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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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     purposes and its Book Value. To the extent that in any year in which book
     depreciation is allowed to both the Class A Units and the Class B Units,
     and an amount of depreciation tax deductions is specially allocated for tax
     purposes to the Class A Units pursuant to Treasury Regulation Section
     1.704-3(b)(1) in excess of the amount of the applicable tax depreciation
     deduction that the Class A Units would have been allocated if Treasury
     Regulation Section 1.704-3(b)(1) had not been applied and depreciation tax
     deductions had instead been allocated to the various Units in proportion to
     the book depreciation allocation to such Units for that year, an amount of
     the excess tax depreciation shall reduce the unpaid yield and be treated as
     a guaranteed payment to such Unitholders for purposes of Article VIII of
     this Agreement. The tax deductions for the guaranteed payment shall be
     specially allocated to the Unitholders which own Class B Units who lost the
     tax depreciation deductions pursuant to Treasury Regulation Section 1.704-
     3(b)(1). The allocations made pursuant to this Section 8.3(b) shall be made
     on a daily basis as if the Company closed its books on a daily basis. The
     Tax Matters Partner will determine the allocation of the aggregate Fair
     Market Value of the assets contributed to the Company among such assets.

          (c)  ADJUSTMENTS IN BOOK VALUE. If the Book Value of any Company asset
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     is adjusted pursuant to Section 6.2, then subsequent allocations of items
     of taxable income, gain, loss and deduction with respect to such asset will
     take into account any variation between the adjusted basis of such asset
     for federal income tax purposes and its Book Value in the same manner as
     under Code Section 704(c).

          (d)  ALLOCATIONS OF CREDITS AND THE LIKE.  Allocations of tax credits,
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     tax credit recapture, and any items related thereto will be allocated to
     the Unitholders according to their interests in such items as determined by
     the Tax Matters Partner taking into account the principles of Treasury
     Regulation Section 1.704-1(b)(4)(ii).

          (e)  NO EFFECT ON CAPITAL ACCOUNTS.  Allocations pursuant to this
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     Section 8.3 are solely for purposes of federal, state and local taxes and
     will not affect, or in any way be taken into account in computing, any
     Unitholder's Capital Account or share of Profits, Losses, Distributions or
     other items pursuant to any provision of this Agreement.

     8.4  CURATIVE ALLOCATIONS.  If the Tax Matters Partner determines, after
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consultation with counsel experienced in income tax matters, that the allocation
of any item of Company income, gain, loss, deduction or credit (an "unallocated
                                                                    -----------
item") is not specified in this Agreement or that the allocation of any item of
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Company income, gain, loss, deduction or credit (a "misallocated item") under
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this Agreement is in the Managers' reasonable judgment inconsistent with the
Unitholders' economic interests in the Company (determined by reference to the
general principles of Treasury Regulation Section 1.704-1(b) and the factors set
forth in Treasury Regulation Section 1.704-1(b)(3)(ii) including any allocation
of any item of Company income, gain, loss deduction or credit that does not
result in Capital Accounts of each Unitholder that support, as nearly as
possible, the Distributions pursuant to Section 7.1 with respect to such
Unitholder), then the Company may allocate such unallocated items, or reallocate
such misallocated items, to reflect such

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