Ascent’s Monitronics enters forbearance agreement, limited waiver

By Sarah Lizee

Olympia, Wash., June 18 – Ascent Capital Group, Inc. wholly owned subsidiary Monitronics International Ltd. entered into another forbearance agreement and limited waiver with lenders under its credit agreement dated March 23, 2012, according to an 8-K filing with the Securities and Exchange Commission.

Under the June 14 agreement, the forbearance parties agreed to:

• Refrain from exercising their rights and remedies under the credit agreement and related loan documents with respect to specified defaults; and

• Waive some conditions precedent to credit extensions under the credit agreement until the earlier of July 3 or the occurrence of a forbearance and limited waiver termination event.

Under the agreement, a “specified default” includes one resulting from Monitronics’ previously reported failure to make the interest payment due on April 1, 2019 under its 9 1/8% senior notes due 2020.

Because active discussions about strategic alternatives were still ongoing, Monitronics’ board of directors determined that the company would not make the interest payment before the end of the 30-day grace period. This constituted an event of default under the indenture governing the notes as well as the company’s credit agreement.

Monitronics is a Dallas-based home security alarm monitoring company. Ascent Capital is a holding company based in Englewood, Colo.

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