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SEC Filings

S-4/A
AVALON CABLE OF MICHIGAN INC/ filed this Form S-4/A on 07/22/1999
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   "Leverage Ratio" means the ratio of (i) the aggregate outstanding amount of
Indebtedness of each of the Issuers and their Restricted Subsidiaries as of the
date of calculation on a combined consolidated basis in accordance with GAAP
(subject to the terms described in the next paragraph) plus the aggregate
liquidation preference of all outstanding Disqualified Stock of the Issuers and
preferred stock of the Issuers' Restricted Subsidiaries (except preferred stock
issued to the Issuers or a Wholly Owned Subsidiary of the Issuers) on such date
to (ii) the aggregate Consolidated Cash Flow of the Issuers for the full fiscal
quarter ending on or prior to the date of determination multiplied by four.
 
   For purposes of this definition, (i) the amount of Indebtedness which is
issued at a discount shall be deemed to be the accreted value of such
Indebtedness at the end of the quarter, whether or not such amount is the
amount then reflected on a balance sheet prepared in accordance with GAAP, and
(ii) the aggregate outstanding principal amount of Indebtedness of the Issuers
and their Subsidiaries and the aggregate liquidation preference of all
outstanding preferred stock of the Issuers' Subsidiaries for which such
calculation is made shall be determined on a pro forma basis as if the
Indebtedness and preferred stock giving rise to the need to perform such
calculation had been incurred and issued and the proceeds therefrom had been
applied, and all other transactions in respect of which such Indebtedness is
being incurred or preferred stock is being issued had occurred, on the first
day of the quarter. In addition to the foregoing, for purposes of this
definition, Consolidated Cash Flow shall be calculated on a pro forma basis
after giving effect to (i) the incurrence of the Indebtedness of such Person
and its Subsidiaries and the issuance of the preferred stock of such
Subsidiaries (and the application of the proceeds therefrom) giving rise to the
need to make such calculation and any incurrence (and the application of the
proceeds therefrom) or repayment of other Indebtedness, at any time subsequent
to the beginning of the quarter and on or prior to the date of determination,
as if such incurrence or issuance (and the application of the proceeds
thereof), or the repayment, as the case may be, occurred on the first day of
the quarter (except that, in making such computation, the amount of
Indebtedness under any revolving credit facility shall be computed based upon
the average balance of such Indebtedness at the end of each month during such
period) and (ii) any acquisition (including, without limitation, the
acquisitions of Cable Michigan, Amrac and Pegasus and any other acquisition
giving rise to the need to make such calculation as a result of such Person or
one of its Subsidiaries (including any Person that becomes a Subsidiary as a
result of such acquisition) incurring, assuming or otherwise becoming liable
for Indebtedness or such Person's Subsidiaries issuing preferred stock) at any
time on or subsequent to the first day of the quarter and on or prior to the
date of determination, as if such acquisition (including the incurrence,
assumption or liability for any such Indebtedness and the issuance of such
preferred stock and also including any Consolidated Cash Flow associated with
such acquisition) occurred on the first day of the quarter, giving pro forma
effect to any non-recurring expenses, non-recurring costs and cost reductions
within the first year after such acquisition the Issuers anticipate if the
Issuers deliver to the Trustee an officer's certificate executed by the chief
financial or accounting officer of any of the Issuers certifying to and
describing and quantifying with reasonable specificity such non-recurring
expenses, non-recurring costs and cost reductions. Furthermore, in calculating
Consolidated Interest Expense for purposes of the calculation of Consolidated
Cash Flow, (a) interest on Indebtedness determined on a fluctuating basis as of
the date of determination (including Indebtedness actually incurred on the date
of the transaction giving rise to the need to calculate the Leverage Ratio) and
which will continue to be so determined thereafter shall be deemed to have
accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness as in effect on the date of determination and (b) notwithstanding
(a) above, interest determined on a fluctuating basis, to the extent such
interest is covered by Hedging Obligations, shall be deemed to accrue at the
rate per annum resulting after giving effect to the operation of such
agreements.
 
   "Lien" means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind in respect of such asset, whether
or not filed, recorded or otherwise perfected under applicable law (including
any conditional sale or other title retention agreement, any lease in the
nature thereof, any option or other agreement to sell or give a security
interest in any asset and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction).
 
   "Mercom" means Mercom, Inc., a Delaware corporation.
 
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