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SEC Filings

S-4
AVALON CABLE OF MICHIGAN INC/ filed this Form S-4 on 04/01/1999
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Principal, Maturity and Interest
 
   The Notes are limited in aggregate principal amount at issuance to $160.4
million, of which $110.4 million were issued in the initial offering, and will
mature on December 1, 2008. The Old Notes were issued at a substantial discount
from their principal amount at maturity of $196.0 million, to generate gross
proceeds of approximately $110.4 million. Until December 1, 2003, interest will
not be paid currently on the Notes, but the Accreted Value will increase
(representing amortization of original issue discount) between the date of
original issuance and December 1, 2003, on a semi-annual basis using a 360-day
year comprised of twelve 30-day months, such that the Accreted Value shall be
equal to the full principal amount at maturity of the Notes on December 1, 2003
(the "Full Accretion Date"). Beginning on the Full Accretion Date, interest on
the Notes will accrue at the rate of 11.875% per annum and will be payable
semi-annually in arrears on June 1 and December 1 of each year, to Holders of
record on the immediately preceding May 15 and November 15. Additional Notes
may be issued from time to time, subject to the provisions of the Indenture
described below under the caption "--Certain Covenants--Incurrence of
Indebtedness and Issuance of Preferred Stock." The Old Notes, the Notes offered
hereby and any additional Notes subsequently issued under the Indenture would
be treated as a single class for all purposes under the Indenture, including,
without limitation, waivers, amendments, redemptions and offers to purchase.
Interest on the Notes will accrue from the most recent date to which interest
has been paid or, if no interest has been paid, from the Full Accretion Date.
Interest will be computed on the basis of a 360-day year comprised of twelve
30-day months. Principal, premium, if any, and interest and Liquidated Damages
thereon, if any, on the Notes will be payable at the office or agency of the
Issuers maintained for such purpose within the City and State of New York or,
at the option of the Issuers, payment of interest may be made by check mailed
to the Holders of the Notes at their respective addresses set forth in the
register of Holders of Notes; provided that all payments of principal, premium,
if any, interest and Liquidated Damages, if any, with respect to Notes for
which Holders have given wire transfer instructions to the Issuers at least 10
business days prior to the applicable interest payment date will be required to
be made by wire transfer of immediately available funds to the accounts
specified by the Holders thereof. Until otherwise designated by the Issuers,
the Issuers' office or agency in New York will be the office of the Trustee
maintained for such purpose. The Notes will be issued in denominations of
$1,000 and integral multiples thereof.
 
Parent Guarantees
 
   The payment obligations of Avalon Holdings under the Notes is jointly and
severally guaranteed (the "Parent Guarantees") by the Parent Guarantors. The
Parent Guarantees were issued in connection with the Reorganization to avoid
certain adverse tax consequences in respect of the Reorganization. Neither
Parent Guarantor has any significant business operations or assets, other than,
with respect to Avalon Michigan, its equity interest in Avalon Holdings, and,
with respect to Michigan Holdings, its equity interest in Avalon Michigan, and
neither Parent Guarantor has any revenues. As a result, prospective purchasers
of the Notes should not expect the Parent Guarantors to participate in
servicing the interest, principal obligations and Liquidated Damages, if any,
on the Notes. The obligations of each Parent Guarantor under its Parent
Guarantee will be limited so as not to constitute a fraudulent conveyance under
applicable law. See the "Risk Factors" section of this prospectus.
 
Maximum Amount of Obligations
 
   The obligations of each Issuer and each Parent Guarantor (under the Parent
Guarantee) are limited to the maximum amount as will, after giving effect to
all other contingent and fixed liabilities of such Issuer or such Parent
Guarantor, as the case may be (including, without limitation, any obligations
under any senior
Indebtedness) and after giving effect to any collections from or payments made
by or on behalf of any other Issuer or Parent Guarantor, as the case may be, in
respect of the obligations of such other Issuer or other Parent
 
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