8-KLeadership ChangesExhibits & Filings

FIRSTENERGY CORP 8-K Report, Executive Changes (Dec 4, 2018)

Filed December 4, 2018For Securities:FE

Summary

This 8-K filing from FirstEnergy Corp. (FE) announces the adoption of the FirstEnergy Solutions Corp. (FES) 2019 Annual Incentive Program (2019 FES AIP). This program is designed to provide cash incentive awards to FES employees, including FES President Donald Schneider, who is a named executive officer of FirstEnergy. The program aims to motivate employees by tying incentive payouts to the achievement of key financial and operational performance indicators (FES KPIs) for FES during the 2019 calendar year. Investors should note that FES, its subsidiaries, and FirstEnergy Nuclear Operating Company are currently operating under Chapter 11 bankruptcy protection. The 2019 FES AIP is structured with performance-based targets, where payouts can range from 50% to 200% of the target award, contingent upon meeting threshold performance levels. A significant portion (75%) of estimated awards are paid quarterly, subject to year-end adjustments. The FES Board retains discretion over KPI targets, award payouts, and the program itself.

Key Highlights

  • 1FirstEnergy Solutions Corp. (FES) has adopted the 2019 Annual Incentive Program (2019 FES AIP) for its employees.
  • 2The 2019 FES AIP is designed to incentivize employees based on achieving specific FES Key Performance Indicators (KPIs) for the 2019 fiscal year.
  • 3FES, its subsidiaries, and FirstEnergy Nuclear Operating Company are currently undergoing Chapter 11 bankruptcy proceedings.
  • 4Incentive awards are performance-based, with potential payouts ranging from 50% to 200% of target compensation, dependent on meeting performance thresholds.
  • 5A portion (75%) of estimated awards will be paid quarterly, with final adjustments made at year-end based on actual performance.
  • 6The FES Board of Directors retains significant discretion over the establishment of KPIs, weighting, and award payouts, and can amend or terminate the program.

Frequently Asked Questions

The 2019 FES AIP's primary purpose is to incentivize employees of FirstEnergy Solutions Corp. (FES), including its President Donald Schneider, by offering cash bonuses tied to the achievement of specific financial and operational performance goals (FES KPIs) for the 2019 calendar year. This aims to drive FES's financial success during its restructuring period.

While FES and related entities are under Chapter 11 bankruptcy protection, the 2019 FES AIP indicates that incentive awards are still being offered to motivate employees during this critical period. The program's success and payout structure are contingent upon achieving FES KPIs, which are intended to drive FES's financial performance. However, the ultimate outcome for FES and its creditors remains subject to the bankruptcy proceedings.

The cash incentive awards under the 2019 FES AIP are based on a percentage of base salary. Target achievement levels for FES KPIs can result in payouts ranging from a minimum of 50% of the target opportunity (at threshold performance) up to a maximum of 200% of the target opportunity (at stretch performance). However, if the threshold performance is not met, no award will be paid.

The FES Board of Directors has substantial control over the 2019 FES AIP. They have the discretion to determine the nature, number, weighting, and targeted achievement levels of the FES KPIs. Furthermore, they can adjust awards downwards through negative discretion, and they also retain the right to amend or terminate the entire program at any time.