8-KLeadership ChangesExhibits & Filings

FIRSTENERGY CORP 8-K Report, Executive Changes (Aug 7, 2015)

Filed August 7, 2015For Securities:FE

Summary

FirstEnergy Corp. (FE) filed an 8-K on August 7, 2015, detailing significant executive compensation and appointment changes effective in August and September 2015. The filing specifically addresses performance-based awards granted to two key executives: James F. Pearson, Senior Vice President and Chief Financial Officer, and James H. Lash, President FirstEnergy Generation (FEG). These awards are tied to achieving specific cash flow savings goals by 2017 and 2016, respectively, and are contingent upon continued employment through their vesting dates. Furthermore, the report announces the promotions of both Mr. Pearson and Mr. Lash to Executive Vice President roles, effective September 6, 2015. Mr. Pearson will also continue as Chief Financial Officer, and Mr. Lash will continue as President FEG. These changes indicate a strategic alignment of executive compensation with corporate performance initiatives and also reflect leadership advancements within the company.

Key Highlights

  • 1Performance-based restricted stock award granted to James F. Pearson (SVP & CFO) tied to company cash flow savings by Dec 31, 2017, with vesting on Oct 30, 2019.
  • 2Performance-based cash award granted to James H. Lash (President FEG) for $580,000 tied to FEG cash flow savings by Dec 31, 2016, payable July 1, 2017.
  • 3Both awards require continued employment through their respective vesting/payment dates to be earned.
  • 4Failure to meet performance goals or continued employment will result in forfeiture of the awards.
  • 5James F. Pearson appointed Executive Vice President and Chief Financial Officer, effective September 6, 2015.
  • 6James H. Lash appointed Executive Vice President, effective September 6, 2015.
  • 7Awards are governed by the 2015 Incentive Compensation Plan and detailed agreements attached as exhibits.

Frequently Asked Questions

The primary purpose is to align executive compensation with the achievement of specific corporate performance goals related to cash flow savings and to recognize leadership through executive promotions. These actions are designed to incentivize key executives to drive financial improvements and provide stability in leadership.

Mr. Pearson will receive his 30,000 restricted stock award if FirstEnergy Corp. achieves its Company Performance Goal (specific cash flow savings) by December 31, 2017. If achieved, the award becomes retention-based and vests fully on October 30, 2019, provided he remains employed with the company through that date. Failure to meet the goal or remain employed will result in forfeiture.

Mr. Lash will receive his $580,000 cash award if FirstEnergy Generation (FEG) achieves its FEG Performance Goal (specific cash flow savings) by December 31, 2016. If achieved, the award becomes fully payable on July 1, 2017, provided he remains employed with the company through that date. Failure to meet the goal or remain employed will result in forfeiture.

Effective September 6, 2015, Mr. Pearson was appointed Executive Vice President and Chief Financial Officer. Mr. Lash was appointed Executive Vice President.