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SEC Filings

S-4/A
AVALON CABLE OF MICHIGAN INC/ filed this Form S-4/A on 05/28/1999
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thereof, for the first year and second year, respectively, and the issuers must
reimburse certain of the senior lenders' costs under certain conditions.

   The credit facility provides that the borrowers must meet or exceed a
consolidated interest coverage ratio, fixed charge coverage ratio and debt
service coverage ratio and must not exceed certain consolidated leverage
ratios, each as set forth in the credit facility. The credit facility also
contains customary affirmative covenants, including, required interest rate
protection arrangements and the pledge of additional collateral in certain
circumstances, and certain negative covenants, including covenants that limit
certain indebtedness, liens, fundamental changes, disposition of property,
restricted payments, including distributions to the issuers of amounts to pay
the Accreted Interest Redemption Amount and other interest payments on the old
notes and new notes, capital expenditures, investments, optional payments and
modifications of debt instruments, including the indenture governing the old
notes and new notes and the senior subordinated notes, transactions with
affiliates and sales and leasebacks. In particular, under the credit facility,
the issuers' operating companies may pay cash dividends to the issuers to allow
payments of interest, including the Accreted Interest Redemption Amount, on the
old notes and new notes so long as no default, or event of default shall have
occurred and be continuing or would occur as a result thereof and a
consolidated leverage ratio test is satisfied. The credit facility includes
customary events of default.

   The obligations of the borrowers under the credit facility are secured by
substantially all the assets of the borrowers. In addition, the obligations of
the borrowers under the credit facility are guaranteed by each of the issuers,
Avalon Cable Holdings, Avalon Cable of New England Holdings, Avalon Cable LLC,
Avalon Cable Finance Holdings, and Avalon Cable of Michigan, Inc. None of the
guarantors have significant assets other than their investments in affiliates.

The Senior Subordinated Notes

   On December 3, 1998, Avalon Cable of Michigan, Inc., Avalon Cable of New
England LLC and Avalon Cable Finance, Inc. issued $150.0 million aggregate
principal amount of their 9 3/8% senior subordinated notes due 2008. The senior
subordinated notes were issued under an indenture dated as of December 10, 1998
by and among Avalon Cable of New England, Avalon Cable Finance and Avalon Cable
of Michigan LLC, as issuers, and The Bank of New York, as trustee.

   In the reorganization, Avalon Cable of Michigan, Inc. ceased to be obligated
as an issuer under the senior subordinated notes and became a guarantor of
Avalon Cable of Michigan LLC's obligations under the senior subordinated notes.
Thus, the obligors under the senior subordinated notes are currently Avalon
Cable of New England, Avalon Cable Finance and Avalon Cable of Michigan LLC,
which we refer to collectively as the senior subordinated note issuers. Avalon
Cable of Michigan LLC does not have significant assets or liabilities, other
than its equity interest in Avalon Holdings.

   The senior subordinated notes are general unsecured obligations of the
senior subordinated note issuers and are subordinated in right of payment to
all current and future senior indebtedness of the senior subordinated note
issuers, including indebtedness under the credit facility. Interest on the
senior subordinated notes accrues at the rate of 9.375% per annum and is
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. The
senior subordinated notes are limited in aggregate principal amount to $200.0
million, of which $150.0 million was issued in the initial senior subordinated
note offering. The remaining $50.0 million may be issued from time to time,
subject to compliance with the debt incurrence covenants in the senior
subordinated note indenture, the indenture governing the old notes and the new
notes and the financial covenants in the credit facility.

   On or after December 1, 2003, the senior subordinated notes will be subject
to redemption at any time at the option of the senior subordinated note
issuers, in whole or in part, at the redemption prices (expressed as percentage
of principal amount) set forth below plus accrued and unpaid interest, if any,
and liquidated

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