10-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C.  20549

FORM 10-K/A

(Amendment No. 1)

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2011

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to

Commission File Number 001-34176

ASCENT CAPITAL GROUP, INC.

(Exact name of Registrant as specified in its charter)

State of Delaware	26-2735737
(State or other jurisdiction of	(I.R.S. Employer Identification No.)
incorporation or organization)

5251 DTC Parkway, Suite 1000
Greenwood Village, Colorado	80111
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (303) 628-5600

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of exchange on which registered
Series A Common Stock, par value $.01 per share	The Nasdaq Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: Series B Common Stock, par value $.01 per share

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act of 1933.  Yes  x  No  o

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934.  Yes  o  No  x

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.  Yes  x  Noo

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, any Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes  x  No  o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  o

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x	Accelerated filer o
Non-accelerated filer o (Do not check if a smaller reporting company).	Smaller reporting company o

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act)  Yes  o  No  x

The aggregate market value of the voting stock held by nonaffiliates of Ascent Capital Group, Inc. computed by reference to the last sales price of such stock, as of the closing of trading on June 30, 2011, was approximately $708 million.

The number of shares outstanding of Ascent Capital Group, Inc.’s common stock as of February 17, 2012 was:

Series A common stock 13,470,323 shares; and Series B common stock 739,894 shares.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant’s definitive proxy statement for its 2012 Annual Meeting of Stockholders, which is to be filed with the Securities Exchange Commission no later than April 30, 2012, are hereby incorporated by reference into Part III of this Annual Report on Form 10-K.

EXPLANATORY NOTE

Ascent Capital Group, Inc. (the “Company”) is filing this Amendment No. 1 on Form 10-K/A (“Amendment No. 1”) pursuant to Rule 405 of Regulation S-T solely to furnish XBRL (eXtensible Business reporting Language) information in Exhibit 101 that was excluded from our Annual Report on Form 10-K for the fiscal year ended December 31, 2011, filed with the Securities Exchange Commission on February 29, 2012.  Exhibit 101 to this Amendment No. 1 provides the following items from the Form 10-K formatted in XBRL: (i) our consolidated balance sheets, (ii) our consolidated statements of operations and comprehensive income (loss), (iii) our consolidated statements of stockholders’ equity, (iv) our consolidated statements of cash flows, and (v) the notes to our consolidated financial statements.

Users of this data are advised that pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

This Amendment No. 1 amends and restates in their entirety the cover page, Exhibit 21 and Exhibit 101, and updates Item 15(a)(3).  No other changes have been made to the Form 10-K other than those described above. This Amendment No. 1 does not reflect subsequent events occurring after the original filing date of the Form 10-K or modify or update in any way disclosures made in the Form 10-K.

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)Financial Statements, Financial Statement Schedules, and Exhibits.

1. Financial Statements

No financial statements are filed with this Amendment No. 1. These items were included in the originally filed Form 10-K.

2.  Financial Statement Schedules

N/A.

3. Exhibits

The information required by this Item is set forth on the exhibit index that follows the signature page of this report.

2

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	ASCENT CAPITAL GROUP, INC.
	By:	/s/  William E. Niles
		William E. Niles
		Executive Vice President, General Counsel and Secretary
March 29, 2012

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EXHIBIT INDEX

Listed below are the exhibits which are filed as a part of this Report (according to the number assigned to them in Item 601 of Regulation S-K):

2.1	Reorganization Agreement, dated as of June 4, 2008, among Discovery Holding Company, Discovery Communications, Inc., Ascent Media Corporation, Ascent Media Group, LLC, and Ascent Media Creative Sound Services, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Registration Statement on Form 10 (File No. 000-53280), filed with the Commission on June 13, 2008).
2.2	Asset Purchase Agreement, dated February 17, 2010, among Ascent Media Network Services Europe Limited, Ascent Media Group LLC and Discovery Communications Europe Limited (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No. 001-34176), filed with the Commission on February 23, 2010).
2.3	Purchase and Sale Agreement dated November 24, 2010, between the Company and Deluxe Entertainment Services Group, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K (File No. 001-34176), filed with the Commission on January 5, 2011).
2.4	Purchase and Sale Agreement, dated December 2, 2010, between the Company and Encompass Digital Media, Inc. (incorporated by reference to Annex B to the Company’s definitive proxy statement (File No. 001-34176), filed with the Commission on January 25, 2011).
2.5	Agreement and Plan of Merger, dated December 17, 2010, between the Company and Monitronics International, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K (File No. 001-34176), filed with the Commission on December 23, 2010).
3.1	Amended and Restated Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form 10 (File No. 000-53280), filed with the Commission on June 13, 2008).
3.2	Certificate of Ownership and Merger, dated July 7, 2011 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-34176), filed with the Commission on July 8, 2011) (filed for the purpose of changing the name of the Company).
3.3	Bylaws of the Company (incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form 10 (File No. 000-53280), filed with the Commission on June 13, 2008).
4.1	Specimen Certificate for shares of Series A common stock, par value $.01 per share, of the Company (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form 10 (File No. 000-53280), filed with the Commission on June 13, 2008).
4.2	Specimen Certificate for shares of Series B common stock, par value $.01 per share, of the Company (incorporated by reference to Exhibit 4.2 to the Company’s Registration Statement on Form 10 (File No. 000-53280), filed with the Commission on June 13, 2008).
4.3	Rights Agreement between the Company and Computershare Trust Company, N.A. (incorporated by reference to Exhibit 4.3 to Amendment No. 1 to the Company’s Registration Statement on Form 10 (File No. 000-53280), filed with the Commission on July 23, 2008).

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4.4	Form of Amendment No. 1 to Rights Agreement by and between the Company and Computershare Trust Company, N.A. (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K (File No. 001-34176), filed with the Commission on September 17, 2009).
10.1	Tax Sharing Agreement, dated as of September 17, 2008, by and among Discovery Holding Company, Discovery Communications, Inc., the Company, Ascent Media Group, LLC and CSS Studios, LLC (incorporated by reference to Exhibit 10.2 to Amendment No. 8 to the Company’s Registration Statement on Form 10 (File No. 001-34176), filed with the Commission on September 17, 2008).
10.2	Ascent Capital Group, Inc. 2008 Incentive Plan (incorporated by reference to Exhibit 4.4 to the Company’s Registration Statement on Form S-8 (File No. 333-156231), filed with the Commission on December 17, 2008).
10.3	Services Agreement, dated as of July 21, 2005, by and between Discovery Holding Company (former parent of the Company) and Liberty Interactive Corporation (f/k/a Liberty Media Corporation), as assigned to the Company in connection with its spin-off from Discovery Holding Company.*
10.4	Form of Indemnification Agreement between the Company and its Directors and Executive Officers (incorporated by reference to Exhibit 10.7 to Amendment No. 1 to the Company’s Registration Statement on Form 10 (File No. 000-53280), filed with the Commission on July 23, 2008).
10.5	Ascent Capital Group, Inc. 2008 Non-Employee Director Incentive Plan (incorporated by reference to Exhibit 10.13 to Amendment No. 8 to the Company’s Registration Statement on Form 10 (File No. 001-34176), filed with the Commission on September 17, 2008).
10.6	Employment Agreement, dated February 9, 2009, by and between the Company and William R. Fitzgerald (incorporated by reference to Exhibit 10.16 to the Company’s Annual Report on Form 10-K (File No. 001-34176), filed with the Commission on March 31, 2009).
10.7	Amendment to Employment Agreement, dated June 6, 2011, between the Company and William R. Fitzgerald (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (File No. 001-34176), filed with the Commission on August 8, 2011 (the “August 2011 10-Q”)).
10.8	Amended and Restated Employment Agreement, dated May 31, 2011, between the Company and William E. Niles (incorporated by reference to Exhibit 10.1 to the August 2011 10-Q).
10.9	Employment Agreement, dated as of April 13, 2009, between the Company and John A. Orr (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No. 001-34176), filed with the Commission on August 13, 2009).
10.10	Employment Agreement, dated September 30, 2011, between the Company and Michael R. Meyers (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No. 001-34176), filed with the Commission on November 7, 2011 (the “November 2011 10-Q”).
10.11	Employment Agreement, dated September 30, 2011, between the Company and Michael R. Haislip (incorporated by reference to Exhibit 10.2 to the November 2011 10-Q).
21	List of Subsidiaries of Ascent Capital Group, Inc.**
23	Consent of KPMG LLP, independent registered public accounting firm.*
24	Power of Attorney dated February 29, 2012.*
31.1	Rule 13a-14(a)/15d-14(a) Certification.*

5

31.2	Rule 13a-14(a)/15d-14(a) Certification.*
32	Section 1350 Certification.*
101	The following financial statements from the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, filed on March 26, 2012, formatted in XBRL: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) Consolidated Statements of Stockholder’s Equity, (iv) Consolidated Statements of Cash Flows and (v) the Notes to Consolidated Financial Statements. **

*Previously filed or furnished, as the case may be, with the Company’s Form 10-K for the year ended December 31, 2011 as filed with the Commission on February 29, 2012.

**Filed or furnished, as the case may be, herewith.

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EX-21

Exhibit 21

List of Subsidiaries

The following is a list of subsidiaries of Ascent Capital Group, Inc., the names under which such subsidiaries do business, and the state or country in which each was organized, as of February 29, 2012. The list does not include dormant subsidiaries or subsidiaries which would not, if considered in the aggregate as a single subsidiary, constitute a significant subsidiary within the meaning of Item 601(b)(21)(ii) of Regulation S-K.

Subsidiary	Jurisdiction of Formation
Monitronics International, Inc.	Texas
Monitronics Canada, Inc.	Delaware
MI Servicer HC, LLC	Delaware
MI Servicer LP, LLC	Delaware
MI Servicer GP, LLC	Delaware
MIBU Servicer Inc.	Delaware
Monitronics Security LP	Delaware
MI Funding HC, LLC	Delaware
MI Funding LP, LLC	Delaware
MI Funding GP, LLC	Delaware
Monitronics Funding LP	Delaware
Platinum Security Solutions, Inc.	Delaware
Ascent Media Property Holdings, LLC	Delaware

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Employee Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2011

Employee Benefit Plans

Schedule of obligations and funded status of the defined benefit plans

	Years Ended
	2011			2010
	Amounts in thousands
Change in Benefit Obligation:
Benefit Obligation — beginning of year	$	12,357		10,070
Service cost	—			68
Interest cost	510			562
Actuarial loss	2,415			2,478
Settlements	(93		)	(333	)
Benefits paid	(413		)	(213	)
Member contributions	—			14
Foreign currency exchange rate changes	(14		)	(289	)
Benefit Obligation — end of year	14,762			12,357
Change in Plan Assets:
Fair Value of plan assets — beginning of year	8,491			7,536
Actual return on assets	3,173			965
Settlements	(97		)	(436	)
Employer contributions	5,098			842
Member contributions	—			14
Benefits paid	(10		)	(213	)
Foreign currency exchange rate changes	(413		)	(217	)
Fair Value of plan assets — end of year	16,242			8,491
Funded (Unfunded) Status	$	1,480		(3,866	)

Schedule of average assumptions and the asset category allocations

	2011		2010
Assumptions:
Discount rate	4.20	%	4.20	%
Long-term return on plan assets	4.20	%	4.20	%
Price inflation	3.60	%	3.60	%
Asset Category Allocations:
Debt securities	7	%	41	%
Equity securities	0	%	42	%
Other	93	%	17	%

Schedule of amount of pension cost recognized

	Year Ended December 30,
	2011			2010		2009
	Amounts in thousands
Service cost	$	—		68		49
Interest cost	529			543		506
Expected return on plan assets	(472		)	(411	)	(341	)
Amortization of net actuarial loss	531			373		141
	$	588		573		355

Schedule of fair value of the plan assets

The fair value of the plan assets as of December 31, 2011 are as follows:

	Level 1		Level 2	Level 3	Total
Cash and cash equivalents	$	64	—	—	64
Pooled investment funds	1,164		—	—	1,164
Debt investments	—		—	—	—
Insurance policies	—		15,014	—	15,014
Total	$	1,228	15,014	—	16,242

The fair value of the plan assets as of December 31, 2010 are as follows:

	Level 1		Level 2	Level 3	Total
Cash and cash equivalents	$	146	—	—	146
Pooled investment funds	3,945		—	—	3,945
Debt investments	—		1,638	—	1,638
Insurance policies	—		2,762	—	2,762
Total	$	4,091	4,400	—	8,491

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Long-Term Debt (Details) (USD $)	12 Months Ended													12 Months Ended		12 Months Ended		12 Months Ended		1 Months Ended		12 Months Ended		1 Months Ended		12 Months Ended		1 Months Ended	12 Months Ended		1 Months Ended	12 Months Ended		1 Months Ended		12 Months Ended					12 Months Ended			12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2011 Interest rate swap Not designated as hedging instrument	Dec. 31, 2010 Interest rate swap Not designated as hedging instrument	Dec. 31, 2011 Interest rate cap Not designated as hedging agreement	Dec. 31, 2011 Interest rate cap Not designated as hedging instrument	Dec. 31, 2010 Interest rate cap Not designated as hedging instrument	Dec. 31, 2011 Interest rate cap effective August 15, 2008 through August 15, 2009 Not designated as hedging	Dec. 31, 2011 Interest rate cap effective August 15, 2009 through August 15, 2010 Not designated as hedging	Dec. 31, 2011 Interest rate cap effective August 15, 2010 through May 15, 2014 Not designated as hedging	Dec. 31, 2011 Interest rate floor effective from October 15, 2007 through May 15, 2014 Not designated as hedging	Dec. 31, 2011 Monitronics	Dec. 31, 2010 Monitronics	Dec. 31, 2011 Monitronics Interest rate swap	Dec. 31, 2011 Monitronics Funding LP ("Funding") Interest rate swap Not designated as hedging	Dec. 31, 2011 Monitronics Security LP ("Security") Minimum	Dec. 31, 2011 Class A-1a Term Notes (matures July 2027), LIBOR plus 1.8% Interest rate swap	Dec. 31, 2011 Class A-1a Term Notes (matures July 2027), LIBOR plus 1.8% Monitronics	Dec. 31, 2010 Class A-1a Term Notes (matures July 2027), LIBOR plus 1.8% Monitronics	Aug. 31, 2007 Class A-1a Term Notes (matures July 2027), LIBOR plus 1.8% Monitronics Funding LP ("Funding")	Dec. 31, 2011 Class A-1b Term Notes (matures July 2027), LIBOR plus 1.7% Interest rate swap	Dec. 31, 2011 Class A-1b Term Notes (matures July 2027), LIBOR plus 1.7% Monitronics	Dec. 31, 2010 Class A-1b Term Notes (matures July 2027), LIBOR plus 1.7% Monitronics	Aug. 31, 2007 Class A-1b Term Notes (matures July 2027), LIBOR plus 1.7% Monitronics Funding LP ("Funding")	Dec. 31, 2011 Class A-2 Term Notes (matures July 2037), LIBOR plus 2.2% Interest rate swap	Dec. 31, 2011 Class A-2 Term Notes (matures July 2037), LIBOR plus 2.2% Monitronics	Dec. 31, 2010 Class A-2 Term Notes (matures July 2037), LIBOR plus 2.2% Monitronics	Aug. 31, 2007 Class A-2 Term Notes (matures July 2037), LIBOR plus 2.2% Monitronics Funding LP ("Funding")	Dec. 31, 2011 Class A-3 Variable Funding Note (matures July 2037), LIBOR plus 1.8% Monitronics	Dec. 31, 2010 Class A-3 Variable Funding Note (matures July 2037), LIBOR plus 1.8% Monitronics	Aug. 31, 2007 Class A-3 Variable Funding Note (matures July 2037), LIBOR plus 1.8% Monitronics Funding LP ("Funding")	Dec. 31, 2011 Class A-4 Variable Funding Note (matures July 2037), LIBOR plus 1.8% Monitronics	Dec. 31, 2010 Class A-4 Variable Funding Note (matures July 2037), LIBOR plus 1.8% Monitronics	Aug. 31, 2007 Class A-4 Variable Funding Note (matures July 2037), LIBOR plus 1.8% Monitronics Funding LP ("Funding")	Jan. 31, 2012 Term Loan (matures June 30, 2012) Monitronics	Dec. 31, 2011 Term Loan (matures June 30, 2012) Monitronics installment	Jan. 02, 2012 Term Loan (matures June 30, 2012) Monitronics	Dec. 31, 2010 Term Loan (matures June 30, 2012) Monitronics	Dec. 17, 2010 Term Loan (matures June 30, 2012) Monitronics	Dec. 17, 2010 $115 million revolving credit facility (matures December 17, 2013), LIBOR plus 4%	Dec. 31, 2011 $115 million revolving credit facility (matures December 17, 2013), LIBOR plus 4% Monitronics	Dec. 31, 2010 $115 million revolving credit facility (matures December 17, 2013), LIBOR plus 4% Monitronics	Dec. 17, 2010 $115 million revolving credit facility (matures December 17, 2013), LIBOR plus 4% Monitronics	Dec. 31, 2011 Variable funding notes Monitronics
Long-term debt instruments
Reference rate for variable interest rate																		LIBOR				LIBOR				LIBOR			LIBOR			LIBOR			LIBOR	LIBOR					LIBOR
Variable interest rate spread (as a percent)																		1.80%				1.70%				2.20%			1.80%			1.80%				4.00%	4.50%				4.00%
Maximum borrowing capacity under the facility																																								$ 115,000,000	$ 115,000,000		$ 115,000,000
Long-term debt including current portion												952,718,000	916,733,000					345,577,000	338,478,000			98,676,000	96,551,000			98,978,000	97,338,000		256,558,000	251,032,000		27,629,000	27,034,000			60,000,000		60,000,000			65,300,000	46,300,000
Less current portion of long-term debt	(60,000,000)	(20,000,000)										(60,000,000)	(20,000,000)
Long-term debt	892,718,000	896,733,000										892,718,000	896,733,000
Other fees included in interest rate (as a percent)																		1.00%				1.00%				1.00%			1.00%			1.00%
Number of principal installments																																				2
Amount of principal payment																																				20,000,000
Guarantee given by the entity																																				30,000,000
Debt instruments issued																				350,000,000				100,000,000				100,000,000			260,000,000			28,000,000
Principal amount of debt instrument																																							60,000,000					288,000,000
Commitment fees on the unused portion of variable funding notes (as a percent)																																												0.20%
Notional amount								100,000,000	260,000,000	240,000,000	260,000,000			550,000,000	550,000,000
Contingent additional interest rate (as a percent)														5.00%																														5.00%
Contingent additional other fees included in interest rate (as a percent)														0.50%																														0.50%
Refinancing costs capitalized	3,619,000
Amount of limit after which excess cash can be distributed to parent																1,000,000
Percentage of subscriber account contracts unavailable to pay Monitronics' other obligations or the claims of its creditors	88.00%
Value of property and equipment unavailable to pay Monitronics' other obligations or the claims of its creditors	19,805,000
Number of agreements entered into by the entity			3	3	3	1	1
Fixed interest rate (as a percent)																	7.50%				7.00%				7.60%
Restricted cash which remained available to the subsidiary	$ 51,420,000																															$ 28,000,000
Interest rate description floor rate (as a percent)																																									1.50%
Commitment fees on unused portion of facility (as a percent)																																									0.50%

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Acquisitions (Details) (USD $)			1 Months Ended
	Dec. 17, 2010 Revolving credit facility	Dec. 17, 2010 Monitronics	Dec. 31, 2010 Monitronics Term Loan (matures June 30, 2012)	Dec. 31, 2010 Monitronics Revolving credit facility
Business acquisition
Voting interest acquired (as a percent)		100.00%
Maximum borrowing capacity			$ 60,000,000
Amount drawn under the facility				45,000,000
Amount of credit facility	115,000,000
Estimated fair value of assets acquired and liabilities assumed:
Restricted cash		43,597,000
Accounts receivable		10,694,000
Subscriber accounts		824,158,000
Property and equipment		20,802,000
Dealer network		50,433,000
Other current and non-current assets		14,419,000
Goodwill		349,227,000
Purchase holdbacks		(9,954,000)
Long-term debt		(814,653,000)
Derivative instruments		(64,623,000)
Deferred income tax liability		(4,057,000)
Other current and noncurrent liabilities		(22,955,000)
Cash consideration paid		$ 397,088,000

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Employee Benefit Plans (Details) (USD $)	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Employee Benefit Plans
Expenses related to domestic 401(k) and foreign pension defined contribution plans	$ 717,000	$ 990,000	$ 1,394,000
Management Incentive Plan Maximum Contractual Period
MIP and discretionary bonuses		318,000
Maximum
Management Incentive Plan Maximum Contractual Period
Payment period for MIP (in months)	2.5
United Kingdom defined benefit plans
Management Incentive Plan Maximum Contractual Period
Number of defined benefit plans	2
Approximate number of participants in the plans.	121
Change in Benefit Obligation:
Benefit Obligation - beginning of year	12,357,000	10,070,000
Service cost		68,000	49,000
Interest cost	510,000	562,000
Actuarial loss	2,415,000	2,478,000
Settlements	(93,000)	(333,000)
Benefits paid	(413,000)	(213,000)
Member contributions		14,000
Foreign currency exchange rate changes	(14,000)	(289,000)
Benefit Obligation - end of year	14,762,000	12,357,000	10,070,000
Change in Plan Assets:
Fair Value of plan assets - beginning of year	8,491,000	7,536,000
Actual return on assets	3,173,000	965,000
Settlements	(97,000)	(436,000)
Employer contributions	5,098,000	842,000
Member contributions		14,000
Benefits paid	(413,000)	(213,000)
Foreign currency exchange rate changes	(10,000)	(217,000)
Fair Value of plan assets - end of year	16,242,000	8,491,000	7,536,000
Funded (Unfunded) Status	1,480,000	(3,866,000)
Accumulated Other Comprehensive Income Defined Benefit Plans Adjustment, Net of Tax
Adjustments of pension included in accumulated other comprehensive income	(4,690,000)	(5,553,000)
Assumptions:
Discount rate (as a percent)	4.20%	4.20%
Long-term return on plan assets (as a percent)	4.20%	4.20%
Price inflation (as a percent)	3.60%	3.60%
Asset Category Allocations:
Debt securities (as a percent)	7.00%	41.00%
Equity securities (as a percent)	0.00%	42.00%
Other (as a percent)	93.00%	17.00%
Pension cost
Service cost		68,000	49,000
Interest cost	529,000	543,000	506,000
Expected return on plan assets	(472,000)	(411,000)	(341,000)
Amortization of net actuarial loss	531,000	373,000	141,000
Pension cost total	$ 588,000	$ 573,000	$ 355,000

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Long-Term Debt (Details 2) (Monitronics, USD $) In Thousands, unless otherwise specified	Dec. 31, 2011	Dec. 31, 2010
Monitronics
Scheduled maturities of long-term debt
2012	$ 60,000
2014	65,300
Thereafter	838,000
Total principal payments	963,300
Less: discount	(10,582)
Total debt on balance sheet	$ 952,718	$ 916,733

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Summary of Significant Accounting Policies (Details 4) (USD $)	12 Months Ended					3 Months Ended	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2011 Subscriber accounts year	Dec. 31, 2010 Subscriber accounts	Dec. 31, 2009 Subscriber accounts	Mar. 31, 2011 Subscriber accounts Monitronics and subsidiaries year	Dec. 31, 2011 Subscriber accounts Monitronics and subsidiaries year	Dec. 31, 2011 Dealer Networks	Dec. 31, 2010 Dealer Networks
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets amortization period (in years)			15			10	14
Amortization rate (as a percent)			220.00%			135.00%	235.00%
Amortization of subscriber accounts and dealer network	$ 159,619,000	$ 5,980,000	$ 149,539,000	$ 5,560,000	$ 0			$ 10,080,000	$ 420,000
Estimated amortization of subscriber accounts in succeeding five fiscal years
2012			135,027,000
2013			112,914,000
2014			94,476,000
2015			79,026,000
2016			64,597,000
Total			$ 486,040,000

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Derivatives (Tables)

12 Months Ended

Dec. 31, 2011

Derivatives

Schedule of Swaps

Notional		Rate Paid		Rate Received
$	350,000,000	6.56	%	1 mo. USD-LIBOR-BBA plus 0.85%
100,000,000		6.06	%	1 mo. USD-LIBOR-BBA plus 0.75%
100,000,000		6.64	%	1 mo. USD-LIBOR-BBA plus 1.25%

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Quarterly Financial Information (Unaudited) (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2010	Sep. 30, 2010	Jun. 30, 2010	Mar. 31, 2010	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Quarterly Financial Information (Unaudited)
Revenue	$ 80,936	$ 79,515	$ 77,577	$ 73,870	$ 9,129				$ 311,898	$ 9,129
Operating Income (loss)	6,030	7,715	8,085	1,176	(9,276)	(7,583)	(8,692)	(7,940)	23,006	(33,490)	(32,557)
Net income (loss)	$ (6,401)	$ (9,867)	$ (18,282)	$ 55,187	$ (22,420)	$ (9,846)	$ (16,138)	$ 9,910	$ 20,637	$ (38,494)	$ (52,897)
Basic and diluted net income (loss) per common share	$ (0.46)	$ (0.69)	$ (1.28)	$ 3.88	$ (1.58)	$ (0.69)	$ (1.14)	$ 0.70	$ 1.45	$ (2.71)	$ (3.76)

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Derivatives (Details 2) (USD $)	12 Months Ended
	Dec. 31, 2011
Derivatives
Notional	$ 550,000,000
6.56 % interest rate swaps
Derivatives
Notional	350,000,000
Rate Paid (as a percent)	6.56%
Variable interest rate base	1 mo.USD-LIBOR-BBA
Percentage points added to the reference rate	0.85%
6.06 % interest rate swaps
Derivatives
Notional	100,000,000
Rate Paid (as a percent)	6.06%
Variable interest rate base	1 mo.USD-LIBOR-BBA
Percentage points added to the reference rate	0.75%
6.64 % interest rate swaps
Derivatives
Notional	$ 100,000,000
Rate Paid (as a percent)	6.64%
Variable interest rate base	1 mo.USD-LIBOR-BBA
Percentage points added to the reference rate	1.25%

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Employee Benefit Plans (Details 2) (USD $)	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2011	Dec. 31, 2011 United Kingdom defined benefit plans	Dec. 31, 2010 United Kingdom defined benefit plans	Dec. 31, 2009 United Kingdom defined benefit plans	Dec. 31, 2011 United Kingdom defined benefit plans Cash and cash equivalents	Dec. 31, 2010 United Kingdom defined benefit plans Cash and cash equivalents	Dec. 31, 2011 United Kingdom defined benefit plans Pooled investment funds	Dec. 31, 2010 United Kingdom defined benefit plans Pooled investment funds	Dec. 31, 2010 United Kingdom defined benefit plans Debt investments	Dec. 31, 2011 United Kingdom defined benefit plans Insurance policies	Dec. 31, 2010 United Kingdom defined benefit plans Insurance policies	Dec. 31, 2011 United Kingdom defined benefit plans Level 1	Dec. 31, 2010 United Kingdom defined benefit plans Level 1	Dec. 31, 2011 United Kingdom defined benefit plans Level 1 Cash and cash equivalents	Dec. 31, 2010 United Kingdom defined benefit plans Level 1 Cash and cash equivalents	Dec. 31, 2011 United Kingdom defined benefit plans Level 1 Pooled investment funds	Dec. 31, 2010 United Kingdom defined benefit plans Level 1 Pooled investment funds	Dec. 31, 2011 United Kingdom defined benefit plans Level 2	Dec. 31, 2010 United Kingdom defined benefit plans Level 2	Dec. 31, 2010 United Kingdom defined benefit plans Level 2 Debt investments	Dec. 31, 2011 United Kingdom defined benefit plans Level 2 Insurance policies	Dec. 31, 2010 United Kingdom defined benefit plans Level 2 Insurance policies
Employee Benefit Plans
Fair value of the plan assets			$ 16,242,000	$ 8,491,000	$ 7,536,000	$ 64,000	$ 146,000	$ 1,164,000	$ 3,945,000	$ 1,638,000	$ 15,014,000	$ 2,762,000	$ 1,228,000	$ 4,091,000	$ 64,000	$ 146,000	$ 1,164,000	$ 3,945,000	$ 15,014,000	$ 4,400,000	$ 1,638,000	$ 15,014,000	$ 2,762,000
Escrow account deposit	5,500,000
Balance in escrow account		$ 800,000

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2011

Summary of Significant Accounting Policies

Consolidation Principles

The consolidated financial statements have been prepared in accordance with US GAAP for all periods presented and include the accounts of the Company and its majority owned subsidiaries over which the Company exercises control. All intercompany accounts and transactions have been eliminated in consolidation.

Cash and Cash Equivalents

The Company considers investments with original purchased maturities of three months or less to be cash equivalents.

Restricted Cash

Restricted cash is cash that is restricted for a specific purpose and cannot be included in the cash and cash equivalents account.  At December 31, 2011, the Company had restricted cash of $51,420,000, including $28,000,000 that is classified as non-current, pursuant to the terms of Monitronics’ debt obligations.  In addition, $7,000,000 of current restricted cash at December 31, 2011 is held in an escrow account in connection with the final settlement of the sale of the Company’s Creative Services and Media Services business units (See note 5).  The remaining amount of restricted cash at December 31, 2011 represents cash held in an escrow account for the eventual settlement of the Company’s defined benefit plans which is expected to occur in 2012.

Trade Receivables

Trade receivables consist primarily of amounts due from customers for recurring monthly monitoring services over a wide geographical base.  The Company performs extensive credit evaluations on the portfolios of subscriber accounts prior to purchase and requires no collateral on the accounts that are acquired.  The Company has established an allowance for doubtful accounts for estimated losses resulting from the inability of subscribers to make required payments.  Factors such as historical-loss experience, recoveries and economic conditions are considered in determining the sufficiency of the allowance to cover potential losses.  The allowance for doubtful accounts as of December 31, 2011 and 2010 was $1,815,000 and $250,000, respectively.

A summary of activity in the allowance for doubtful accounts is as follows:

	Balance Beginningof Year		Chargedto Expense	Write-Offs and Other		BalanceEnd ofYear
	Amounts in thousands
2011	$	250	5,484	(3,919	)	1,815
2010	$	0	250	0		250
2009	$	0	0	0		0

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of trade accounts receivable.  The Company performs extensive credit evaluations on the portfolios of subscriber accounts prior to purchase and requires no collateral on the subscriber accounts that are acquired.  Concentrations of credit risk with respect to trade accounts receivable are generally limited due to the large number of subscribers comprising the Company’s customer base.

Fair Value of Financial Instruments

Fair values of cash equivalents, current accounts receivable and current accounts payable approximate the carrying amounts because of their short-term nature.  The securitization debt, net of debt discount, approximates fair value based on the terms of such debt in that it bears interest at variable market rates and requires Monitronics to maintain certain derivative financial instruments to fix the interest rate, and due to management’s expectation that the Company will be able to refinance and/or repay the debt in full by July 2012. In addition, the credit facility approximates fair value based on the terms of such debt in that it bears interest at variable market rates, the term note matures in June 2012, and the revolver matures December 2013.  See Note 11 for further fair value information.

Investments

All investments in marketable securities held by the Company are classified as available-for-sale (“AFS”) and are carried at fair value generally based on quoted market prices.  The Company records unrealized changes in the fair value of AFS securities in the consolidated balance sheet in accumulated other comprehensive income.  When these investments are sold, the gain or loss realized on the sale is recorded in other income (expense) in the consolidated statements of operations.

Property and Equipment

Property and equipment are carried at cost and depreciated using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the underlying lease. Estimated useful lives by class of asset are as follows:

Buildings	20 years
Leasehold improvements	15 years or lease term, if shorter
Machinery and equipment	5 - 7 years
Computer systems and software (included in Machinery and Equipment in Note 6)	3 - 5 years

Depreciation expense for property and equipment was $7,052,000, $3,067,000 and $4,259,000 for the years ended December 31, 2011, 2010 and 2009, respectively.

Subscriber Accounts

Subscriber accounts relate to the cost of acquiring monitoring service contracts from independent dealers.  The subscriber accounts acquired in the Monitronics acquisition were recorded at fair value under the acquisition method of accounting.  Subscriber accounts purchased subsequent to the acquisition are recorded at cost.  All direct external costs associated with the creation of subscriber accounts are capitalized. Internal costs, including all personnel and related support costs, incurred solely in connection with subscriber account acquisitions and transitions are expensed as incurred.

The costs of subscriber accounts acquired in the Monitronics acquisition are amortized using the 14-year 235% declining balance method.  The costs of subscriber accounts acquired subsequent to the acquisition are amortized using the 15-year 220% declining balance method, beginning in the month following the date of purchase.  The amortization methods were selected to provide an approximate matching of the amortization of the subscriber accounts intangible asset to estimated future subscriber revenues based on the projected lives of individual subscriber contracts.  Amortization of subscriber accounts was $149,539,000, $5,560,000, and $0 for the fiscal years ended December 31, 2011, 2010, and 2009, respectively.

Based on subscriber accounts held at December 31, 2011, estimated amortization of subscriber accounts in the succeeding five fiscal years ending December 31 is as follows (in thousands):

2012	$	135,027
2013	112,914
2014	94,476
2015	79,026
2016	64,597
Total	$	486,040

The Company reviews the subscriber accounts for impairment or a change in amortization period whenever events or changes indicate that the carrying amount of the asset may not be recoverable or the life should be shortened.  For purposes of recognition and measurement of an impairment loss, the Company views subscriber accounts as a single pool because of the assets’ homogeneous characteristics, and the pool of subscriber accounts is the lowest level for which identifiable cash flows are largely independent of the cash flows of the other assets and liabilities.

Dealer Networks

Dealer networks is an intangible asset that relates to the dealer relationships that were acquired as part of the Monitronics acquisition.  This intangible asset will be amortized on a straight-line basis over its estimated useful life of five years.  Amortization of dealer networks was $10,080,000 and $420,000 for the fiscal years ended December 31, 2011 and 2010, respectively.  Dealer networks intangible asset is reviewed for impairment in accordance with the Property, Plant and Equipment Topic of the FASB ASC.

Goodwill and other intangible assets

The Company accounts for its goodwill pursuant to the provisions of the Intangibles — Goodwill and Other Topic of the FASB ASC.  In accordance with the FASB ASC, goodwill is not amortized, but rather tested for impairment at least annually.

The Company assesses the recoverability of the carrying value of goodwill during the fourth quarter of its fiscal year or whenever events or changes in circumstances indicate that the carrying amount of the goodwill of a reporting unit may not be fully recoverable. Recoverability is measured at the reporting unit level based on the provisions of FASB ASC Topic 350, Intangibles — Goodwill and Other.

Recoverability of goodwill at a reporting unit level is measured using a discounted cash flow model incorporating discount rates commensurate with the risks involved, which is classified as a Level 3 measurement under FASB ASC Topic 820, Fair Value Measurements and Disclosures. The key assumptions used in the discounted cash flow valuation model include discount rates, growth rates, cash flow projections and terminal value rates. Discount rates, growth rates and cash flow projections are the most sensitive and susceptible to change as they require significant management judgment. If the calculated fair value is less than the current carrying value, impairment of the reporting unit may exist. When the recoverability test indicates potential impairment, the Company will calculate an implied fair value of goodwill for the reporting unit. The implied fair value of goodwill is determined in a manner similar to how goodwill is calculated in a business combination. If the implied fair value of goodwill exceeds the carrying value of goodwill assigned to the reporting unit, there is no impairment. If the carrying value of goodwill assigned to a reporting unit exceeds the implied fair value of the goodwill, an impairment loss is recorded to write down the carrying value. An impairment loss cannot exceed the carrying value of goodwill assigned to the reporting unit but may indicate certain long-lived and amortizable intangible assets associated with the reporting unit may require additional impairment testing.

Long-Lived Assets

Management reviews the realizability of its long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating the value and future benefits of long-term assets, their carrying value is compared to management’s best estimate of undiscounted future cash flows over the remaining economic life. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying value of the assets exceeds the estimated fair value of the assets.  For the year ended December 31, 2009, the Company recorded an asset impairment of $972,000 for one of its content services facilities, which is included in discontinued operations in the consolidated statement of operations.

Purchase Holdbacks

The Company typically withholds payment of a designated percentage of the purchase price when it purchases subscriber accounts from dealers.  The withheld funds are recorded as a liability until the guarantee period provided by the dealer has expired.  The holdback is used as a reserve to cover any terminated subscriber accounts that are not replaced by the dealer during the guarantee period.  At the end of the guarantee period, which is typically one year from the date of purchase, the dealer is responsible for any deficit or is paid the balance of the holdback.

Deferred Financing Costs

Deferred financing costs are capitalized when the related debt is issued or when revolving credit lines increase the borrowing capacity of the Company.  Deferred financing costs are amortized over the term of the related debt on an effective interest method.

Derivative Financial Instruments

The Company uses derivative financial instruments to manage exposure to movement in interest rates. The use of these financial instruments modifies the exposure of these risks with the intention of reducing the risk or cost. The Company does not use derivatives for speculative or trading purposes. The Company recognizes the fair value of all derivative instruments as either assets or liabilities at fair value on the consolidated balance sheets. Fair value is based on market quotes for similar instruments with the same duration. Changes in the fair value of derivatives are reported in the consolidated statements of operations.

Foreign Currency Translation

The functional currencies of the Company’s foreign subsidiaries are their respective local currencies. Assets and liabilities of foreign operations are translated into United States dollars using exchange rates on the balance sheet date, and revenue and expenses are translated into United States dollars using average exchange rates for the period. The effects of the foreign currency translation adjustments are deferred and are included in stockholders’ equity as a component of accumulated other comprehensive income (loss).

Revenue Recognition

Revenue is generated from security alarm monitoring and related services provided by Monitronics.  Revenue related to alarm monitoring services is recognized ratably over the life of the contract.  Revenue related to maintenance and other services is recognized as the services are rendered.  Deferred revenue includes payments for monitoring services to be provided in future periods.

Income Taxes

The Company accounts for income taxes under the Income Taxes Topic of the FASB ASC, which prescribes an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s consolidated financial statements or tax returns. In estimating future tax consequences, the Company generally considers all expected future events other than proposed changes in the tax law or rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.  Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities.

The Income Taxes Topic of the FASB ASC specifies the accounting for uncertainty in income taxes recognized in a company’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.  In instances where the Company has taken or expects to take a tax position in its tax return and the Company believes it is more likely than not that such tax position will be upheld by the relevant taxing authority, the Company records the benefits of such tax position in its consolidated financial statements.

Stock-Based Compensation

The Company accounts for stock-based awards pursuant to the Stock Compensation Topic of the FASB ASC, which requires companies to measure the cost of employee services received in exchange for an award of equity instruments (such as stock options and restricted stock) based on the grant-date fair value of the award, and to recognize that cost over the period during which the employee is required to provide service (usually the vesting period of the award).

The Company calculated the grant-date fair value for all of its stock options using the Black-Scholes Model.  Ascent Capital calculated the expected term of the awards using the simplified method included in SEC Staff Accounting Bulletin No. 107.  The volatility used in the calculation is based on the historical volatility of peer companies.  The Company used the risk-free rate for Treasury Bonds with a term similar to that of the subject options and has assumed a dividend rate of zero.

Basic and Diluted Earnings (Loss) Per Common Share - Series A and Series B

Basic earnings (loss) per common share (“EPS”) is computed by dividing net income (loss) by the weighted average number of Series A and Series B common shares outstanding for the period.  Diluted EPS is computed by dividing net income (loss) by the sum of the weighted average number of Series A and Series B common shares outstanding and the effect of dilutive securities such as outstanding stock options and unvested restricted stock.  For the years ended December 31, 2011, 2010 and 2009, diluted EPS is computed the same as basic EPS since the Company recorded a loss from continuing operations, which would make potentially dilutive securities related to vested stock options antidilutive.

	Year Ended December 31,
	2011	2010	2009
Weighted average Series A and Series B shares	14,195,834	14,200,417	14,086,075

Indemnifications

On September 17, 2008 (“Spin-Off Date”), Ascent Capital was spun off from Discovery Holding Company (“DHC”) as effected by a distribution of Ascent Capital Series A and Series B common stock holders of DHC Series A and Series B common stock.  In connection with the spin off, Ascent Capital and DHC entered into certain agreements in order to govern certain ongoing relationships between Ascent Capital and DHC after the spin off and to provide mechanisms for an orderly transition.  These agreements included a tax sharing agreement.  Pursuant to the tax sharing agreement with DHC, Ascent Capital is responsible for all taxes attributable to it or any of its subsidiaries, whether accruing before, on or after the Spin-Off Date.  The Company is responsible for and indemnifies DHC with respect to (i) certain taxes attributable to DHC or any of its subsidiaries (other than Discovery Communications, LLC) and (ii) all taxes arising as a result of the Ascent Capital Spin Off.  The indemnification obligations under the tax sharing agreement are not limited in amount or subject to any cap.  Also, pursuant to the reorganization agreement it entered into with DHC in connection with the Ascent Capital Spin Off, the Company assumed certain indemnification obligations designed to make it financially responsible for substantially all non-tax liabilities that may exist relating to the business of AMG, whether incurred prior to or after the spin-off, as well as certain obligations of DHC.  As of December 31, 2011, the Company has accrued $3,357,000 related to matters covered under these agreements.

The purchase and sale agreement dated November 24, 2010, relating to the disposition of the creative services business unit and its media services business unit (which is referred to collectively as Creative/Media”), contains customary indemnification obligations of each party with respect to breaches of representations, warranties and covenants and certain other specified matters, including any amounts that may become due with respect to certain pre-closing obligations of the Company relating to the Creative/Media business for which the Company has agreed to indemnify the buyer.  Indemnification obligations with respect to losses resulting from breaches of any representations or warranties are generally subject to a deductible basket of $1 million and a cap of $10.5 million, subject to specified exceptions.  Pursuant to the agreement, the Company has deposited $7 million in escrow to satisfy potential indemnification claims under the agreement.  The Company does not expect to incur any material obligations under such indemnification provisions and anticipates that the escrow will be released in full on or about December 31, 2012.

The purchase and sale agreement dated December 2, 2010, relating to the disposition of the Content Distribution business contains customary indemnification obligations of each party with respect to breaches of representations, warranties and covenants and certain other specified matters, including any amounts that may become due with respect to certain pre-closing obligations of the Company relating to the Content Distribution businessfor which the Company has agreed to indemnify the buyer.  Indemnification obligations with respect to losses resulting from breaches of any representations or warranties are generally subject to a deductible basket of approximately $1.6 million and a cap of approximately $19.4 million, subject to specified exceptions.  The Company does not expect to incur any material obligations under such indemnification provisions.

Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of revenue and expenses for each reporting period.  The significant estimates made in preparation of the Company’s consolidated financial statements primarily relate to valuation of goodwill, other intangible assets, long-lived assets, deferred tax assets, derivative financial instruments, and the amount of the allowance for doubtful accounts. These estimates are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts them when facts and circumstances change. As the effects of future events cannot be determined with any certainty, actual results could differ from the estimates upon which the carrying values were based.

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Dispositions (Details) (USD $)	12 Months Ended				1 Months Ended	3 Months Ended	12 Months Ended		1 Months Ended	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2011 System Integration business	Feb. 28, 2011 Content Distribution business	Mar. 31, 2011 Content Distribution business	Dec. 31, 2010 Creative/Media services business unit	Dec. 31, 2010 Global Media Exchange	Feb. 28, 2010 Chiswick Park facility	Dec. 31, 2010 Chiswick Park facility
Information of discontinued operations
Exit costs related to employee severance				$ (1,119,000)
Percentage of ownership interest in business sold					100.00%
Cash proceeds on sale of business	99,488,000	92,121,000			104,000,000		69,000,000		34,800,000
Pre-tax gain (loss) on sale of business						(66,136,000)	27,110,000			(25,498,000)
Income tax expense (benefits) related to sale of business						(2,906,000)	7,587,000			(3,423,000)
Asset retirements and severance costs recorded	(4,258,000)	(4,604,000)	(695,000)					(1,838,000)
Results of operations of the discontinued operations
Revenue	24,183,000	426,295,000	472,049,000
Income (loss) before income taxes	$ 48,836,000	$ (12,077,000)	$ (6,682,000)

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Basis of Presentation (Details)	7 Months Ended	12 Months Ended
	Dec. 31, 2011 segment	Dec. 31, 2010 segment
Basis of Presentation
Number of reportable segments	1	2

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Stock-based and Long-Term Compensation (Tables)

12 Months Ended

Dec. 31, 2011

Stock-based and Long-Term Compensation

Schedule of number and weighted average exercise price ("WAEP") of options

	Series A
	common stock		WAEP
Outstanding at January 1, 2011	615,563		$	22.72
Granted	318,606		$	48.29
Exercised	(51,460	)	$	25.09
Forfeited	—		$	—
Outstanding at December 31, 2011	882,709		$	31.81
Exercisable at December 31, 2011	385,224		$	22.87

Schedule of number and weighted average fair value ("WAFV") of unvested restricted stock awards

	Restricted Stock Awards
	Series A		Series B	WAFV
Outstanding at January 1, 2011	63,196		—	$	22.47
Granted	148,654		9,029	$	42.63
Vested	(52,782	)	—	$	31.30
Cancelled	(14,846	)	—	$	31.30
Outstanding at December 31, 2011	144,222		9,029	$	39.34

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Goodwill (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2011
Activity and balances of goodwill
Balance at the beginning of the period		$ 349,227
Acquisition of Monitronics	349,227
Balance at the end of the period	$ 349,227	$ 349,227

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Stock-Based and Long-Term Compensation (Details 3) (USD $)	12 Months Ended				3 Months Ended			12 Months Ended	3 Months Ended				12 Months Ended		3 Months Ended	12 Months Ended
	Dec. 31, 2011 year	Dec. 31, 2011 Series A common stock	Dec. 31, 2009 Series A common stock	Dec. 31, 2009 Series B common stock	Sep. 30, 2011 Stock option Series A common stock	Mar. 31, 2011 Stock option Series A common stock	Mar. 31, 2009 Stock option Series A common stock	Dec. 31, 2011 Stock option Series A common stock year	Sep. 30, 2011 Restricted Stock Awards	Mar. 31, 2011 Restricted Stock Awards	Mar. 31, 2010 Restricted Stock Awards	Dec. 31, 2009 Restricted Stock Awards	Dec. 31, 2011 Restricted Stock Awards	Dec. 31, 2011 Restricted Stock Awards Series A common stock	Dec. 31, 2011 Restricted Stock Awards Series B common stock	Dec. 31, 2011 Restricted Stock Awards Series B common stock
Number of options
Outstanding at the beginning of the period (in shares)						615,563		615,563
Granted (in shares)					187,500	99,794	116,740	318,606
Exercised (in shares)		(51,460)	(11,722)	(76,210)				(51,460)
Outstanding at the end of the period (in shares)								882,709
Exercisable at the end of period (in shares)								385,224
Weighted average exercise price ("WAEP")
Outstanding at the beginning of the period (in dollars per share)						$ 22.72		$ 22.72
Granted (in dollars per share)					$ 48.00	$ 48.15	$ 25.30	$ 48.29
Exercised (in dollars per share)								$ 25.09
Outstanding at the end of the period (in dollars per share)								$ 31.81
Exercisable at the end of period (in dollars per share)								$ 22.87
Additional disclosures
Total compensation cost related to unvested equity awards	$ 11,701,000
Period to recognize compensation cost (in years)	4
Intrinsic value of outstanding stock option awards								16,694,000
Intrinsic value of exercisable stock option awards								$ 10,728,000
Weighted average remaining contractual life of exercisable awards (in years)								6.5
Weighted average remaining contractual life of outstanding awards (in years)								6.75
Number of restricted stock awards
Outstanding at the beginning of the period (in shares)														63,196
Granted (in shares)									56,250	83,236	12,766	15,923		148,654	9,029	9,029
Vested (in shares)														(52,782)
Cancelled (in shares)														(14,846)
Outstanding at the end of the period (in shares)														144,222	9,029	9,029
Weighted average fair value ("WAFV")
Outstanding at the beginning of the period (in dollars per share)										$ 22.47			$ 22.47
Granted (in dollars per share)									$ 39.32	$ 44.91	$ 28.20	$ 24.81	$ 42.63		$ 52.05
Vested (in dollars per share)													$ 31.30
Cancelled (in dollars per share)													$ 31.30
Outstanding at the end of the period (in dollars per share)													$ 39.34

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Restructuring Charges (Details) (USD $)	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Restructuring Charges.
Amount of restructuring charges	$ 4,258,000	$ 4,604,000	$ 695,000
Combined ending restructuring liability balance	2,122,000
2010 Restructuring Plan
Change in activity of restructuring reserves during the period
Opening balance	3,590,000
Additions	4,186,000	3,994,000
Deductions	(5,890,000)	(404,000)
Ending balance	1,886,000	3,590,000
2010 Restructuring Plan | Severance and retention
Change in activity of restructuring reserves during the period
Opening balance	3,590,000
Additions	4,186,000	3,994,000
Deductions	(5,890,000)	(404,000)
Ending balance	1,886,000	3,590,000
2008 Restructuring Plan
Change in activity of restructuring reserves during the period
Opening balance	220,000	314,000	464,000
Additions	72,000	610,000	695,000
Deductions	(56,000)	(704,000)	(845,000)
Ending balance	236,000	220,000	314,000
2008 Restructuring Plan | Severance
Change in activity of restructuring reserves during the period
Opening balance	9,000	221,000	404,000
Additions		477,000	647,000
Deductions	(9,000)	(689,000)	(830,000)
Ending balance		9,000	221,000
2008 Restructuring Plan | Excess facility costs
Change in activity of restructuring reserves during the period
Opening balance	211,000	93,000	60,000
Additions	72,000	133,000	48,000
Deductions	(47,000)	(15,000)	(15,000)
Ending balance	$ 236,000	$ 211,000	$ 93,000

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Summary of Significant Accounting Policies (Details 5) (USD $)	12 Months Ended			1 Months Ended		12 Months Ended
	Dec. 31, 2011 year	Dec. 31, 2010	Dec. 31, 2009	Nov. 30, 2010 Creative/Media business	Nov. 24, 2010 Creative/Media business	Dec. 31, 2009 Content Distribution business	Dec. 02, 2010 Content Distribution business
Long-Lived Assets
Asset impairment charges			$ 972,000			$ 972,000
Purchase Holdbacks
Guarantee period (in years)	1
Stock-Based Compensation
Assumed dividend rate (as a percent)	0.00%
Basic and Diluted Earnings (Loss) Per Common Share - Series A and Series B
Weighted average Series A and Series B shares	14,195,834	14,200,417	14,086,075
Indemnifications obligation in disposition
Accrued liabilities under tax sharing agreement	3,357,000
Deductible basket for indemnification obligations with respect to losses from breach of any representations and warranties					1,000,000		1,600,000
Cap for losses for indemnification obligations with respect to losses from breach of any representations and warranties					10,500,000		19,400,000
Amount in escrow deposit for satisfaction of potential indemnification claims				7,000,000
Supplemental Cash Flow Information
Net cash received for income taxes	9,060,000	18,738,000	4,494,000
Net cash received (paid) for interest	$ (24,559,000)	$ 966,000	$ 2,574,000

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Accounting Pronouncements

12 Months Ended

Dec. 31, 2011

Accounting Pronouncements

Accounting Pronouncements

(3)  Accounting Pronouncements

In September 2011, the FASB issued ASU 2011-08, Testing Goodwill for Impairment, an amendment to FASB ASC Topic 350, Intangibles - Goodwill and Other.  The update provides an entity with the option to first assess qualitative factors in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. After assessing the qualitative factors, if an entity determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is unnecessary. If an entity concludes otherwise, then it is required to perform the first step of the two-step impairment test as described in FASB ASC Topic 350.  Entities have the option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to performing the first step of the two-step impairment test as well as resume performing the qualitative assessment in any subsequent period.  The ASU is effective for the Company for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011.  Early adoption was permitted, including for annual and interim goodwill impairment tests performed as of a date before September 15, 2011, if an entity’s financial statements for the most recent annual or interim period had not yet been issued. The Company did not early adopt the provisions of this ASU; however, the Company’s annual goodwill impairment testing did not result in an impairment charge (Note 7). Accordingly, the Company does not expect the impact of adopting this ASU to be material to the Company’s financial position, results of operations or cash flows.

In June 2011, the FASB issued ASU 2011-05, Presentation of Comprehensive Income, an amendment to FASB ASC Topic 220, Comprehensive Income. The update gives companies the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in separate but consecutive statements. The amendments in the update do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. This amendment also required an entity to present on the face of the financial statements adjustments for items that are reclassified from accumulated other comprehensive income to net income, however, in December 2011 the FASB issued ASU 2011-12, Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in ASU 2011-05. The update defers the specific requirement to present items that are reclassified from accumulated other comprehensive income to net income separately with their respective components of net income and other comprehensive income. The Company adopted ASU 2011-05 and ASU 2011-12 beginning December 15, 2011 and amendments have been applied retrospectively for all prior periods presented.

In May 2011, the FASB issued FASB ASU 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs, an amendment to FASB ASC Topic 820, Fair Value Measurement. The update revises the application of the valuation premise of highest and best use of an asset, the application of premiums and discounts for fair value determination, as well as the required disclosures for transfers between Level 1 and Level 2 fair value measures and the highest and best use of nonfinancial assets. The update provides additional disclosures regarding Level 3 fair value measurements and clarifies certain other existing disclosure requirements. The ASU is effective for the Company for interim and annual periods beginning after December 15, 2011. The Company does not expect the impact of adopting this ASU to have a material effect on the Company’s consolidated financial statements, but the adoption of this ASU may require additional disclosures.

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Income Taxes (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Current
Federal	$ 350	$ (1,594)	$ 8,389
State	(2,405)	(200)	207
Foreign		1,307	726
Total current	(2,055)	(487)	9,322
Deferred
Federal	(380)	(233)	(24,051)
State	(22)	908	(13,992)
Foreign		(458)
Total deferred	(402)	217	(38,043)
Total tax expense	(2,457)	(270)	(28,721)
Components of pretax loss from continuing operations
Domestic	(20,437)	(22,643)	(18,926)
Foreign	(5,258)	(10,588)	(8,158)
Loss from continuing operations before income taxes	$ (25,695)	$ (33,231)	$ (27,084)

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Summary of Significant Accounting Policies (Details) (USD $)	12 Months Ended
	Dec. 31, 2011 M	Dec. 31, 2010
Cash and Cash Equivalents
Maximum term of original maturity to classify investments as cash equivalents (in months)	3
Restricted Cash:
Restricted cash	$ 51,420,000
Restricted cash non-current	28,000,000	35,000,000
Amount held in escrow account in connection with sale of Creative Services and Media Services business units	7,000,000
Trade Receivables
Allowance for doubtful accounts receivable	1,815,000	250,000
Monitronics and subsidiaries
Restricted Cash:
Restricted cash non-current	$ 28,000,000

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Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2011

Property and Equipment

Schedule of property and equipment

	2011			2010
Property and equipment, net:
Land	$	34,896		34,901
Buildings	54,575			57,824
Machinery and equipment	22,763			19,949
	112,234			112,674
Accumulated depreciation	(37,537		)	(34,463	)
	$	74,697		78,211

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Dispositions (Tables)

12 Months Ended

Dec. 31, 2011

Dispositions

Schedule of results of operations of the discontinued operations that are included in earnings from discontinued operations, net of income tax

	Year Ended December 30,
	2011		2010		2009
Revenue	$	24,183	426,295		472,049
Income (loss) before income taxes (a)	$	48,836	(12,077	)	(6,682	)

(a)  The 2011 amount includes a gain on the sale of the Content Distribution business of approximately $66,136,000 and a charge of $1,119,000 related to the shutdown of the Systems Integration business.  The 2010 amount includes the pre-tax loss on the sale of the Creative/Media businesses of $(27,110,000), a pre-tax $25,498,000 gain on the sale of the Chiswick Park facility and a charge of $(1,838,000) related to the shutdown of the GMX business.

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Derivatives (Details) (USD $)	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010
Derivatives
Settlement payments	$ 38,645,000	$ 1,504,000
Unrealized gain (loss) related to the change in fair value of derivatives	28,044,000	(178,000)
Interest rate cap | Not designated as hedges
Derivatives
Number of agreements entered into by the entity	1
Aggregate fair value of an asset	25,000	447,000
Interest rate floor effective from October 15, 2007 through May 15, 2014 | Not designated as hedges
Derivatives
Aggregate fair value of liability	19,320,000	21,810,000
Interest rate swaps (Swaps) | Not designated as hedges
Derivatives
Number of agreements entered into by the entity	3	3
Aggregate fair value of liability	$ 16,959,000	$ 42,935,000

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Summary of Significant Accounting Policies (Details 2) (Allowance for doubtful accounts, USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Allowance for doubtful accounts
Changes in allowance for doubtful accounts
Balance Beginning of Year	$ 250	$ 0	$ 0
Charged to Expense	5,484	250	0
Write-Offs and Other	(3,919)	0	0
Balance End of Year	$ 1,815	$ 250	$ 0

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Goodwill (Tables)

12 Months Ended

Dec. 31, 2011

Goodwill.

Schedule of activity and balances of goodwill

	Goodwill
Balance at December 31, 2009	$	—
Acquisition of Monitronics	349,227
Balance at December 31, 2010	349,227
Balance at December 31, 2011	$	349,227

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Investments in Marketable Securities (Tables)

12 Months Ended

Dec. 31, 2011

Investments in Marketable Securities

Schedule of activity of investments classified as available-for-sale securities

	Years ended December 31,
	2011		2010
Beginning Balance	$	—	$	56,197
Purchases	40,253		41,757
Sales (at cost) (a)	—		(95,624		)
Unrealized gain (loss)	124		(2,330		)
Ending Balance	$	40,377	$	—

(a)For the year ended December 31, 2010, total proceeds from the sales were $96,685,000 which included a pre-tax gain of $1,061,000.

Schedule of net after-tax unrealized and realized gains on the investment in marketable securities

	Years ended December 31,
	2011		2010
Accumulated other comprehensive income
Beginning Balance	$	—	$	1,352
Gains (losses), net of tax (a)	124		(291		)
Losses (gains) recognized into earnings, net of tax (b)	—		(1,061		)
Ending Balance	$	124	$	—

(a)The 2011 and 2010 amount is net of tax of $0.

(b)The 2010 amount is net of tax of $0.

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Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2011

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

(2)  Summary of Significant Accounting Policies

Consolidation Principles

The consolidated financial statements have been prepared in accordance with US GAAP for all periods presented and include the accounts of the Company and its majority owned subsidiaries over which the Company exercises control. All intercompany accounts and transactions have been eliminated in consolidation.

Cash and Cash Equivalents

The Company considers investments with original purchased maturities of three months or less to be cash equivalents.

Restricted Cash

Restricted cash is cash that is restricted for a specific purpose and cannot be included in the cash and cash equivalents account.  At December 31, 2011, the Company had restricted cash of $51,420,000, including $28,000,000 that is classified as non-current, pursuant to the terms of Monitronics’ debt obligations.  In addition, $7,000,000 of current restricted cash at December 31, 2011 is held in an escrow account in connection with the final settlement of the sale of the Company’s Creative Services and Media Services business units (See note 5).  The remaining amount of restricted cash at December 31, 2011 represents cash held in an escrow account for the eventual settlement of the Company’s defined benefit plans which is expected to occur in 2012.

Trade Receivables

Trade receivables consist primarily of amounts due from customers for recurring monthly monitoring services over a wide geographical base.  The Company performs extensive credit evaluations on the portfolios of subscriber accounts prior to purchase and requires no collateral on the accounts that are acquired.  The Company has established an allowance for doubtful accounts for estimated losses resulting from the inability of subscribers to make required payments.  Factors such as historical-loss experience, recoveries and economic conditions are considered in determining the sufficiency of the allowance to cover potential losses.  The allowance for doubtful accounts as of December 31, 2011 and 2010 was $1,815,000 and $250,000, respectively.

A summary of activity in the allowance for doubtful accounts is as follows:

	Balance Beginningof Year		Chargedto Expense	Write-Offs and Other		BalanceEnd ofYear
	Amounts in thousands
2011	$	250	5,484	(3,919	)	1,815
2010	$	0	250	0		250
2009	$	0	0	0		0

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of trade accounts receivable.  The Company performs extensive credit evaluations on the portfolios of subscriber accounts prior to purchase and requires no collateral on the subscriber accounts that are acquired.  Concentrations of credit risk with respect to trade accounts receivable are generally limited due to the large number of subscribers comprising the Company’s customer base.

Fair Value of Financial Instruments

Fair values of cash equivalents, current accounts receivable and current accounts payable approximate the carrying amounts because of their short-term nature.  The securitization debt, net of debt discount, approximates fair value based on the terms of such debt in that it bears interest at variable market rates and requires Monitronics to maintain certain derivative financial instruments to fix the interest rate, and due to management’s expectation that the Company will be able to refinance and/or repay the debt in full by July 2012. In addition, the credit facility approximates fair value based on the terms of such debt in that it bears interest at variable market rates, the term note matures in June 2012, and the revolver matures December 2013.  See Note 11 for further fair value information.

Investments

All investments in marketable securities held by the Company are classified as available-for-sale (“AFS”) and are carried at fair value generally based on quoted market prices.  The Company records unrealized changes in the fair value of AFS securities in the consolidated balance sheet in accumulated other comprehensive income.  When these investments are sold, the gain or loss realized on the sale is recorded in other income (expense) in the consolidated statements of operations.

Property and Equipment

Property and equipment are carried at cost and depreciated using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of their estimated useful lives or the term of the underlying lease. Estimated useful lives by class of asset are as follows:

Buildings	20 years
Leasehold improvements	15 years or lease term, if shorter
Machinery and equipment	5 - 7 years
Computer systems and software (included in Machinery and Equipment in Note 6)	3 - 5 years

Depreciation expense for property and equipment was $7,052,000, $3,067,000 and $4,259,000 for the years ended December 31, 2011, 2010 and 2009, respectively.

Subscriber Accounts

Subscriber accounts relate to the cost of acquiring monitoring service contracts from independent dealers.  The subscriber accounts acquired in the Monitronics acquisition were recorded at fair value under the acquisition method of accounting.  Subscriber accounts purchased subsequent to the acquisition are recorded at cost.  All direct external costs associated with the creation of subscriber accounts are capitalized. Internal costs, including all personnel and related support costs, incurred solely in connection with subscriber account acquisitions and transitions are expensed as incurred.

The costs of subscriber accounts acquired in the Monitronics acquisition are amortized using the 14-year 235% declining balance method.  The costs of subscriber accounts acquired subsequent to the acquisition are amortized using the 15-year 220% declining balance method, beginning in the month following the date of purchase.  The amortization methods were selected to provide an approximate matching of the amortization of the subscriber accounts intangible asset to estimated future subscriber revenues based on the projected lives of individual subscriber contracts.  Amortization of subscriber accounts was $149,539,000, $5,560,000, and $0 for the fiscal years ended December 31, 2011, 2010, and 2009, respectively.

Based on subscriber accounts held at December 31, 2011, estimated amortization of subscriber accounts in the succeeding five fiscal years ending December 31 is as follows (in thousands):

2012	$	135,027
2013	112,914
2014	94,476
2015	79,026
2016	64,597
Total	$	486,040

The Company reviews the subscriber accounts for impairment or a change in amortization period whenever events or changes indicate that the carrying amount of the asset may not be recoverable or the life should be shortened.  For purposes of recognition and measurement of an impairment loss, the Company views subscriber accounts as a single pool because of the assets’ homogeneous characteristics, and the pool of subscriber accounts is the lowest level for which identifiable cash flows are largely independent of the cash flows of the other assets and liabilities.

Dealer Networks

Dealer networks is an intangible asset that relates to the dealer relationships that were acquired as part of the Monitronics acquisition.  This intangible asset will be amortized on a straight-line basis over its estimated useful life of five years.  Amortization of dealer networks was $10,080,000 and $420,000 for the fiscal years ended December 31, 2011 and 2010, respectively.  Dealer networks intangible asset is reviewed for impairment in accordance with the Property, Plant and Equipment Topic of the FASB ASC.

Goodwill and other intangible assets

The Company accounts for its goodwill pursuant to the provisions of the Intangibles — Goodwill and Other Topic of the FASB ASC.  In accordance with the FASB ASC, goodwill is not amortized, but rather tested for impairment at least annually.

The Company assesses the recoverability of the carrying value of goodwill during the fourth quarter of its fiscal year or whenever events or changes in circumstances indicate that the carrying amount of the goodwill of a reporting unit may not be fully recoverable. Recoverability is measured at the reporting unit level based on the provisions of FASB ASC Topic 350, Intangibles — Goodwill and Other.

Recoverability of goodwill at a reporting unit level is measured using a discounted cash flow model incorporating discount rates commensurate with the risks involved, which is classified as a Level 3 measurement under FASB ASC Topic 820, Fair Value Measurements and Disclosures. The key assumptions used in the discounted cash flow valuation model include discount rates, growth rates, cash flow projections and terminal value rates. Discount rates, growth rates and cash flow projections are the most sensitive and susceptible to change as they require significant management judgment. If the calculated fair value is less than the current carrying value, impairment of the reporting unit may exist. When the recoverability test indicates potential impairment, the Company will calculate an implied fair value of goodwill for the reporting unit. The implied fair value of goodwill is determined in a manner similar to how goodwill is calculated in a business combination. If the implied fair value of goodwill exceeds the carrying value of goodwill assigned to the reporting unit, there is no impairment. If the carrying value of goodwill assigned to a reporting unit exceeds the implied fair value of the goodwill, an impairment loss is recorded to write down the carrying value. An impairment loss cannot exceed the carrying value of goodwill assigned to the reporting unit but may indicate certain long-lived and amortizable intangible assets associated with the reporting unit may require additional impairment testing.

Long-Lived Assets

Management reviews the realizability of its long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating the value and future benefits of long-term assets, their carrying value is compared to management’s best estimate of undiscounted future cash flows over the remaining economic life. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying value of the assets exceeds the estimated fair value of the assets.  For the year ended December 31, 2009, the Company recorded an asset impairment of $972,000 for one of its content services facilities, which is included in discontinued operations in the consolidated statement of operations.

Purchase Holdbacks

The Company typically withholds payment of a designated percentage of the purchase price when it purchases subscriber accounts from dealers.  The withheld funds are recorded as a liability until the guarantee period provided by the dealer has expired.  The holdback is used as a reserve to cover any terminated subscriber accounts that are not replaced by the dealer during the guarantee period.  At the end of the guarantee period, which is typically one year from the date of purchase, the dealer is responsible for any deficit or is paid the balance of the holdback.

Deferred Financing Costs

Deferred financing costs are capitalized when the related debt is issued or when revolving credit lines increase the borrowing capacity of the Company.  Deferred financing costs are amortized over the term of the related debt on an effective interest method.

Derivative Financial Instruments

The Company uses derivative financial instruments to manage exposure to movement in interest rates. The use of these financial instruments modifies the exposure of these risks with the intention of reducing the risk or cost. The Company does not use derivatives for speculative or trading purposes. The Company recognizes the fair value of all derivative instruments as either assets or liabilities at fair value on the consolidated balance sheets. Fair value is based on market quotes for similar instruments with the same duration. Changes in the fair value of derivatives are reported in the consolidated statements of operations.

Foreign Currency Translation

The functional currencies of the Company’s foreign subsidiaries are their respective local currencies. Assets and liabilities of foreign operations are translated into United States dollars using exchange rates on the balance sheet date, and revenue and expenses are translated into United States dollars using average exchange rates for the period. The effects of the foreign currency translation adjustments are deferred and are included in stockholders’ equity as a component of accumulated other comprehensive income (loss).

Revenue Recognition

Revenue is generated from security alarm monitoring and related services provided by Monitronics.  Revenue related to alarm monitoring services is recognized ratably over the life of the contract.  Revenue related to maintenance and other services is recognized as the services are rendered.  Deferred revenue includes payments for monitoring services to be provided in future periods.

Income Taxes

The Company accounts for income taxes under the Income Taxes Topic of the FASB ASC, which prescribes an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s consolidated financial statements or tax returns. In estimating future tax consequences, the Company generally considers all expected future events other than proposed changes in the tax law or rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.  Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities.

The Income Taxes Topic of the FASB ASC specifies the accounting for uncertainty in income taxes recognized in a company’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.  In instances where the Company has taken or expects to take a tax position in its tax return and the Company believes it is more likely than not that such tax position will be upheld by the relevant taxing authority, the Company records the benefits of such tax position in its consolidated financial statements.

Stock-Based Compensation

The Company accounts for stock-based awards pursuant to the Stock Compensation Topic of the FASB ASC, which requires companies to measure the cost of employee services received in exchange for an award of equity instruments (such as stock options and restricted stock) based on the grant-date fair value of the award, and to recognize that cost over the period during which the employee is required to provide service (usually the vesting period of the award).

The Company calculated the grant-date fair value for all of its stock options using the Black-Scholes Model.  Ascent Capital calculated the expected term of the awards using the simplified method included in SEC Staff Accounting Bulletin No. 107.  The volatility used in the calculation is based on the historical volatility of peer companies.  The Company used the risk-free rate for Treasury Bonds with a term similar to that of the subject options and has assumed a dividend rate of zero.

Basic and Diluted Earnings (Loss) Per Common Share — Series A and Series B

Basic earnings (loss) per common share (“EPS”) is computed by dividing net income (loss) by the weighted average number of Series A and Series B common shares outstanding for the period.  Diluted EPS is computed by dividing net income (loss) by the sum of the weighted average number of Series A and Series B common shares outstanding and the effect of dilutive securities such as outstanding stock options and unvested restricted stock.  For the years ended December 31, 2011, 2010 and 2009, diluted EPS is computed the same as basic EPS since the Company recorded a loss from continuing operations, which would make potentially dilutive securities related to vested stock options antidilutive.

	Year Ended December 31,
	2011	2010	2009
Weighted average Series A and Series B shares	14,195,834	14,200,417	14,086,075

Indemnifications

On September 17, 2008 (“Spin-Off Date”), Ascent Capital was spun off from Discovery Holding Company (“DHC”) as effected by a distribution of Ascent Capital Series A and Series B common stock holders of DHC Series A and Series B common stock.  In connection with the spin off, Ascent Capital and DHC entered into certain agreements in order to govern certain ongoing relationships between Ascent Capital and DHC after the spin off and to provide mechanisms for an orderly transition.  These agreements included a tax sharing agreement.  Pursuant to the tax sharing agreement with DHC, Ascent Capital is responsible for all taxes attributable to it or any of its subsidiaries, whether accruing before, on or after the Spin-Off Date.  The Company is responsible for and indemnifies DHC with respect to (i) certain taxes attributable to DHC or any of its subsidiaries (other than Discovery Communications, LLC) and (ii) all taxes arising as a result of the Ascent Capital Spin Off.  The indemnification obligations under the tax sharing agreement are not limited in amount or subject to any cap.  Also, pursuant to the reorganization agreement it entered into with DHC in connection with the Ascent Capital Spin Off, the Company assumed certain indemnification obligations designed to make it financially responsible for substantially all non-tax liabilities that may exist relating to the business of AMG, whether incurred prior to or after the spin-off, as well as certain obligations of DHC.  As of December 31, 2011, the Company has accrued $3,357,000 related to matters covered under these agreements.

The purchase and sale agreement dated November 24, 2010, relating to the disposition of the creative services business unit and its media services business unit (which is referred to collectively as Creative/Media”), contains customary indemnification obligations of each party with respect to breaches of representations, warranties and covenants and certain other specified matters, including any amounts that may become due with respect to certain pre-closing obligations of the Company relating to the Creative/Media business for which the Company has agreed to indemnify the buyer.  Indemnification obligations with respect to losses resulting from breaches of any representations or warranties are generally subject to a deductible basket of $1 million and a cap of $10.5 million, subject to specified exceptions.  Pursuant to the agreement, the Company has deposited $7 million in escrow to satisfy potential indemnification claims under the agreement.  The Company does not expect to incur any material obligations under such indemnification provisions and anticipates that the escrow will be released in full on or about December 31, 2012.

The purchase and sale agreement dated December 2, 2010, relating to the disposition of the Content Distribution business contains customary indemnification obligations of each party with respect to breaches of representations, warranties and covenants and certain other specified matters, including any amounts that may become due with respect to certain pre-closing obligations of the Company relating to the Content Distribution businessfor which the Company has agreed to indemnify the buyer.  Indemnification obligations with respect to losses resulting from breaches of any representations or warranties are generally subject to a deductible basket of approximately $1.6 million and a cap of approximately $19.4 million, subject to specified exceptions.  The Company does not expect to incur any material obligations under such indemnification provisions.

Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of revenue and expenses for each reporting period.  The significant estimates made in preparation of the Company’s consolidated financial statements primarily relate to valuation of goodwill, other intangible assets, long-lived assets, deferred tax assets, derivative financial instruments, and the amount of the allowance for doubtful accounts. These estimates are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts them when facts and circumstances change. As the effects of future events cannot be determined with any certainty, actual results could differ from the estimates upon which the carrying values were based.

Supplemental Cash Flow Information

For the years ended December 31, 2011, 2010 and 2009, net cash received for income taxes was $9,060,000, $18,738,000 and $4,494,000, respectively.  For the years ended December 31, 2011, 2010, and 2009, net cash received (paid) for interest was $(24,559,000), $966,000, and $2,574,000, respectively.

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Long-Term Debt (Tables)

12 Months Ended

Dec. 31, 2011

Monitronics

Long-term debt instruments

Schedule of long-term debt

	Years ended December 31,
	2011			2010
Class A-1a Term Notes (matures July 2027), LIBOR plus 1.8% (a)	$	345,577		$	338,478
Class A-1b Term Notes (matures July 2027), LIBOR plus 1.7% (a)	98,676			96,551
Class A-2 Term Notes (matures July 2037), LIBOR plus 2.2% (a)	98,978			97,338
Class A-3 Variable Funding Note (matures July 2037), LIBOR plus 1.8% (a)	256,558			251,032
Class A-4 Variable Funding Note (matures July 2037), LIBOR plus 1.8% (a)	27,629			27,034
Term Loan (matures June 30, 2012) (b)	60,000			60,000
$115 million revolving credit facility (matures December 17, 2013), LIBOR plus 4%	65,300			46,300
	952,718			916,733
Less current portion of long —term debt	(60,000		)	(20,000		)
Long-term debt	$	892,718		$	896,733

(a)The interest rate on the Term Notes and VFNs include 1.0% of other fees.

(b)During 2011, the interest rate on the Term Loan was LIBOR plus 4.00%.  As of January 1, 2012, the interest rate on the Term Loan is LIBOR plus 4.50%.  The term loan matures on June 30, 2012, and requires two principal installments of $20,000,000 on the first business day occurring on or after December 31, 2011 and March 31, 2012.  Ascent Capital has guaranteed $30 million of this Term Loan.

Schedule of maturities of long-term debt

Scheduled maturities of long-term debt at December 31, 2011, utilizing the required payment schedule of the securitization debt, are as follows for the fiscal years below (in thousands):

2012	$	60,000
2013	—
2014	65,300
2015	—
2016	—
Thereafter	838,000
Total principal payments	963,300
Less: discount	(10,582		)
Total debt on balance sheet	$	952,718

Monitronics Funding LP ("Funding")

Long-term debt instruments

Schedule of debt instruments issued under securitization

	Principal
Class A-1a Term Notes	$	350,000
Class A-1b Term Notes	100,000
Class A-2 Term Notes	100,000
Class A-3 Variable Funding Note	260,000
Class A-4 Variable Funding Note	28,000

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Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2011

Commitments and Contingencies

Schedule of future minimum lease payments under scheduled operating leases

Year ended December 31:
2012	$	5,663
2013	$	4,645
2014	$	4,693
2015	$	3,649
2016	$	3,003
Thereafter	$	2,467
Sublease income	$	(14,255	)
Minimum lease commitments	$	9,865

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Investments in Marketable Securities (Details) (USD $)	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Activity of investments classified as available-for-sale securities
Beginning Balance		$ 56,197,000
Purchases	40,253,000	41,757,000	68,126,000
Sales (at cost)		(95,624,000)
Unrealized gain (loss)	124,000	(2,330,000)
Ending Balance	40,377,000		56,197,000
Total proceeds from the sale of available-for-sale securities		96,685,000	16,309,000
Pre-tax gain on the sale of available-for-sale securities		1,061,000
Accumulated other comprehensive income
Beginning Balance		1,352,000
Gains (losses), net of tax	124,000	(291,000)
Losses (gains) recognized into earnings, net of tax		(1,061,000)
Ending Balance	124,000		1,352,000
Tax on gains (losses)	0	0
Tax on losses (gains) recognized into earnings		$ 0

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Commitments and Contingencies (Details) (USD $)	12 Months Ended			1 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Nov. 30, 2011 Negligence related to a home break-in Monitronics and Tel-Star Alarms, Inc.	Dec. 31, 2011 Negligence related to a home break-in Monitronics and Tel-Star Alarms, Inc.
Future minimum lease payments
2012	$ 5,663,000
2013	4,645,000
2014	4,693,000
2015	3,649,000
2016	3,003,000
Thereafter	2,467,000
Sublease income	(14,255,000)
Minimum lease commitments	9,865,000
Rent expense for noncancelable operating leases
Rent expense	2,261,000	825,000	744,000
Commitments and Contingencies
Amount awarded to plaintiff				8,600,000
Portion of award expected to be covered by insurance				6,000,000
Legal reserves					8,600,000
Insurance receivable					$ 6,000,000

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Dec. 31, 2011	Dec. 31, 2010
Current assets:
Cash and cash equivalents	$ 183,558	$ 149,857
Restricted cash (note 2)	31,196	28,915
Trade receivables, net	10,973	11,092
Deferred income tax assets, net (note 13)	5,881	9,070
Investments in marketable securities (note 8)	40,377
Assets of discontinued operations (note 5)		22,990
Income taxes receivable	308	8,798
Prepaid and other current assets	17,600	9,964
Total current assets	289,893	240,686
Restricted cash (note 2)	28,000	35,000
Property and equipment, net (note 6)	74,697	78,211
Subscriber accounts, net (note 2)	838,441	822,811
Dealer network, net (note 2)	39,933	50,013
Goodwill	349,227	349,227
Assets of discontinued operations (note 5)	62	62,420
Other assets, net (note 2)	5,706	6,514
Total assets	1,625,959	1,644,882
Current liabilities:
Accounts payable	3,987	7,059
Accrued payroll and related liabilities	5,149	8,510
Other accrued liabilities	19,000	14,366
Deferred revenue	6,803	3,382
Purchase holdbacks	12,273	9,818
Current portion of long-term debt (note 9)	60,000	20,000
Liabilities related to assets of discontinued operations (note 5)	7,101	30,771
Total current liabilities	114,313	93,906
Non-current liabilities:
Long-term debt (note 9)	892,718	896,733
Derivative financial instruments	36,279	64,745
Deferred income tax liability, net (note 13)	9,793	12,798
Other liabilities	12,529	18,282
Liabilities related to assets of discontinued operations (note 5)		10,678
Total liabilities	1,065,632	1,097,142
Commitments and contingencies (note 17)
Stockholders' Equity:
Preferred stock, $.01 par value. Authorized 5,000,000 shares; no shares issued
Additional paid-in capital	1,461,671	1,467,757
Accumulated deficit	(896,710)	(917,347)
Accumulated other comprehensive loss	(4,776)	(2,813)
Total stockholders' equity	560,327	547,740
Total liabilities and stockholders' equity	1,625,959	1,644,882
Common Stock Series A
Stockholders' Equity:
Common stock	135	136
Total stockholders' equity	135	136
Common Stock Series B
Stockholders' Equity:
Common stock	7	7
Total stockholders' equity	7	7
Common Stock Series C
Stockholders' Equity:
Common stock
Total stockholders' equity	$ 0

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Summary of Significant Accounting Policies (Details 3) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Property and Equipment
Depreciation expense	$ 7,052	$ 3,067	$ 4,259
Buildings
Property and Equipment
Estimated useful lives (in years)	20
Leasehold improvements
Property and Equipment
Estimated useful lives (in years)	15
Machinery and equipment
Property and Equipment
Minimum estimated useful lives (in years)	5
Maximum estimated useful lives (in years)	7
Computer systems and software
Property and Equipment
Minimum estimated useful lives (in years)	3
Maximum estimated useful lives (in years)	5

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Consolidated Statements of Stockholders' Equity (USD $) In Thousands, unless otherwise specified	Total	Common Stock Series A	Common Stock Series B	Common Stock Series C	Preferred stock	Additional paid-in capital	Accumulated deficit	Accumulated other comprehensive income (loss)
Balance at Dec. 31, 2008	$ 625,310	$ 134	$ 7			$ 1,459,078	$ (825,956)	$ (7,953)
Increase (Decrease) in Stockholders' Equity
Net loss	(52,897)						(52,897)
Other comprehensive income (loss)	4,336							4,336
Stock-based compensation	2,443					2,443
Stock option exercises (note 14)	2,121					2,121
Shares withheld for tax liability	(263)					(263)
Other	1,546					1,546
Balance at Dec. 31, 2009	582,596	134	7			1,464,925	(878,853)	(3,617)
Increase (Decrease) in Stockholders' Equity
Net loss	(38,494)						(38,494)
Other comprehensive income (loss)	804							804
Stock-based compensation	3,148	2				3,146
Shares withheld for tax liability	(314)					(314)
Balance at Dec. 31, 2010	547,740	136	7			1,467,757	(917,347)	(2,813)
Increase (Decrease) in Stockholders' Equity
Net loss	20,637						20,637
Other comprehensive income (loss)	(1,963)							(1,963)
Stock repurchases (note 15)	(11,488)	(2)				(11,486)
Stock-based compensation	4,732					4,732
Stock option exercises (note 14)	1,291	1				1,290
Shares withheld for tax liability	(622)					(622)
Balance at Dec. 31, 2011	$ 560,327	$ 135	$ 7	$ 0	$ 0	$ 1,461,671	$ (896,710)	$ (4,776)

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Fair Value Measurements (Details 2) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010
Derivative financial instruments - liabilities
Activity in the Level 3 balances
Beginning Balance	$ 42,935
Derivatives acquired in the acquisition of Monitronics		(43,116)
Unrealized (gain) loss	(25,976)	181
Ending Balance	16,959	42,935
Other liabilities
Activity in the Level 3 balances
Beginning Balance		(134)
Amounts credited to income		$ 134

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Restructuring Charges (Tables)

12 Months Ended

Dec. 31, 2011

Restructuring Charges.

Schedule of activity and balances of the restructuring plan

	Opening Balance		Additions	Deductions (a)		Ending Balance
	Amounts in thousands
2010 Restructuring Plan
Severance and retention	$	—	3,994	(404	)	3,590
Excess facility costs	—		—	—		—
December 31, 2010	$	—	3,994	(404	)	3,590
Severance and retention	$	3,590	4,186	(5,890	)	1,886	(b)
Excess facility costs	—		—	—		—
December 31, 2011	$	3,590	4,186	(5,890	)	1,886
2008 Restructuring Plan
Severance	$	404	647	(830	)	221
Excess facility costs	60		48	(15	)	93
December 31, 2009	$	464	695	(845	)	314
Severance	221		477	(689	)	9
Excess facility costs	93		133	(15	)	211
December 31, 2010	$	314	610	(704	)	220
Severance	9		—	(9	)	—
Excess facility costs	211		72	(47	)	236	(b)
December 31, 2011	$	220	72	(56	)	236

(a) Primarily represents cash payments.

(b) Substantially all of this amount is expected to be paid in 2012.

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Stock-based and Long-Term Compensation (Details) (USD $)	12 Months Ended
	Dec. 31, 2011 M denominator year	Dec. 31, 2010
Phantom Appreciation Rights ("PARs")
Stock-based and Long-Term Compensation
Numerator of PAR Value calculation, percentage of cumulative free cash flow, level one	6.00%
Maximum period of cumulative free cash flow considered for calculation of PAR Value (in years)	6
Denominator for calculation of PAR Value, level one	500,000
Denominator for calculation of PAR Value, level two	10,000,000
Maximum number of awards that may be granted under the plan (in shares)	500,000
Vesting period beginning on the grant date (in years)	3 years
Vesting period beginning after grantee's termination of employment (in months)	6
Awards granted (in shares)		122,000
Award outstanding (in shares)		267,000
Percentage of awards vested		100.00%
Liability and charge to selling, general and administrative expense related to the distribution		$ 1,034,000
2008 incentive plan
Stock-based and Long-Term Compensation
Maximum number of awards that may be granted under the plan (in shares)	2,000,000
2008 director incentive plan
Stock-based and Long-Term Compensation
Maximum number of awards that may be granted under the plan (in shares)	500,000

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Employee Benefit Plans

12 Months Ended

Dec. 31, 2011

Employee Benefit Plans

Employee Benefit Plans

(16)  Employee Benefit Plans

Defined Contribution Plan

The Company offers a 401(k) defined contribution plan covering most of its full-time domestic employees. The Company also sponsored a pension plan for eligible employees of its foreign subsidiaries.  The plans are funded by employee and employer contributions.  Total combined 401(k) plan and pension plan expenses for the years ended December 31, 2011, 2010 and 2009 were $717,000, $990,000 and $1,394,000, respectively.

Management Incentive Plan and Discretionary Bonuses

Ascent, through its former subsidiary AMG, offered a Management Incentive Plan (“MIP”) which provided for annual cash incentive awards based on company and individual performance.  Certain executive officers and certain employees with a title of divisional managing director, corporate director or higher were eligible to receive awards under the MIP, as determined by a management incentive plan compensation committee.  To the extent an award was earned, it is payable no later than two and one-half months following the end of the applicable plan year. Participants were required to be employed by AMG through the payment date to be eligible to receive the award. The forecasted award liability is accrued on a monthly basis throughout the plan year.  The Company also paid bonuses to certain employees at the discretion of management and the compensation committee.  For the years ended December 31, 2011 and 2009, no MIP or discretionary bonus amounts were recorded.  For the year ended 2010, amounts recorded for MIP and discretionary bonuses were $318,000.  The liability recorded at December 31, 2010 was equivalent to the expense for that year.  The plan was terminated as of December 31, 2010.

Defined Benefit Plans

The Company has two defined benefit plans in the United Kingdom.  Participation in the defined benefit plans is limited with approximately 121 participants, including retired employees.  The plans are closed to new participants.

The Company uses a measurement date of December 31 for its defined benefit pension plans.

The obligations and funded status of the defined benefit plans for the years ended December 31, 2011 and 2010 are as follows:

	Years Ended
	2011			2010
	Amounts in thousands
Change in Benefit Obligation:
Benefit Obligation — beginning of year	$	12,357		10,070
Service cost	—			68
Interest cost	510			562
Actuarial loss	2,415			2,478
Settlements	(93		)	(333	)
Benefits paid	(413		)	(213	)
Member contributions	—			14
Foreign currency exchange rate changes	(14		)	(289	)
Benefit Obligation — end of year	14,762			12,357
Change in Plan Assets:
Fair Value of plan assets — beginning of year	8,491			7,536
Actual return on assets	3,173			965
Settlements	(97		)	(436	)
Employer contributions	5,098			842
Member contributions	—			14
Benefits paid	(10		)	(213	)
Foreign currency exchange rate changes	(413		)	(217	)
Fair Value of plan assets — end of year	16,242			8,491
Funded (Unfunded) Status	$	1,480		(3,866	)

The Company had recorded the 2011 funded balance in the table above in other assets and the 2010 unfunded balance in the table above in other liabilities account on the consolidated balance sheets.  The projected benefit obligation and accumulated benefit obligation at December 31, 2010 are equal to the “Benefit obligation — end of year” amount for the respective year in the table above.  The accumulated other comprehensive income balance at December 31, 2011 and 2010, included pension adjustments of $(4,690,000) and $(5,553,000), respectively.

The following table sets forth the average assumptions and the asset category allocations of the defined benefit plans for the years ended December 31, 2010 and 2009.

	2011		2010
Assumptions:
Discount rate	4.20	%	4.20	%
Long-term return on plan assets	4.20	%	4.20	%
Price inflation	3.60	%	3.60	%
Asset Category Allocations:
Debt securities	7	%	41	%
Equity securities	0	%	42	%
Other	93	%	17	%

The discount rate and the long-term return on plan asset rate were based on United Kingdom government bonds to reflect the expected settlement of the defined benefit plans.  See below for further information.

The amount of pension cost recognized for the years ended December 31, 2011, 2010 and 2009 were as follows:

	Year Ended December 30,
	2011			2010		2009
	Amounts in thousands
Service cost	$	—		68		49
Interest cost	529			543		506
Expected return on plan assets	(472		)	(411	)	(341	)
Amortization of net actuarial loss	531			373		141
	$	588		573		355

The Company employs a mix of investments, insurance policies and cash at a prudent level of risk in order to maximize the long-term return on plan assets.  The investment objectives are to meet the future benefit obligations of the pension plans and to reduce funding volatility as much as possible.

The fair value of the plan assets as of December 31, 2011 are as follows:

	Level 1		Level 2	Level 3	Total
Cash and cash equivalents	$	64	—	—	64
Pooled investment funds	1,164		—	—	1,164
Debt investments	—		—	—	—
Insurance policies	—		15,014	—	15,014
Total	$	1,228	15,014	—	16,242

The fair value of the plan assets as of December 31, 2010 are as follows:

	Level 1		Level 2	Level 3	Total
Cash and cash equivalents	$	146	—	—	146
Pooled investment funds	3,945		—	—	3,945
Debt investments	—		1,638	—	1,638
Insurance policies	—		2,762	—	2,762
Total	$	4,091	4,400	—	8,491

The Company is in the process of settling all the benefit obligations under both of its defined benefit plans and expects to complete the settlement process in 2012.  The settlement will be funded by the plan assets and employer contributions from the Company.  During 2010, Ascent Capital has deposited approximately $5.5 million in an escrow account that will be used to fund the settlements.  As of December 31, 2011, $0.8 million remained in the escrow account.  These amounts are included in restricted cash on the December 31, 2011 and 2010 consolidated balance sheets.

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2011

Income Taxes

Schedule of company's income tax benefit (expense) from continuing operations

	Years Ended December 31,
	2011			2010		2009
	Amounts in thousands
Current
Federal	$	350		(1,594	)	8,389
State	(2,405		)	(200	)	207
Foreign	—			1,307		726
	(2,055		)	(487	)	9,322
Deferred
Federal	(380		)	(233	)	(24,051	)
State	(22		)	908		(13,992	)
Foreign	—			(458	)	—
	(402		)	217		(38,043	)
Total tax expense	$	(2,457	)	(270	)	(28,721	)

Schedule of components of pretax loss from continuing operations

	Years Ended December 31,
	2011			2010		2009
	Amounts in thousands
Domestic	$	(20,437	)	(22,643	)	(18,926	)
Foreign	(5,258		)	(10,588	)	(8,158	)
	$	(25,695	)	(33,231	)	(27,084	)

Schedule of a reconciliation of the reported amount of income tax (expense) benefit from continuing operations

	Years Ended December 31,
	2011			2010		2009
	Amounts in thousands
Computed expected tax benefit	$	8,993		11,631		9,479
State and local income taxes, net of federal income taxes	106			3,548		1,908
Change in valuation allowance affecting tax expense	(13,285		)	(9,756	)	(36,370	)
Non-deductible expenses	(547		)	(4,331	)	(139	)
Foreign tax credit	—			—		—
Other, net	2,276			(1,362	)	(3,599	)
Income tax expense	$	(2,457	)	(270	)	(28,721	)

Schedule of components of deferred tax assets and (liabilities)

	2011			2010
	Amounts in thousands
Current assets:
Accounts receivable reserves	$	879		$	802
Accrued liabilities	8,796			11,970
Other	—			—
Total current deferred tax assets	9,675			12,772
Valuation allowance	(2,141		)	(3,702		)
	7,534			9,070
Noncurrent assets:
Net operating loss carryforwards	76,478			36,334
Derivative financial instruments	12,718			22,525
Deferred financing costs	9,056			9,527
Other	8,523			3,688
Total noncurrent deferred tax assets	106,775			72,074
Valuation allowance	(27,107		)	(28,176		)
	79,668			43,898
Deferred tax assets, net	87,202			52,968
Current liabilities:
Other	(1,653		)	—
Noncurrent liabilities:
Intangible assets	(64,054		)	28,727
Subscriber accounts	(20,236		)	(72,381		)
Long-term debt	(3,686		)	(9,657		)
Property, plant and equipment	(1,485		)	(2,509		)
Marketable securities	—			—
Other	—			(876		)
	(89,461		)	(56,696		)
Total deferred tax liabilities	(91,114		)	(56,696		)
Net deferred tax assets (liabilities)	$	(3,912	)	$	(3,728	)

Schedule of company's deferred tax assets and liabilities reported in the accompanying consolidated balance sheets

	December 31,
	2011			2010
	Amounts in thousands
Current deferred tax assets, net	$	5,881		$	9,070
Long-term deferred tax assets, net	—			—
Long-term deferred tax liabilities, net	(9,793		)	(12,798		)
Net deferred tax assets (liabilities)	$	(3,912	)	$	(3,728	)

Schedule of a reconciliation of the beginning and ending amount of uncertain tax positions

	Amounts in thousands
Balance at January 1, 2011	$	292
Increase related to acquisitions	—
Increases for the tax positions of prior years	—
Reductions for tax positions of prior years	—
Foreign currency exchange adjustments	(12		)
Balance at December 31, 2011	$	280

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Quarterly Financial Information (Unaudited)

12 Months Ended

Dec. 31, 2011

Quarterly Financial Information (Unaudited)

Quarterly Financial Information (Unaudited)

(18) Quarterly Financial Information (Unaudited)

	1st			2nd		3rd		4th
	Quarter			Quarter		Quarter		Quarter
	Amounts in thousands,
	except per share amounts
2011:
Revenue	$	73,870		77,577		79,515		80,936
Operating income	$	1,176		8,085		7,715		6,030
Net income (loss)	$	55,187		(18,282	)	(9,867	)	(6,401	)
Basic and diluted net income (loss) per common share	$	3.88		(1.28	)	(0.69	)	(0.46	)
2010:
Revenue	$	—		—		—		9,129
Operating loss	$	(7,940	)	(8,692	)	(7,583	)	(9,276	)
Net income (loss)	$	9,910		(16,138	)	(9,846	)	(22,420	)
Basic and diluted net income (loss) per common share	$	0.70		(1.14	)	(0.69	)	(1.58	)

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Stockholders' Equity (Details) (USD $)	1 Months Ended	12 Months Ended
	Jun. 30, 2011	Dec. 31, 2011 vote	Dec. 31, 2010	Dec. 31, 2009
Series A common stock
Stockholders' Equity
Number of votes which holders of common shares are entitled to, for each share held		1
Number of shares of series A common stock issuable for conversion of series B common stock		1
Authorized amount for repurchase of shares	$ 25,000,000
Average purchase price (in dollars per share)		$ 42.60
Total purchase price		$ 11,488,000
Activity in the Series A and Series B common stock
Balance at the beginning of the period (in shares)		13,553,251	13,550,676	13,531,567
Conversion from Series B to Series A shares		2,734	528	1,815
Issuance of restricted stock (in shares)		148,654	12,766	15,923
Restricted stock cancelled for tax withholding (in shares)		(14,846)	(10,719)	(10,351)
Repurchase and retirement of Series A shares		(269,659)
Stock option exercises (in shares)		51,460		11,722
Balance at the end of the period (in shares)		13,471,594	13,553,251	13,550,676
Common stock reserved for issuance (in shares)		882,709
Series B common stock
Stockholders' Equity
Number of votes which holders of common shares are entitled to, for each share held		10
Activity in the Series A and Series B common stock
Balance at the beginning of the period (in shares)		733,599	734,127	659,732
Conversion from Series B to Series A shares		(2,734)	(528)	(1,815)
Issuance of restricted stock (in shares)		9,029
Stock option exercises (in shares)				76,210
Balance at the end of the period (in shares)		739,894	733,599	734,127

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Basis of Presentation

12 Months Ended

Dec. 31, 2011

Basis of Presentation

Basis of Presentation

(1)  Basis of Presentation

On July 7, 2011, Ascent Media Corporation merged with its direct wholly owned subsidiary, Ascent Capital Group, Inc., for the purpose of changing its name to Ascent Capital Group, Inc. The accompanying Ascent Capital Group, Inc. (“Ascent Capital” or the “Company”) consolidated financial statements represent the financial position and results of operations of Ascent Capital and its consolidated subsidiaries.  Monitronics International, Inc. (“Monitronics”) is the primary, wholly owned, operating subsidiary of the Company.  Monitronics provides security alarm monitoring and related services to residential and business subscribers throughout the United States and parts of Canada.  Monitronics monitors signals arising from burglaries, fires, medical alerts, and other events through security systems installed by independent dealers at subscribers’ premises.

As of December 31, 2010, Ascent Capital’s business units were aggregated into two reportable segments: Monitronics and the Content Services group.  The Content Services group had historically included the Content Distribution business and the System Integration business.  The Content Distribution business was sold to Encompass Digital Media, Inc. (“Encompass”) in February 2011 and has been treated as a discontinued operation for all periods presented.  In June 2011, the Systems Integration business ceased operations and is treated as a discontinued operation for all periods presented. As a result, Ascent Capital has one reportable segment.

The Company has reclassified certain prior period amounts to conform to the current period’s presentation.

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Consolidated Balance Sheets (Parenthetical) (USD $)	Dec. 31, 2011	Dec. 31, 2010
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, Authorized shares	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Common Stock Series A
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, Authorized shares	45,000,000	45,000,000
Common stock, issued shares	13,471,594	13,553,251
Common stock, outstanding shares	13,471,594	13,553,251
Common Stock Series B
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, Authorized shares	5,000,000	5,000,000
Common stock, issued shares	739,894	733,599
Common stock, outstanding shares	739,894	733,599
Common Stock Series C
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, Authorized shares	45,000,000	45,000,000
Common stock, issued shares	0	0

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Fair Value Measurements

12 Months Ended

Dec. 31, 2011

Fair Value Measurements

Fair Value Measurements

(11) Fair Value Measurements

According to the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants and requires that assets and liabilities carried at fair value are classified and disclosed in the following three categories:

·Level 1 - Quoted prices for identical instruments in active markets.

·Level 2 - Quoted prices for similar instruments in active or inactive markets and valuations derived from models where all significant inputs are observable in active markets.

·Level 3 - Valuations derived from valuation techniques in which one or more significant inputs are unobservable in any market.

The following summarizes the fair value level of assets and liabilities that are measured on a recurring basis at December 31 (amounts in thousands):

	Level 1		Level 2		Level 3		Total
2010
Derivative financial instruments - assets	—		447		—		447
Derivative financial instruments - liabilities	—		(21,810	)	(42,935	)	(64,745	)
Total	$	—	(21,363	)	(42,935	)	(64,298	)
2011
Money market funds (a)	$	168,622	—		—		168,622
Investments in marketable securities (b)	40,377		—		—		40,377
Derivative financial instruments - assets	—		25		—		25
Derivative financial instruments - liabilities	—		(19,320	)	(16,959	)	(36,279	)
Total	$	208,999	(19,295	)	(16,959	)	172,745

(a)Included in cash and cash equivalents on the consolidated balance sheet.

(b)Investments primarily consist of diversified corporate bond funds and are all classified as available-for-sale securities.

The Company has determined that the majority of the inputs used to value its interest rate caps and floor derivatives fall within Level 2 of the fair value hierarchy. The Company has determined that the majority of the inputs used to value its Swaps fall within Level 3 of the fair value hierarchy, including management’s estimates of the refinancing date of the Term Notes, which affects the termination date of the Swaps as the notional amount of the Swaps is directly linked to the outstanding principal balance of the Term Notes.  The credit valuation adjustments associated with its derivatives utilize also Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by its counterparties.  For counterparties with publicly available credit information, the credit spreads over LIBOR used in the calculations represent implied credit default swap spreads obtained from a third-party credit data provider.  However, as of December 31, 2011, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its interest rate caps and floor derivatives, but are significant for the Swaps.  As a result, the Company has determined that its derivative valuations on its interest rate caps and floor are classified in Level 2 of the fair value hierarchy and its derivative valuation on its Swaps are classified in Level 3 of the fair-value hierarchy.

The following table presents the activity in the Level 3 balances:

	Years Ended December 31,
	2011			2010
	Amounts in thousands
Derivative financial instruments - liabilities
Beginning Balance	$	42,935		$	—
Derivatives acquired in the acquisition of Monitronics	—			(43,116		)
Unrealized (gain) loss	(25,976		)	181
Ending Balance	$	16,959		$	42,935
Other liabilities
Beginning Balance	$	—		$	(134	)
Contingent consideration	—			—
Settlements paid in cash	—			—
Amounts credited to income (a)	—			134
Ending Balance	$	—		$	—

(a)Amount consisted of a participating residual interest change in fair value.  This amount was recorded in SG&A on the consolidated statements of operations.

For the year ended December 31, 2009, the Company recorded an asset impairment for one of its content services facilities.  The fair value of the asset was $7,195,000 which resulted in an impairment charge of $972,000, which is presented in discontinued operations.  The fair value was a non-recurring, Level 3 valuation and was measured using a discounted cash flow model which uses internal estimates of future revenues and costs and an estimated discount rate.

Ascent Capital’s financial instruments, including cash and cash equivalents, accounts receivable and accounts payable are carried at cost, which approximates their fair value because of their short-term maturities.

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Document and Entity Information (USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2011	Jun. 30, 2011	Feb. 17, 2012 Common Stock Series A	Feb. 17, 2012 Common Stock Series B
Entity Registrant Name	Ascent Capital Group, Inc.
Entity Central Index Key	0001437106
Document Type	10-K
Document Period End Date	Dec. 31, 2011
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float		$ 708
Entity Common Stock, Shares Outstanding			13,470,323	739,894
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	FY

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Restructuring Charges

12 Months Ended

Dec. 31, 2011

Restructuring Charges.

Restructuring Charges

(12)  Restructuring Charges

During 2011, 2010 and 2009, the Company completed certain restructuring activities and recorded charges of $4,258,000, $4,604,000 and $695,000, respectively.

In the fourth quarter of 2010, the Company began a new restructuring plan (the “2010 Restructuring Plan) in conjunction with the expected sales of the Creative/Media and Content Distribution businesses.  The 2010 Restructuring Plan was implemented to meet the changing strategic needs of the Company as it sold most of its media and entertainment assets and acquired Monitronics, an alarm monitoring business.  Such charges included retention costs for employees to remain employed until the sales were complete, severance costs for certain employees that were not retained by the buyers and facility costs that were no longer being used by the Company due to the sales.

Before the Company implemented the 2010 Restructuring Plan, it had just completed a restructuring plan that was implemented in 2008 and concluded in September 2010 (the “2008 Restructuring Plan”).  The 2008 Restructuring Plan was implemented to align the Company’s organization with its strategic goals and how it operates, manages and markets its services.  The 2008 Restructuring Plan charges included severance costs from labor cost mitigation measures undertaken across all of the businesses and facility costs in conjunction with the consolidation of certain facilities in the United Kingdom and the closing of the Company’s Mexico operations.

The following table provides the activity and balances of the 2010 Restructuring Plan and 2008 Restructuring Plan.  At December 31, 2011, $2,122,000 of the combined ending liability balance is included in other accrued liabilities.

	Opening Balance		Additions	Deductions (a)		Ending Balance
	Amounts in thousands
2010 Restructuring Plan
Severance and retention	$	—	3,994	(404	)	3,590
Excess facility costs	—		—	—		—
December 31, 2010	$	—	3,994	(404	)	3,590
Severance and retention	$	3,590	4,186	(5,890	)	1,886	(b)
Excess facility costs	—		—	—		—
December 31, 2011	$	3,590	4,186	(5,890	)	1,886
2008 Restructuring Plan
Severance	$	404	647	(830	)	221
Excess facility costs	60		48	(15	)	93
December 31, 2009	$	464	695	(845	)	314
Severance	221		477	(689	)	9
Excess facility costs	93		133	(15	)	211
December 31, 2010	$	314	610	(704	)	220
Severance	9		—	(9	)	—
Excess facility costs	211		72	(47	)	236	(b)
December 31, 2011	$	220	72	(56	)	236

(a) Primarily represents cash payments.

(b) Substantially all of this amount is expected to be paid in 2012.

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Consolidated Statements of Operations and Comprehensive Income (loss) (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Net revenue	$ 311,898	$ 9,129
Operating expenses:
Cost of services	40,553	1,422
Selling, general, and administrative, including stock-based and long-term compensation (note 14)	76,845	30,314	27,451
Amortization of subscriber accounts and dealer network	159,619	5,980
Depreciation	7,052	3,067	4,259
Restructuring charges (note 12)	4,258	4,604	695
Loss (gain) on sale of operating assets, net	565	(2,768)	152
Total operating expenses	288,892	42,619	32,557
Operating Income (loss)	23,006	(33,490)	(32,557)
Other income (expense):
Interest income	671	3,638	2,676
Interest expense	(42,813)	(2,672)	(102)
Realized and unrealized loss on derivative financial instruments	(10,601)	(1,682)
Other income (expense), net	4,042	975	2,899
Total other income (expense)	(48,701)	259	5,473
Loss from continuing operations before income taxes	(25,695)	(33,231)	(27,084)
Income tax expense from continuing operations (note 13)	(2,457)	(270)	(28,721)
Net loss from continuing operations	(28,152)	(33,501)	(55,805)
Discontinued operations:
Income (loss) from discontinued operations	48,836	(12,077)	(6,682)
Income tax (expense) benefit from discontinued operations	(47)	7,084	9,590
Income (loss) from discontinued operations, net of income taxes	48,789	(4,993)	2,908
Net income (loss)	20,637	(38,494)	(52,897)
Other comprehensive income (loss) (note 15):
Foreign currency translation adjustments	(2,950)	4,026	4,693
Unrealized holding gain (loss), net of income tax	124	(1,352)	1,352
Pension liability adjustment	863	(1,870)	(1,709)
Other comprehensive income (loss)	(1,963)	804	4,336
Comprehensive income (loss)	$ 18,674	$ (37,690)	$ (48,561)
Basic and diluted earnings (loss) per share (note 2)
Continuing operations (in dollars per share)	$ (1.98)	$ (2.36)	$ (3.97)
Discontinued operations (in dollars per share)	$ 3.43	$ (0.35)	$ 0.21
Net income (loss) (in dollars per share)	$ 1.45	$ (2.71)	$ (3.76)

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Property and Equipment

12 Months Ended

Dec. 31, 2011

Property and Equipment

Property and Equipment

(6)  Property and Equipment

Property and equipment at December 31, 2011 and 2010 consist of the following (amounts in thousands):

	2011			2010
Property and equipment, net:
Land	$	34,896		34,901
Buildings	54,575			57,824
Machinery and equipment	22,763			19,949
	112,234			112,674
Accumulated depreciation	(37,537		)	(34,463	)
	$	74,697		78,211

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Dispositions

12 Months Ended

Dec. 31, 2011

Dispositions

Dispositions

(5) Dispositions

The consolidated financial statements and accompanying notes of Ascent Capital have been prepared reflecting the following businesses as discontinued operations for all years presented in accordance with the Presentation of the Financial Statements Topic of the FASB ASC.

In June 2011, the Company shut down the operations of the Systems Integration business.  In connection with ceasing its operations, the Company recorded exit costs of $1,119,000 related to employee severance for the year ended December 31, 2011.

On February 28, 2011, Ascent Capital completed the sale of 100% of the Content Distribution business to Encompass.  Ascent Capital received cash proceeds of approximately $104,000,000.  Ascent Capital recorded a gain on the sale of $66,136,000 and the related income tax expense of $2,906,000 for the quarter ended March 31, 2011.

On December 31, 2010, pursuant to a definitive agreement with Deluxe Entertainment Services Group Inc. (“Deluxe”), dated November 24, 2010, Ascent Capital completed the sale of Creative/Media, for an aggregate sales price of approximately $69,000,000 in cash.  Ascent Capital recorded a pre-tax loss on the sale of $27,110,000 and $7,587,000 of related income tax benefit for the year ended December 31, 2010.

In September 2010, the Company shut down the operations of the Global Media Exchange (“GMX”), which was previously included in the Content Services group.  Ascent Capital recorded a charge of $1,838,000 related to asset retirements and severance costs in connection with the shutdown for the year ended December 31, 2010.

In February 2010, the Company completed the sale of the assets and operations of the Chiswick Park facility in the United Kingdom, which was previously included in the Content Services group, to Discovery Communications, Inc.  The net cash proceeds on the sale were $34.8 million.  Ascent Capital recorded a pre-tax gain on the sale of $25,498,000, subject to customary post-closing adjustments, and $3,423,000 of related income tax expense for the year ended December 31, 2010.

The following table presents the results of operations of the discontinued operations that are included in earnings from discontinued operations, net of income tax (amounts in thousands):

	Year Ended December 30,
	2011		2010		2009
Revenue	$	24,183	426,295		472,049
Income (loss) before income taxes (a)	$	48,836	(12,077	)	(6,682	)

(a)  The 2011 amount includes a gain on the sale of the Content Distribution business of approximately $66,136,000 and a charge of $1,119,000 related to the shutdown of the Systems Integration business.  The 2010 amount includes the pre-tax loss on the sale of the Creative/Media businesses of $(27,110,000), a pre-tax $25,498,000 gain on the sale of the Chiswick Park facility and a charge of $(1,838,000) related to the shutdown of the GMX business.

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2011

Commitments and Contingencies

Commitments and Contingencies

(17)  Commitments and Contingencies

Future minimum lease payments under scheduled operating leases, which are primarily for buildings, equipment and real estate, having initial or remaining noncancelable terms in excess of one year are as follows (in thousands):

Year ended December 31:
2012	$	5,663
2013	$	4,645
2014	$	4,693
2015	$	3,649
2016	$	3,003
Thereafter	$	2,467
Sublease income	$	(14,255	)
Minimum lease commitments	$	9,865

Rent expense for noncancelable operating leases for real property and equipment was $2,261,000, $825,000 and $744,000 for the years ended December 31, 2011, 2010 and 2009, respectively.  Various lease arrangements contain options to extend terms and are subject to escalation clauses.

The Company is involved in litigation and similar claims incidental to the conduct of its business. In August 2009, a monitoring service subscriber filed suit against Monitronics and Tel-Star Alarms, Inc., a Monitronics authorized dealer, alleging negligence related to a home break-in.  On November 16, 2011, a trial court awarded the plaintiff $8,600,000, of which $6,000,000 is expected to be covered by the Monitronics’ general liability insurance policies.  Monitronics intends to appeal the court ruling and vigorously defend its position.  The Company recorded legal reserves of $8,600,000 and an insurance receivable of $6,000,000 in fiscal year 2011 related to this matter.

Except as disclosed above, in management’s opinion, none of the pending actions are likely to have a material adverse impact on the Company’s financial position or results of operations.

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Income Taxes

12 Months Ended

Dec. 31, 2011

Income Taxes

Income Taxes

(13)  Income Taxes

The Company’s income tax benefit (expense) from continuing operations is as follows:

	Years Ended December 31,
	2011			2010		2009
	Amounts in thousands
Current
Federal	$	350		(1,594	)	8,389
State	(2,405		)	(200	)	207
Foreign	—			1,307		726
	(2,055		)	(487	)	9,322
Deferred
Federal	(380		)	(233	)	(24,051	)
State	(22		)	908		(13,992	)
Foreign	—			(458	)	—
	(402		)	217		(38,043	)
Total tax expense	$	(2,457	)	(270	)	(28,721	)

Components of pretax loss from continuing operations are as follows:

	Years Ended December 31,
	2011			2010		2009
	Amounts in thousands
Domestic	$	(20,437	)	(22,643	)	(18,926	)
Foreign	(5,258		)	(10,588	)	(8,158	)
	$	(25,695	)	(33,231	)	(27,084	)

Income tax benefit differs from the amounts computed by applying the United States federal income tax rate of 35% as a result of the following:

	Years Ended December 31,
	2011			2010		2009
	Amounts in thousands
Computed expected tax benefit	$	8,993		11,631		9,479
State and local income taxes, net of federal income taxes	106			3,548		1,908
Change in valuation allowance affecting tax expense	(13,285		)	(9,756	)	(36,370	)
Non-deductible expenses	(547		)	(4,331	)	(139	)
Foreign tax credit	—			—		—
Other, net	2,276			(1,362	)	(3,599	)
Income tax expense	$	(2,457	)	(270	)	(28,721	)

Components of deferred tax assets and (liabilities) as of December 31 are as follows:

	2011			2010
	Amounts in thousands
Current assets:
Accounts receivable reserves	$	879		$	802
Accrued liabilities	8,796			11,970
Other	—			—
Total current deferred tax assets	9,675			12,772
Valuation allowance	(2,141		)	(3,702		)
	7,534			9,070
Noncurrent assets:
Net operating loss carryforwards	76,478			36,334
Derivative financial instruments	12,718			22,525
Deferred financing costs	9,056			9,527
Other	8,523			3,688
Total noncurrent deferred tax assets	106,775			72,074
Valuation allowance	(27,107		)	(28,176		)
	79,668			43,898
Deferred tax assets, net	87,202			52,968
Current liabilities:
Other	(1,653		)	—
Noncurrent liabilities:
Intangible assets	(64,054		)	28,727
Subscriber accounts	(20,236		)	(72,381		)
Long-term debt	(3,686		)	(9,657		)
Property, plant and equipment	(1,485		)	(2,509		)
Marketable securities	—			—
Other	—			(876		)
	(89,461		)	(56,696		)
Total deferred tax liabilities	(91,114		)	(56,696		)
Net deferred tax assets (liabilities)	$	(3,912	)	$	(3,728	)

The Company’s deferred tax assets and liabilities are reported in the accompanying consolidated balance sheets as follows:

	December 31,
	2011			2010
	Amounts in thousands
Current deferred tax assets, net	$	5,881		$	9,070
Long-term deferred tax assets, net	—			—
Long-term deferred tax liabilities, net	(9,793		)	(12,798		)
Net deferred tax assets (liabilities)	$	(3,912	)	$	(3,728	)

The excess tax benefits associated with the exercise of non-qualified stock options, restricted stock grants, and disqualifying dispositions of both incentive stock option stock and stock acquired from the Company’s Employee Stock Purchase Plan, for 2011 and 2010 in the amount of $2,103,000 and $1,469,000, respectively, did not reduce current income taxes payable and, accordingly, are not included in the deferred tax asset relating to net operating loss (“NOL”) carryforwards, but are included with the federal and state NOL carryforwards disclosed in this footnote.

At December 31, 2011, the Company has $208,087,000, $36,996,000 and $79,303,000 in net operating loss carryforwards for federal, California and other state tax purposes, respectively.  The net operating losses expire at various times from 2023 through 2031.  Approximately $83 million of the Company’s net operating losses are subject to IRC Section 382 limitations.  The Company has $1,064,000 of federal income tax credits, of which $638,000 will expire in 2013.  The Company also has $1,127,000 of state credits that will expire through year 2026.

During the first quarter of 2008, Liberty Media Corporation (“Liberty”) reached an agreement with the IRS with respect to certain tax items that related to periods prior to DHC’s spin off from Liberty in July 2005 (the “2005 spin off”). The IRS agreement resulted in a reduction of $5,370,000 of a federal net operating loss (“NOL”) that Liberty allocated to the Company (which was then a subsidiary of DHC) at the time of the 2005 spin off. The reduction in the Company’s federal NOLs resulted in a first quarter 2008 tax expense of $1,880,000 (35% of $5,370,000).  During the fourth quarter of 2008, Liberty closed its IRS audit for tax years through 2005, with no further adjustments affecting the Company.  At December 31, 2008, Ascent Capital had fully utilized its federal net operating losses against its continuing and discontinued operations.  In the fourth quarter of 2010, Liberty amended certain federal income tax returns which resulted in a reduction of $7,138,000 to the amount of federal NOL allocated to the Company.  This resulted in a tax expense of $2,500,000 in the fourth quarter of 2010.

During 2009, the Company performed an assessment of positive and negative evidence regarding the realization of its net deferred tax assets.  Based on this assessment, management determined that it is more likely than not that the Company will not realize the tax benefits associated with its United States deferred tax assets and certain foreign deferred tax assets.  As such, for the year ended December 31, 2009, the Company increased the total valuation allowance by $35,350,000 consisting of an increase of $36,370,000 to tax expense and an increase of $463,000 to other comprehensive income.  At December 31, 2010, the valuation allowance balance was $33,347,000.  The increase in the valuation allowance includes a tax expense of $9,756,000 and a $405,000 adjustment due to the Monitronics business that was purchased.   At December 31, 2011, the valuation allowance balance was $31,351,000.  The change in the valuation allowance includes a tax expense of $13,285,000 and a $47,000 adjustment to other comprehensive income.

As of December 31, 2011, the Company’s income tax returns for the periods of September 18, 2008 through December 31, 2008 and the years ended December 31, 2010 and 2009, as well as the periods July 21, 2005 through September 17, 2008, when the Company was included in the consolidated income tax returns of DHC, remain subject to examination by the IRS and state authorities.

A reconciliation of the beginning and ending amount of uncertain tax positions, which is recorded in other long term liabilities, for the year ended December 31, 2011 is as follows:

	Amounts in thousands
Balance at January 1, 2011	$	292
Increase related to acquisitions	—
Increases for the tax positions of prior years	—
Reductions for tax positions of prior years	—
Foreign currency exchange adjustments	(12		)
Balance at December 31, 2011	$	280

When the tax law requires interest to be paid on an underpayment of income taxes, the Company recognizes interest expense from the first period the interest would begin accruing according to the relevant tax law. Such interest expense is included in other income, net in the accompanying consolidated statements of operations. Any accrual of penalties related to underpayment of income taxes on uncertain tax positions is included in Other income, net in the accompanying consolidated statements of operations. As of December 31, 2011, accrued interest and penalties related to uncertain tax positions were not significant.

The Company’s 2008 and 2009 federal income tax returns are under examination by the U.S. Internal Revenue Service. Although the outcome of tax audits is always uncertain, the Company believes that the results of the examination will not materially affect its financial position or result of operations.  The Company’s state income tax returns subsequent to 2006 are subject to examination by state tax authorities. The Company’s foreign tax returns subsequent to 2007 are open for review by the foreign tax authorities.

During 2009, the Company restructured its United Kingdom and Singapore operations which resulted in the Company permanently reinvesting excess cash from these operations within those countries.  There were no undistributed earnings from these operations as of December 31, 2011, 2010, and 2009.

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Long-Term Debt

12 Months Ended

Dec. 31, 2011

Long-Term Debt:

Long-Term Debt

(9)  Long-Term Debt

Long-term debt, which is all issued by Monitronics and its subsidiaries, consisted of the following:

	Years ended December 31,
	2011			2010
Class A-1a Term Notes (matures July 2027), LIBOR plus 1.8% (a)	$	345,577		$	338,478
Class A-1b Term Notes (matures July 2027), LIBOR plus 1.7% (a)	98,676			96,551
Class A-2 Term Notes (matures July 2037), LIBOR plus 2.2% (a)	98,978			97,338
Class A-3 Variable Funding Note (matures July 2037), LIBOR plus 1.8% (a)	256,558			251,032
Class A-4 Variable Funding Note (matures July 2037), LIBOR plus 1.8% (a)	27,629			27,034
Term Loan (matures June 30, 2012) (b)	60,000			60,000
$115 million revolving credit facility (matures December 17, 2013), LIBOR plus 4%	65,300			46,300
	952,718			916,733
Less current portion of long —term debt	(60,000		)	(20,000		)
Long-term debt	$	892,718		$	896,733

(a)The interest rate on the Term Notes and VFNs include 1.0% of other fees.

(b)During 2011, the interest rate on the Term Loan was LIBOR plus 4.00%.  As of January 1, 2012, the interest rate on the Term Loan is LIBOR plus 4.50%.  The term loan matures on June 30, 2012, and requires two principal installments of $20,000,000 on the first business day occurring on or after December 31, 2011 and March 31, 2012.  Ascent Capital has guaranteed $30 million of this Term Loan.

Securitization Debt

Monitronics completed a financing transaction of the type commonly referred to as a contract securitization in August 2007.  Under the securitization, Monitronics Funding LP (“Funding”), a newly formed, wholly owned subsidiary of Monitronics, issued the following debt instruments, which are included in the table of long-term debt above (in thousands):

	Principal
Class A-1a Term Notes	$	350,000
Class A-1b Term Notes	100,000
Class A-2 Term Notes	100,000
Class A-3 Variable Funding Note	260,000
Class A-4 Variable Funding Note	28,000

Principal payments under the Term Notes and Variable Funding Notes (‘VFNs’) are payable monthly beginning July 2012 in accordance with the priority of payments established in the securitization.  Available cash remaining after paying items as established in the securitization is allocated ratably between the Class A Term Notes and the VFNs. Amounts allocated to the Class A Term Notes are paid first to the Class A-1 Term Notes until their outstanding amount has been paid in full, and second to the Class A-2 Term Notes. Amounts allocated to the VFNs are paid ratably between the Class A-3 VFN and the Class A-4 VFN.

Monitronics is charged a commitment fee of 0.2% on the unused portion of the VFNs.  Interest incurred on borrowings is payable monthly. The securitization debt has an expected repayment date of July 2012.  If the securitization debt is not repaid at that time, contingent additional interest will accrue on the $550,000,000 notional amount of the interest rate swaps (see note 10) and $288,000,000 of VFNs at an annual rate of 5% per annum (including 0.5% of other fees), and will become due upon repayment of the securitization debt.  Monitronics is currently exploring opportunities to refinance or amend the terms of its securitization.  As of December 31, 2011, direct costs of $3,619,000 associated with a potential refinancing have been capitalized and are presented in Prepaids and other current assets on the consolidated balance sheet.  If it becomes probable a new debt arrangement will not be executed, the related capitalized costs will be expensed.

In connection with the 2007 securitization, Monitronics transferred substantially all of its then-existing subscriber assets, dealer alarm monitoring purchase agreements, and property and equipment related to its backup monitoring center, to Funding.  Monitronics also transferred substantially all of its other property and equipment, dealer service agreements, contract monitoring agreements, and employees to Monitronics Security LP (“Security”), which also was a newly formed, wholly owned subsidiary of Monitronics.  Following such transfers, Security assumed responsibility for the monitoring, customer service, billing, and collection functions of Funding and Monitronics.  Funding and Security are distinct legal entities.  Funding’s assets are available only for payment of the debt and satisfaction of the other obligations arising under the securitization facility and are not available to pay Monitronics’ other obligations or the claims of its other creditors.  Security’s assets are available only for the satisfaction of obligations arising under the securitization facility and are not available to pay Monitronics’ other obligations or the claims of its other creditors; provided that, subject to compliance with applicable covenants, Security may distribute any excess cash to Monitronics greater than $1,000,000.  In total, 88% of Monitronics subscriber account contracts, all of its wholesale monitoring contracts and $19,805,000 of its property and equipment are unavailable to pay Monitronics’ other obligations or the claims of its other creditors.

On the closing date of the securitization agreement, Funding also entered into several interest rate swap agreements with similar terms in an aggregate notional amount of $550,000,000 in order to reduce the financial risk related to changes in interest rates associated with the floating rate term notes (collectively the “Swaps”).  The Swaps have an expected repayment date of August 2012 to match the expected refinancing of the securitization debt.  The Company entered into three interest rate cap agreements with staggered durations with notional amounts of $100,000,000 effective August 15, 2008 through August 15, 2009, $260,000,000 effective August 15, 2009 through August 15, 2010, and $240,000,000 effective August 15, 2010 through May 15, 2014 and an interest rate floor with a notional amount of $260,000,000 effective from October 15, 2007 through May 15, 2014, to reduce the financial risk related to changes in interest rates associated with the floating rate variable funding notes.  None of these derivative financial instruments are designated as hedges but, in effect, they act as hedges against the variable interest rate risk of the debt obligations.  The Class A-1a Term Notes were effectively converted from floating to fixed with such derivative instruments at a rate of 7.5%.  The Class A-1b Term Notes were effectively converted from floating to fixed with such derivative financial instruments at a rate of 7.0%.  The Class A-2 Term Notes were effectively converted from floating to fixed with such derivative instruments at a rate of 7.6%.  See note 10 for further information regarding these derivatives.

As of December 31, 2011, Monitronics has $28,000,000 of the Class A-4 VFN held as restricted cash, which continues to be available to Monitronics under certain conditions as specified in the securitization agreement.  No amounts are available to be drawn from the VFNs.

The securitization debt has certain financial and nonfinancial covenants, which must be met on a monthly basis.  These tests include maximum attrition rates, interest coverage, and minimum average recurring monthly revenue.  Indebtedness under the securitization is secured by all of the assets of Funding. As of December 31, 2011, Monitronics was in compliance with all required covenants.

Credit Facility

On December 17, 2010, in order to partially fund the cash consideration paid for the Monitronics acquisition and provide for growth capital, Monitronics entered into a Credit Agreement with the lenders party thereto and Bank of America, N.A., as administrative agent (the “Credit Facility”).  The Credit Facility provides for a $60,000,000 term loan and a $115,000,000 revolving credit facility.  There is a LIBOR floor of 1.50% and a commitment fee of 0.50% on unused portions of the revolving credit facility.  Upon any refinancing of the notes issued by Funding, Monitronics must prepay the term loan.  At any time after the occurrence of an event of default under the Credit Facility, the lenders may, among other options, declare any amounts outstanding under the Credit Facility immediately due and payable and terminate any commitment to make further loans under the Credit Facility.  In addition, failure to comply with restrictions contained in the existing securitization indebtedness could lead to an event of default.  The obligations under the Credit Facility are secured by a security interest on substantially all of the assets of Monitronics and its wholly owned subsidiary, Monitronics Canada, Inc., as well as a pledge of the stock of Monitronics.  Ascent Capital has guaranteed the term loan up to $30,000,000.

The terms of the Credit Facility provide for certain financial and nonfinancial covenants which include maximum leverage ratios and minimum fixed charge coverage ratios.  As of December 31, 2011, Monitronics was in compliance with all required covenants.

Scheduled maturities of long-term debt at December 31, 2011, utilizing the required payment schedule of the securitization debt, are as follows for the fiscal years below (in thousands):

2012	$	60,000
2013	—
2014	65,300
2015	—
2016	—
Thereafter	838,000
Total principal payments	963,300
Less: discount	(10,582		)
Total debt on balance sheet	$	952,718

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Fair Value Measurements (Details 3) (USD $)	12 Months Ended
	Dec. 31, 2009
Information of discontinued operations
Impairment charge	$ 972,000
Content services facilities
Information of discontinued operations
Fair value of the asset	7,195,000
Impairment charge	$ 972,000

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Goodwill

12 Months Ended

Dec. 31, 2011

Goodwill.

Goodwill

(7)  Goodwill

The following table provides the activity and balances of goodwill in the Monitronics business group (amounts in thousands):

	Goodwill
Balance at December 31, 2009	$	—
Acquisition of Monitronics	349,227
Balance at December 31, 2010	349,227
Balance at December 31, 2011	$	349,227

In connection with the Company’s annual goodwill impairment test performed during the three months ended December 31, 2011, the Company did not record an impairment loss related to goodwill as the estimated fair value the Company’s reporting unit exceeded the carrying value of the underlying assets.

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Investments in Marketable Securities

12 Months Ended

Dec. 31, 2011

Investments in Marketable Securities

Investments in Marketable Securities

(8) Investments in Marketable Securities

The Company currently holds marketable securities consisting primarily of diversified corporate bond funds.  The following table presents the activity of these investments, which were classified as available-for-sale securities (amounts in thousands):

	Years ended December 31,
	2011		2010
Beginning Balance	$	—	$	56,197
Purchases	40,253		41,757
Sales (at cost) (a)	—		(95,624		)
Unrealized gain (loss)	124		(2,330		)
Ending Balance	$	40,377	$	—

(a)For the year ended December 31, 2010, total proceeds from the sales were $96,685,000 which included a pre-tax gain of $1,061,000.

The following table presents the net after-tax unrealized and realized gains on the investment in marketable securities that was recorded into accumulated other comprehensive income on the consolidated balance sheet and in other comprehensive income on the consolidated statements of operations and comprehensive income (loss) (amounts in thousands):

	Years ended December 31,
	2011		2010
Accumulated other comprehensive income
Beginning Balance	$	—	$	1,352
Gains (losses), net of tax (a)	124		(291		)
Losses (gains) recognized into earnings, net of tax (b)	—		(1,061		)
Ending Balance	$	124	$	—

(a)The 2011 and 2010 amount is net of tax of $0.

(b)The 2010 amount is net of tax of $0.

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Derivatives

12 Months Ended

Dec. 31, 2011

Derivatives

Derivatives

(10)  Derivatives

As part of the Monitronics acquisition, the Company acquired derivative financial instruments which are used by Monitronics to manage its interest rate risk.  The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values of interest rate caps are determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates rise above the strike rate of the caps. The variable interest rates used in the calculation of projected receipts on the cap are based on an expectation of future interest rates derived from observable market interest rate curves and volatilities. The Company incorporates credit valuation adjustments to appropriately reflect the respective counterparty’s nonperformance risk in the fair value measurements.

At December 31, 2011, derivative financial instruments include one interest rate cap with an aggregate fair value of $25,000, that constitutes an asset of the Company, an interest rate floor with a fair value of $19,320,000 that constitutes a liability of the Company, and three interest rate swaps (Swaps) with an aggregate fair value of $16,959,000 that constitute liabilities of the Company.  At December 31, 2010, derivative financial instruments include one interest rate cap with an aggregate fair value of $447,000, that constitutes an asset of the Company, an interest rate floor with a fair value of $21,810,000 that constitutes a liability of the Company, and three interest rate swaps (Swaps) with an aggregate fair value of $42,935,000 that constitute liabilities of the Company.  The interest rate caps are included in Other assets on the consolidated balance sheet, while the interest rate floor and Swaps are included in Derivative financial instruments on the consolidated balance sheet.  The interest rate caps, floor and Swaps have not been designated as hedges.  For year ended December 31, 2011, the realized and unrealized loss on derivative financial instruments in the consolidated statements of operations includes settlement payments of $38,645,000 partially offset by a $28,044,000 unrealized gain related to the change in the fair value of these derivatives.  For year ended December 31, 2010, the realized and unrealized loss on derivative financial instruments in the consolidated statements of operations includes settlement payments of $1,504,000 and a $178,000 unrealized loss related to the change in the fair value of these derivatives.

For purposes of valuation of the Swaps, the Company has considered that certain provisions of the Term Notes and VFNs provide for significant adverse changes to interest rates and uses of cash flows if this debt is not repaid by July 2012.  In addition, the Swaps can be terminated with no additional costs to the Company subject to compliance with certain make-whole obligations in accordance with the terms thereof in connection with any termination of the Swaps before April 2012.  If the Term Notes and the VFNs are not repaid in full by July 2012, the Company would incur additional interest and other costs and be restricted from making subscriber account purchases at Funding, until the Term Notes and VFNs were repaid in full.  Management expects that the Company will be able to refinance and/or repay the Term Notes and VFNs in full by July 2012, and the valuation considers adjustments for termination dates before and after July 2012 on a probability weighted basis. The valuation of the Swaps is based principally on a July 2012 maturity of the Term Notes less a credit valuation adjustment.

All of the Company’s debt obligations have variable interest rates.  The objective of the Swaps was to reduce the risk associated with these variable interest rates. In effect, the Swaps convert variable interest rates into fixed interest rates on $550 million of borrowings.  It is the Company’s policy to offset fair value amounts recognized for derivative instruments executed with the same counterparty under a master netting agreement.  As of December 31, 2011, no such amounts were offset.

The Company’s Swaps are as follows:

Notional		Rate Paid		Rate Received
$	350,000,000	6.56	%	1 mo. USD-LIBOR-BBA plus 0.85%
100,000,000		6.06	%	1 mo. USD-LIBOR-BBA plus 0.75%
100,000,000		6.64	%	1 mo. USD-LIBOR-BBA plus 1.25%

Monitronics has a single counterparty for its derivative contracts.

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Income Taxes (Details 3) (USD $)	12 Months Ended			3 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2010 Federal	Mar. 31, 2008 Federal	Dec. 31, 2011 Federal	Dec. 31, 2011 State	Dec. 31, 2011 California	Dec. 31, 2011 Other state
Operating loss carryforwards
Net operating loss carryforwards						$ 208,087,000		$ 36,996,000	$ 79,303,000
Net operating losses subject to IRC Section 382 limitations	83,000,000
Income tax credits						1,064,000	1,127,000
Income tax credits expiring in 2013						638,000
Reduction in net operating loss				7,138,000	5,370,000
Tax expense due to reduction in net operating loss				2,500,000	1,880,000
Federal income tax rate (as a percent)	35.00%	35.00%	35.00%
Increase in total valuation allowance			35,350,000
Increase in tax expense due to increase in valuation allowance	13,285,000	9,756,000	36,370,000
Increase in other comprehensive income due to increase in valuation allowance	47,000		463,000
Valuation allowance	31,351,000	33,347,000
Adjustment due to Monitronics business acquisition, included in increase in the valuation allowance		405,000
Excess tax benefits realized from exercises under all share-based payments arrangements	2,103,000	1,469,000
Reconciliation of the beginning and ending amount of uncertain tax positions
Balance at the beginning of the period	292,000
Foreign currency exchange adjustments	(12,000)
Balance at the end of the period	$ 280,000	$ 292,000

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Stock-Based and Long-Term Compensation (Details 2) (USD $)	12 Months Ended	1 Months Ended	3 Months Ended			12 Months Ended		3 Months Ended	1 Months Ended			3 Months Ended				12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended
	Dec. 31, 2011	Sep. 30, 2008 Stock option Series A common stock	Sep. 30, 2011 Stock option Series A common stock year	Mar. 31, 2011 Stock option Series A common stock year	Mar. 31, 2009 Stock option Series A common stock year	Dec. 31, 2011 Stock option Series A common stock	Sep. 17, 2008 Stock option Series A common stock	Dec. 31, 2011 Stock option Series A common stock Non-employee director director year	Sep. 30, 2008 Stock option Series A common stock Low end of the range	Sep. 30, 2008 Stock option Series A common stock High end of the range	Sep. 30, 2008 Stock option Series B common stock	Sep. 30, 2011 Restricted stock	Mar. 31, 2011 Restricted stock	Mar. 31, 2010 Restricted stock	Dec. 31, 2009 Restricted stock director	Dec. 31, 2011 Restricted stock	Mar. 31, 2011 Restricted stock Non-employee director director	Dec. 31, 2011 Restricted stock Series A common stock	Dec. 31, 2011 Restricted stock Series B common stock	Dec. 31, 2011 Restricted stock Series B common stock
Stock-based compensation
Number of options issued in conversion (in shares)		11,722									76,210
Exercise price of options issued in conversion (in dollars per share)									$ 15.21	$ 29.42	$ 25.29
Right to receive Series A options in conversion of Series B options (in shares)							93,115
Exercise price of convertible Series B to Series A options (in dollars per share)							$ 22.53
Awards granted (in shares)												56,250	83,236	12,766	15,923		9,168	148,654	9,029	9,029
Vesting period (in years)			51 months		4 years			2 years				51 months		1 year	2 years		2 years		1 year
Weighted average grant date fair value (in dollars per share)												$ 39.32	$ 44.91	$ 28.20	$ 24.81	$ 42.63	$ 43.08		$ 52.05
Number of non-employee directors to whom awards were granted								5							4		4
Options granted (in shares)			187,500	99,794	116,740	318,606		31,312
Exercise price of options granted (in dollars per share)			$ 48.00	$ 48.15	$ 25.30	$ 48.29		$ 50.45
Termination period (in years)				P7Y	P10Y			P5Y
Weighted-average grant date fair value of options (in dollars per share)			$ 11.70	$ 20.32	$ 12.30			$ 15.01
Assumptions used in the Black-Scholes model to determine grant date fair value
Volatility factor (as a percent)			42.00%	35.00%	50.00%			42.00%
Risk-free interest rate (as a percent)			0.96%	2.88%	1.51%			0.91%
Expected life (in years)			5	7	6.1			3
Dividend yield (as a percent)	0.00%		0.00%	0.00%	0.00%			0.00%
Vesting period, minimum (in years)				P4Y									P1Y
Vesting period, maximum (in years)				P5Y									P5Y

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Income Taxes (Details 2) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Income Taxes
United States federal income tax rate (as a percent)	35.00%	35.00%	35.00%
Reconciliation of the reported amount of income tax (expense) benefit from continuing operations
Computed expected tax benefit	$ 8,993	$ 11,631	$ 9,479
State and local income taxes, net of federal income taxes	106	3,548	1,908
Change in valuation allowance affecting tax expense	(13,285)	(9,756)	(36,370)
Non-deductible expenses	(547)	(4,331)	(139)
Other, net	2,276	(1,362)	(3,599)
Total tax expense	(2,457)	(270)	(28,721)
Current assets:
Accounts receivable reserves	879	802
Accrued liabilities	8,796	11,970
Total current deferred tax assets	9,675	12,772
Valuation allowance	(2,141)	(3,702)
Total current deferred tax assets, net of valuation allowance	7,534	9,070
Noncurrent assets:
Net operating loss carryforwards	76,478	36,334
Derivative financial instruments	12,718	22,525
Deferred financing costs	9,056	9,527
Other	8,523	3,688
Total noncurrent deferred tax assets	106,775	72,074
Valuation allowance	(27,107)	(28,176)
Total noncurrent assets, net of valuation allowance	79,668	43,898
Deferred tax assets, net	87,202	52,968
Current liabilities:
Other	(1,653)
Noncurrent liabilities:
Intangible assets	(64,054)	28,727
Subscriber accounts	(20,236)	(72,381)
Long-term debt	(3,686)	(9,657)
Property, plant and equipment	(1,485)	(2,509)
Other		(876)
Total noncurrent liabilities	(89,461)	(56,696)
Total deferred tax liabilities	(91,114)	(56,696)
Net deferred tax assets (liabilities)	(3,912)	(3,728)
Deferred tax assets and liabilities
Current deferred tax assets, net	5,881	9,070
Long-term deferred tax assets (liabilities), net	(9,793)	(12,798)
Net deferred tax assets (liabilities)	$ (3,912)	$ (3,728)

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Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2011

Fair Value Measurements

Schedule of fair value level of assets and liabilities that are measured on a recurring basis

The following summarizes the fair value level of assets and liabilities that are measured on a recurring basis at December 31 (amounts in thousands):

	Level 1		Level 2		Level 3		Total
2010
Derivative financial instruments - assets	—		447		—		447
Derivative financial instruments - liabilities	—		(21,810	)	(42,935	)	(64,745	)
Total	$	—	(21,363	)	(42,935	)	(64,298	)
2011
Money market funds (a)	$	168,622	—		—		168,622
Investments in marketable securities (b)	40,377		—		—		40,377
Derivative financial instruments - assets	—		25		—		25
Derivative financial instruments - liabilities	—		(19,320	)	(16,959	)	(36,279	)
Total	$	208,999	(19,295	)	(16,959	)	172,745

(a)Included in cash and cash equivalents on the consolidated balance sheet.

(b)Investments primarily consist of diversified corporate bond funds and are all classified as available-for-sale securities.

Schedule of activity in the Level 3 balances

	Years Ended December 31,
	2011			2010
	Amounts in thousands
Derivative financial instruments - liabilities
Beginning Balance	$	42,935		$	—
Derivatives acquired in the acquisition of Monitronics	—			(43,116		)
Unrealized (gain) loss	(25,976		)	181
Ending Balance	$	16,959		$	42,935
Other liabilities
Beginning Balance	$	—		$	(134	)
Contingent consideration	—			—
Settlements paid in cash	—			—
Amounts credited to income (a)	—			134
Ending Balance	$	—		$	—

(a)Amount consisted of a participating residual interest change in fair value.  This amount was recorded in SG&A on the consolidated statements of operations.

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Property and Equipment (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2011	Dec. 31, 2010
Property and Equipment
Property and equipment, gross	$ 112,234	$ 112,674
Accumulated depreciation	(37,537)	(34,463)
Property and equipment, net	74,697	78,211
Land
Property and Equipment
Property and equipment, gross	34,896	34,901
Buildings
Property and Equipment
Property and equipment, gross	54,575	57,824
Machinery and equipment
Property and Equipment
Property and equipment, gross	$ 22,763	$ 19,949

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Stockholders' Equity

12 Months Ended

Dec. 31, 2011

Stockholders' Equity

Stockholders' Equity

(15)  Stockholders’ Equity

Preferred Stock

The Company’s preferred stock is issuable, from time to time, with such designations, preferences and relative participating, optional or other rights, qualifications, limitations or restrictions thereof, as shall be stated and expressed in a resolution or resolutions providing for the issue of such preferred stock adopted by Ascent Capital’s Board of Directors.  As of December 31, 2011, no shares of preferred stock were issued.

Common Stock

Holders of Ascent Capital Series A common stock are entitled to one vote for each share held, and holders of Ascent Capital Series B common stock are entitled to 10 votes for each share held.  Holders of Ascent Capital Series C common stock are not entitled to any voting powers, except as required by Delaware law.  As of December 31, 2011, 13,471,594 shares of Series A common stock was outstanding and 739,894 shares of Series B common stock was outstanding.  Each share of the Series B common stock is convertible, at the option of the holder, into one share of Series A common stock.  As of December 31, 2011, no shares of Ascent Capital Series C common stock were issued.

On June 16, 2011, the Company’s Board of Directors authorized the repurchase of up to $25,000,000 of its Series A common stock.  During 2011, the Company repurchased 269,659 shares of its Series A common stock at an average purchase price of $42.60 per share for a total of approximately $11,488,000 pursuant to this authorization. These shares were returned to authorized and unissued, reducing the number of shares outstanding.

The following table presents the activity in the Series A and Series B common stock:

	Series A		Series B
	common stock		common stock
Balance at December 31, 2008	13,531,567		659,732
Conversion from Series B to Series A shares	1,815		(1,815	)
Issuance of restricted stock	15,923		—
Restricted stock cancelled for tax withholding	(10,351	)	—
Stock option exercises	11,722		76,210
Balance at December 31, 2009	13,550,676		734,127
Conversion from Series B to Series A shares	528		(528	)
Issuance of restricted stock	12,766		—
Restricted stock cancelled for tax withholding	(10,719	)	—
Balance at December 31, 2010	13,553,251		733,599
Conversion from Series B to Series A shares	2,734		(2,734	)
Issuance of restricted stock	148,654		9,029
Restricted stock cancelled for tax withholding	(14,846	)	—
Repurchase and retirement of Series A shares	(269,659	)
Stock option exercises	51,460		—
Balance at December 31, 2011	13,471,594		739,894

As of December 31, 2011, there were 882,709 shares of Ascent Capital Series A common stock reserved for issuance under exercise privileges of outstanding stock options.

Other Comprehensive Income (Loss)

Accumulated other comprehensive income (loss) included in the consolidated balance sheets and consolidated statement of stockholders’ equity reflect the aggregate of foreign currency translation adjustments and pension adjustments.

The change in the components of accumulated other comprehensive income (loss), net of taxes, is summarized as follows:

	ForeignCurrencyTranslationAdjustments (a)			UnrealizedHoldingGains, netof income tax (b)		Pension Adjustments (c)		Accumulated Other Comprehensive Income (Loss), Net of Taxes
	Amounts in thousands
Balance at December 31, 2008	$	(5,979	)	—		(1,974	)	(7,953	)
Other comprehensive income	4,693			1,352		(1,709	)	4,336
Balance at December 31, 2009	(1,286		)	1,352		(3,683	)	(3,617	)
Other comprehensive income	4,026			(1,352	)	(1,870	)	804
Balance at December 31, 2010	2,740			—		(5,553	)	(2,813	)
Other comprehensive income	(2,950		)	124		863		(1,963	)
Balance at December 31, 2011	$	(210	)	124		(4,690	)	(4,776	)

(a) No income taxes were recorded on foreign currency translation amounts for 2011, 2010 and 2009 since the Company’s investment in foreign subsidiaries were essentially permanent in duration.

(b) Net of income tax benefit of $978,000 for 2010, and income tax expense of $978,000 for 2009.  No income taxes were recorded on the December 31, 2011 unrealized holding gains because the Company is subject to a full valuation allowance.

(c) No income taxes were recorded on the pension adjustment amounts for 2011, 2010 and 2009.

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Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2011

Summary of Significant Accounting Policies

Schedule of activity in the allowance for doubtful accounts

	Balance Beginningof Year		Chargedto Expense	Write-Offs and Other		BalanceEnd ofYear
	Amounts in thousands
2011	$	250	5,484	(3,919	)	1,815
2010	$	0	250	0		250
2009	$	0	0	0		0

Schedule of estimated useful lives by class of asset

Buildings	20 years
Leasehold improvements	15 years or lease term, if shorter
Machinery and equipment	5 - 7 years
Computer systems and software (included in Machinery and Equipment in Note 6)	3 - 5 years

Schedule of estimated amortization of subscriber accounts

Based on subscriber accounts held at December 31, 2011, estimated amortization of subscriber accounts in the succeeding five fiscal years ending December 31 is as follows (in thousands):

2012	$	135,027
2013	112,914
2014	94,476
2015	79,026
2016	64,597
Total	$	486,040

Schedule of weighted average number of shares used in calculation of basic and diluted earnings (loss) per common share

	Year Ended December 31,
	2011	2010	2009
Weighted average Series A and Series B shares	14,195,834	14,200,417	14,086,075

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Acquisitions (Details 2) (USD $)	3 Months Ended					12 Months Ended						3 Months Ended	12 Months Ended	3 Months Ended
	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2010	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2011 Subscriber accounts year	Dec. 31, 2010 Subscriber accounts	Dec. 31, 2009 Subscriber accounts	Dec. 17, 2010 Monitronics	Mar. 31, 2011 Monitronics Subscriber accounts year	Dec. 31, 2011 Monitronics Subscriber accounts year	Dec. 31, 2010 Monitronics Allocation adjustments Adoption of ASC Topic 805
Business acquisition
Goodwill											$ (349,227,000)			$ 447,000
Subscriber accounts											(824,158,000)			5,542,000
Dealer network											50,433,000			33,000
Deferred revenue														5,342,000
Purchase holdbacks											(9,954,000)			336,000
Accrued liabilities														1,490,000
Amount of post-closing working capital adjustments to purchase price														1,212,000
Impact on revenue recognized	(80,936,000)	(79,515,000)	(77,577,000)	(73,870,000)	(9,129,000)	(311,898,000)	(9,129,000)							3,047,000
Weighted average useful life (in years)								15				10	14
Amortization rate (as a percent)								220.00%				135.00%	235.00%
Weighted average useful life based on evaluation by the entity (in years)												14
Amortization rate based on evaluation by the entity (as a percent)												235.00%
Amortization of subscriber accounts						$ 159,619,000	$ 5,980,000	$ 149,539,000	$ 5,560,000	$ 0				$ 1,187,000

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Quarterly Financial Information (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2011

Quarterly Financial Information (Unaudited)

Schedule of Quarterly Financial Information

	1st			2nd		3rd		4th
	Quarter			Quarter		Quarter		Quarter
	Amounts in thousands,
	except per share amounts
2011:
Revenue	$	73,870		77,577		79,515		80,936
Operating income	$	1,176		8,085		7,715		6,030
Net income (loss)	$	55,187		(18,282	)	(9,867	)	(6,401	)
Basic and diluted net income (loss) per common share	$	3.88		(1.28	)	(0.69	)	(0.46	)
2010:
Revenue	$	—		—		—		9,129
Operating loss	$	(7,940	)	(8,692	)	(7,583	)	(9,276	)
Net income (loss)	$	9,910		(16,138	)	(9,846	)	(22,420	)
Basic and diluted net income (loss) per common share	$	0.70		(1.14	)	(0.69	)	(1.58	)

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Cash flows from operating activities:
Net income (loss)	$ 20,637	$ (38,494)	$ (52,897)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Loss (income) from discontinued operations, net of income tax	(48,789)	4,993	(2,908)
Amortization of subscriber accounts and dealer network	159,619	5,980
Depreciation	7,052	3,067	4,259
Stock-based compensation	4,732	3,148	2,443
Deferred income tax expense	181	747	22,194
Unrealized (gain) loss on derivative financial instruments	(28,044)	1,682
Long term debt amortization	16,985	780
Loss (gain) on sale of assets, net	565	(2,768)	152
Other non-cash activity, net	6,428	(1,874)	2,145
Changes in assets and liabilities, net of acquisitions:
Trade receivables	(5,365)	1,806
Prepaid expenses and other assets	225	4,368	(3,535)
Payables and other liabilities	(4,546)	12,388	(6,695)
Operating activities from discontinued operations, net	1,558	54,477	70,816
Net cash provided by operating activities	131,238	50,300	35,974
Cash flows from investing activities:
Capital expenditures	(4,242)	(139)	(1,420)
Purchases of subscriber accounts	(162,714)	(4,214)
Purchases of marketable securities	(40,253)	(41,757)	(68,126)
Decrease (increase) in restricted cash	4,719	(13,318)
Cash paid for acquisitions, net of cash acquired		(388,401)
Proceeds from sales of marketable securities		96,685	16,309
Proceeds from the sale of discontinued operations	99,488	92,121
Proceeds from the sale of operating assets		6,201	23
Other investing activities, net		54
Investing activities from discontinued operations, net	(3,196)	(37,553)	(31,674)
Net cash used in investing activities	(106,198)	(290,321)	(84,888)
Cash flows from financing activities:
Proceeds from long-term debt	78,800	110,300
Payments of long-term debt	(59,800)	(9,000)
Payment of deferred financing costs		(2,388)
Stock option exercises	1,291		2,121
Purchases (and retirement) of common stock	(11,488)
Other		2
Financing activities from discontinued operations, net	(142)	(1,950)	(1,810)
Net cash provided by financing activities	8,661	96,964	311
Net increase (decrease) in cash and cash equivalents	33,701	(143,057)	(48,603)
Cash and cash equivalents at beginning of year	149,857	292,914	341,517
Cash and cash equivalents at end of year	$ 183,558	$ 149,857	$ 292,914

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Acquisitions

12 Months Ended

Dec. 31, 2011

Acquisitions

Acquisitions

(4) Acquisitions

On December 17, 2010, Ascent Capital acquired 100% of the outstanding capital stock of Monitronics (“Acquisition”).  The cash consideration paid by Ascent Capital was approximately $397,088,000.  The consideration was funded by a $60,000,000 term loan, a draw of $45,000,000 on a $115,000,000 revolving credit facility and cash on hand.  The goodwill recorded in the acquisition reflects the value to Ascent Capital of Monitronics’ recurring revenue and cash flow streams and its unique business strategy of partnering with independent dealers to obtain customers.  The goodwill balance is not deductible for tax purposes.

Under the acquisition method of accounting, the purchase price has been allocated to Monitronics’ tangible and identifiable intangible assets acquired and liabilities assumed based on estimates of fair value. The excess of the purchase price over those fair values was recorded as goodwill.  Ascent Capital’s results of operations include the operations of Monitronics from the date of acquisition.

The purchase price of Monitronics has been allocated as follows (in thousands):

Estimated fair value of assets acquired and liabilities assumed:
Restricted cash	$	43,597
Accounts receivable	10,694
Subscriber accounts	824,158
Property and equipment	20,802
Dealer network	50,433
Other current and non-current assets	14,419
Goodwill	349,227
Purchase holdbacks	(9,954		)
Long-term debt	(814,653		)
Derivative instruments	(64,623		)
Deferred income tax liability	(4,057		)
Other current and noncurrent liabilities	(22,955		)
Cash consideration paid	$	397,088

The Company’s 2010 Form 10-K included an initial allocation of the purchase price based on preliminary data.  Subsequent to filing the Company’s 2010 Form 10-K, adjustments were made to decrease goodwill by $447,000.  The decrease to goodwill, which is reflected in the revised December 31, 2010 consolidated balance sheet in accordance with Accounting Standards Codification (ASC) Topic 805, Business Combinations, is related to the finalization of certain assumptions and estimates used to determine the fair value of acquired assets and assumed liabilities.  These adjustments resulted in a $5,542,000 decrease to subscriber accounts, a $33,000 increase to dealer network, a $5,342,000 decrease to deferred revenue, a $336,000 decrease to purchase holdbacks, a $1,490,000 decrease to certain accrued liabilities, and customary post-closing working capital adjustments to the purchase price of $1,212,000.  The adjustment to acquired deferred revenue resulted in a $3,047,000 reduction to revenue recognized during the quarter ended December 31, 2010.  The reduction in revenue has been retrospectively applied to the revised December 31, 2010 consolidated balance sheet.

During the first quarter of 2011, the Company completed its evaluation of the useful life of subscriber accounts based on current subscriber attrition data.  Based on the evaluation, amortization of subscriber accounts acquired in the Acquisition was changed from a 10-year 135% declining balance method to a 14-year 235% declining balance method.  In accordance with ASC Topic 805, the incremental subscriber account amortization of $1,187,000 related to the period ended December 31, 2010 is reflected in the revised December 31, 2010 consolidated balance sheet and consolidated statement of operations included in this annual report.

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Fair Value Measurements (Details) (Recurring, USD $) In Thousands, unless otherwise specified	Dec. 31, 2011	Dec. 31, 2010
Level 1
Fair Value Measurements
Money market funds	$ 168,622
Investments in marketable securities	40,377
Total	208,999
Level 2
Fair Value Measurements
Derivative financial instruments - assets	25	447
Derivative financial instruments - liabilities	(19,320)	(21,810)
Total	(19,295)	(21,363)
Level 3
Fair Value Measurements
Derivative financial instruments - liabilities	(16,959)	(42,935)
Total	(16,959)	(42,935)
Total
Fair Value Measurements
Money market funds	168,622
Investments in marketable securities	40,377
Derivative financial instruments - assets	25	447
Derivative financial instruments - liabilities	(36,279)	(64,745)
Total	$ 172,745	$ (64,298)

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Stockholders' Equity (Details 2) (USD $)	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Components of accumulated other comprehensive income (loss), net of taxes
Balance at the beginning of the period	$ (2,813,000)	$ (3,617,000)	$ (7,953,000)
Other comprehensive income	(1,963,000)	804,000.0	4,336,000
Balance at the end of the period	(4,776,000)	(2,813,000)	(3,617,000)
Foreign Currency Translation Adjustments
Components of accumulated other comprehensive income (loss), net of taxes
Balance at the beginning of the period	2,740,000	(1,286,000)	(5,979,000)
Other comprehensive income	(2,950,000)	4,026,000	4,693,000
Balance at the end of the period	(210,000)	2,740,000	(1,286,000)
Unrealized Holding Gains, net of income tax
Components of accumulated other comprehensive income (loss), net of taxes
Balance at the beginning of the period		1,352,000
Other comprehensive income	124,000	(1,352,000)	1,352,000
Balance at the end of the period	124,000		1,352,000
Income tax expense (benefit) on unrealized holding gains		(978,000)	978,000
Pension Adjustments
Components of accumulated other comprehensive income (loss), net of taxes
Balance at the beginning of the period	(5,553,000)	(3,683,000)	(1,974,000)
Other comprehensive income	863,000	(1,870,000)	(1,709,000)
Balance at the end of the period	$ (4,690,000)	$ (5,553,000)	$ (3,683,000)

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Acquisitions (Tables)

12 Months Ended

Dec. 31, 2011

Acquisitions

Schedule of purchase price allocation

Estimated fair value of assets acquired and liabilities assumed:
Restricted cash	$	43,597
Accounts receivable	10,694
Subscriber accounts	824,158
Property and equipment	20,802
Dealer network	50,433
Other current and non-current assets	14,419
Goodwill	349,227
Purchase holdbacks	(9,954		)
Long-term debt	(814,653		)
Derivative instruments	(64,623		)
Deferred income tax liability	(4,057		)
Other current and noncurrent liabilities	(22,955		)
Cash consideration paid	$	397,088

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Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2011

Stockholders' Equity

Schedule of activity in the Series A and Series B common stock

	Series A		Series B
	common stock		common stock
Balance at December 31, 2008	13,531,567		659,732
Conversion from Series B to Series A shares	1,815		(1,815	)
Issuance of restricted stock	15,923		—
Restricted stock cancelled for tax withholding	(10,351	)	—
Stock option exercises	11,722		76,210
Balance at December 31, 2009	13,550,676		734,127
Conversion from Series B to Series A shares	528		(528	)
Issuance of restricted stock	12,766		—
Restricted stock cancelled for tax withholding	(10,719	)	—
Balance at December 31, 2010	13,553,251		733,599
Conversion from Series B to Series A shares	2,734		(2,734	)
Issuance of restricted stock	148,654		9,029
Restricted stock cancelled for tax withholding	(14,846	)	—
Repurchase and retirement of Series A shares	(269,659	)
Stock option exercises	51,460		—
Balance at December 31, 2011	13,471,594		739,894

Summary of change in components of accumulated other comprehensive earnings (loss), net of taxes

	ForeignCurrencyTranslationAdjustments (a)			UnrealizedHoldingGains, netof income tax (b)		Pension Adjustments (c)		Accumulated Other Comprehensive Income (Loss), Net of Taxes
	Amounts in thousands
Balance at December 31, 2008	$	(5,979	)	—		(1,974	)	(7,953	)
Other comprehensive income	4,693			1,352		(1,709	)	4,336
Balance at December 31, 2009	(1,286		)	1,352		(3,683	)	(3,617	)
Other comprehensive income	4,026			(1,352	)	(1,870	)	804
Balance at December 31, 2010	2,740			—		(5,553	)	(2,813	)
Other comprehensive income	(2,950		)	124		863		(1,963	)
Balance at December 31, 2011	$	(210	)	124		(4,690	)	(4,776	)

(a) No income taxes were recorded on foreign currency translation amounts for 2011, 2010 and 2009 since the Company’s investment in foreign subsidiaries were essentially permanent in duration.

(b) Net of income tax benefit of $978,000 for 2010, and income tax expense of $978,000 for 2009.  No income taxes were recorded on the December 31, 2011 unrealized holding gains because the Company is subject to a full valuation allowance.

(c) No income taxes were recorded on the pension adjustment amounts for 2011, 2010 and 2009.

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Stock-based and Long-Term Compensation

12 Months Ended

Dec. 31, 2011

Stock-based and Long-Term Compensation

Stock-based and Long-Term Compensation

(14)  Stock-based and Long-Term Compensation

2006 Ascent Capital Group Long-Term Incentive Plan

AMG had made awards to certain employees under its 2006 Long-Term Incentive Plan, as amended, (the “2006 Plan”).  The 2006 Plan provided the terms and conditions for the grant of, and payment with respect to, Phantom Appreciation Rights (“PARs”) granted to certain officers and other key personnel of AMG and its subsidiaries.  The value of a single PAR (“PAR Value”) was equal to the positive amount (if any) by which (a) the sum of (i) 6% of cumulative free cash flow (as defined in the 2006 Plan) 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 2006 Plan, divided by 10,000,000; exceeds (b) a baseline value determined at the time of grant.  The 2006 Plan was administered by a committee whose members were designated by the board of directors and grants were determined by the committee.  The maximum number of PARs that may be granted under the 2006 Plan was 500,000.  The PARs vest quarterly over a three year period beginning on the grant date, and vested PARs were payable on March 31, 2012 (or, if earlier, on the six-month anniversary of a grantee’s termination of employment for any reason other than cause) in either cash or stock at the committee’s discretion.  The Company recorded a liability and a charge to expense based on the PAR Value and percent vested at each reporting period.

During fiscal year 2010, the Company granted 122,000 PARs to certain key personnel of AMG and its subsidiaries, resulting in 267,000 outstanding PARs.  At December 31, 2010, in connection with the sale of the Creative/Media business, all current AMG employees vested in 100% of their PARs and those shares were deemed to be exercised at December 31, 2010.  Cash distributions under the 2006 Plan were made to all active participants under which the employees grant date PAR value exceeded the PAR’s value as computed at December 31, 2010.  The Company recorded a liability and a charge to selling, general and administrative expense in fiscal year 2010 of $1,034,000 related to this distribution.

Ascent Capital Group, Inc. 2008 Incentive Plan

The Ascent Capital Group, Inc. 2008 Incentive Plan (the “2008 incentive plan”) was adopted by the Board of Directors of the Company on September 15, 2008.  The 2008 incentive plan is designed to provide additional compensation to certain employees and independent contractors for services rendered, to encourage their investment in Ascent Capital’s capital stock and to attract persons of exceptional ability to become officers and employees.  The number of individuals who receive awards under the 2008 incentive plan will vary from year to year and is not predictable.  Awards may be granted as non-qualified stock options, stock appreciation rights, restricted shares, stock units, cash awards, performance awards or any combination of the foregoing (collectively, “awards”).  The maximum number of shares of Ascent Capital’s common stock with respect to which awards may be granted under the 2008 incentive plan is 2,000,000, subject to anti-dilution and other adjustment provisions of the incentive plan.  The base or exercise price of a stock option or stock appreciation right may not be less than fair market value on the day it is granted.

Ascent Capital Group, Inc. 2008 Non-Employee Director Incentive Plan

The Ascent Capital Group, Inc. 2008 Non-Employee Director Incentive Plan (the “2008 director incentive plan”) was adopted by the Board of Directors of the Company on September 15, 2008.  The 2008 director incentive plan is designed to provide additional compensation to the non-employee Board of Director members for services rendered and to encourage their investment in Ascent Capital’s capital stock.  Awards may be granted as non-qualified stock options, stock appreciation rights, restricted shares, stock units, cash awards, performance awards or any combination of the foregoing (collectively, “awards”).  The maximum number of shares of Ascent Capital’s common stock with respect to which awards may be granted under the 2008 director incentive plan is 500,000, subject to anti-dilution and other adjustment provisions of the incentive plan.  The base or exercise price of a stock option or stock appreciation right may not be less than fair market value on the day it is granted.

Other

As of the Spin Off Date, DHC stock options held by an officer and director of DHC, who is currently a director of DHC’s successor, were converted into options to purchase shares of the applicable series of Ascent Capital common stock and options to purchase shares of the applicable series of common stock of DHC’s successor.  In accordance with the conversion calculation, the holder received 11,722 Ascent Capital Series A options with exercise prices ranging from $15.21 to $29.42 and 76,210 Ascent Capital Series B options with an exercise price of $25.29.  In accordance with the terms of the original DHC option and the conversion, the holder had the right, at the exercise date, to convert the Series B options into 93,115 Series A options with an exercise price of $22.53.  All of these options were fully vested and the holder exercised all of these options in 2009.

Grants of Stock-based Awards

2011

In the fourth quarter of 2011, a key employee was granted an award for a total of 9,029 shares of Ascent Capital Series B restricted stock that vest over a period of one year.  The fair value for the restricted stock award of $52.05 per share was based on the closing price of the Ascent Capital Series A common stock on the grant date.

In the fourth quarter of 2011, five non-employee directors were granted a total of 31,312 options to purchase Ascent Capital Series A common stock for an exercise price of $50.45 per share, which was the closing price on the date of grant.  Such options vest over a period of two years, terminate five years from the date of grant, and had a weighted-average fair value at the date of grant of $15.01 per share, as determined using the Black-Scholes Model.  The assumptions used in the Black-Scholes Model to determine grant date fair value were a volatility factor of 42%, a risk-free interest rate of 0.91%, an expected life of approximately 3 years, and a dividend yield of zero.

In the third quarter of 2011, certain key employees were granted awards for a total of 56,250 shares of restricted stock that vest over a period of four years and three months.  The fair values for the restricted stock awards were the closing prices of the Ascent Capital Series A common stock on the applicable dates of grant.  The weighted average fair value of the restricted stock on an aggregate basis for all such grants was $39.32 per share.

In the third quarter of 2011, certain key employees were granted a total of 187,500 options to purchase Ascent Capital Series A common stock at an exercise price of $48.00 per share, which was the closing price on the date of grant.  Such options vest over a period of four years and three months, terminate on December 31, 2017, and had a weighted-average fair value at the date of grant of $11.70 per share, as determined using the Black-Scholes Model.  The assumptions used in the Black-Scholes Model to determine grant date fair value were a volatility factor of 42%, a risk-free interest rate of 0.96%, an expected life of five years, and a dividend yield of zero.

In the first quarter of 2011, certain key employees were granted awards for a total of 83,236 shares of restricted stock that vest quarterly over varying periods from one year to five years.  The fair values for the restricted stock awards were the closing prices of the Ascent Capital Series A common stock on the applicable dates of grant.  The weighted average fair value of the restricted stock on an aggregate basis for all such grants was $44.91 per share.

In the first quarter of 2011, four non-employee directors were granted a combined total of 9,168 shares of restricted stock awards that vest quarterly over two years.  The restricted stock had a fair value of $43.08 per share which was the closing price of the Ascent Capital Series A common stock on the date of grant.

In the first quarter of 2011, certain key employees were granted a total of 99,794 options to purchase Ascent Capital Series A common stock at an exercise price of $48.15 per share, which was the closing price on the date of grant.  Such options vest quarterly over four to five years from the date of grant, terminate seven years from the date of grant and had a weighted-average fair value at the date of grant of $20.32 per share, as determined using the Black-Scholes Model.  The assumptions used in the Black-Scholes Model to determine grant date fair value were a volatility factor of 35%, a risk-free interest rate of 2.88%, an expected life of seven years and a dividend yield of zero.

2010

In the first quarter of 2010, certain key employees were granted a total of 12,766 shares of restricted stock awards that vest quarterly over one year.  The restricted stock had a fair value of $28.20 per share which was the closing price of the Ascent Capital Series A common stock on the date of grant.

2009

In the fourth quarter of 2009, four non-employee directors were granted a combined total of 15,923 shares of restricted stock awards that vest quarterly over two years.  The restricted stock had a fair value of $24.81 per share which was the closing price of the Ascent Capital Series A common stock on the date of grant.

In the first quarter of 2009, certain key employees were granted a total of 116,740 options to purchase Ascent Capital Series A common stock for a weighted average exercise price of $25.30 per share.  Such options vest quarterly over four years from the date of grant, terminate 10 years from the date of grant and had a weighted-average fair value at the date of grant of $12.30 per share, as determined using the Black-Scholes Model.  For the 2009 stock grants, the assumptions used in the Black-Scholes Model to determine grant date fair value were a volatility factor of 50%, a risk-free interest rate of 1.51%, an expected life of 6.1 years and a dividend yield of zero.

The following table presents the number and weighted average exercise price (“WAEP”) of options to purchase Ascent Capital Series A and Series B common stock.

	Series A
	common stock		WAEP
Outstanding at January 1, 2011	615,563		$	22.72
Granted	318,606		$	48.29
Exercised	(51,460	)	$	25.09
Forfeited	—		$	—
Outstanding at December 31, 2011	882,709		$	31.81
Exercisable at December 31, 2011	385,224		$	22.87

The intrinsic value of outstanding stock option awards and exercisable stock option awards at December 31, 2011 was $16,694,000 and $10,728,000, respectively.  The weighted average remaining contractual life of both exercisable and outstanding awards at December 31, 2011 was 6.5 years and 6.75 years, respectively.

The following table presents the number and weighted average fair value (“WAFV”) of unvested restricted stock awards.

	Restricted Stock Awards
	Series A		Series B	WAFV
Outstanding at January 1, 2011	63,196		—	$	22.47
Granted	148,654		9,029	$	42.63
Vested	(52,782	)	—	$	31.30
Cancelled	(14,846	)	—	$	31.30
Outstanding at December 31, 2011	144,222		9,029	$	39.34

As of December 31, 2011, the total compensation cost related to unvested equity awards was approximately $11,701,000.  Such amount will be recognized in the consolidated statements of operations over a period of approximately 4 years.