5.375% 
 
 
10.00% 
10.00% 
10.00% 
 
3.846% 
4.202% 
 
 
 
 
8.75% 
15.00% 
15.00% 
 
9.25% 
 
 
 
 
 
 
 
 
Foreign Currency Transaction Gain (Loss), before Tax
 
 
34 
 
 
 
 
22 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign Currency Exchange Rate, Translation
 
 
6.3 
 
 
 
 
6.30 
 
 
4.30 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign Currency Exchange Rate, Remeasurement
 
 
10.6 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Property, Plant and Equipment, Gross
19,489 
 
 
 
17,329 
 
 
 
19,489 
17,329 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
24 
 
 
 
 
 
 
Long-term Debt, Gross
11,366 
 
 
 
8,392 
 
 
 
11,366 
8,392 
 
 
0 
605 
 
2,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,000 
 
Asset Retirement Obligation, Revision of Estimate
 
 
 
 
 
 
 
 
$ 7 
$ 0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Subsequent Events (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended 3 Months Ended
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Mar. 31, 2014
Dec. 31, 2013
Sep. 30, 2013
Jun. 30, 2013
Mar. 31, 2013
Dec. 31, 2014
Dec. 31, 2013
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2010
Dec. 31, 2014
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2011
Convertible Senior Notes due 2013 (15.0%)
Dec. 31, 2014
Senior Notes due 2019 (9.375%)
Dec. 31, 2011
Senior Notes due 2019 (9.375%)
Dec. 31, 2014
Level 3 Financing [Member]
Senior Notes due 2019 (9.375%)
Mar. 4, 2011
Level 3 Financing [Member]
Senior Notes due 2019 (9.375%)
Jan. 29, 2015
Level 3 Financing [Member]
Subsequent Event [Member]
Senior Notes 5point 625Percent Due 2023 [Member]
Jun. 30, 2015
Level 3 Financing [Member]
Subsequent Event [Member]
Senior Notes due 2019 (9.375%)
Jan. 29, 2015
Level 3 Financing [Member]
Subsequent Event [Member]
Senior Notes due 2019 (9.375%)
Dec. 31, 2014
Level 3 Communications, Inc.
Dec. 31, 2013
Level 3 Communications, Inc.
Dec. 31, 2012
Level 3 Communications, Inc.
Dec. 31, 2010
Level 3 Communications, Inc.
Subsequent Events
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Face Amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 500.0 
$ 500.0 
 
$ 500.0 
 
 
 
 
Debt instrument, stated interest rate (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
15.00% 
15.00% 
9.375% 
9.375% 
9.375% 
 
5.625% 
 
9.375% 
 
 
 
 
Cash and cash equivalents
580 
 
 
 
631 
 
 
 
580 
631 
979 
918 
918 
 
 
 
 
 
 
 
 
 
7 
8 
253 
2 
Other, net
(20)
(11)
(44)
6 
9 
23 
14 
(50)
(69)
(4)
(58)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss on modification and extinguishment of debt, net
$ (53)
$ 0 
$ 0 
$ 0 
$ (67)
$ (17)
$ 0 
$ 0 
$ (53)
$ (84)
$ (160)
 
 
 
 
 
 
 
 
 
$ 40