Highlights

11/15/2018: Company enters into amendment with Term Loan lenders

Amendment No. 8 amended the Credit Agreement, to, among other things, (a) permit the issuance of new 5.500%/6.500% Senior Secured Second Lien Notes, (b) reduce the Revolving Credit Commitments (as defined in the Credit Agreement) under the revolving portion of the Credit Facility (the “Credit Facility Revolver”) to $250,000,000, (c) create two separate classes of the existing term loan (the “Term Loan”) of the Credit Facility, (the “Extending Term Loan,” and the portion of the Term Loan that does not convert to Extending Term Loan, the “Non-Extending Term Loan”), (d) remove Monitronics’ ability to incur incremental equivalent debt under both the Credit Facility Revolver and the Term Loan, (e) increase the interest rates applicable to the Credit Facility Revolver and the Term Loan and (f) amend certain financial covenants.

 

The Non-Extending Term Loan matures on the earlier of 181 days prior to the scheduled maturity date (the “Springing Maturity Date”) of Monitronics’ outstanding 9.125% senior notes due 2020 (the “Existing Unsecured Notes”) if any Existing Unsecured Notes remain outstanding on such date, and September 30, 2022, and the Extending Term Loan matures on the earlier of the Springing Maturity Date, solely if more than $22,500,000 in principal amount of Existing Unsecured Notes is outstanding on such date, and September 30, 2022.

 

The Credit Facility Revolver matures on the earlier of the Springing Maturity Date solely if more than $22,500,000 in principal amount of Existing Unsecured Notes is outstanding on such date (provided that if (1) Monitronics makes a voluntary prepayment of Non-Extending Term Loans (or without the consent of the majority of the lenders under the Credit Facility Revolver if any payment of Non-Extending Term Loans is made on or after the maturity date thereof) or (2) less than all of the lenders under the Credit Facility Revolver are parties to Amendment No. 8, the Credit Facility Revolver will mature 181 days prior to the Springing Maturity Date if any Existing Unsecured Notes remain outstanding on such date), and September 30, 2021.

 

The Non-Extending Term Loan requires quarterly interest payments and quarterly principal payments of 0.25% of the principal amount of Non-Extending Term Loan outstanding on the effective date of Amendment No. 6 to the Credit Agreement. The Extending Term Loan requires quarterly interest payments and quarterly principal payments of (i) commencing with the first full fiscal quarter ending after the effective date of Amendment No. 8 and for the succeeding seven fiscal quarters thereafter (for a total of eight (8) quarters), $9,375,000, less amounts payable in respect of the Non-Extending Term Loan as described in the preceding sentence, up to an aggregate amount of $75,000,000 for all such payments in respect of the Term Loan, and (ii) commencing with the ninth fiscal quarter ending after the effective date of Amendment No. 8, 0.25% of the principal amount of the Extending Term Loan outstanding on the effective date of Amendment No. 8.

 

The Non-Extending Term Loan bears interest at LIBOR plus 5.50% subject to a LIBOR floor of 1.0%. The Extending Term Loan bears interest at LIBOR plus 6.50% per annum subject to a LIBOR floor of 1.0%. The Credit Facility Revolver bears interest at LIBOR plus 4.00% for revolving loans held by lenders that do not consent to Amendment No. 8 and 4.75% for revolving loans held by lenders that consent to Amendment No. 8, in each case, subject to a LIBOR floor of 1.0%. There is a commitment fee of 0.5% on unused portions of the Credit Facility Revolver.

10/4/2018: Company rejects proposal by Term Loan holders. 

8/30/2018: Company offers to redeem Convertible debt.

Ascent Capital Group, Inc. (“Ascent”) (NASDAQ: ASCMA) today announced that Ascent and its wholly owned subsidiary, Monitronics International, Inc. (“Monitronics” and, together with Ascent, the “Offerors”), launched an offer to exchange (the “Exchange Offer”) up to (i) an aggregate of $100,000,000 in cash (the “Cash Consideration Cap”) from Ascent and/or (ii) a combination of (x) $585,000,000 aggregate principal amount of new Monitronics’ 7.750%/3.750% Senior Unsecured Cashpay/PIK Notes due 2023 (the “New Notes”) and (y) for each $1,000 principal amount of Old Notes (as defined below) accepted in the Exchange Offer, one warrant entitling the holder to purchase 2.64 shares of Ascent’s Series A common stock, par value $0.01 per share (“Ascent Series A Common Stock”), at an exercise price equal to $5.00 for each whole share, which, assuming the Exchange Offer is fully subscribed at the high end of the price range set forth in the table below at or prior to the Early Tender Time (as defined below) and the Cash Consideration Cap is reached, would constitute in the aggregate warrants to purchase up to 1,243,117 shares of Ascent Series A Common Stock, representing 10.0% of the aggregate shares of Ascent Series A Common Stock and Ascent’s Series B common stock, par value $0.01 per share, outstanding immediately prior to the launch of the Exchange Offer and the Consent Solicitation (as defined below) (the “Warrants”), in each case, for validly tendered (and not validly withdrawn) Monitronics’ 9.125% Senior Notes due 2020 (the “Old Notes”) and, in conjunction with the Exchange Offer, a solicitation (the “Consent Solicitation”) of consents (the “Consents”) by Monitronics to certain proposed amendments (the “Proposed Amendments”) to the indenture governing the Old Notes (the “Old Notes Indenture”). Tenders of Old Notes may be withdrawn and Consents may be revoked prior to 5:00 p.m., New York City time, on September 13, 2018 (the “Early Tender Time”), but not thereafter, subject to limited exceptions, unless such time is extended. The Exchange Offer will expire at 11:59 p.m., New York City time, on October 3, 2018 (such time and date, as the same may be extended, the “Expiration Time”).

8/28/2018: Group of hedge fund investors sue Company.