The indenture governing the new notes permits the
Issuers and the Operating Companies to incur
additional indebtedness subject to certain
limitations. As of December 31, 1998, on a pro
. the Issuers would have had no outstanding
indebtedness other than the existing notes and
the debt of their subsidiaries, and
. the outstanding senior indebtedness of the
Operating Companies on a combined basis would
have been $180.2 million.
Certain Covenants........ The indenture governing the new notes limits the
activities of the Issuers and their restricted
subsidiaries. The provisions of the new note
indenture limit the ability of the Issuers to:
. incur additional indebtedness,
. pay dividends or make certain other restricted
. enter into transactions with affiliates,
. sell assets or subsidiary stock,
. create liens,
. restrict dividends or other payments from
. merge, consolidate or sell all or substantially
all of their combined assets, and
. with respect to restricted subsidiaries, issue
Guarantors............... Avalon Cable of Michigan Holdings, Inc. and Avalon
Cable of Michigan, Inc. will guarantee the
obligations of Avalon Cable LLC under the new
notes. However, neither Avalon Cable of Michigan
Holdings, Inc. nor Avalon Cable of Michigan, Inc.
has any significant assets other than its equity
interest in Avalon Cable of Michigan Inc. and
Avalon Cable LLC, respectively. Thus, holders
should not expect the guarantors to participate in
making principal and interest payments on the new
notes. For a description of the relationship of the
Guarantors to the Issuers, see "The Company--
Structure After the Reorganization."
For more information about the new notes, see the "Description of the Notes"
section of this prospectus.
You should carefully consider all of the information in the "Risk Factors"
section of this prospectus as well as other information and data included in
this prospectus before tendering your old notes in exchange for new notes.
Summary Unaudited Pro Forma Combined Financial and Operating Data
The following table shows for the periods indicated certain financial and
operating data for the Issuers, their predecessors and Taconic, which is
subject to a pending acquisition by the Issuers. The following summary
unaudited pro forma combined financial and operating data are based on the
historical financial statements of the Avalon Cable of Michigan Holdings, Inc.,
Cable Michigan, Inc. Avalon Cable LLC, Avalon Cable of New England LLC, AMRAC
Clear View, Pegasus Cable Television, Inc. and Pegasus Cable Television of
Connecticut, Inc., Taconic