Consolidated Communications Holdings, Inc. (Form: 8-K, Received: 05/04/2011 12:50:15)

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): May 4, 2011

CONSOLIDATED COMMUNICATIONS HOLDINGS, INC.

(Exact name of registrant as specified in its charter)


Delaware	000-51446	02-0636095
(State of Incorporation)	(Commission File Number)	(IRS employer identification no.)

121 South 17 th Street
Mattoon, Illinois		61938-3987
(Address of principal executive offices)		(Zip code)

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))

Item 5.02.

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) In a Current Report on Form 8-K, dated April 27, 2011, Consolidated Communications Holdings, Inc. (the “Company”) previously disclosed that Joseph R. Dively, a Senior Vice President of the Company, had informed the Company of his decision to resign from the Company, effective as of May 6, 2011, in order to accept the positions of Senior Executive Vice President of First Mid-Illinois Bancshares, Inc. and President of its subsidiary, First Mid-Illinois Bank & Trust, N.A. The parties have agreed that Mr. Dively will resign effective as of May 8, 2011.

In connection therewith, on May 3, 2011, the Company entered into a Separation Agreement with Mr. Dively. A copy of the Separation Agreement is attached to this Current Report on Form 8-K as Exhibit 10.1 and incorporated herein by reference.

The Separation Agreement provides: (i) that until two years following the separation date, Mr. Dively will be prohibited from competing with the Company and from soliciting any customer, representative, agent or employee of the Company to terminate such person’s relationship with the Company or to violate the terms of any agreement between such customer, representative, agent or employee and the Company, (ii) for a lump sum payment of $170,769.00, which represents an amount equal to 40 weeks of Mr. Dively’s current base salary; and (iii) for continued vesting in the portion of Mr. Dively’s outstanding restricted stock awards granted to him under the Company’s 2005 Long-Term Incentive Plan that will vest on December 5, 2011 and that all other outstanding awards or portions thereof shall be forfeited as of the separation date.

Item 5.05

Amendments to the Registrant’s Code of Ethics, or Waiver of a Provision of the Code of Ethics.

(a) On May 3, 2011, the Board of Directors of the Company adopted amendments to the Company’s Code of Business Conduct and Ethics (the “Code”). The amendments took effect immediately upon adoption by the Board of Directors.

The amendments to the Code included adding the following provisions:

·	an employee who reports his or her own misconduct will not be absolved of responsibility for his or her actions by the act of reporting;

·	the Code does not create any rights for any person or entity other than the Company; and

·	the Code does not alter the employment relationship between the Company and any employee or grant any employee employment for any specific period of time.

The Company has posted the Code, as amended, on its website at www.consolidated.com .

Item 5.07.

Submission of Matters to a Vote of Security Holders.

At the Annual Meeting of Stockholders (the “Annual Meeting”) of the Company held on May 3, 2011, 27,603,227 shares of common stock, $0.01 par value, or approximately 92.74% of the 29,763,122 shares of common stock outstanding and entitled to vote at the Annual Meeting, were present in person or by proxy. Set forth below are the matters acted upon by the Company’s stockholders at the Annual Meeting and the final voting results on each such matter.

Proposal No. 1: Election of Class III Directors . The number of votes cast for each nominee named in the Company’s proxy statement, as well as the number of votes withheld and broker non-votes, were as follows:

Name of Nominee	Votes For	Withheld	Broker Non-Votes
Robert J. Currey	20,575,862	269,003	6,751,562
Maribeth S. Rahe	20,491,350	360,315	6,751,562

Each nominee, having received a plurality of the votes cast, was elected. In addition, the terms of office of the following Directors continued after the Annual Meeting: Richard A. Lumpkin, Roger H. Moore, and Jack W. Blumenstein.

Proposal No. 2: Ratification of Appointment of Independent Registered Public Accounting Firm . With respect to the ratification of the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2011, the number of votes cast for and against this matter, as well as the number of abstentions, were as follows:

Votes For	Votes Against	Abstentions
27,387,941	144,858	70,428

There were no broker non-votes as to Proposal No. 2.

Proposal No. 2, having received the affirmative vote of the holders of more than a majority of the votes present, in person or by proxy, and entitled to vote on the matter at the Annual Meeting, was adopted.

Proposal No. 3: Advisory Vote on Executive Compensation . With respect to the advisory vote to approve the compensation of the Company’s named executive officers described in the Company’s proxy statement, the number of votes cast for and against this matter, as well as the number of abstentions and broker non-votes, were as follows:

Votes For	Votes Against	Abstentions	Broker Non-Votes
19,809,874	782,131	229,477	6,751,562

Proposal No. 3, having received the affirmative vote of the holders of more than a majority of the votes present, in person or by proxy, and entitled to vote on the matter at the Annual Meeting, was approved, on an advisory basis.

Proposal No. 4: Advisory Vote on the Frequency of the Executive Compensation Vote . With respect to the advisory vote as to whether the stockholder vote to approve named executive officer compensation should occur yearly, every two years or every three years, the number of votes cast for the “Yearly,” “Every Two Years” and “Every Three Years” frequencies, as well as the number of abstentions and broker non-votes, were as follows:

Yearly	Every Two Years	Every Three Years	Abstentions	Broker Non-Votes
9,860,107	592,148	10,166,820	232,590	6,751,562

Proposal No. 5: Amendments to the Amended and Restated Certificate of Incorporation (the “Certificate”) to Eliminate the 75% Stockholder Approval Requirement for any Merger, Consolidation or Sale of All or Substantially All of the Assets of the Company . With respect to proposed amendments to the Certificate to eliminate the 75% stockholder approval requirement for any merger, consolidation or sale of all or substantially all of the assets of the Company, the number of votes cast for and against this matter, as well as the number of abstentions and broker non-votes, were as follows:

Votes For	Votes Against	Abstentions	Broker Non-Votes
26,783,858	602,023	217,346	0

Proposal No. 5, having received the affirmative vote of the holders of more than 75% of the Company’s common stock outstanding on the record date, was approved.

As a result of this approval, a Certificate of Amendment of the Certificate was filed with the Secretary of State of the State of Delaware on May 3, 2011, a copy of which is filed as Exhibit 3.1 hereto and is incorporated by reference herein.

Item 9.01.

Financial Statements and Exhibits.

(d)	Exhibits .

Exhibit No.		Description

3.1		Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Consolidated Communications Holdings, Inc., as filed with the Secretary of State of the State of Delaware on May 3, 2011
10.1		Separation Agreement, dated as of May 3, 2011, by and between Consolidated Communications Holdings, Inc. and Joseph R. Dively

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: May 4, 2011
	Consolidated Communications Holdings, Inc.

	By:	/s/ Steven L. Childers
		Name: Steven L. Childers Title: Chief Financial Officer

EXHIBIT INDEX

Exhibit No.		Description

3.1		Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Consolidated Communications Holdings, Inc., as filed with the Secretary of State of the State of Delaware on May 3, 2011
10.1		Separation Agreement, dated as of May 3, 2011, by and between Consolidated Communications Holdings, Inc. and Joseph R. Dively

EXHIBIT 10.1

SEPARATION AGREEMENT

This Separation Agreement (the “Agreement”) is made as of this 3 rd day of May, 2011 (the “Effective Date”), by and between Joseph R. Dively (the “Executive”) and Consolidated Communications Holdings, Inc. (the “Company”), concerning the Executive’s separation from employment with the Company.

WHEREAS, the Executive and the Company have agreed that the Executive’s employment with the Company will end at 11:59 p.m. Mattoon, Illinois time on May 8, 2011 (the “Separation Date”); and

WHEREAS, the Company and the Executive intend this Agreement to document the complete understanding of the parties as to all rights of the Executive relating to the Executive’s employment by, and separation from employment with, the Company.

NOW THEREFORE, in consideration of the mutual promises and agreements set forth below, the receipt and adequacy of which is hereby acknowledged, the Company and the Executive agree as follows:

1. Separation . The Executive’s employment as a Senior Vice President shall terminate as of the close of business on the Separation Date. The Executive hereby resigns from all other officer, director and other positions with the Company and any and all of its affiliates effective as of the close of business on the Separation Date. Through the Separation Date, the Executive shall take reasonable and appropriate actions to cooperatively and smoothly transition his duties and responsibilities. Through the Separation Date, the Executive will be paid his current base salary and will continue participation in all benefit plans and programs of the Company in which he currently participates, in accordance with the terms of such plans and programs. Any business expenses properly incurred by the Executive prior to the Separation Date will be reimbursed in accordance with the Company’s expense reimbursement policy. The Executive’s final paycheck will also include payment for any vacation time that is accrued but unused as of the Separation date.

2. Consideration . In exchange for the Executive’s continued compliance with all of the terms and conditions of this Agreement, the Company shall provide the following:

(a) A separation payment equal to 40 weeks of base salary ($170,769.00), which will be paid to the Executive in a lump-sum within 15 days of the Separation Date.

(b) Continued vesting in the portion of the Executive’s outstanding restricted stock awards granted to him under the Company’s 2005 Long-Term Incentive Plan that will vest on December 5, 2011, as described on Exhibit A attached to this Agreement. All other outstanding awards or portions thereof shall be forfeited as of the Separation Date.

(c) If the Executive elects continued coverage under the Company’s health plan pursuant to Part 6 of Title I of the Employee Retirement Income Security Act of 1974 or other applicable law (“COBRA”), then the Executive shall be responsible for paying the portion

of the premiums paid by similarly situated active employees of the Company for the first 40 weeks following the Separation Date and thereafter the Executive shall be responsible for paying the full COBRA premiums for the duration of the COBRA period.

3. Termination of Benefits; No Other Payments . Except as specifically provided in Section 2 of this Agreement, the Executive’s continued participation in all employee benefit plans and programs of the Company will cease as of the Separation Date. Nothing contained herein shall limit or otherwise impair the Executive’s right to receive pension or similar benefit payments that are vested as of the Separation Date under any applicable tax qualified retirement plan. The Executive agrees and acknowledges that, other than as specifically provided for in this Agreement, no additional payments are due from the Company on any basis whatsoever.

4. Confidentiality . The Executive acknowledges that preservation of a continuing business relationship between the Company and its customers, representatives and employees is of critical importance to the continued business success of the Company and that it is the active policy of the Company to guard as confidential the identity of its customers, trade secrets, pricing policies, business affairs, representatives and employees. In view of the foregoing, the Executive agrees that he shall not, during his remaining employment with the Company and thereafter, without the prior written consent of the Company, disclose to any person or entity any information concerning the business of, or any customer, representative, agent or employee of, the Company which was obtained by the Executive in the course of his employment by the Company. The Executive further agrees that upon the Separation Date, he will leave with the Company, and will not take originals or copies of, any records, papers, programs, computer software and documents and any matter of whatever nature which contains any such confidential information of the Company. This Section 4 shall not be applicable if and to the extent the Executive is required to testify in a legislative, judicial or regulatory proceeding pursuant to an order of Congress, any state or local legislature, a judge, or an administrative law judge.

5. Non-Compete; Non-Solicitation .

(a) The Executive agrees that the benefits provided in Section 2 of the Agreement serve as adequate consideration for the restrictive covenants described below:

(i) The Executive agrees that he shall not, during his remaining employment with the Company and for two years following the Separation Date, be associated, directly or indirectly, as an employee, proprietor, stockholder, partner, agent, representative, officer, or otherwise, with the operation of any business that is competitive with any line of business of the Company, in any geographic area in which such line of business was active as of the Separation Date, without the prior written consent of the Company, which shall not unreasonably be withheld, except that the Executive’s ownership of less than 1% of any class of publicly-traded securities of any such business shall not be considered a violation of this Section 5. For purposes of the preceding sentence, the Executive shall be considered as the “stockholder” of any equity securities owned by his spouse and all relatives and children residing in the Executive’s principal residence.

(ii) The Executive agrees that he shall not, during his remaining employment with the Company and for two years following the Separation Date, directly or

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indirectly, in his individual capacity or otherwise, induce, cause, persuade, or attempt to do any of the foregoing in order to cause, any customer, representative, agent or employee of the Company to terminate such person’s relationship with the Company or to violate the terms of any agreement between such customer, representative, agent or employee and the Company.

(b) If at any time any clause or portion of this Section 5 shall be deemed invalid or unenforceable by the laws of the jurisdiction in which it is to be enforced by reason of being vague or unreasonable as to duration, geographic scope, nature of activities restricted, or for any other reason, this provision shall be considered divisible as to such portions and the foregoing restrictions shall become and be immediately amended to include only such duration, scope or restriction and such event as shall be deemed reasonable and enforceable by the court or other body having jurisdiction to enforce this Agreement; and the parties hereto agree that the restrictions, as so amended, shall be valid and binding as though the invalid or unenforceable portion had not been involved herein.

(c) The Executive acknowledges and agrees that the Company would be irreparably harmed by violations of this Section 5 and in recognition thereof, the Company shall be entitled to withhold the benefits described in Section 2 of this Agreement, and to obtain an injunction or other decree of specific performance with respect to any violation thereof (without any bond or other security being required) in addition to other available legal and equitable remedies.

(d) This Section 5 shall survive any termination of this Agreement. The time period associated with each covenant herein shall be tolled (that is, shall not run) for so long as the Executive is in breach of that covenant.

6. Withholding for Taxes . All benefits and payments provided to the Executive pursuant to this Agreement shall be subject to all applicable tax withholding and reporting requirements.

7. Miscellaneous .

(a) This Agreement may not be assigned by the Company without the written consent of the Executive except in connection with a merger, consolidation or sale of substantially all the assets of the Company, and the obligations of the Company under this Agreement shall be the binding legal obligations of any successor to the Company by merger, consolidation or otherwise, and in the event of any business combination or transaction that results in the transfer or substantially all of the assets or business of the Company, the Company will cause the transferee to assume the obligations of the Company under this Agreement. This Agreement may not be assigned by the Executive during the Executive’s life, and upon the Executive’s death will inure to the benefit of the Executive’s heirs, legatees and legal representatives of the Executive’s estate.

(b) This Agreement shall be construed in accordance with the laws of the State of Illinois, without regard to the conflict of law provisions of any jurisdiction.

(c) This Agreement reflects the entire agreement between the Executive and the Company and supersedes all prior agreements and understandings, written or oral relating to

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the subject matter hereof. This Agreement may not be modified or amended except by a writing signed by the parties to this Agreement.

(d) Any notice pertaining to this Agreement shall be in writing and shall be deemed to have been effectively given on the earliest of (i) when received, (ii) on the day of transmission if sent via facsimile with electronic confirmation, (iii) one business day after delivery via an overnight courier service or (iv) five days after deposit with the United Postal Service, and addressed as follows:

	to the Executive at:	______________________
		______________________
		______________________

	to the Company at:	Consolidated Communications Holdings, Inc.
		121 South 17 th Street, Mattoon, IL 61938
		Fax: (217) 234-9934
		Attn: Corporate Secretary

(e) The waiver by either party to this Agreement of a breach of any provision of this Agreement shall not operate as or be deemed a waiver of any subsequent breach by such party. Continuation of benefits hereunder by the Company following a breach by the Executive of any provision of this Agreement shall not preclude the Company from thereafter exercising any right that it may otherwise independently have to terminate such benefits based upon the same violation.

(f) In the event that any provision or portion of this Agreement shall be determined to be invalid or unenforceable for any reason, the remaining provisions of this Agreement shall be unaffected thereby and shall remain in full force and effect.

(g) The Executive shall continue to be eligible for indemnification by the Company to the extent provided to other former executives of the Company under any policy of insurance obtained by the Company or as may be required by the Company’s Certificate of Incorporation, its Bylaws or Delaware law.

IN WITNESS WHEREOF, this Agreement has been duly executed as of the Effective Date.

/s/ Joseph R. Dively		/s/ Robert J. Currey
Joseph R. Dively		Consolidated Communications Holdings, Inc. By: Robert J. Currey Title: President & Chief Executive Officer

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The Executive shall continue to vest in the portion of the outstanding restricted stock awards that vest on December 5, 2011:

Award Date	# of Shares Subject to Award	# of Shares that Vest on December 5, 2011

2008	5,215	1,304
2009	5,913	1,479
2010	9,568	2,392
2010	19,194	4,799
2011	5,279	1,320

All other portions of all outstanding restricted stock awards (including related dividends), and the performance share award made in 2011, shall be forfeited to the Company on the Separation Date.

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	By:	/s/ Steven J. Shirar
	Name:	Steven J. Shirar
	Title:	Senior Vice President and Secretary