Ascent Capital Group, Inc.
Ascent Capital Group, Inc. (Form: DEF 14A, Received: 04/16/2015 06:05:52)
Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.     )
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Ascent Capital Group, Inc.
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ASCENT CAPITAL GROUP, INC.
5251 DTC Parkway, Suite 1000
Greenwood Village, Colorado 80111
(303) 628-5600
 
Dear Stockholder:
 
April 15, 2015
 
The 2015 annual meeting of stockholders of Ascent Capital Group, Inc. will be held at 10:00 a.m., Mountain Time, on May 29, 2015 , at 5251 DTC Parkway, Second Floor Conference Room, Greenwood Village, Colorado 80111, Tel. No. (303) 628-5600.
 
At the annual meeting, you will be asked to consider and vote on the re-election of two of our directors, the ratification of our auditors and the adoption of our 2015 Omnibus Incentive Plan. Each of the matters to be considered at the annual meeting is described in greater detail in the accompanying proxy statement.
 
Your vote is important, regardless of the number of shares you own.  Whether or not you plan to attend the annual meeting, please read the accompanying proxy statement and then vote via the Internet, telephone or using your smartphone as promptly as possible.  Alternatively, request a paper proxy card to complete, sign and return by mail.  This will save us additional expense in soliciting proxies and will ensure that your shares are represented at the meeting.  It will not, however, prevent you from later revoking your proxy or changing your vote.
 
Thank you for your continued support and interest in our company.
 
 
Very truly yours,
 
 
William R. Fitzgerald
 
Chairman and Chief Executive Officer
 





















The Notice of Internet Availability of Proxy Materials is first being mailed on or about April 16, 2015 , and the proxy materials relating to the annual meeting will first be made available on or about the same date.

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ASCENT CAPITAL GROUP, INC.
5251 DTC Parkway, Suite 1000
Greenwood Village, Colorado 80111
(303) 628-5600
 
____________________________
 
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on May 29, 2015
 
____________________________

 
NOTICE IS HEREBY GIVEN of the annual meeting of stockholders of Ascent Capital Group, Inc. to be held at 10:00 a.m., Mountain Time, on May 29, 2015 , at 5251 DTC Parkway, Second Floor Conference Room, Greenwood Village, Colorado 80111, Tel. No. (303) 628-5600, to consider and vote on the following:
 
1.
A proposal to re-elect Charles Y. Tanabe and Carl E. Vogel to serve as the Class I members of our board of directors for a three year term (the director election proposal );

2.
A proposal to ratify the selection of KPMG LLP as our independent auditors for the fiscal year ending December 31, 2015 (the auditor ratification proposal ); and

3.
A proposal to adopt the Ascent Capital Group, Inc. 2015 Omnibus Incentive Plan (the incentive plan proposal ).
 
We describe the proposals in more detail in the accompanying proxy statement.  We encourage you to read the proxy statement in its entirety before voting.  You may also be asked to consider and vote on any other business properly brought before the annual meeting.
 
Holders of record of our Series A common stock, par value $.01 per share, and Series B common stock, par value $.01 per share, outstanding as of 5:00 p.m., New York City time, on April 10, 2015 , the record date for the annual meeting, will be entitled to notice of the annual meeting and to vote at the annual meeting or any adjournment thereof.  Holders of Series A common stock and Series B common stock will vote together as a single class on each proposal.  A list of stockholders entitled to vote at the annual meeting will be available at our offices for review by our stockholders, for any purpose germane to the annual meeting, for at least 10 days prior to the annual meeting.
 
The following stockholder approvals are required with respect to the matters described above:
 
The director election proposal requires the affirmative vote of a plurality of the votes cast for the director election proposal by the holders of shares of our common stock present, in person or by proxy, and entitled to vote at the annual meeting, voting together as a single class. This means that Mr. Tanabe and Mr. Vogel will be elected if they receive more affirmative votes than any other persons.

Approval of each of the auditor ratification proposal and the incentive plan proposal requires the affirmative vote of a majority of the voting power of the shares of our common stock present, in person or by proxy, and entitled to vote at the annual meeting, voting together as a single class.
 
Our board of directors has carefully considered and approved each of the director election proposal, the auditor ratification proposal and the incentive plan proposal described above and recommends that you vote FOR each of these proposals.



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YOUR VOTE IS IMPORTANT .  We urge you to vote as soon as possible by telephone, Internet, smartphone or mail.
 
 
By order of the board of directors,
 
 
William E. Niles
 
Executive Vice President, General Counsel and Secretary
 
 
Greenwood Village, Colorado
 
April 15, 2015
 
 
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE ANNUAL MEETING, PLEASE VOTE AS PROMPTLY AS POSSIBLE BY TELEPHONE, INTERNET OR SMARTPHONE.  ALTERNATIVELY, REQUEST A PAPER PROXY CARD TO COMPLETE, SIGN AND RETURN BY MAIL.
 



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ASCENT CAPITAL GROUP, INC.
a Delaware corporation
 
5251 DTC Parkway, Suite 1000

Greenwood Village, Colorado 80111

(303) 628-5600
 
PROXY STATEMENT

For Annual Meeting of Stockholders
 
We are furnishing this proxy statement in connection with our board of directors’ (our Board ) solicitation of proxies for use at our 2015 annual meeting of stockholders (our annual meeting ) to be held at 10:00 a.m., Mountain Time, at 5251 DTC Parkway, Second Floor Conference Room, Greenwood Village, Colorado 80111, Tel. No. (303) 628-5600, on May 29, 2015 , or at any adjournment or postponement of the annual meeting.  At the annual meeting, we will ask you to consider and vote on the proposals described in the accompanying Notice of Annual Meeting of Stockholders.  The proposals are described in more detail in this proxy statement.  We are soliciting proxies from holders of our Series A common stock, par value $0.01 per share, and Series B common stock, par value $0.01 per share.
 
ANNUAL MEETING; PROXIES
 
Notice and Access of Proxy Materials
 
We have elected, in accordance with the Securities and Exchange Commission’s ( SEC ) “Notice and Access” rule, to deliver a Notice of Internet Availability of Proxy Materials (the Notice ) to our stockholders and to post our proxy statement and our annual report to our stockholders (collectively, the proxy materials ) electronically.  The Notice is first being mailed to our stockholders on or about April 16, 2015 .  The proxy materials are first being made available to our stockholders on or about the same date.
 
The Notice instructs you how to access and review the proxy materials and how to submit your proxy via the Internet or by telephone or smartphone.  The Notice also instructs you how to request and receive a paper copy of the proxy materials, including a proxy card or voting instruction form, at no charge.  We will not mail a paper copy of the proxy materials to you unless specifically requested to do so.
 
Electronic Delivery
 
Registered stockholders may elect to receive future notices and proxy materials by e-mail. To sign up for electronic delivery, go to www.computershare.com/investor . You may also sign up for electronic delivery when you vote by Internet at www.envisionreports.com/ASCMA , by following the prompts. Once you sign up, you will not receive a printed copy of the notices and proxy materials, unless you request them. You may suspend electronic delivery of the notices and proxy materials at any time by contacting our transfer agent, Computershare, at 800-730-4001 (outside the United States 781-575-2879). Stockholders who hold shares through a bank, brokerage firm or other nominee may request electronic access by contacting their nominee.
 
Time, Place and Date
 
The annual meeting of the stockholders is to be held at 10:00 a.m., Mountain Time, on May 29, 2015 , at 5251 DTC Parkway, Second Floor Conference Room, Greenwood Village, Colorado 80111, Tel. No. (303) 628-5600.
 

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Purpose
 
At the annual meeting, you will be asked to consider and vote on each of the following:

the re-election of two of our directors, Charles Y. Tanabe and Carl E. Vogel, to serve as the Class I members of our Board for a three year term;

the auditor ratification proposal, to ratify the selection of KPMG LLP as our independent auditors for the fiscal year ending December 31, 2015 ; and

the incentive plan proposal, to approve the Ascent Capital Group, Inc. 2015 Omnibus Incentive Plan.

You may also be asked to consider and vote on such other business as may properly come before the annual meeting. However, we are not currently aware of any such additional business.

Quorum
 
In order to carry on the business of the annual meeting, at least a majority of the aggregate voting power represented by the outstanding shares of our Series A common stock and Series B common stock, as of the record date, must be present at the annual meeting, either in person or by proxy.  For purposes of determining a quorum, your shares will be included as represented at the meeting even if you indicate on your proxy that you abstain from voting.  If a broker, who is a record holder of shares, indicates on a form of proxy that the broker does not have discretionary authority to vote those shares on one or more of the proposals, or if those shares are voted in circumstances in which proxy authority is defective or has been withheld, those shares (which we refer to as broker non-votes ) nevertheless will be treated as present for purposes of determining the presence of a quorum.

Who May Vote; Record Date
 
Holders of our Series A common stock and Series B common stock, as recorded in our stock register as of 5:00 p.m., New York City time, on April 10, 2015 (which is the record date for the annual meeting), may vote at the annual meeting or at any adjournment or postponement thereof.
 
Votes Required
 
The following stockholder approvals are required with respect to proposals described above:

The director election proposal requires the affirmative vote of a plurality of the votes cast for the director election proposal by the holders of shares of our common stock present, in person or by proxy, and entitled to vote at the annual meeting, voting together as a single class. This means that Mr. Tanabe and Mr. Vogel will be elected if they receive more affirmative votes than any other persons.

Approval of each of the auditor ratification proposal and the incentive plan proposal requires the affirmative vote of a majority of the voting power of the shares of our common stock present, in person or by proxy, and entitled to vote at the annual meeting, voting together as a single class.
  
Votes You Have
 
At the annual meeting, holders of our Series A common stock will have one vote per share for each share of Series A common stock that our records show they owned on the record date, and holders of our Series B common stock will have ten votes per share for each share of Series B common stock that our records show they owned on the record date.  Holders of all series of our common stock will vote together as a single class.
 
Shares Outstanding
 
As of the record date, there were 12,924,364 shares of our Series A common stock and 384,086 shares of our Series B common stock outstanding.


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Number of Holders
 
As of the record date, there were 858 and 52 record holders of our Series A common stock and our Series B common stock, respectively.  Such amounts do not include the number of stockholders whose shares are held of record by banks, brokers or other nominees, but include each such institution as one holder.
 
Voting Procedures for Record Holders
 
Holders of record of our common stock as of the record date may vote in person at the annual meeting.  Alternatively, they may give a proxy by completing, signing, dating and returning the proxy card, or by voting by telephone, smartphone or over the Internet.  Unless subsequently revoked, shares of our common stock represented by a proxy submitted as described below and received at or before the annual meeting will be voted in accordance with the instructions on the proxy.
 
YOUR VOTE IS IMPORTANT.   It is recommended that you vote by proxy even if you plan to attend the annual meeting.  You may change your vote at the annual meeting.  Specific voting instructions are set forth in this proxy statement and on both the Notice and proxy card.
 
If a proxy is properly executed and submitted by a record holder without indicating any voting instructions, the shares represented by the proxy will be voted FOR the election of Mr. Tanabe and Mr. Vogel as directors and will be voted FOR the approval of each of the auditor ratification proposal and the incentive plan proposal.

If you submit a proxy card on which you indicate that you abstain from voting, it will have no effect on the director election proposal but will have the same effect as a vote AGAINST the auditor ratification proposal and the incentive plan proposal.

If you fail to respond with a vote, your shares will not be counted as present and entitled to vote for purposes of determining a quorum, and your failure to vote will have no effect on determining whether any of the proposals are approved (assuming a quorum is present).

Voting Procedures for Shares Held in Street Name
 
General . If you hold your shares in the name of a broker, bank or other nominee, you should follow the instructions provided by your broker, bank or other nominee when voting your shares of our common stock or when granting or revoking a proxy. The rules and regulations of the New York Stock Exchange and The Nasdaq Stock Market prohibit brokers, banks and other nominees from voting shares on behalf of their clients with respect to numerous matters, including, in our case, the director election proposal and the incentive plan proposal. Accordingly, to ensure your shares held in street name are voted on such matter, we encourage you to provide specific voting instructions to your broker, bank or other nominee promptly.

Effect of Broker Non-Votes . Broker non-votes are counted as shares of our common stock present and entitled to vote for purposes of determining a quorum but will have no effect on any of the proposals. You should follow the directions your broker, bank or other nominee provides to you regarding how to vote your shares of common stock or how to change your vote or revoke your proxy.
 
Revoking a Proxy
 
Before the start of the annual meeting, you may change your vote, by voting in person at the annual meeting or by delivering a signed proxy revocation or a new signed proxy with a later date to Ascent Capital Group, Inc., c/o Computershare Trust Company, N.A., 250 Royall Street, Canton, MA 02021.  Any proxy revocation or new proxy must be received before the start of the annual meeting.  In addition, you may change your vote through the Internet or by telephone or smartphone (if you originally voted by the same method) not later than 11:59 p.m., New York City time, on May 28, 2015 .
 
Your attendance at the annual meeting will not, by itself, revoke a prior vote or proxy from you.  Please be sure to request a ballot at the annual meeting if you have not voted or wish to change your vote.

If your shares are held in an account by a broker, bank or other nominee, you should contact your nominee to change your vote or revoke your proxy.
 

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Solicitation of Proxies
 
The proxies for the annual meeting are being solicited on behalf of our Board.  In addition to this mailing, our employees may solicit proxies personally or by telephone.  We pay the cost of soliciting these proxies.  We also reimburse brokers and other nominees for their expenses in sending these materials to you and getting your voting instructions. We have also retained Georgeson Inc. ( Georgeson ) to assist in the solicitation of proxies at a cost of $8 , 500, plus reasonable out of pocket expenses.

If you have any further questions about voting or attending the annual meeting, please contact Ascent Capital Group, Inc. Investor Relations at (303) 628-5600 or our proxy solicitor, Georgeson, at (800) 561-3947.
Recommendation of Our Board of Directors
 
Our Board has carefully considered and approved the director election proposal, the auditor ratification proposal and the incentive plan proposal, and recommends that you vote FOR the election of Mr. Tanabe and Mr. Vogel to new three-year terms and that you vote FOR each of the auditor ratification proposal and the incentive plan proposal.

Other Matters to Be Voted on at the Annual Meeting
 
Our Board is not currently aware of any business to be acted on at the annual meeting other than that which is described in the Notice of Annual Meeting of Stockholders and this proxy statement. If, however, other matters are properly brought to a vote at the annual meeting, the persons designated as proxies will have discretion to vote or to act on these matters according to their best judgment, unless you indicate otherwise in your proxy. In the event there is a proposal to adjourn or postpone the annual meeting, the persons designated as proxies will have discretion to vote on that proposal.


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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Security Ownership of Certain Beneficial Owners
 
The following table sets forth information concerning shares of our common stock beneficially owned by each person or entity (excluding any of our directors and executive officers) known by us to own more than five percent of the outstanding shares of any series of our common stock.  All of such information is based on publicly available filings.
 
The security ownership information is given as of February 28, 2015 , and, in the case of percentage ownership information, is based upon 13,161,399 shares of our Series A common stock and 384,086 shares of our Series B common stock, in each case, outstanding on that date.  The percentage voting power is presented on an aggregate basis for all series of common stock. 
Name and Address of Beneficial Owner
 
Title of
  Class
 
Amount and Nature of
Beneficial Ownership
 
 
 
Percent of
  Class
 
Voting
  Power
 
 
 
 
 
 
 
 
 
 
 
John C. Malone
 
Series A
 
313,759

 
(1)(2)(3)(4)(5)
 
2.38
%
 
16.47
%
c/o Liberty Media Corporation
12300 Liberty Boulevard
Englewood, CO 80112
 
Series B
 
248,693

 
(1)(2)(4)
 
64.75
%
 
 

 
 
 
 
 
 
 
 
 
 
 
Brown Advisory Incorporated
 
Series A
 
906,068

 
(6)
 
6.88
%
 
5.33
%
901 South Bond Street, Ste. 400
Baltimore, MD 21231
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BlackRock, Inc.
 
Series A
 
897,133

 
(7)
 
6.82
%
 
5.28
%
55 East 52nd Street
New York, NY 10022
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
JPMorgan Chase & Co.
 
Series A
 
948,108

 
(8)
 
7.20
%
 
5.58
%
270 Park Ave.
New York, NY 10017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
GAMCO Investors, Inc.
 
Series A
 
1,149,046

 
(9)
 
8.73
%
 
6.76
%
One Corporate Center
Rye, NY 10580
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
T. Rowe Price Associates, Inc.
 
Series A
 
689,138

 
(10)
 
5.24
%
 
4.05
%
100 E. Pratt Street
Baltimore, MD 21202
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The Vanguard Group
 
Series A
 
774,132

 
(11)
 
5.88
%
 
4.55
%
100 Vanguard Blvd.
Malvern, PA 19355
 
 
 
 
 
 
 
 
 
 
 
(1)
Mr. Malone has sole voting power and sole dispositive power over 306,192 shares of our Series A common stock and 239,515 shares of our Series B common stock.
(2)
Includes (i) 26,833 shares of our Series A common stock and 2,046 shares of our Series B common stock held by Mr. Malone’s wife, Mrs. Leslie Malone, as to which shares Mr. Malone has disclaimed beneficial ownership and (ii) 113,345 shares of our Series A common stock and 145,225 shares of our Series B common stock held by Columbus Holdings, LLC, which is owned by Mr. Malone and his wife.
(3)
Includes (i) 16 and 55,317 shares of our Series A common stock held by two trusts with respect to which Mr. Malone is the sole trustee and, with his wife, retains a unitrust interest in the trusts and (ii) 4,997 shares of our Series A common stock that may be acquired upon exercise of stock options exercisable within 60 days after February 28, 2015 .

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(4)
Includes 2,570 shares of our Series A common stock and 9,178 shares of our Series B common stock held by two trusts managed by an independent trustee, of which the beneficiaries are Mr. Malone’s adult children. Mr. Malone has no pecuniary interest in the trusts, but he retains the right to substitute the assets held by the trusts. Mr. Malone disclaims beneficial ownership of such shares.
(5)
Does not include beneficial ownership of shares of our Series A common stock issuable upon exercise of conversion rights relating to shares of our Series B common stock held by Mr. Malone.
(6)
Based upon Amendment No. 1 to Schedule 13G filed on February 13, 2015 by Brown Advisory Incorporated, Brown Advisory, LLC and Brown Investment Advisory and Trust Company, which states that Brown Advisory Incorporated, a parent holding company, has sole voting power over 741,348 shares and shared dispositive power over 906,068 shares.
(7)
Based upon Amendment No. 5 to Schedule 13G filed on January 29, 2015 by BlackRock, Inc., which states that BlackRock, Inc., a parent holding company, has sole voting power over 847,672 shares and sole dispositive power over 897,133 shares. All shares covered by the Schedule 13G are held by subsidiaries of BlackRock, Inc.
(8)
Based upon Schedule 13G filed on January 23, 2015 by JPMorgan Chase & Co., which states that JPMorgan Chase & Co. has sole voting power over 844,431 shares and sole dispositive power over 948,108 shares.
(9)
Based upon Form 13F filed on February 5, 2015 by GAMCO Investors, Inc. et al ( GAMCO ) and the Form 13F filed on February 5, 2015 by Gabelli Funds, LLC, which state that (i) GAMCO has sole investment discretion over 884,846 shares, sole voting power over 807,618 shares and shared voting power over 77,228 shares and (ii) Gabelli Funds LLC has sole investment discretion and sole voting power over 264,200 shares.
(10)
Based upon Amendment No. 7 to Schedule 13G filed on February 13, 2015 by T. Rowe Price Associates, Inc. ( Price Associates ), an investment advisor, which states that Price Associates has sole voting power over 263,427 shares and sole dispositive power over 689,138 shares. These securities are owned by various individual and institutional investors for which Price Associates serves as an investment adviser with power to direct investments and/or sole power to vote the securities. For the purposes of the reporting requirements of the Securities Exchange Act of 1934, as amended (the Exchange Act ), Price Associates is deemed to be a beneficial owner of such securities; however, Price Associates expressly disclaims that it is, in fact, the beneficial owner of such securities.
(11)
Based upon Amendment No. 2 to Schedule 13G filed on February 10, 2015 by The Vanguard Group, an investment advisor, which states that The Vanguard Group has sole voting power over 20,277 shares, sole dispositive power over 755,355 shares and shared dispositive power over 18,777 shares.

Security Ownership of Management
 
The following table sets forth information with respect to the ownership by each of our directors, each of our named executive officers (as defined below) and by all of our directors and executive officers as a group, of shares of our Series A common stock and Series B common stock.  The security ownership information is given as of February 28, 2015 , and, in the case of percentage ownership information, is based upon 13,161,399 shares of Series A common stock and 384,086 shares of Series B common stock, in each case, outstanding on that date.  Such outstanding share amounts do not include shares of our common stock that may be issued upon the exercise of stock options, including stock options disclosed in the table below.  The percentage voting power is presented in the table below on an aggregate basis for all series of common stock.
 
Shares of restricted stock that have been granted pursuant to our equity incentive plans are included in the outstanding share numbers provided throughout this proxy statement.  Shares of common stock issuable upon exercise or conversion of options, warrants and convertible securities that, as of February 28, 2015 , were exercisable or convertible on such date or within 60 days thereafter, are deemed to be outstanding and to be beneficially owned by the person holding the options, warrants or convertible securities for the purpose of computing the percentage ownership of that person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.  For purposes of the following presentation, any beneficial ownership of shares of our Series B common stock, though convertible on a one-for-one basis into shares of our Series A common stock, is reported as beneficial ownership of our Series B common stock only, and not as beneficial ownership of our Series A common stock.  So far as is known to us, the persons indicated below have sole voting power with respect to the shares indicated as owned by them, except as otherwise stated in the notes to the table.

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Name of Beneficial Owner
 
Title of
Class
 
Amount and Nature of
Beneficial Ownership
 
 
 
Percent
of
Class
 
Voting
Power
 
 
 
 
 
 
 
 
 
 
 
William R. Fitzgerald
 
Series A
 
539,353

 
(1)(2)
 
3.98
%
 
9.56
%
Chairman of the Board and
Chief Executive Officer
 
Series B
 
112,374

 
  (3)
 
29.26
%
 
 

 
 
 
 
 
 
 
 
 
 
 
Brian Deevy
 
Series A
 
4,724

 
(1)(4)
 
*

 
*

Director
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
Michael R. Haislip
 
Series A
 
73,734

 
(1)(2)
 
*

 
*

Executive Vice President
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
Philip J. Holthouse
 
Series A
 
31,619

 
(1)(2)(5)
 
*

 
*

Director
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
Michael R. Meyers
 
Series A
 
45,505

 
(1)(2)(6)
 
*

 
*

Senior Vice President and
Chief Financial Officer
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
William E. Niles
 
Series A
 
80,325

 
(1)(2)
 
*

 
*

Executive Vice President, General Counsel and Secretary
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
John A. Orr (7)
 
Series A
 
145,808

 
(1)(2)
 
1.10
%
 
*

Senior Vice President
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
Michael J. Pohl
 
Series A
 
26,884

 
(1)(2)
 
*

 
*

Director
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
Charles Y. Tanabe
 
Series A
 
2,241

 
(1)
 
*

 
*

Director
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
Carl E. Vogel
 
Series A
 
18,203

 
(1)(2)(8)
 
*

 
*

Director
 
Series B
 

 
 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
All directors and executive officers as a group (10 persons) (7)
 
Series A
 
968,396

 
(1)(2)(4)(5)(6)(8)
 
6.99
%
 
11.82
%
 
Series B
 
112,374

 
  (3)
 
29.26
%
 
 

 
* Less than one percent
 

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(1)      Includes, as applicable, the following restricted shares of our Series A common stock which remain subject to vesting as of February 28, 2015 :
Name
Restricted Shares
William R. Fitzgerald
134,201

Brian Deevy
2,495

Michael R. Haislip
13,000

Philip J. Holthouse
2,882

Michael R. Meyers
8,250

William E. Niles
8,753

John A. Orr
7,500

Michael J. Pohl
2,825

Charles Y. Tanabe
1,961

Carl E. Vogel
2,825

 
(2)    Includes, as applicable, beneficial ownership of the following shares of our Series A common stock that may be acquired upon exercise of stock options that are exercisable within 60 days of February 28, 2015 :     
Name
Option Shares
William R. Fitzgerald
401,716

Michael R. Haislip
46,875

Philip J. Holthouse
17,692

Michael R. Meyers
28,125

William E. Niles
56,968

John A. Orr
121,799

Michael J. Pohl
14,692

Carl E. Vogel
6,329

 
(3)
Includes 16,919 shares of our Series B common stock owned by the William R. Fitzgerald Irrevocable 2012 Trust.
 
(4)
Includes (i) 1,000 shares of our Series A common stock owned by the Deevy Sons 2004 Trust and (ii) 70 shares of our Series A common stock owned by the WJD Foundation.
 
(5)  
Includes 10,528 shares of our Series A common stock owned by Mr. Holthouse jointly with his wife and over which he has shared voting and investment power. Also includes 3 shares of our Series A common stock held by Mr. Holthouse’s children, as to which shares Mr. Holthouse has disclaimed beneficial ownership.
 
(6)
Includes 115 shares of our Series A common stock owned by Mr. Meyers jointly with his wife.
 
(7)
Mr. Orr served as our Senior Vice President, Corporate Development, until his departure from our company in March 2015.

(8)
Includes 6,035 shares of our Series A common stock owned by the Vogel Family 2012 Irrevocable Trust, as to which Mr. Vogel has disclaimed beneficial ownership.
 
Changes in Control
 
We know of no arrangements, including any pledge by any person of our securities, the operation of which may at a subsequent date result in a change in control of our company.


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PROPOSAL 1 - THE DIRECTOR ELECTION PROPOSAL

Board of Directors
 
Our company is governed by a board of directors. Pursuant to our bylaws, the size of our Board shall be not less than three nor more than nine members, with the exact number of directors fixed from time to time by resolution adopted by the affirmative vote of at least 75% of the directors then in office. The number of directors constituting our whole Board is currently fixed at seven; however, there are currently only six directors on our Board. Our Board may appoint a director to fill the one vacancy at any time.

Our Board is divided into three classes. Our current Class I directors, whose terms will expire at the annual meeting, are Charles Y. Tanabe and Carl E. Vogel. Each of Mr. Tanabe and Mr. Vogel have been nominated for re-election to our Board and, if elected, will continue to serve as a Class I director. We have been informed that each of Mr. Tanabe and Mr. Vogel is willing to serve as a director of our company. Each director is elected to serve for a full term of approximately three years. The term of the Class I directors who are elected at the annual meeting will expire at the annual meeting of our stockholders in the year 2018. Our Class II directors, whose term will expire at the annual meeting of our stockholders in the year 2016, are Philip J. Holthouse and Brian Deevy. Our Class III directors, whose term will expire at the annual meeting of our stockholders in the year 2017, are William R. Fitzgerald and Michael J. Pohl.

If either of Mr. Tanabe or Mr. Vogel should decline re-election or should he become unable to serve as a director of our company for any reason before re-election, votes will be cast for a substitute nominee, if any, designated by our Board, or, if none is so designated prior to the election, votes will be cast according to the judgment of the person or persons voting the proxy.

The following lists the nominees for election as directors at the annual meeting and the four other directors of our company, and includes, as to each person, how long such person has been a director of our company, such person’s professional background, other public company directorships and other factors considered in the determination that such person possesses the requisite qualifications and skills to serve as a member of our Board. All positions referenced in the table below with our company include, where applicable, positions with our predecessors. The number of shares of our common stock beneficially owned by each director, as of February 28, 2015, is set forth in this proxy statement under the caption “Security Ownership of Certain Beneficial Owners and Management-Security Ownership of Management.”

Nominees for Election as Director
Charles Y. Tanabe

Professional Background : A director of our company since November 2014. Mr. Tanabe served as an Executive Vice President and the General Counsel of Liberty Media Corporation ( Liberty Media ) from May 2007 to December 2012. Mr. Tanabe also served as an Executive Vice President of Liberty Interactive Corporation (together with its predecessors, Liberty Interactive ) from January 2007 to December 2012 and as the General Counsel from January 1999 to December 2012. He also served as a Senior Vice President of Liberty Interactive from January 1999 to December 2006 and as the Secretary from April 2001 to December 2007.

Other Public Company Directorships : Mr. Tanabe has served as a director of Starz since January 2013. Mr. Tanabe also served as a director of Sirius XM Radio Inc. from January 2013 to May 2013.

Age : 63

Board Qualification : Mr. Tanabe brings to our Board significant operational and legal experience based on his senior positions with Liberty Media and Liberty Interactive. He provides our Board with executive leadership perspective on the legal operations and management of large public companies and risk management policies.


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Carl E. Vogel

Professional Background : A director of our company since December 2009. Mr. Vogel is currently a Senior Advisor to DISH Network Corporation ( DISH ), a publicly-traded company providing pay-TV services, and served as President of DISH from September 2006 until February 2008 and Vice Chairman of DISH from June 2005 until March 2009. Mr. Vogel has also been the president and sole stockholder of Bulldog Capital, Inc., a private investment firm, through which he was, from November 2011 to October 2014, a Senior Advisor of The Gores Group, a Los Angeles based private equity firm. He serves as Chairman of Imagine Communications Corp. (formerly Harris Broadcast), a portfolio company of the Gores Group ( Imagine ). Since October 2014, Mr. Vogel has been a Senior Advisor to KKR & Co., LP. From October 2007 until March 2009, Mr. Vogel served as a Senior Advisor to EchoStar Corporation ( EchoStar ), a publicly-traded company in the digital set-top box and satellite services businesses. From 2001 until 2005, Mr. Vogel served as the President and CEO of Charter Communications Inc. ( Charter ), a publicly-traded company providing cable television and broadband services. Prior to joining Charter, Mr. Vogel worked as an executive officer in various capacities for companies affiliated with the predecessors of Liberty Interactive and the former Liberty Media Corporation (currently known as Starz) ( Old LMC ). Mr. Vogel held various executive positions with DISH from 1994 until 1997, including serving as the President from 1995 until 1997.

Other Public Company Directorships : Mr. Vogel has served on the board of directors AMC Networks Inc. ( AMC Networks ) since June of 2013 and serves as chairman of the audit committee of AMC Networks and as a member of its compensation committee. Mr. Vogel has served on the board of directors of DISH since May 2005 and on the board of directors and audit committee of Universal Electronics Inc., a publicly-traded company providing wireless control technology for the connected home, since October 2009. In addition, Mr. Vogel has served on the board of directors of Sirius XM Holdings Inc. (including its predecessor) ( Sirius ), a publicly-traded satellite radio system operator and broadcaster, since April 2011, and has served on its compensation committee and nominating and corporate governance committee since 2012 and has served as chairman of its compensation committee since April 2013. Since 2006, Mr. Vogel has also served on the board of directors of Shaw Communications, Inc., a publicly-traded diversified communications company providing broadband cable and direct-to-home satellite services in Canada, where he currently is a member of the corporate governance and nominating committee. Mr. Vogel was a director of NextWave Wireless Inc. from November 2009 to January 2013 (where he served as the chair of the audit committee from March 2010 to January 2013). From October 2007 until March 2009, Mr. Vogel served as the Vice Chairman of the board of directors of EchoStar. From October 2001 to January 2005, Mr. Vogel served on the board of directors of Charter.

Age : 57

Board Qualification : Mr. Vogel brings to our Board extensive executive leadership experience and board experience, including experience with subscription-based businesses, along with professional accounting and financial expertise.

Directors Whose Term Expires in 2016

Philip J. Holthouse

Professional Background : A director of our company since September 2008. Mr. Holthouse has been a partner with Holthouse Carlin & Van Trigt LLP since 1991, where he provides tax planning and tax consulting services for privately held businesses and high net-worth individuals primarily in the real estate, entertainment and service industries. Mr. Holthouse is a certified public accountant.

Other Public Company Directorships : Mr. Holthouse served on the board of directors and audit committee of Napster, Inc. from January 2004 to October 2008.

Age : 56

Board Qualification : Mr. Holthouse brings to our Board experience as a public company director and an audit committee member. His tax and accounting training enables him to provide our Board with sophisticated financial insight and to fulfill his function as audit committee chairman.


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Brian Deevy

Professional Background. A director of our company since November 2013, Mr. Deevy is head of Royal Bank of Canada ( RBC ) Capital Markets’ Communications, Media & Entertainment ( CME ) Group. Mr. Deevy is responsible for strategic development of the CME Group’s business, which includes mergers & acquisitions, private equity and debt capital formation and financial advisory engagements. Mr. Deevy also serves as Chairman and Chief Executive Officers of RBC/Daniels and Daniels & Associates, the investment banking firm that provided financial advisory services to the communications industry until it was acquired by RBC in 2007. Prior to joining Daniels & Associates, RBC Daniels’ predecessor, Mr. Deevy was with Continental Illinois National Bank.

Other Public Company Directorships: Mr. Deevy served on the board of directors of Ticketmaster Entertainment, Inc. from August 2008 to January 2010.

Age: 59

Board Qualification: Mr. Deevy brings to our Board extensive executive and leadership experience in the cable industry as well as expertise in the financial sector and with strategic development of businesses.

Directors Whose Term Expires in 2017

William R. Fitzgerald

Professional Background: A director of our company since September 2008. Mr. Fitzgerald is Chairman of our Board and Chief Executive Officer of our company. Mr. Fitzgerald has also served as a director of our principal operating subsidiary, Monitronics International, Inc. ( Monitronics ), since December 2010 and served as Chairman of Ascent Media Group, LLC ( AMG ) from July 2000 until we sold AMG at the end of 2010. Mr. Fitzgerald also served as a Senior Vice President of Liberty Interactive and its predecessors from July 2000 to September 2011 and as a Senior Vice President of Old LMC from its split-off from Liberty Interactive in September 2011 to December 2012. Prior to joining Liberty Interactive, Mr. Fitzgerald served as Executive Vice President and Chief Operating Officer, Operations Administration for AT&T Broadband (formerly known as Tele-Communications, Inc. ( TCI )), from 1998 to 2000 and was Executive Vice President, Corporate Development and Chief Operating Officer of TCI Communications, Inc., a wholly-owned subsidiary of TCI, from 1996 to 1998.

Other Public Company Directorships : Mr. Fitzgerald has served as a director of Piper Jaffray Companies since March 2014 and serves as a member of its compensation committee and nominating and governance committee. Mr . Fitzgerald served as a director of Expedia, Inc. from March 2006 to December 2012, during which time he also served as a member of the compensation committee. Mr. Fitzgerald also served as a director of TripAdvisor, Inc. from December 2011 to February 2013. In addition, Mr. Fitzgerald served as a director of On Command Corporation from 2001 to 2005 and Cablevision Systems Corporation from 1999 to 2000.

Age : 57

Board Qualification : Mr. Fitzgerald brings to our Board over 30 years of experience in the media and telecommunications industries, as well as subscription-based businesses. He has an in-depth understanding of our business and the history of our organization coupled with significant executive and leadership experience.


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Michael J. Pohl

Professional Background : A director of our company since September 2008.  Mr. Pohl serves as an advisor to companies in the technology, media and telecommunications industries. Mr. Pohl has served on the board of directors of BlackArrow, Inc. since January 2012 and was appointed as Chairman of its board of directors in June 2012.  Mr. Pohl has served on the board of Think Analytics since March 2013 and on the board of Imagine since March 2013, having previously served on the board of its predecessor, Harris Broadcast. From December 2007 to April 2008, Mr. Pohl served as the Interim Vice President/General Manager of the On Demand Systems Division of ARRIS Group, Inc., a communications technology company specializing in the design and engineering of broadband networks ( ARRIS ).  Mr. Pohl was President of Global Strategies at C-COR Incorporated ( C-COR ) from December 2005 to November 2007, when C-COR was acquired by ARRIS, and served as the President and Chief Executive Officer of nCUBE Corporation, an interactive video server company, from December 1999 to December 2005. Mr. Pohl has been and continues to be actively involved in numerous industry associations and received the National Cable and Telecommunications Association’s highest honor, the Vanguard Award, in 2008.  

Other Public Company Directorships : Mr. Pohl served on the board of directors and compensation committee of BigBand Networks, Inc. from May 2009 through the sale of the company to ARRIS in November 2011, during which time he served for a period on the audit committee of its board of directors and served as Chairman of its board of directors beginning in February 2010.

Age : 63

Board Qualification : Mr. Pohl brings to our Board valuable technological insight and over 25 years of extensive experience with technology companies. His management experience and financial expertise is complemented by his knowledge of applied sciences.

Vote and Recommendation
 
The director election requires the affirmative vote of a plurality of the votes cast for the director election proposal by the holders of shares of our common stock present, in person or by proxy, and entitled to vote at the annual meeting, voting together as a single class. This means that each of Mr. Tanabe and Mr. Vogel will be elected if they receive more affirmative votes than any other persons.

Our Board unanimously recommends a vote FOR the election of the nominees to our Board.



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PROPOSAL 2 - THE AUDITOR RATIFICATION PROPOSAL
 
We are asking our stockholders to ratify the selection of KPMG LLP as our independent auditors for the fiscal year ending December 31, 2015 .
 
Even if the selection of KPMG LLP is ratified, the audit committee of our Board, in its discretion, may direct the appointment of a different independent accounting firm at any time during the year if our audit committee determines that such a change would be in the best interests of our company and our stockholders.  In the event our stockholders fail to ratify the selection of KPMG LLP, our audit committee will consider it as a direction to select other auditors for the year ending December 31, 2015 .
 
A representative of KPMG LLP is expected to be present at the annual meeting, will have the opportunity to make a statement if he or she so desires and is expected to be available to respond to appropriate questions.
 
Audit Fees and All Other Fees
 
The following table presents fees for professional audit services rendered by KPMG LLP for the audit of our consolidated financial statements for 2014 and 2013:
 
 
2014
 
2013
Audit fees
 
$
985,000

 
$
1,061,000

Audit related fees (1)
 
104,000

 
107,000

Audit and audit related fees
 
$
1,089,000

 
$
1,168,000

Tax fees (2)
 
53,000

 
28,000

Total fees
 
$
1,142,000

 
$
1,196,000

 
(1)
Audit related fees consist primarily of due diligence assistance.
(2)
Tax related services consist primarily of tax compliance and advice.
 
Our audit committee has considered whether the provision of services by KPMG LLP to our company other than auditing is compatible with KPMG LLP maintaining its independence and believes that the provision of such other services is compatible with KPMG LLP maintaining its independence.
 
Policy on Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditor
 
Our audit committee adopted a policy, dated November 6, 2008, regarding the pre-approval of all audit and permissible non-audit services provided by our independent auditor.  Pursuant to this policy, our audit committee has approved the engagement of our independent auditor to provide the following services (all of which are collectively referred to as pre-approved services ):
 
audit services as specified in the policy, including (i) financial audits of our company and our subsidiaries, (ii) services associated with our periodic reports, registration statements and other documents filed or issued in connection with a securities offering (including comfort letters and consents), (iii) attestations of our management’s reports on internal controls and (iv) consultations with management as to accounting or disclosure treatment of transactions;

audit-related services as specified in the policy, including (i) due diligence services, (ii) financial audits of employee benefit plans, (iii) consultations with management as to accounting or disclosure treatment of transactions not otherwise considered audit services, (iv) attestation services not required by statute or regulation, (v) certain audits incremental to the audit of our consolidated financial statements, (vi) closing balance sheet audits related to dispositions and (vii) general assistance with implementation of SEC rules or listing standards; and

tax services as specified in the policy, including federal, state, local and international tax planning, compliance and review services, and tax due diligence.
 
Notwithstanding the foregoing general pre-approval, any individual project involving the provision of pre-approved services that is likely to result in fees in excess of $100,000 requires the specific prior approval of our audit committee.  Any engagement of our independent auditors for services other than the pre-approved services requires the specific approval of our

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audit committee. Our audit committee has delegated the authority for the foregoing approvals to the chairman of the audit committee, subject to his subsequent disclosure to the entire audit committee of the granting of any such approval.  Philip J. Holthouse currently serves as the chairman of our audit committee.
 
Our pre-approval policy prohibits the engagement of our independent auditor to provide any services that are subject to the prohibition imposed by Section 201 of the Sarbanes-Oxley Act.
 
All services provided by our independent auditor during 2014 were approved in accordance with the terms of the policy.

Vote and Recommendation
 
Approval of the auditor ratification proposal requires the affirmative vote of a majority of the voting power of the shares of our common stock present, in person or by proxy, and entitled to vote at the annual meeting, voting together as a single class.
 
Our Board unanimously recommends a vote FOR the auditor ratification proposal.


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PROPOSAL 3 - THE INCENTIVE PLAN PROPOSAL
 
The following is a description of the material provisions of the Ascent Capital Group, Inc. 2015 Omnibus Incentive Plan (the incentive plan ). The summary that follows is not intended to be complete, and we refer you to the copy of the incentive plan set forth as Annex A to this proxy statement for a complete statement of its terms and provisions.

Key Features of the Incentive Plan

No Increase in Number of Shares Available for Grants. The available number of shares under the incentive plan is a combination of the remaining availability under the 2008 Plans (defined below), and no further grants may be made under the 2008 Plans.
No Repricing of Options or SARs. Unless approved by our stockholders, substitutions and repricing of stock options and SARs are prohibited.
No Reload Feature. The incentive plan does not permit grants of options or SARs that automatically “reload” when outstanding awards are exercised, expired or forfeited.
No Discounted Options or SARs. Stock options and SARs may not be granted with an exercise price below fair market value, which generally means the closing price of our common stock as reported on the Nasdaq Global Select Market on the date of grant.
Dividend Equivalents. Only an award of restricted stock units may include dividend equivalents. With respect to a performance-based award, dividend equivalents may only be paid to the extent the underlying award is actually paid.
Limited Terms for Options and SARs. The term for stock options and SARs granted under the incentive plan is limited to ten years.
Clawback Policy. All awards granted under the incentive plan will be subject to any clawback policy we have or adopt.
No Transferability. Awards generally may not be transferred, except by a domestic relations order or after the holder’s death by beneficiary designation, unless otherwise provided for in an award agreement.
No “Evergreen” Provision. Shares authorized for issuance under the incentive plan will not be automatically replenished. Any additional shares to be issued over and above the amount for which we are seeking authorization must be approved by our stockholders.
No Tax Gross-Ups. Holders do not receive tax gross-ups under the incentive plan.
Award Limitations. In any calendar year, no person may be granted awards relating to more than 500,000 shares of our common stock or cash award in excess of $3,000,000 and no nonemployee director may be granted awards having a value in excess of $500,000 on the date of grant.

The Incentive Plan

Our Board determined to adopt the incentive plan, in part, due to the diminishing number of shares of our common stock with respect to which awards could be granted under our existing 2008 Incentive Plan (the 2008 incentive plan ). However, because a substantial number of shares remained available for grant under our 2008 Non-Employee Director Incentive Plan (which, together with the 2008 incentive plan, we refer to as the 2008 Plans ), the Board determined to combine the available number of shares under the 2008 Plans and use such aggregate number of shares of 599,862 (as detailed below) as the maximum available for grant under the incentive plan. Accordingly, the adoption of the incentive plan will not result in any increase in the aggregate number of shares of our common stock available to be granted as equity awards.

The incentive plan is structured as an omnibus plan under which awards may be made to our company's officers, employees, independent contractors and nonemployee directors. Upon adoption of the incentive plan, our Board determined to cease making any further grants under the 2008 Plans. A summary of certain terms of the incentive plan is set forth below.
    
The incentive plan is administered by the compensation committee of our Board with regard to all awards granted under the incentive plan (other than awards granted to the nonemployee directors), and the compensation committee has full power and authority to determine the terms and conditions of such awards. The incentive plan is administered by the full Board with regard to all awards granted under the incentive plan to nonemployee directors, and the full Board has full power and authority to determine the terms and conditions of such awards. The incentive plan is designed to provide additional remuneration to eligible employees, nonemployee directors and independent contractors for services to our company and to encourage their investment in our capital stock, thereby increasing their proprietary interest in our business, encouraging them to remain in the employ or service of our company or its subsidiaries, and increasing their personal interest in the continued success and progress of our company and its subsidiaries. The incentive plan is also intended to (1) attract persons of exceptional ability to become officers and employees of our company and its subsidiaries, and (2) induce nonemployee

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directors and independent contractors to provide services to our company and its subsidiaries. Employees (including officers and directors) of, and nonemployee directors and independent contractors providing services to, our company or any of our subsidiaries will be eligible to participate and may be granted awards under the incentive plan. Awards may be made to any such employee, nonemployee director or independent contractor who holds or has held awards under the incentive plan or under any other plan of our company or any of our affiliates. The number of individuals who will receive awards under the incentive plan will vary from year to year and will depend on various factors, such as the number of promotions and our hiring needs during the year, and whether employees, nonemployee directors or independent contractors of our subsidiaries are granted awards. Therefore, we cannot predict the number of future award recipients.

Non-qualified stock options, stock appreciation rights ( SARs ), restricted shares, restricted stock units, cash awards, performance awards or any combination of the foregoing (as used in this description of the incentive plan, collectively, awards ) may be granted under the incentive plan. The maximum number of shares of our common stock with respect to which awards may be granted under the incentive plan is an aggregate of 599,862 shares (plus any shares of our common stock subject to currently outstanding awards that become available again under the 2008 Plans), subject to anti-dilution and other adjustment provisions of the incentive plan. With limited exceptions, no person will be granted in any calendar year awards under the incentive plan covering more than 500,000 shares of our common stock, subject to anti-dilution and other adjustment provisions of the incentive plan. In addition, no person may receive payment for cash awards during any calendar year aggregating in excess of $3,000,000. No nonemployee director may receive awards during any calendar year valued in excess of $500,000 on the date of grant.

Shares of our common stock issuable pursuant to awards made under the incentive plan will be made available from either authorized but unissued shares of our common stock or shares of our common stock that we have issued but reacquired, including shares purchased in the open market. Shares of our common stock that are subject to (i) any award granted under the incentive plan or the 2008 Plans that expires, terminates or is cancelled or annulled for any reason without having been exercised, (ii) any award of any SARs granted under the incentive plan the terms of which provide for settlement in cash, and (iii) any award of restricted shares or restricted stock units granted under the incentive plan or the 2008 Plans that shall be forfeited prior to becoming vested, will once again be available for issuance under the incentive plan. Shares of our common stock that are (i) not issued or delivered as a result of the net settlement of an outstanding option or SAR, (ii) used to pay the purchase price or withholding taxes relating to an outstanding award, or (iii) repurchased in the open market with the proceeds of an option purchase price will not be again made available for issuance under the incentive plan.

Subject to the provisions of the incentive plan, the compensation committee will be authorized to establish, amend and rescind such rules and regulations as it deems necessary or advisable for the proper administration of the incentive plan and to take such other action in connection with or in relation to the incentive plan as it deems necessary or advisable.

Unless otherwise determined by the compensation committee and expressly provided for in an agreement, awards are not transferrable except pursuant to a qualified domestic relations order or after the holder's death by beneficiary designation.

Stock Options. Non-qualified stock options awarded under the incentive plan will entitle the holder to purchase a specified number of shares of a series of our common stock at a specified exercise price subject to the terms and conditions of the applicable option grant. The exercise price of an option awarded under the incentive plan may be no less than the fair market value of the shares of the applicable series of our common stock as of the day the option is granted. The term of an option may not exceed ten years. The compensation committee will determine, and each individual award agreement will provide, (1) the series and number of shares of our common stock subject to the option, (2) the per share exercise price, (3) whether that price is payable in cash, by check, by promissory note, in whole shares of any series of our common stock, by the withholding of shares of our common stock issuable upon exercise of the option, by cashless exercise, or any combination of the foregoing, (4) other terms and conditions of exercise, (5) restrictions on transfer of the option and (6) other provisions not inconsistent with the incentive plan. Dividend equivalents will not be paid with respect to any stock options.

Stock Appreciation Rights. A SAR awarded under the incentive plan entitles the recipient to receive a payment in stock or cash equal to the excess of the fair market value (on the day the SAR is exercised) of a share of the applicable series of our common stock with respect to which the SAR was granted over the base price specified in the grant. A SAR may be granted to an option holder with respect to all or a portion of the shares of our common stock subject to a related stock option (a tandem SAR ) or granted separately to an eligible employee, nonemployee director or independent contractor (a free standing SAR ). Tandem SARs are exercisable only at the time and to the extent that the related stock option is exercisable. Upon the exercise or termination of the related stock option, the related tandem SAR will be automatically cancelled to the extent of the number of shares of our common stock with respect to which the related stock option was so exercised or terminated. The base price of a tandem SAR is equal to the exercise price of the related stock option. Free standing SARs are exercisable at the time and upon the terms and conditions provided in the relevant award agreement. The term of a free standing SAR may not exceed

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ten years. The base price of a free standing SAR may be no less than the fair market value of a share of the applicable series of our common stock as of the day the SAR is granted. Dividend equivalents will not be paid with respect to any SARs.

Restricted Shares and Restricted Stock Units. Restricted shares are shares of our common stock that become vested and may be transferred upon completion of the restriction period. The compensation committee will determine, and each individual award agreement will provide, (1) the price, if any, to be paid by the recipient of the restricted shares, (2) whether dividends or distributions paid with respect to restricted shares will be retained by us during the restriction period ( retained distributions ), (3) whether the holder of the restricted shares may be paid a cash amount any time after the shares become vested, (4) the vesting date or vesting dates (or basis of determining the same) for the award and (5) other terms and conditions of the award. The holder of an award of restricted shares, as the registered owner of such shares, may vote the shares.

A restricted stock unit is a unit evidencing the right to receive, in specified circumstances, one share of the specified series of our common stock, or its cash equivalent, subject to a restriction period or forfeiture conditions. The compensation committee will be authorized to award restricted stock units based upon the fair market value of shares of any series of our common stock under the incentive plan. The compensation committee will determine, and each individual award agreement will provide, the terms, conditions, restrictions, vesting requirements and payment rules for awards of restricted stock units, including whether the holder will be entitled to dividend equivalent payments with respect to the restricted stock units. Restricted stock units will be issued at the beginning of the restriction period and holders will not be entitled to shares of our common stock covered by restricted stock unit awards until such shares are issued to the holder at the end of the restriction period. Awards of restricted stock units or the common stock covered thereunder may not be transferred, assigned or encumbered prior to the date on which such shares are issued or as provided in the relevant award agreement.

Upon the applicable vesting date, all or the applicable portion of restricted shares or restricted stock units will vest, any retained distributions or unpaid dividend equivalents with respect to the restricted shares or restricted stock units will vest to the extent that the awards related thereto have vested, and any cash amount to be received by the holder with respect to the restricted shares or restricted stock units will become payable, all in accordance with the terms of the individual award agreement. The compensation committee may permit a holder to elect to defer delivery of any restricted shares or restricted stock units that become vested and any related cash payments, retained distributions or dividend equivalents, provided that such deferral elections are made in accordance with Section 409A of the Internal Revenue Code of 1986, as amended (the Code ).

Cash Awards. The compensation committee will also be authorized to provide for the grant of cash awards under the incentive plan. A cash award is a bonus paid in cash that may be based upon the attainment of one or more performance goals over a performance period established by the compensation committee. The terms, conditions and limitations applicable to any cash awards will be determined by the compensation committee.


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Performance Awards. At the discretion of the compensation committee any of the above-described awards may be designated as a performance award. All cash awards shall be designated as performance awards. Performance awards are contingent upon performance measures applicable to a particular period, as established by the compensation committee and set forth in individual agreements, based upon any one or more of the following business criteria:

increased revenue;
net income measures (including income after capital costs and income before or after taxes);
stock price measures (including growth measures and total stockholder return);
price per share of our common stock;
market share;
earnings per share (actual or targeted growth);
earnings before interest, taxes, depreciation and amortization (EBITDA);
operating income before depreciation and amortization (OIBDA);
recurring monthly revenue;
net recurring monthly revenue;
economic value added (or an equivalent metric);
market value added;
debt to equity ratio;
cash flow measures (including cash flow return on capital, cash flow return on tangible capital, net cash flow and net cash flow before financing activities);
return measures (including return on equity, return on average assets, return on capital, risk-adjusted return on capital, return on investors' capital and return on average equity);
creation costs;
operating measures (including operating income, funds from operations, cash from operations, after-tax operating income, sales volumes, production volumes and production efficiency);
expense measures (including overhead cost and general and administrative expense);
margins;
stockholder value;
total stockholder return;
proceeds from dispositions;
total market value; and
corporate values measures (including ethics compliance, environmental and safety).

Performance measures may apply to the award recipient, to one or more business units, divisions, subsidiaries or affiliates of our company or an applicable sector of our company, or to our company as a whole. Goals may also be based on performance relative to a peer group of companies. If the compensation committee intends for the performance award to be granted and administered in a manner that preserves the deductibility of the compensation resulting from such award in accordance with Section 162(m) of the Code, the applicable performance goals must be established (1) no later than 90 days after the commencement of the period of service to which the performance goals relate and (2) prior to the completion of 25% of such period of service. The compensation committee will have no discretion to modify or waive such performance goals to increase the amount of compensation payable that would otherwise be due upon attainment of the goal, unless the applicable award is not intended to qualify as qualified performance-based compensation under Section 162(m) of the Code and the relevant agreement provides for such discretion. Section 162(m) of the Code generally disallows deductions for compensation in excess of $1 million for some executive officers unless the awards meet the requirements for being performance-based.

Awards Generally . Awards under the incentive plan may be granted either individually, in tandem or in combination with each other. Where applicable, the securities underlying, or relating to, awards granted under the incentive plan may be shares of our Series A common stock and our Series B common stock, as provided in the relevant grant. On April 14, 2015, the closing price of our Series A common stock was $40.54, and the average of the bid and ask prices of our Series B common stock as reported on the OTC Markets was $50.26. Under certain conditions, including the occurrence of certain approved transactions, a board change or a control purchase (all as defined in the incentive plan), options and SARs will become immediately exercisable, and the restrictions on restricted shares and restricted stock units will lapse, unless individual agreements state otherwise. At the time an award is granted, the compensation committee will determine, and the relevant agreement will provide for, any vesting or early termination, upon a holder's termination of employment with our company, of any unvested options, SARs, restricted stock units or restricted shares and the period during which any vested options and SARs must be exercised. Unless otherwise provided in the relevant agreement, (1) no option or SAR may be exercised after its scheduled expiration date (however, if the term of an option or SAR expires when trading in our common stock is prohibited by law or our company’s insider trading policy, then the term of such option or SAR shall expire on the 30th day after the expiration of such prohibition), (2) if the holder's service terminates by reason of death or disability (as defined in the incentive

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plan), his or her options or SARs shall remain exercisable for a period of at least one year following such termination (but not later than the scheduled expiration date) and (3) any termination of the holder's service for "cause" (as defined in the incentive plan) will result in the immediate termination of all options and SARs and the forfeiture of all rights to any restricted shares, restricted stock units, retained distributions, unpaid dividend equivalents and related cash amounts held by such terminated holder. If a holder's service terminates due to death or disability, options and SARs will become immediately exercisable, and the restrictions on restricted shares and restricted stock units will lapse and become fully vested, unless individual agreements state otherwise.

Adjustments . The number and kind of shares of our common stock that may be awarded or otherwise made subject to awards under the incentive plan, the number and kind of shares of our common stock covered by outstanding awards and the purchase or exercise price and any relevant appreciation base with respect to any of the foregoing will be subject to appropriate adjustment as the compensation committee deems equitable, in its sole discretion, in the event (1) we subdivide the outstanding shares of any series of our common stock into a greater number of shares of such series of common stock, (2) we combine the outstanding shares of any series of our common stock into a smaller number of shares of such series of common stock or (3) there is a stock dividend, extraordinary cash dividend, reclassification, recapitalization, reorganization, stock redemption, split-up, spin-off, combination, exchange of shares, warrants or rights offering to purchase any series of our common stock, or any other similar corporate event (including mergers or consolidations, other than approved transactions (as defined in the incentive plan) for which other provisions are made pursuant to the incentive plan). In addition, in the event of a merger, consolidation, acquisition of property or stock, separation, reorganization or liquidation, the compensation committee has the discretion to (i) provide, prior to the transaction, for the acceleration of vesting and exercisability, or lapse of restrictions, with respect to the awards, or in the case of a cash merger, termination of unexercised awards, or (ii) cancel such awards and deliver cash to holders based on the fair market value of such awards as determined by the compensation committee, in a manner that is in compliance with the requirements of Section 409A of the Code.

Prohibition on Repricing of Awards. Except for any adjustment as described above, the compensation committee will not, without first obtaining approval by the majority of stockholders of our company, (1) decrease the purchase price of an option or SAR after the date of grant, (2) accept for surrender any outstanding option or SAR previously granted as consideration for the grant of a new award, or (3) grant any option or SAR that contains a “reload” feature, under which additional options, SARS or other awards are granted automatically to the holder upon the exercise of the original option or SAR.

Amendment and Termination. The incentive plan will terminate on the fifth anniversary of the plan's effective date (which was February 25, 2015) unless earlier terminated by the compensation committee. The compensation committee may suspend, discontinue, modify or amend the incentive plan at any time prior to its termination, except that outstanding awards may not be amended to reduce the purchase or base price of outstanding options or SARs. However, before an amendment may be made that would adversely affect a participant who has already been granted an award, the participant's consent must be obtained, unless the change is necessary to comply with Section 409A of the Code.

U.S. Federal Income Tax Consequences of Awards Granted under the Incentive Plan
Consequences to Participants
The following is a summary of the U.S. federal income tax consequences that generally will arise with respect to awards granted under the incentive plan and with respect to the sale of any shares of our common stock acquired under the incentive plan. This general summary does not purport to be complete, does not describe any state, local or non-U.S. tax consequences, and does not address issues related to the tax circumstances of any particular recipient of an award under the incentive plan.

Non-Qualified Stock Options; SARs. Holders will not realize taxable income upon the grant of a non-qualified stock option or a SAR. Upon the exercise of a non-qualified stock option or a SAR, the holder will recognize ordinary income (subject to withholding, if applicable) in an amount equal to the excess of (1) the fair market value on the date of exercise of the shares received over (2) the exercise price or base price (if any) he or she paid for the shares. The holder will generally have a tax basis in any shares of our common stock received pursuant to the exercise of a SAR, or pursuant to the cash exercise of a non-qualified stock option, that equals the fair market value of such shares on the date of exercise. The disposition of the shares of our common stock acquired upon exercise of a non-qualified stock option will ordinarily result in capital gain or loss. We are entitled to a deduction in an amount equal to the income recognized by the holder upon the exercise of a non-qualified stock option or SAR.


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Cash Awards; Restricted Stock Units; Restricted Shares. A holder will recognize ordinary compensation income upon receipt of cash pursuant to a cash award or, if earlier, at the time such cash is otherwise made available for the holder to draw upon it, and we will have a corresponding deduction for federal income tax purposes, subject to certain limits on deductibility discussed below. A holder will not have taxable income upon the grant of a restricted stock unit but rather will generally recognize ordinary compensation income at the time the award is settled in an amount equal to the fair market value of the shares received, at which time we will have a corresponding deduction for federal income tax purposes, subject to certain limits on deductibility discussed below.

Generally, a holder will not recognize taxable income upon the grant of restricted shares, and we will not be entitled to any federal income tax deduction upon the grant of such award. The value of the restricted shares will generally be taxable to the holder as compensation income in the year or years in which the restrictions on the shares of common stock lapse. Such value will equal the fair market value of the shares on the date or dates the restrictions terminate. A holder, however, may elect pursuant to Section 83(b) of the Code to treat the fair market value of the shares subject to the restricted share award on the date of such grant as compensation income in the year of the grant of the restricted share award. The holder must make such an election pursuant to Section 83(b) of the Code within 30 days after the date of grant. If such an election is made and the holder later forfeits the restricted shares to us, the holder will not be allowed to deduct, at a later date, the amount such holder had earlier included as compensation income. In any case, we will receive a deduction for federal income tax purposes corresponding in amount to the amount of compensation included in the holder's income in the year in which that amount is so included, subject to certain limits on deductibility discussed below.

A holder who is an employee will be subject to withholding for federal, and generally for state and local, income taxes at the time the holder recognizes income under the rules described above with respect to the cash or the shares of our common stock received pursuant to awards. Dividend equivalents that are received by a holder prior to the time that the restricted shares are taxed to the holder under the rules described in the preceding paragraph are taxed as additional compensation, not as dividend income. The tax basis of a holder in the shares of our common stock received will equal the amount recognized by the holder as compensation income under the rules described in the preceding paragraph, and the holder's holding period in such shares will commence on the date income is so recognized.

Certain Tax Code Limitations on Deductibility. In order for us to deduct the amounts described above, such amounts must constitute reasonable compensation for services rendered or to be rendered and must be ordinary and necessary business expenses. The ability to obtain a deduction for awards under the incentive plan could also be limited by Section 280G of the Code, which provides that certain excess parachute payments made in connection with a change in control of an employer are not deductible. The ability to obtain a deduction for amounts paid under the incentive plan could also be affected by Section 162(m) of the Code, which limits the deductibility, for U.S. federal income tax purposes, of compensation paid to certain employees to $1 million during any taxable year. However, certain exceptions apply to this limitation in the case of qualified performance-based compensation. In certain cases, we may determine it is in our interests to not satisfy the requirements for the qualified performance-based exception.

Code Section 409A. Section 409A of the Code generally provides that any deferred compensation arrangement must satisfy specific requirements, both in operation and in form, regarding (1) the timing of payment, (2) the advance election of deferrals, and (3) restrictions on the acceleration of payment. Failure to comply with Section 409A of the Code may result in the early taxation (plus interest) to the participant of deferred compensation and the imposition of a 20% penalty on the participant on such deferred amounts included in the participant's income. We intend to structure awards under the incentive plan in a manner that is designed to be exempt from or comply with Section 409A of the Code.

New Plan Benefits
Except as otherwise described below, due to the nature of the incentive plan and the discretionary authority afforded the compensation committee in connection with the administration thereof, we cannot determine or predict the value, number or type of awards to be granted pursuant to the incentive plan.

Prior to the date of this proxy statement, we have granted awards, including performance-based equity awards, under the incentive plan to certain of our employees, which awards are conditioned upon receiving stockholder approval of the incentive plan (and, in the case of certain awards, the satisfaction of other conditions). Assuming the performance-based awards are earned and vested in full, there would remain available for future grants under the incentive plan 537,521 shares of our common stock. We have also adopted our annual performance bonus program for the 2015 calendar year with respect to certain of our officers under the incentive plan. The payment of any earned awards under this bonus program is conditioned upon receiving stockholder approval of the incentive plan. Awards granted under the incentive plan prior to the date of this proxy statement are set forth below.

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Name and Position
 
Dollar Value ($) (1)
 
Number of Units
 
 
 
 
 
William R. Fitzgerald
 
1,238,188
 
Chief Executive Officer (Principal Executive Officer) and
Chairman of the Board
 
 
 
 
 
 
 
 
 
Michael R. Meyers
 
246,000
 
30,000 (2)
Chief Financial Officer (Principal Financial Officer) and
Senior Vice President
 
 
 
 
 
 
 
 
 
William E. Niles
 
322,844
 
Executive Vice President and General Counsel
 
 
 
 
 
 
 
 
 
Michael R. Haislip
 
356,250
 
Executive Vice President
 
 
 
 
 
 
 
 
 
John A. Orr
 
(3)
 
Senior Vice President
 
 
 
 
 
 
 
 
 
Executive Group
 
2,163,282
 
60,000 (4)
 
 
 
 
 
Non-Executive Director Group
 
 
 
 
 
 
 
Non-Executive Officer Employee Group
 
 
15,250 (5)
 
(1)
Represents target and maximum bonus amounts payable under our annual performance bonus program for the 2015 calendar year, as determined by the compensation committee taking into account the terms of each named executive officer’s employment agreement.
(2)
Represents performance-based restricted stock units granted to Mr. Meyers, as described in more details under “Executive Compensation-Compensation Discussion and Analysis-Changes for 2015.”
(3)
Upon his departure from our company, Mr. Orr was no longer eligible to receive an award under our annual performance bonus program for the 2015 calendar year.
(4)
Represents performance-based restricted stock units granted (i) to Mr. Meyers and (ii) to a prospective employee of our company in connection with the commencement of employment with our company.
(5)
Represents 15,000 performance-based restricted stock units and 250 restricted shares of our Series A common stock granted to certain of our employees.

Vote and Recommendation
 
Approval of the incentive plan proposal requires the affirmative vote of a majority of the voting power of the shares of our common stock present, in person or by proxy, and entitled to vote at the annual meeting, voting together as a single class.

Our Board unanimously recommends a vote FOR the incentive plan proposal.


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MANAGEMENT

Executive Officers
 
The following lists the executive officers of our company (other than William R. Fitzgerald, Chairman of our Board and Chief Executive Officer, whose background is described under “Proposal 1-The Director Election Proposal”), their ages and a description of their business experience, including positions held with our company.

Name
 
Positions
 
 
 
Michael R. Haislip
 
Mr. Haislip has served as Executive Vice President of our company since April 2011. Since May 2005, Mr. Haislip has served as the President and Chief Executive Officer of Monitronics, our company’s principal operating subsidiary. Prior to joining Monitronics, Mr. Haislip held multiple executive positions, mostly in the cable industry. He served in various operations and financial management positions at Cox Communications for ten years. Other positions in his career have included President of Star Cable Associates; President of Armstrong Cable; and Senior Vice President, Great Lakes Division, of Charter.
Age: 63
 
 
 
 
Michael R. Meyers
 
Mr. Meyers has served as Senior Vice President of our company since April 2011 and as Chief Financial Officer and Treasurer since August 2011. Mr. Meyers is the Chief Financial Officer of Monitronics, and has held various positions at Monitronics since July 1996. Before joining Monitronics, Mr. Meyers, a certified public accountant, had over 15 years of accounting, finance, and operations experience. He has worked with a variety of businesses, including Fortune 500, medium, and small companies, as well as working in public accounting.
Age: 58
 
 
 
 
William E. Niles
 
Mr. Niles has served as Executive Vice President, General Counsel and Secretary of our company since the spin-off of our company from Discovery Holding Company ( DHC ) in September 2008, and also served as Executive Vice President and General Counsel of AMG from January 2002 until the sale of AMG in December 2010. From August 2006 through February 2008, Mr. Niles was a member of AMG’s executive committee. Prior to 2002, Mr. Niles was a senior executive handling legal and business affairs within AMG and its predecessor companies. Mr. Niles is also a director of our principal operating subsidiary, Monitronics, and also serves as its Executive Vice President and Secretary.
Age: 51
 
 
Our executive officers will serve in such capacities until the next annual meeting of our Board, or until their respective successors have been duly elected or appointed, or until their earlier death, resignation or removal from office. There is no family relationship between any of our executive officers or directors, by blood, marriage or adoption.

From September 2008 to March 2015, John A. Orr served as Senior Vice President, Corporate Development, of our company. Mr. Orr also served in multiple capacities with Liberty Interactive and its predecessor from August 1996 until December 2008, spearheading numerous acquisition opportunities and serving most recently as Vice President of Investor Relations from 2003 until December 2008. Mr. Orr departed from our company in March 2015.

During the past ten years, none of our directors or executive officers has had any involvement in any legal proceedings that would be material to an evaluation of his ability or integrity.
 
Section 16(a) Beneficial Ownership Reporting Compliance
 
Section 16(a) of the Exchange Act requires our executive officers and directors, and persons who own more than ten percent of a registered class of our equity securities, to file reports of ownership and changes in ownership with the SEC. Officers, directors and greater than ten-percent stockholders are required by SEC regulations to furnish us with copies of all Section 16 forms they file.

Based solely on a review of the copies of the Forms 3, 4 and 5 and amendments to those forms furnished to us during our most recent fiscal year, or written representations that no Forms 5 were required, we believe that, during the year ended December 31, 2014, all Section 16(a) filing requirements applicable to our officers, directors and greater than ten-percent beneficial owners were all met.


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Code of Ethics
 
We have adopted a code of ethics that applies to all of our employees, directors and officers, which constitutes our “code of ethics” within the meaning of Section 406 of the Sarbanes-Oxley Act. Our code of ethics is available on our website at http://ir.ascentcapitalgroupinc.com/corporate-governance.cfm .
 
Director Independence
 
It is our policy that a majority of the members of our Board be independent of our management. For a director to be deemed independent, our Board must affirmatively determine that the director has no disqualifying direct or indirect material relationship with our company. To assist our Board in determining which of our directors qualify as independent for purposes of The Nasdaq Stock Market rules as well as applicable rules and regulations adopted by the SEC, the nominating and corporate governance committee of our Board follows the Corporate Governance Rules of The Nasdaq Stock Market on the criteria for director independence.

Our Board has determined that each of Philip J. Holthouse, Brian Deevy, Michael J. Pohl, Charles Y. Tanabe and Carl E. Vogel qualifies as an independent director of our company.

Board Composition
 
As described above under “Proposal 1-The Director Election Proposal”, our Board is comprised of directors with a broad range of backgrounds and skill sets, including media, telecommunications, technology, subscription-based business, finance, transactional and advisory work, auditing and tax. For more information on our Board’s position with respect to the importance of diverse viewpoints on our Board, see “-Committees of our Board of Directors-Nominating and Corporate Governance Committee” below.
 
Board Leadership Structure
 
Our bylaws currently provide that the Chairman of our Board shall be the Chief Executive Officer of our company, unless our Board determines otherwise. William R. Fitzgerald currently serves as the Chairman of our Board and Chief Executive Officer (principal executive officer) and is responsible for identifying and implementing strategic initiatives as well as executive leadership. Our Board believes that Mr. Fitzgerald is best situated to serve as Chairman of our Board because he is the director most familiar with our company’s history and business and is also the person most capable of effectively identifying strategic priorities and leading the discussion and execution of strategy.

In evaluating our current Board leadership structure, our Board noted that our company is a holding company and that substantially all of our operating activities are conducted through our principal operating subsidiary, Monitronics. Michael R. Haislip serves as the President and Chief Executive Officer of Monitronics, and is responsible for the day to day operations of Monitronics. Our Board believes that the allocation of responsibilities between Mr. Fitzgerald and Mr. Haislip represents an appropriate leadership structure because, among other reasons, it enables Mr. Fitzgerald to foster clear accountability and effective decision making at the board level and with regard to holding company activities, while Mr. Haislip focuses on the daily management of our operating company.

The key members of all committees of our Board are independent directors. Each member of the compensation committee, nominating and corporate governance committee and audit committee is independent. In addition, an independent director, Carl E. Vogel, is the chairman of the executive committee of our Board. Through these committees, we have established independent processes for the effective oversight of critical issues entrusted to independent directors, such as the integrity of our financial statements, CEO and senior management compensation, board evaluation and selection of directors. For more information on the function of the committees of our Board, see “-Committees of our Board of Directors” below.

For the above reasons, our Board does not believe that a separation of the Chairman of the Board and Chief Executive Officer positions will provide any meaningful additional oversight. Moreover, our Board believes its current leadership structure positions our company to achieve the optimal result for its stockholders. Because Mr. Fitzgerald bears primary responsibility for the strategic management and leadership of our company, our Board believes that Mr. Fitzgerald is best suited to chair board meetings and ensure that key business issues and stockholders’ interests are brought to the attention of our Board.


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Board Role in Risk Oversight
 
Our Board has an active role, as a whole and at the committee level, in overseeing the management of our company’s risks. Our Board regularly reviews information regarding our credit, liquidity, strategic, operational, financial and reporting, succession and compensation, legal and compliance functions and status, as well as the risks associated with each. The compensation committee is responsible for overseeing the management of risks relating to our incentive compensation plans and arrangements. The audit committee oversees management of financial risks. The nominating and corporate governance committee manages risks associated with the independence of our Board and, together with the audit committee, potential conflicts of interest. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, our entire Board is regularly informed through committee reports and management presentations about such risks.

Committees of our Board of Directors
 
Executive Committee
 
Our Board has established an executive committee consisting of Carl E. Vogel and William R. Fitzgerald, with Mr. Vogel serving as chairman. The principal purpose of the executive committee is to assist our Board in the performance of its duties and responsibilities between regularly scheduled meetings of our Board and at any time when our Board is not in session or otherwise unable to act, by exercising the power and authority of our Board to manage the business and affairs of our company with respect to (i) such matters as shall be delegated to the executive committee by resolution of our Board and (ii) any other lawful matters to the extent the executive committee, in its discretion, determines that it is necessary or advisable to attend to such matters prior to the next regularly scheduled meeting of our Board. As such, the executive committee generally has and may exercise all the powers and authority of our Board in the management of the business and affairs of our company, including without limitation the power and authority to authorize the issuance of shares of our capital stock. However, the executive committee has no power or authority in reference to the following matters:

approving, adopting or recommending to the stockholders of our company any action or matter expressly required by the Delaware General Corporation Law to be submitted to stockholders for approval;

adopting, amending or repealing any bylaws of our company;

fixing the size of our Board or filling any vacancies on our Board or on any committee of our Board; or

the matters or powers expressly conferred upon the audit committee, the compensation committee, and the nominating and corporate governance committee.

Compensation Committee
 
Our Board has also established a compensation committee, whose chairman is Michael J. Pohl and whose other members are Philip J. Holthouse and Brian Deevy. The compensation committee reviews and makes recommendations to our Board regarding all forms of compensation provided to our executive officers and directors. In addition, the compensation committee reviews and makes recommendations on bonus and stock compensation arrangements for all of our employees and has sole responsibility for the administration of our incentive plans.

The compensation committee reviews and approves corporate goals and objectives relevant to the compensation of our Chief Executive Officer and our other executive officers. The compensation committee also reviews and approves the compensation of our Chief Executive Officer and certain other officers of our company. For a description of our processes and policies for consideration and determination of executive and director compensation, including the role of our Chief Executive Officer and outside consultants in determining or recommending amounts and/or forms of compensation, see “Executive Compensation-Compensation Discussion and Analysis” below. The compensation committee has the authority to retain a compensation consultant to assist in the evaluation of executive compensation.

Our Board has adopted a written charter for the compensation committee, which is available on our website at http://ir.ascentcapitalgroupinc.com/corporate-governance.cfm .
 

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Compensation Committee Report
The compensation committee has reviewed and discussed with the company’s management the “Compensation Discussion and Analysis” included under “Executive Compensation” below. Based on such review and discussions, the compensation committee recommended to our company’s Board that the “Compensation Discussion and Analysis” be included in this proxy statement.

Submitted by the Members of the Compensation Committee
Brian Deevy
Philip J. Holthouse
Michael J. Pohl (chairman)

Compensation Committee Interlocks and Insider Participation

In 2014, the compensation committee of our Board consisted of Michael J. Pohl, Philip J. Holthouse and Brian Deevy. No member of the compensation committee during 2014 is, was or has been an officer or employee of our company or any of our subsidiaries, or has engaged in any related party transaction in which our company or any of our subsidiaries was a participant.

Nominating and Corporate Governance Committee
 
Our Board has established a nominating and corporate governance committee, whose chairman is Charles Y. Tanabe and whose other members are Philip J. Holthouse, Michael J. Pohl, and Carl E. Vogel. See “-Director Independence” above.

The nominating and corporate governance committee:

develops qualification criteria for selecting candidates to serve as directors of our company;

identifies individuals qualified to become directors of our company and makes recommendations to our Board with respect thereto;

reviews and approves “related person transactions” (as set forth in our corporate governance guidelines); and

reviews, and makes recommendations with respect to changes to, our corporate governance guidelines.

The nominating and corporate governance committee will consider candidates for director recommended by any stockholder provided that such nominations are properly submitted. Eligible stockholders wishing to recommend a candidate for nomination as a director should send the recommendation in writing to the Nominating and Corporate Governance Committee, Ascent Capital Group, Inc., 5251 DTC Parkway, Suite 1000, Greenwood Village, Colorado 80111. Stockholder recommendations must be made in accordance with our bylaws, as discussed under “Stockholder Proposals” below, and must contain the following information:

the proposing stockholder’s name and address and documentation indicating the number of shares of our common stock beneficially owned by such person and the holder or holders of record of those shares, together with a statement that the proposing stockholder is recommending a candidate for nomination as a director;

the candidate’s name, age, business and residence addresses, principal occupation or employment, business experience, educational background and any other information relevant in light of the factors considered by the nominating and corporate governance committee in making a determination of a candidate’s qualifications, as described below;

a statement detailing any relationship, arrangement or understanding that might affect the independence of the candidate as a member of our Board;

any other information that would be required under SEC rules in a proxy statement soliciting proxies for the election of such candidate as a director;

a representation as to whether the proposing stockholder intends to deliver any proxy materials or otherwise solicit proxies in support of the director nominee;

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a representation that the proposing stockholder intends to appear in person or by proxy at the annual stockholders meeting at which the person named in such notice is to stand for election; and

a signed consent of the candidate to serve as a director, if nominated and elected.

In connection with its evaluation, the nominating and corporate governance committee may request additional information from the proposing stockholder and the candidate. The nominating and corporate governance committee has sole discretion to decide which individuals to recommend for nomination as directors.

To be nominated to serve as a director, a nominee need not meet any specific, minimum criteria; however, the nominating and corporate governance committee believes that nominees for director should possess the highest personal and professional ethics, integrity, values and judgment and should be committed to the long-term interests of our stockholders. When evaluating a potential director nominee, including one recommended by a stockholder, the nominating and corporate governance committee will take into account a number of factors, including, but not limited to, the following:

independence from management;

his or her unique background, including education, professional experience and relevant skill sets;

judgment, skill, integrity and reputation;

industry experience;

existing commitments to other businesses as a director, executive or owner;

personal conflicts of interest, if any; and

the size and composition of our existing Board, including whether the potential director nominee would positively impact the composition of our Board by bringing a new perspective or viewpoint to our Board.

The nominating and corporate governance committee does not have a formal policy with respect to diversity; however, our Board and the nominating and corporate governance committee believe that it is essential that our Board members represent diverse viewpoints.

When seeking candidates for director, the nominating and corporate governance committee may solicit suggestions from incumbent directors, management, stockholders and others. After conducting an initial evaluation of a prospective nominee, the nominating and corporate governance committee will interview that candidate if it believes the candidate might be suitable to be a director. The nominating and corporate governance committee may also ask the candidate to meet with management. If the nominating and corporate governance committee believes a candidate would be a valuable addition to our Board, it may recommend to our full Board that candidate’s nomination and election.

Based on the foregoing criterion, our Chief Executive Officer and the members of the nominating and corporate governance committee in office at the relevant time of determination recommended Mr. Tanabe for nomination as a director of our Board in November 2014. Mr. Tanabe was recommended based on his extensive professional experience as a senior executive of large public companies, including his expertise in the fields of mergers and acquisitions, public reporting, risk management, and corporate governance. Mr. Tanabe was appointed to our Board following a vote of the Board and will stand for election this year.

Prior to nominating an incumbent director for re-election at an annual meeting of stockholders, the nominating and corporate governance committee will consider the director’s past attendance at, and participation in, meetings of our Board and its committees and the director’s formal and informal contributions to the various activities conducted by our Board and our Board committees of which such individual is a member.

The nominating and corporate governance committee believes that Mr. Tanabe and Mr. Vogel continue to be qualified to serve as directors of our company and supports their nomination for re-election. The nominations of Mr. Tanabe and Mr. Vogel have been approved by our entire Board.


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Our Board has adopted a written charter for the nominating and corporate governance committee and corporate governance guidelines, which are available on our website at http://ir.ascentcapitalgroupinc.com/corporate-governance.cfm .

Audit Committee

Our Board has established an audit committee, whose chairman is Philip J. Holthouse and whose other members are Brian Deevy, Michael J. Pohl and Carl E. Vogel. See “-Director Independence” above.

The audit committee reviews and monitors the corporate financial reporting and the internal and external audits of our company. The committee’s functions include, among other things:

appointing or replacing our independent auditors;

reviewing and approving in advance the scope and the fees of our annual audit and reviewing the results of our audits with our independent auditors;

reviewing and approving in advance the scope and the fees of non-audit services of our independent auditors;

reviewing compliance with and the adequacy of our existing major accounting and financial reporting policies;

reviewing our management’s procedures and policies relating to the adequacy of our internal accounting controls and compliance with applicable laws relating to accounting practices;

reviewing compliance with applicable SEC and stock exchange rules regarding audit committees; and

preparing a report for our annual proxy statement.

Our Board has adopted a written charter for the audit committee, which is available on our website at http://ir.ascentcapitalgroupinc.com/corporate-governance.cfm .

Audit Committee Report
Each member of the audit committee is an independent director as determined by our Board, based on the listing standards of The Nasdaq Stock Market. Each member of the audit committee also satisfies the SEC’s independence requirements for members of audit committees. Each of Mr. Holthouse, Mr. Deevy and Mr. Vogel is an “audit committee financial expert” under applicable SEC rules and regulations.

The audit committee reviews our financial reporting process on behalf of our Board. Management has primary responsibility for establishing and maintaining adequate internal controls, for preparing financial statements and for the public reporting process. Our independent auditor, KPMG LLP, is responsible for expressing opinions on the conformity of our audited consolidated financial statements with U.S. generally accepted accounting principles. Our independent auditor also expresses its opinion as to the effectiveness of our internal control over financial reporting.

The audit committee has reviewed and discussed with management and KPMG LLP our most recent audited consolidated financial statements, as well as management’s assessment of the effectiveness of our internal control over financial reporting and KPMG LLP’s evaluation of the effectiveness of our internal control over financial reporting. The audit committee has also discussed with KPMG LLP the matters required to be discussed by the Public Company Accounting Oversight Board Auditing Standard No. 16, Communications with Audit Committees, including that firm’s judgment about the quality of our accounting principles, as applied in its financial reporting.

KPMG LLP has provided the audit committee with the written disclosures and the letter required by the Public Company Accounting Oversight Board Ethics and Independence Rule 3526, as modified or supplemented, and the audit committee has discussed with KPMG LLP that firm’s independence from the company and its subsidiaries.


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Based on the reviews, discussions and other considerations referred to above, the audit committee recommended to our Board that the audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2014, which was filed on February 27, 2015 with the SEC.

Submitted by the Members of the Audit Committee
Philip J. Holthouse (chairman)
Brian Deevy
Michael J. Pohl
Carl E. Vogel

Other

Our Board, by resolution, may from time to time establish other committees of our Board, consisting of one or more of our directors. Any committee so established will have the powers delegated to it by resolution of our Board, subject to applicable law.

Board Meetings
 
During 2014, there were five meetings of our full Board, two meetings of our compensation committee, four meetings of our audit committee, zero meetings of our nominating and corporate governance committee and zero meetings of our executive committee.

Director Attendance at Annual Meetings
 
Our Board encourages all members of our Board to attend each annual meeting of our stockholders. One of our Board members then serving attended our 2014 annual meeting of stockholders.

Stockholder Communication with Directors
 
Our stockholders may send communications to our Board or to an individual director, in each case, c/o Ascent Capital Group, Inc., 5251 DTC Parkway, Suite 1000, Greenwood Village, Colorado 80111.  All such communications from stockholders will be forwarded to our directors on a timely basis.

Executive Sessions
 
In 2014, the independent directors of our company met at four executive sessions without management participation. Any interested party who has a concern regarding any matter which it wishes to have addressed by our independent directors, as a group, at an upcoming executive session may send its concern in writing addressed to Independent Directors of Ascent Capital Group, Inc., c/o Ascent Capital Group, Inc., 5251 DTC Parkway, Suite 1000, Greenwood Village, Colorado 80111. The current independent directors of our company are Philip J. Holthouse, Brian Deevy, Michael J. Pohl, Charles Y. Tanabe and Carl E. Vogel.

Risk Assessment in Compensation Programs
 
Following the completion of a risk assessment of our compensation programs applicable to all employees, we have concluded that the design and operation of our compensation programs do not provide our employees with incentive to engage in business activities or other actions that would threaten the value of our company or the investment of our stockholders. We have also concluded that any risks associated with our compensation programs are not reasonably likely to have a material adverse effect on our company.


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EXECUTIVE COMPENSATION
 
This section sets forth information relating to, and an analysis and discussion of, compensation paid by our company to:

William R. Fitzgerald;

Michael R. Haislip;

Michael R. Meyers;

William E. Niles; and

John A. Orr.

Mr. Fitzgerald is our principal executive officer; Mr. Meyers is our principal financial officer; and Messrs. Haislip and Niles are executive officers of our company. Prior to his departure from our company in March 2015, John A. Orr was a senior vice president of our company. Our company did not have any other executive officers during 2014. We refer to Messrs. Fitzgerald, Haislip, Meyers, Niles and Orr in this proxy statement collectively as our named executive officers .
 
Compensation Discussion and Analysis
 
Overview

The compensation committee of our Board has responsibility for overseeing the compensation of our named executive officers and ensuring that their compensation packages are consistent with the company’s compensation objectives. In furtherance of this purpose, our compensation committee considers and approves all components of the named executive officers’ compensation packages, including periodic corporate goals and objectives upon which compensation decisions are made. The compensation committee also administers our equity incentive plans and has the authority to make and modify grants under, and to approve or disapprove participation in, such plans (in each case, other than with respect to awards granted to nonemployee directors).

Objectives

The compensation program for our named executive officers was designed to meet the following objectives that align with and support our strategic business goals:

attracting and retaining executive managers with the industry knowledge, skills, experience and talent to help our company attain its strategic objectives and build long-term company value;

emphasizing variable performance-based compensation components, which include equity-based compensation, by linking individual compensation with corporate operating metrics as well as individual professional achievements; and

aligning the interests of management of our company with the interests of our stockholders.

Principles

The following principles are used to guide the design of our executive compensation program and to ensure that the program is consistent with the objectives described above:

Competitive Positioning . We believe that our executive compensation program must provide compensation to our named executive officers that is both reasonable in relation to, and competitive with, the compensation paid to similarly situated employees of companies in our similar industries and companies with which we compete for talent, taking into account many factors, including cost-of-living considerations. See “-Setting Executive Compensation” below.

“Pay for Performance” Philosophy . We believe our compensation program should align the interests of our named executive officers with the interests of our company and our stockholders by strengthening the link between pay and company

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and individual performance. Accordingly, our compensation committee believes variable compensation, including plan-based awards, should represent a significant portion of the total compensation mix for our named executive officers.

At our 2014 annual stockholders meeting, our stockholders representing 89.5% of our aggregate voting power present and entitled to vote on our say-on-pay proposal approved, on an advisory basis, our executive compensation, as disclosed in our proxy statement for our 2014 annual meeting of stockholders. The compensation committee did not implement any material changes to our executive compensation program as a result of that vote.

Role of Chief Executive Officer in Compensation Decisions

As a general matter, our Chief Executive Officer provides recommendations to the compensation committee with respect to all elements of compensation proposed to be paid to the other named executive officers in conjunction with his evaluation of their performance. No significant changes were recommended by Mr. Fitzgerald with respect to the 2014 compensation packages of each other named executive officer as all of our named executive officers were subject to existing employment agreements during 2014, with the exception of Mr. Orr, whose employment agreement expired in accordance with its terms in September of 2013, as described in more detail below.

Setting Executive Compensation

Consistent with the principles outlined above, the compensation committee considers compensation data relating to other companies in reviewing and approving the compensation packages of our named executive officers. Historically, the compensation committee had focused on a select group of peer companies that operated in various markets within the technology, media, communications and entertainment industries. However, in connection with our company’s transition out of the media and entertainment business, the compensation committee hired Compensia, Inc., a compensation consultant ( Compensia ), in May 2011 to assist the compensation committee in identifying a new peer group of companies, gathering market data on competitive market practices with respect to cash and equity-based compensation and developing an updated compensation framework, including with respect to equity awards (such as award types, vesting parameters and individual allocations).

Along with Compensia, our compensation committee developed our peer group list taking into account our company’s focus on the alarm monitoring and security business (a technology business supported by subscription-based revenue), our range of financial performance metrics and our aggregate market capitalization. Compensia advised the compensation committee that our peer group of companies should be comprised of those in the technology space and those with a subscription/service-based business model, which together most closely correlate to our current business and operations. Accordingly, the companies in our peer group are set forth below:
 
Bally Technologies, Inc.
Cardtronics Inc.
Charter Communications, Inc.
Consolidated Communications Holdings, Inc.
CSG Systems International, Inc.
Cumulus Media, Inc.
Digital Globe, Inc.
DISH Network Corporation
EarthLink Holdings Corp.

 
Fair Isaac Corporation
Interval Leisure Group, Inc.
J2 Global, Inc.
National Cinemedia, Inc.
Netflix, Inc.
Nexstar Broadcasting Group, Inc.
Outerwall Inc.
Scientific Games Corporation
The ADT Corporation


The compensation committee did not apply specific benchmarking parameters that formed the basis for any of the named executive officers’ employment agreements. Rather, the compensation committee incorporated the competitive market data received from Compensia, including as to the compensation paid by the peer groups described above, into the compensation committee’s total mix of information (including its members’ general business and industry knowledge and experience and its evaluation of each named executive officer’s job performance) in establishing what the compensation committee believed to be reasonable and competitive variable elements of each named executive officer’s compensation package.

Elements of 2014 Executive Compensation

For 2014, the principal components of compensation for our named executive officers were:

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base salary;

performance-based bonuses in the case of Messrs. Haislip, Meyers and Niles;

the remaining vestiges of AMG’s non-equity incentive plan in the case of Mr. Niles;

equity incentive compensation; and

limited perquisites and personal benefits.

A summary of each element of our compensation program is set forth below. We believe that each element complements the others and that together they serve to achieve our compensation objectives.

Base Salary

We provide competitive base salaries to attract and retain high-performing executive talent. We believe that a competitive base salary is an important component of compensation, as it provides a degree of financial stability for executives. The base salary level of each named executive officer is generally determined based on the responsibilities performed by such officer, his or her experience, overall effectiveness and demonstrated leadership ability, the performance expectations set for such officer, and competitive market factors. With respect to 2014, Mr. Fitzgerald received an increase in his base salary pursuant to the terms of his amended and restated employment agreement. In recognition of the favorable performance of each of our named executive officers of his respective duties as an officer of our company and taking into account cost-of-living adjustments, with respect to 2014, each of Messrs. Haislip, Meyers, Niles and Orr received an increase in their base salary of up to 9.9%.

Bonuses: Performance-Based and Other. Our compensation committee adopted a performance-based bonus program for 2014 in which each of the named executive officers was eligible to participate. The program is designed to comply with Section 162(m) of the Code. In order for any named executive officer to be eligible to receive any bonus under the program, our company had to achieve a consolidated Adjusted EBITDA (as defined in our Annual Report on Form 10-K for the year ended December 31, 2013 (the 2013 Form 10-K )) for the year ended December 31, 2014 of no less than 112% of our consolidated Adjusted EBITDA for the year ended December 31, 2013 (as reported in the 2013 Form 10-K), subject to such adjustments (to the extent permissible under Section 162(m) of the Code) as the compensation committee may determine to be necessary or appropriate to provide year-over-year comparability (including, for example, in the event of any acquisitions, dispositions, changes in accounting policies or other extraordinary events). As this threshold performance metric was met for 2014, the compensation committee then determined, in its sole discretion, the actual portion of each grantee’s target (which was also his maximum) bonus amount that was payable under the program (which could have been zero) after taking into account each grantee’s personal performance over the year based on a set of key performance indicators ( KPIs ) adopted for each named executive officer with respect to 2014. Each named executive officer’s target and maximum bonus amount for 2014 (which was determined by the committee taking into account each named executive officer’s applicable employment agreement (which, in the case of Mr. Orr, was his employment agreement in effect prior to September 2013)) was as follows: Mr. Fitzgerald $1,237,500; Mr. Haislip $356,250; Mr. Meyers $246,000; Mr. Niles $322,500; and Mr. Orr $277,500. The KPIs considered for each named executive officer were as follows:

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Name
 
KPIs
William R. Fitzgerald
 
Provision of leadership in support of the company’s corporate governance and financial oversight and reporting responsibilities
Support of our and Monitronics leadership teams in efforts to achieve their financial, operating, management development and capital objectives and continued drive of development of shareholder value
Provision of leadership, guidance and support to both our company and Monitronics in efforts to pursue acquisition and investment opportunities
Leadership in investor relations messaging strategy and execution
Pursuit of objectives and strategies consistent with improving the company’s near-term and long-term financial performance, which serves to enhance shareholder value
 
 
 
Michael R. Haislip
 
Achievement of superior financial and operating performance
Improvement upon the processes by which our company evaluates and tracks its financial performance and metrics
Implementation of more formal quarterly competitive review
Creation of management succession plan for Monitronics’ senior leadership team
Pursuit of objectives and strategies consistent with improving the company’s near-term and long-term financial performance, which serves to enhance shareholder value
 
 
 
Michael R. Meyers
 
Achievement of superior financial and operating performance
Continued expertise in financial markets and financing alternatives for our company and Monitronics and ensure that our company maintains sufficient growth capital to support its long range plan
Improvement upon the processes by which our company evaluates and tracks its financial performance and metrics
Continued compliance with SEC reporting
Pursuit of objectives and strategies consistent with improving the company’s near-term and long-term financial performance, which serves to enhance shareholder value
 
 
 
William E. Niles
 
Provision of sound legal counsel to our Chief Executive Officer, the Board and its committees on all legal matters relating to our company
Management of our company’s litigation portfolio, legal compliance with SEC reporting, enterprise level risk insurance policies and real estate portfolio
Continued awareness of evolving legal issues relating to corporate governance and SEC compliance
Collaboration with our Chief Executive Officer on corporate strategy and the development of opportunities to enhance shareholder value
Participation in corporate development process through assisting with the identification, evaluation and execution of transactions
 
 
 
John A. Orr
 
Pursuit of objectives and strategies consistent with improving our company's near-term and long-term financial performance which serve to enhance shareholder value
Continued development of key relationships in the security alarm monitoring business, the broader home automation related business and the venture capital, private equity and banking communities in order to provide an ongoing pipeline of acquisition and investment opportunities
Collaboration with management of Monitronics to complete strategic review of the industry and Monitronics’ business with an objective of prioritizing areas of investment focus and specific transaction opportunities
Continued oversight of cash management
Continued assistance with our company’s ongoing investor communications efforts
 
After evaluating each named executive officer’s performance over the year and taking into account the aggregate amount of each named executive officer’s other compensation outside of the program, the compensation committee determined the appropriate blend of compensation components for each named executive officer and exercised its discretionary authority to determine the amount payable to each named executive officer under the program. The compensation committee also exercised its discretionary authority to pay the bonus amount payable to each named executive officer in a mix of cash and a number of shares of Series A common stock that was determined based on the closing price of the Series A common stock on March 2, 2015 of $43.90. The performance-based bonus for each named executive officer was paid as follows:

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Name
 
Target/
Maximum
Bonus
 
Percentage
of Target
Bonus
Payable
 
Total
Payout
 
Cash Portion
of Total
Payout
 
Stock
Portion of
Total
Payout
William R. Fitzgerald
 
$
1,237,500

 
%
 
$

 
$

 
$

Michael R. Haislip
 
$
356,250

 
35.09
%
 
$
125,000

 
$
62,500

 
$
62,500

Michael R. Meyers
 
$
246,000

 
67.07
%
 
$
165,000

 
$
82,500

 
$
82,500

William E. Niles
 
$
322,500

 
62.02
%
 
$
200,000

 
$
80,000

 
$
120,000

John A. Orr
 
$
277,500

 
%
 
$

 
$

 
$

For more information on these awards, see “-Summary Compensation Table” and “-Grant of Plan-Based Awards” below.
LTIP . AMG’s 2006 Long-Term Incentive Plan as amended and restated as of September 9, 2008 (which we refer to as the LTIP ) was terminated in connection with the sale of AMG on December 31, 2010, and all continuing obligations arising out of the LTIP were transferred to our company. Historically, the LTIP provided for the grant by AMG of awards which we refer to as phantom appreciation rights or PARs to key employees of AMG. Subject to vesting in accordance with the LTIP, each PAR measured the increase, if any, in the Value (as defined below) of a phantom unit under the LTIP from the grant date to the date of exercise, in each case as defined in accordance with the LTIP. Mr. Niles participated in the LTIP, which was subject to the approval of our compensation committee.

Prior to the termination of the LTIP on December 31, 2010, Mr. Niles had received multiple grants, including those made as of July 9, 2010, of 9,000 PARs (which we refer to as the July 2010 Grants ), subject to vesting. The initial value of the PARs granted pursuant to the July 2010 Grants was $17.19 as of the date of such grant.

The amount, if any, by which the Value of a phantom unit on the exercise date of a PAR exceeds the grant date Value of a phantom unit is referred to under the LTIP as the PAR Value of such PAR. Pursuant to the LTIP, the Value of a phantom unit under the LTIP as of any valuation date was equal to the sum of (i) 6% of cumulative free cash flow (as defined in the LTIP) over a period of up to six years, divided by 500,000 plus (ii) the calculated value of AMG, based on a formula set forth in the LTIP, divided by 10,000,000. Upon the termination of the LTIP on December 31, 2010, the PARs granted pursuant to the July 2010 Grants had a PAR Value of $12.46 per PAR. These were the only outstanding LTIP awards held by Mr. Niles with a positive unpaid PAR Value as of the termination of the LTIP.

Awards under the LTIP were subject to vesting. However, in accordance with the terms of the LTIP, all outstanding PARs became 100% vested, and were deemed automatically exercised, on December 31, 2010 as a result of the change in control that occurred when our company sold AMG. Following this deemed automatic exercise, the LTIP was terminated, and each grantee was entitled to receive consideration in the amount of the applicable PAR Value, including interest from the date of exercise to the date of payment at the rate of three month LIBOR as published in the Wall Street Journal. Accordingly, Mr. Niles was entitled to receive the consideration with respect to his July 2010 Grants on the earlier of (i) March 31, 2014 and (ii) six months following his “separation from service” as such term is defined in Section 409A of the Code. Mr. Niles received the consideration owed to him with respect to his July 2010 Grants in 2014.

Under the LTIP, we had a right to require Mr. Niles to repay or return to our company any payments made to him under the LTIP, in the event of a material restatement of our financial statements resulting from his material noncompliance with any financial reporting requirement under applicable securities laws, provided that such material noncompliance resulted from Mr. Niles’ misconduct.

Equity Incentive Compensation. Consistent with our compensation philosophy, we seek to align the interests of our named executive officers with those of our stockholders by awarding equity-based incentive compensation, ensuring that our executives have a continuing stake in the long-term success of our company and our subsidiaries. Accordingly, the compensation committee believes that an executive’s overall mix of compensation should be weighted more heavily toward equity-based incentives.

The Ascent Capital Group, Inc. 2008 Incentive Plan (the 2008 incentive plan ) provided, and the Ascent Capital Group, Inc. 2015 Omnibus Incentive Plan (the 2015 incentive plan ) provides, for the grant of a variety of incentive awards, including non-qualified stock options, stock appreciation rights (which we refer to as SARs), restricted shares, restricted stock units, cash awards and performance awards and are administered by our compensation committee (other than with respect to awards made to our nonemployee directors under the 2015 incentive plan, which are administered by the full Board). Our executives have historically been granted stock options and awards of restricted stock in preference to other awards because of our company's

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belief that options and restricted shares better promote retention of key employees through the continuing, long-term nature of an equity investment. It is the policy of our compensation committee that stock options be awarded with an exercise price equal to fair market value on the date of grant, measured by reference to the closing sale price on the grant date.
Over the past few years, our compensation committee has determined to make larger grants with long-term vesting schedules rather than making annual grants over the same period. These multi-year grants are meant to encourage executives to remain with the company over the long-term and to better align their interests with those of the stockholders. In that regard, multi-year awards were granted to our named executive officers by our compensation committee prior to 2014, and, accordingly, no new equity incentive awards were granted to the named executive officers during the 2014 calendar year.
The 2015 incentive plan was approved and adopted by our Board and is being submitted to the stockholders of our company for approval at the annual meeting, as described in more detail under “Proposal 3-The Incentive Plan Proposal.” As described in more detail under “Proposal 3-The Incentive Plan Proposal,” upon the adoption of the 2015 incentive plan by our Board, our Board determined to cease making any further grants under the 2008 incentive plan. Any future equity incentive awards granted to our employees will be under the 2015 incentive plan.

Perquisites and Personal Benefits. For the year ended December 31, 2014, the limited perquisites and personal benefits provided to our named executive officers consisted generally of term life insurance premiums, 401(k) matching contributions and a reimbursement from our company relating to health insurance premiums paid by each such individual. We offer our named executive officers other benefits that are also available on the same basis to all of our salaried employees, such as medical and disability insurance premiums.

Changes for 2015

As described above under “-Equity Incentive Compensation,” our compensation committee has determined to make larger grants with long-term vesting schedules rather than making annual grants over the same period. Accordingly, in connection with on-going negotiations regarding the extension of the term of his employment agreement with our company and a promotion to Executive Vice President at Monitronics, Mr. Meyers was granted an award of 30,000 performance-based restricted stock units with respect to shares of our Series A common stock. This award of performance-based restricted stock units is subject to the approval of the 2015 incentive plan and the extension by Mr. Meyers of his term of employment. These restricted stock units will vest 20%, 30% and 50% following the completion of one-year performance periods ending December 31, 2016, 2017 and 2018, respectively. Vesting of each tranche of restricted stock units will be subject to the satisfaction, as determined by our compensation committee, of certain key performance indicators relating to Mr. Meyers’ performance. Mr. Meyers last received equity incentive awards from our company in 2011, which included multi-year awards.


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SUMMARY COMPENSATION TABLE
 
Name and Principal
Position
 
Year
 
Salary ($)
 
Bonus ($)
 
 
 
Stock
Awards
($)(1)
 
Option
Awards
($)(1)
 
Non-Equity
Incentive Plan
Compensation
($)
 
All Other
Compensation
($)
 
 
 
Total ($)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
William R. Fitzgerald
 
2014
 
824,808

 

 
 
 

 

 

 
17,771

 
(2)(3)(4)(5)
 
842,579

Chairman and Chief Executive Officer
 
2013
 
808,431

 

 
 
 
549,985

 

 
550,015

 
8,616

 
(2)(3)(4)
 
1,917,047

 
2012
 
611,769

 

 
 
 
8,099,981

 
8,450,017

 
550,000

 
5,648

 
(2)(3)
 
17,717,415

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Michael R. Haislip
 
2014
 
475,404

 

 
 
 
62,500

 

 
62,500

 
17,173

 
(3)(4)(5)(6)
 
617,577

Senior Vice President
 
2013
 
446,088

 

 
 
 
467,781

 

 
165,073

 
12,721

 
(3)(4)(6)
 
1,091,663

 
 
2012
 
436,295

 

 
 
 

 

 
300,000

 
2,500

 
(6)
 
738,795

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Michael R. Meyers
 
2014
 
410,427

 

 
 
 
82,500

 

 
82,500

 
11,603

 
(3)(4)(5)
 
587,030

Executive Vice President and Chief Financial Officer
 
2013
 
381,964

 
1,000

 
(7)
 
372,079

 

 
111,511

 
2,545

 
(3)(4)
 
869,099

2012
 
374,147

 
17,500

 
(7)
 

 

 
182,500

 
2,500

 
(4)
 
576,647

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
William E. Niles
 
2014
 
429,866

 

 
 
 
120,000

 

 
192,140

(8)
12,396

 
(3)(4)(5)
 
754,402

Executive Vice President, General Counsel and Secretary
 
2013
 
421,503

 

 
 
 
409,546

 

 
150,044

 
3,235

 
(3)(4)
 
984,328

2012
 
406,417

 

 
 
 

 

 
290,000

 
3,430

 
(3)(4)
 
699,847

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
John A. Orr (9)
 
2014
 
369,924

 

 
 
 

 

 

 
12,341

 
(3)(4)(5)
 
382,265

Senior Vice President
 
2013
 
368,993

 

 
 
 
773,924

 

 
125,051

 
3,135

 
(3)(4)
 
1,271,103

 
 
2012
 
357,616

 

 
 
 

 

 
180,000

 
4,628

 
(3)(4)
 
542,244

 
(1)
The aggregate grant date fair value of stock awards and option awards has been computed in accordance with FASB ASC Topic 718, but (pursuant to SEC regulations) without reduction for estimated forfeitures. For a description of the assumptions applied in these calculations, see Note 15 to our consolidated financial statements for the year ended December 31, 2014 (which are included in our Annual Report on Form 10-K as filed with the SEC on February 27, 2015).
(2)
Includes amounts paid to Mr. Fitzgerald for tax preparation fees.
(3)    Includes the following term life and AD&D insurance premiums:
 
 
Amounts ($)
Name
 
2014
 
2013
 
2012
William R. Fitzgerald
 
1,116

 
1,116

 
648

Michael R. Haislip
 
45

 
45

 

Michael R. Meyers
 
45

 
45

 

William E. Niles
 
691

 
735

 
530

John A. Orr
 
636

 
635

 
378

(4)    Includes the following matching contributions to the applicable named executive officer’s 401(k) account:     
 
 
Amounts ($)
Name
 
2014
 
2013
 
2012
William R. Fitzgerald
 
2,500

 
2,500

 

Michael R. Haislip
 
2,378

 
2,500

 
2,500

Michael R. Meyers
 
2,403

 
2,500

 
2,500

William E. Niles
 
2,550

 
2,500

 
2,900

John A. Orr
 
2,550

 
2,500

 
4,250

(5)
Includes a reimbursement paid by the company to each named executive officer with respect to health insurance premiums paid by such individual.
(6)
Includes health club dues reimbursed to Mr. Haislip by the Company.
(7)
Represents the portion of Mr. Meyers’ performance-based award that exceeded his maximum bonus amount under the plan, which was thus granted to Mr. Meyers as a discretionary bonus.

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(8)
Includes a payment of $112,140 owed to Mr. Niles under the LTIP as described under “-Compensation Discussion and Analysis-Elements of 2014 Executive Compensation-LTIP.”
(9)
Mr. Orr served as our Senior Vice President, Corporate Development, until his departure from our company in March 2015.
Employment Agreements

Named Executive Officers

Each of Messrs. Fitzgerald, Haislip, Meyers and Niles has entered into an employment agreement with our company, which agreement, in each case, sets forth the respective terms and conditions of the applicable named executive officer’s employment. The term of Mr. Orr’s original employment agreement ended on September 16, 2013.

The material terms of the existing employment agreements of Messr. Fitzgerald, Haislip, Meyers and Niles in effect during 2014 and the material terms of Mr. Orr's original employment agreement are set forth below.

Term. The term of the employment agreement of Mr. Fitzgerald is five years, commencing effective as of January 1, 2013 and ending on December 31, 2017. The term of the employment agreement of Mr. Orr was five years, commencing effective as of September 17, 2008 (the date of the spin-off of our company from DHC) and ending on September 16, 2013. The term of Mr. Niles’ employment agreement is five years, commencing effective March 1, 2011 and ending on February 29, 2016. The term of the employment agreements of each of Messrs. Haislip and Meyers is five years, commencing effective as of June 15, 2011 and ending on June 14, 2016.

Base Salary. Pursuant to their respective employment agreements, each of our named executive officers receives a base salary that is subject to an annual review for increase by the compensation committee. The 2014 base salaries for each of our named executive officers are set forth in the “-Summary Compensation Table” above.

Bonus. Each of our named executive officers is eligible to receive a bonus in a certain range based on percentages of the applicable named executive officer’s base salary (75% to 150% in the case of Mr. Fitzgerald, 60% to 75% in the case of Mr. Haislip, 50% to 75% in the case of Mr. Niles and 40% to 50% in the case of Mr. Meyers). Pursuant to the terms of his former employment agreement, Mr. Orr was eligible to receive a bonus in the range of 50% to 75%. Each such officer’s entitlement to receive such bonus, and the actual amount thereof, is determined by the compensation committee in its sole discretion based on the applicable named executive officer’s achievement of certain performance criteria as the compensation committee may establish in its sole discretion.

Equity Incentive Awards . Each of Mr. Fitzgerald’s employment agreement and Mr. Orr’s former employment agreement memorialized stock option and restricted stock grants previously made under the 2008 incentive plan to the applicable named executive officer. Mr. Niles’ employment agreement also provided for equity grants made in prior years. Messrs. Haislip and Meyers also received equity incentive awards in connection with their entrance into new employment agreements in 2011. See “-Outstanding Equity Awards at Fiscal Year-End” below.

Termination . The terms and conditions of compensation payable upon termination of the employment of each named executive officer are summarized in “-Potential Payments Upon Termination or Change-in-Control” below.

Gross-Up . Under Mr. Fitzgerald’s employment agreement, if any payment or distribution in the nature of compensation (as defined in Section 280G(b)(2) of the Code) to or for the benefit of Mr. Fitzgerald would be subject to excise tax imposed by Section 4999 of the Code, Mr. Fitzgerald will be entitled to receive a gross-up payment equivalent on an after-tax basis to the amount of such excise tax.


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Grants of Plan-Based Awards
 
The following table contains information regarding plan-based incentive awards granted during the year ended December 31, 2014 to our named executive officers.
 
 
 
 
 
 
 
 
 
 
 
 
All other
stock
awards:
Number of
 
All other
option
awards:
Number of
 
Exercise
or base
 
Grant date
fair value
 
 
 
 
 
 
Estimated Future Payouts under Non-
equity Incentive Plan Awards
 
shares of
stock or
 
securities
underlying
 
price of
option
 
of stock
and
 
 
 
 
 
 
Threshold
 
Target
 
Maximum
 
units
 
options
 
awards
 
option
Name
 
Grant Date
 
 
 
($)(1)
 
($)(2)
 
($)(2)
 
(#)
 
(#)
 
($/Sh)
 
awards ($)
William R. Fitzgerald
 
 
 
 
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
2/26/2014
 
(3
)
 

 
1,237,500

 
1,237,500

 

 

 

 

Michael R. Haislip
 
 
 
 
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
2/26/2014
 
(3
)
 

 
356,250

 
356,250

 

 

 

 

 
 
3/2/2015
 
(4
)
 

 

 

 
1,423

 

 

 
62,500

Michael R. Meyers
 
 
 
 
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
2/26/2014
 
(3
)
 

 
246,000

 
246,000

 

 

 

 

 
 
3/2/2015
 
(4
)
 

 

 

 
1,879

 

 

 
82,500

William E. Niles
 
 
 
 
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
2/26/2014
 
(3
)
 

 
322,500

 
322,500

 

 

 

 

 
 
3/2/2015
 
(4
)
 

 

 

 
2,733

 

 

 
120,000

John A. Orr
 
 
 
 
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
2/26/2014
 
(3
)
 

 
277,500

 
277,500

 

 

 

 

 
(1)
Our 2014 performance-based bonus program did not provide for a threshold bonus amount.
(2)
Represents the target and maximum bonus amounts payable under the program, as determined by the compensation committee in accordance with the terms of each named executive officer’s employment agreement. Such bonus amounts were paid to each named executive officer who received a performance-based bonus award in a combination of cash and shares of Series A common stock. See “-Compensation Discussion and Analysis-Elements of 2014 Executive Compensation-Bonuses: Performance-Based and Other.”
(3)
Reflects the date on which our compensation committee established the terms of the 2014 performance-based bonus program, as described under “-Compensation Discussion and Analysis-Elements of 2014 Executive Compensation-Bonuses: Performance-Based and Other.”
(4)
Represents shares of Series A common stock awarded in partial payment of the named executive officer’s 2014 performance-based bonus award. See “-Compensation Discussion and Analysis-Elements of 2014 Executive Compensation-Bonuses: Performance-Based and Other.”


37

Table of Contents

Outstanding Equity Awards at Fiscal Year-End
 
The following table contains information regarding unexercised options to acquire shares of our common stock, and unvested restricted stock awards, which were outstanding as of December 31, 2014 and held by our named executive officers.
 
 
Option Awards
 
Stock Awards
Name
 
Number of
Securities
Underlying
Unexercised
Options-
Exercisable
 
Number of
Securities
Underlying
Unexercised
Options-
Unexercisable
 
 
 
Option
Exercise
Price ($)
 
Option
Expiration
Date
 
Number of
Shares or
Units of Stock
That Have not
Vested (#)
 
 
 
Market Value
of Shares or
Units of Stock
That Have not
Vested ($)
William R. Fitzgerald
 
 

 
 

 
 
 
 

 
 

 
 

 
 
 
 

Option Awards