Form 4: FirstEnergy Director Boosts Phantom Stock Holdings

FirstEnergy Corp. Director Paul J. Kaleta acquired 925 phantom stock units, increasing his total beneficial ownership to over 16,200 units.

Summary

• Paul J. Kaleta, a Director of FirstEnergy Corp. (FE), reported changes in his beneficial ownership.
• He acquired 925 phantom stock units on October 1, 2025, as part of his compensation.
• These units are granted under the FirstEnergy Corp. 2020 Incentive Compensation Plan and deferred via the FirstEnergy Corp. Deferred Compensation Plan for Outside Directors.
• Each phantom stock unit is economically equivalent to one share of common stock and is convertible on a 1-for-1 basis.
• Following this transaction, Kaleta beneficially owns 16,203.6424 phantom stock units, which includes accrued dividends.
• He also directly owns 2,051 shares of FirstEnergy Corp. Common Stock.
• The phantom stock units are payable in cash or shares of common stock upon conclusion of his service as a director.

Sentiment

Score: 7

Explanation: The acquisition of phantom stock units by a director, even if part of a compensation plan, generally signals alignment of interests and confidence in the company's future performance, contributing to a moderately positive sentiment.

Positives

• The acquisition of phantom stock units by a director aligns his interests with those of shareholders, potentially signaling confidence in the company's future performance.

Future Outlook

Phantom stock units are payable in cash or shares of FirstEnergy Corp. common stock following the conclusion of service as a director, indicating a future payout event tied to continued service.

Management Comments

• Phantom stock units are paid quarterly under the FirstEnergy Corp. 2020 Incentive Compensation Plan and deferred pursuant to the FirstEnergy Corp. Deferred Compensation Plan for Outside Directors.

Industry Context

Insider transactions, particularly acquisitions of equity-linked compensation, are a common practice across industries to align management and director interests with shareholders. This is a standard form of executive and director compensation in many publicly traded companies.

Comparison to Industry Standards

• Many public companies utilize phantom stock or similar equity-based compensation plans for their directors, reflecting a common industry standard for aligning director incentives with long-term shareholder value. The specific number of units granted is typically determined by the company's compensation policies, director responsibilities, and overall market compensation benchmarks for similar roles in the utility sector.

Related Party Transactions

• Acquisition of 925 phantom stock units by Director Paul J. Kaleta from FirstEnergy Corp. as part of his compensation plan, representing a transaction between a company and a related party (director).

Stakeholder Impact

• Shareholders may view the director's increased beneficial ownership through phantom stock as a positive indicator of management's commitment and alignment with long-term company performance.

Next Steps

• Payout of phantom stock units to Paul J. Kaleta upon the conclusion of his service as a director, in accordance with the terms of the Deferred Compensation Plan for Outside Directors.

Key Dates

Recommendation

This Form 4 reports a routine acquisition of phantom stock units as part of a director's compensation plan. While it indicates continued alignment of interests, it does not present new information significant enough to alter an investment thesis or warrant a 'buy' or 'sell' recommendation based solely on this filing. It reinforces a 'hold' position for existing investors, as it's a standard operational event rather than a material change in company fundamentals or outlook.

Keywords

FirstEnergy, FE, Paul J. Kaleta, Director, Insider Transaction, Form 4, Phantom Stock, Equity Compensation, Beneficial Ownership