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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): February 20, 2007
CONSOLIDATED COMMUNICATIONS HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 000-51446 02-0636095
(State of (Commission File) (IRS employer
Incorporation) Number identification no.)
121 South 17th Street
Mattoon, Illinois 61938-3987
(Address of principal (Zip code)
executive offices)
Registrant's telephone number, including area code: (217) 235-3311
NOT APPLICABLE
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
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ITEM 5.02. DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF
DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS
OF CERTAIN OFFICERS.
Employment Security Agreements
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On February 20, 2007, Consolidated Communications Holdings, Inc. (the
"Company") approved entering into Employment Security Agreements (the
"Agreements") with the following executive officers of the Company:
Steven L. Childers, Robert J. Currey, Joseph R. Dively, Steven J.
Shirar, C. Robert Udell, Jr., and Christopher A. Young. A complete
copy of a form of the Agreements is filed with this Current Report as
Exhibit 10.1 and incorporated herein by this reference.
Payments under the Agreements are provided if (i) there is a change in
control of the Company and (ii) within two years following the change
in control, either the executive's employment is terminated by the
Company without "cause" (i.e., commission of a felony, fraud,
negligence in the performance of duties, or violation of the Company's
code of conduct resulting in termination of employment) or the
executive terminates his employment for "good reason" (i.e., reduction
in salary, bonus or job responsibilities, or relocation more than 30
miles away). Change in control is defined in the Agreements and
includes the acquisition of a majority of the Company's common stock,
certain mergers, consolidations and asset transfers, or the election
of a majority of the directors not recommended by the incumbent board.
Change in control benefits under the Agreements generally include a
lump sum cash payment equal to one year base salary and bonus, a
prorata bonus for the year in which the termination occurs, and
continuation of medical, dental, life insurance and similar benefits
for one year. The Agreements also provide for reimbursement to the
executive for any excise tax imposed on payments under the Agreements
or otherwise in connection with the change in control as well as taxes
imposed on such reimbursement amounts. The Agreements include
covenants that prohibit the executives from competing and from
soliciting Company employees for one year following a termination of
employment.
Executive Long-Term Incentive Program
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Also on February 20, 2007, the Compensation Committee of the Board of
Directors of the Company adopted the Executive Long-Term Incentive
Program, which provides a methodology for determining the amount of
stock awards made to senior executives under the Company's 2005 Long-
Term Incentive Plan. A complete copy of the Executive Long-Term
Incentive Program is filed with this Current Report as Exhibit 10.2
and incorporated herein by this reference.
The program is intended to provide eligible executives with long-term
incentive compensation at or near the 50th percentile of such
compensation paid to executives holding comparable job positions at
the companies within the Company's custom comparator group. Half of
this value is paid to the executive in an award of restricted shares
and half is paid to the executive in an award of performance shares.
The restricted shares vest at a rate equal to 25% per year on each
December 5th following the date of grant. The performance shares
entitle the executive to receive an award of restricted shares in the
next subsequent year if certain goals based on current year Company
performance are attained. Attainment of the goals at the target
levels will result in the target number of performance shares awarded
as restricted shares, and attainment of the goals at above or below
the target levels will result in an increased or decreased number of
restricted shares awarded. The restricted shares awarded pursuant to
the performance shares also vest at a rate equal to 25% per year on
each December 5th following the date of grant.
Except for the grants described in the next sentence, in determining
the number of shares subject to the awards, restricted shares are
valued at the fair market value of the common stock on the date of
grant, and performance shares are valued by applying a discount to the
fair market value of the common stock on the date of grant, which is
intended to reflect the risk of attaining performance goal results at
below the target levels (the discount for 2007 is 10%). The
Compensation Committee expects to grant awards in March 2007, which,
if granted, will be made pursuant to the program's methodology
described above, except that the long-term equity incentive
compensation levels and the fair market value will be based on
November 2006 data (with the fair market value based on the average of
the closing price of the shares for the month of November), which is
the date the initial calculation of awards was determined, as
contemplated by the Compensation Committee.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits.
Exhibit No. Description
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10.1 Form of Employment Security Agreement with certain of
the Company's executive officers.
10.2 Executive Long-Term Incentive Program, effective as of
February 20, 2007.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
Date: February 23, 2007
Consolidated Communications
Holdings, Inc.
By: /s/ Steven L. Childers
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Name: Steven L. Childers
Title: Chief Financial Officer
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EXHIBIT INDEX
Exhibit No. Description
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10.1 Form of Employment Security Agreement with certain of
the Company's executive officers.
10.2 Executive Long-Term Incentive Program, effective as of
February 20, 2007.
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