8-KOther Events

FIRSTENERGY CORP 8-K Report, Corporate Update (May 27, 2021)

Filed May 27, 2021For Securities:FE

Summary

FirstEnergy Corp. (FE) announced the separation of Eileen M. Mikkelsen, Vice President of Rates and Regulatory Affairs, and Acting Vice President of External Affairs, effective May 27, 2021. This separation is linked to her alleged inaction regarding a 2015 amendment to a consulting agreement with an entity associated with a state official who now regulates the company's Ohio subsidiaries. The consulting agreement, active since 2013, was terminated in 2019 with a payment of approximately $4 million, and FirstEnergy continues to believe these payments may not have been for their stated purpose. The company is currently reviewing interim organizational changes to address Ms. Mikkelsen's departure. This event occurs amidst ongoing investigations and scrutiny related to Ohio House Bill 6, which has broad implications for the company's regulatory and financial standing. Investors should monitor the company's progress on resolving these investigations and any further impact on its regulatory matters and financial performance.

Key Highlights

  • 1Separation of Eileen M. Mikkelsen, VP of Rates and Regulatory Affairs and Acting VP of External Affairs, effective May 27, 2021.
  • 2The separation is related to inaction regarding a 2015 amendment of a consulting agreement with an entity tied to a current Ohio government official.
  • 3The official in question regulates FirstEnergy's Ohio electric utility subsidiaries.
  • 4The consulting agreement was in place since 2013 and terminated in 2019 with a $4 million payment.
  • 5FirstEnergy suspects payments under the consulting agreement may have been for purposes other than stated.
  • 6The company is evaluating interim organizational changes in response to the separation.
  • 7This event is framed within the context of ongoing government investigations related to Ohio House Bill 6.

Frequently Asked Questions

Eileen M. Mikkelsen was separated due to her alleged inaction regarding the amendment in 2015 of a previously disclosed consulting agreement. This agreement was with an entity associated with an individual who now holds a significant regulatory role over FirstEnergy's Ohio utilities.

The consulting agreement was active from 2013 to 2019, during which FirstEnergy made payments totaling approximately $4 million. FirstEnergy continues to believe that these payments may have been for purposes other than those stated in the agreement.

While the filing does not explicitly detail the impact, the separation of a key regulatory and external affairs executive, tied to a consulting agreement involving a state regulator, raises questions about governance and potential influence. This could be relevant to the ongoing investigations surrounding Ohio House Bill 6 and other regulatory matters impacting the company's Ohio operations and future rates.

FirstEnergy is reviewing interim organizational changes to address Ms. Mikkelsen's separation. Further details on these changes are expected later.