8-KLeadership ChangesExhibits & Filings

FIRSTENERGY CORP 8-K Report, Executive Changes (Jul 23, 2018)

Filed July 23, 2018For Securities:FE

Summary

FirstEnergy Corp. (FE) announced on July 23, 2018, the implementation of a Voluntary Enhanced Retirement Program (VERP) and an Executive Voluntary Enhanced Retirement Program (E-VERP). These programs are part of the company's broader initiative to reduce shared services and align with its strategy to transition into a fully regulated utility company by exiting the competitive generation business. The VERP offers enhanced retirement benefits to eligible non-bargaining employees, while the E-VERP extends similar benefits to executive officers, excluding the CEO. The filing specifically notes the election of two executive officers, Leila L. Vespoli (Executive Vice President, Corporate Strategy, Regulatory Affairs, and Chief Legal Officer) and James F. Pearson (Executive Vice President, Finance), to participate in the E-VERP. Their retirements are effective in 2019 and will include lump-sum payments, continued healthcare benefits, and pension enhancements. These programs represent a significant step in FirstEnergy's organizational restructuring and workforce management strategy.

Key Highlights

  • 1FirstEnergy Corp. implemented a Voluntary Enhanced Retirement Program (VERP) for eligible non-bargaining employees and an Executive Voluntary Enhanced Retirement Program (E-VERP) for executive officers.
  • 2These programs are linked to the company's strategic initiative to exit the competitive generation business and operate as a fully regulated utility.
  • 3The VERP and E-VERP offer a lump-sum severance payment, continued healthcare benefits for up to 18 months, and a temporary monthly pension enhancement.
  • 4Executive Vice President Leila L. Vespoli and Executive Vice President James F. Pearson have elected to participate in the E-VERP.
  • 5Ms. Vespoli's retirement is effective April 1, 2019, with a lump-sum payment of approximately $1.52 million.
  • 6Mr. Pearson's retirement is expected no later than April 1, 2019, with a lump-sum payment of approximately $1.32 million.
  • 7The retirements and program benefits are contingent upon the execution of a release in favor of the Company.

Frequently Asked Questions

These programs are part of FirstEnergy's strategy to reduce shared services and transition to a fully regulated utility company. They are designed to facilitate workforce restructuring by offering enhanced retirement benefits to eligible employees and executives.

Participants receive a lump-sum payment equivalent to severance benefits, continuation of health care benefits for up to 18 months, a temporary monthly pension enhancement of $1,500 (up to age 65 for VERP, and for a minimum of 24 months for E-VERP participants), and payment for unused paid time off. Executive participants may also be eligible for other standard retirement benefits.

Leila L. Vespoli, Executive Vice President, Corporate Strategy, Regulatory Affairs, and Chief Legal Officer, and James F. Pearson, Executive Vice President, Finance, have elected to participate in the E-VERP.

The filing indicates specific lump-sum payments for Ms. Vespoli ($1,518,400) and Mr. Pearson ($1,320,800), which are significant but are part of a broader workforce reduction strategy aimed at long-term operational efficiency and alignment with the company's regulated utility focus. The exact total cost of the VERP and E-VERP programs is not fully detailed in this filing.