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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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                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
Investor Securities Purchase Agreement
 
   David W. Unger, Joel C. Cohen, ABRY III, Avalon and others are parties to an
Investor Securities Purchase Agreement dated as of May 29, 1998 (the "Investors
Securities Purchase Agreement"), pursuant to which Avalon sold to certain
investors, and such investors purchased from Avalon, certain Class A Units of
Avalon for $1,000 per Unit, in cash. The investors are entitled to
indemnification in certain circumstances to the extent that Avalon is
determined to have breached certain representations, warranties or agreements
contained in the Investors Securities Purchase Agreement.
 
Management Securities Purchase Agreements
 
   Each of the Executives entered into a Management Securities Purchase
Agreement with Avalon (each, a "Management Securities Purchase Agreement"),
pursuant to which Avalon sold to each Executive and such Executive purchased
from Avalon certain Incentive Units. The Incentive Units purchased by each of
the Executives are subject to vesting over a five-year period. In addition,
each Management Securities Purchase Agreement provides that the Incentive Units
purchased thereunder will subject to certain limitations, automatically vest in
full upon a Sale of the Company (as defined in such Management Securities
Purchase Agreement) and will cease to vest upon the date on which each such
Executive ceases to be employed by the Company or any of its subsidiaries. Each
Management Securities Purchase Agreement further provides that Avalon or ABRY
III may repurchase the applicable Executive's unvested units at the initial
purchase price at any time within 18 months of such Executive's termination of
employment.
 
Members Agreement
 
   Avalon, ABRY III and the Executives are parties to a Members Agreement dated
as of May 29, 1998 (the "Members Agreement"). Pursuant to the Members
Agreement, ABRY III and each of the Executives have agreed to vote their equity
interests in Avalon to elect three representatives of ABRY III and each of
Messrs. Unger and Cohen to the Board. The Members Agreement also contains:
 
  . certain "co-sale" rights exercisable by the Executives and others in the
    event of certain sales by ABRY III,
 
  . certain "drag along" sale rights exercisable by ABRY III, as majority
    interest holder in Avalon, in the event of an Approved Company Sale (as
    defined in the Members Agreement) and
 
  . certain restrictions on transfers by interest holders in Avalon other
    than ABRY III.
 
   The voting, co-sale, drag along and transfer restrictions will terminate
upon the consummation of the first to occur of (a) an initial public offering
by Avalon resulting in at least $25 million in net proceeds or in which at
least 25% of the equity interests of Avalon are sold or (b) a Sale of the
Company (as defined in the Members Agreement).
 
Registration Agreement
 
   Avalon, ABRY III, the Executives and certain other holders are parties to a
Registration Agreement dated as of May 29, 1998 (the "Registration Agreement").
Pursuant to the Registration Agreement, the holders of a majority of the ABRY
Registrable Securities (as defined in the Registration Agreement) may request
registration (a "Demand Registration") under the Securities Act of all or any
portion of the ABRY Registrable Securities:
 
  . on Form S-1 or any similar long-form registration,
 
  . on Form S-2 or S-3 or any similar short-form registration, if available,
    and
 
  . on any applicable form pursuant to Rule 415 under the Securities Act.
 
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