K. Jon Taylor
FIRSTENERGYAbout K. Jon Taylor
K. Jon Taylor is Senior Vice President, Chief Financial Officer & Strategy at FirstEnergy (FE), a role he has held since 2021 after serving as CFO since 2020 across multiple FE entities; he is 51 years old as of February 27, 2025 . His incentive pay is tied primarily to multi‑year EPS and relative TSR; the 2022–2024 LTIP paid at 77% of target, with Operating EPS at 85% of target and Relative TSR at the 37th percentile; an absolute TSR cap did not apply because FE’s December 2024 average stock price ($45.31) exceeded December 2021 ($39.94) . FE has transitioned its earnings focus and LTIP metric from Operating EPS to Core EPS for 2025–2027, and 2024 STIP paid zero, underscoring pay‑for‑performance rigor . FE reaffirmed a 6–8% long‑term Operating EPS growth target in 2024 and narrowed 2024 EPS guidance during his tenure as CFO, reflecting execution on regulatory and investment plans (company commentary) .
Past Roles
| Organization (Entity Code) | Role | Years | Strategic Impact |
|---|---|---|---|
| FirstEnergy (FE/FESC) | SVP, CFO & Strategy | 2021–Present | Enterprise CFO with strategy remit across holding company and service company . |
| FE subsidiaries (C/E entities) | SVP & CFO | 2020–2024 | CFO leadership across operating utilities and transmission entities . |
| FirstEnergy (FE/FESC) | SVP & CFO | 2020–2021 | Corporate CFO role . |
| FESC | Vice President, Utility Operations | Through 2020 | Oversight of utility operations platform . |
| AGC (D) | President | Through 2020 | Led generating company affiliate . |
| FESC | President, Ohio Operations | Through 2019 | Led Ohio utility operations . |
| Various subsidiaries (C) | Vice President | Through 2019 | Senior leadership across Ohio, PA, transmission entities . |
Fixed Compensation
Historical cash compensation (SEC-reported)
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | $790,223 | $870,962 | $881,731 |
| Non-Equity Incentive Plan Compensation ($) | $661,438 | $939,479 | $0 (Board approved zero 2024 STIP payout) |
Target compensation levels
| Year | Base Salary | Target STIP (% Base) | Target LTIP (% Base) |
|---|---|---|---|
| 2023 | $875,000 | 90% | 325% |
| 2024 | $875,000 | 90% | 325% |
| 2025 | $875,000 | 90% | 325% |
FE states executive pay is predominantly variable (77% for non-CEO NEOs in 2024), with potential reduction to zero if minimum thresholds are not met .
Performance Compensation
LTIP design and results
| LTIP Cycle | Metric | Weight | Threshold | Target | Stretch | Actual | Payout |
|---|---|---|---|---|---|---|---|
| 2022–2024 | Cumulative Operating EPS | 65% | $7.11 | $7.72 | $8.06 | $7.60 | 85% of target for this KPI |
| 2022–2024 | Relative TSR vs S&P Utility | 35% | 25th pct | 50th pct | 85th pct | 37th pct | 61% of target for this KPI |
| 2022–2024 | Total Payout | — | — | — | — | — | 77% of target (shares/cash paid Mar 2025) |
- March 2025 LTIP payouts from 2022–2024: Taylor received 27,459 shares and $523,425 cash .
- 2025–2027 LTIP moves to 60% performance‑adjusted stock‑based RSUs (65% Core EPS, 35% Relative TSR; absolute TSR cap if negative TSR) + 40% time‑based RSUs; cash‑settled component eliminated; an individual +/-15% grant value modifier exists but was not used for 2025 grants .
- In June 2025, FE amended open 2023–2025 and 2024–2026 LTIP cycles to replace Operating EPS with Core EPS prospectively (post‑2024) and capped the EPS KPI payout at 100% of target; targets disclosed below .
| Amended LTIP KPI (3‑year) | Threshold | Target | Payout Cap |
|---|---|---|---|
| 2023–2025 Mixed Operating/Core EPS | $7.32 | $7.76 | 100% for EPS KPI |
| 2024–2026 Mixed Operating/Core EPS | $7.44 | $7.88 | 100% for EPS KPI |
2024 and 2023 equity grants (Taylor)
| Grant Date | Type | Threshold (#) | Target (#) | Max (#) | Grant Date Fair Value ($) |
|---|---|---|---|---|---|
| 3/1/2024 | 2024 PA RSUs – Stock‑based | 13,075 | 52,300 | 104,600 | $1,889,905 |
| 3/1/2024 | 2024 PA RSUs – Cash‑based | 6,507 | 26,029 | 52,059 | $940,597 |
| 3/1/2023 | 2023 PA RSUs – Stock‑based | 12,188 | 48,752 | 97,504 | $1,779,505 |
| 3/1/2023 | 2023 PA RSUs – Cash‑based | 6,066 | 24,263 | 48,527 | $885,644 |
| 3/1/2023 | Restricted Stock | — | — | — | $2,000,032 (51,352 shares) |
Vesting and realized payouts
| Vest/Payout Date | Award | Shares/Units | Value Realized |
|---|---|---|---|
| 3/1/2024 | 2021 PA RSUs – Stock‑based | 71,483 | $2,595,190 |
| 3/1/2024 | 2021 PA RSUs – Cash‑based | 35,526.961 units | $1,289,806 |
| Mar 2025 | 2022–2024 PA RSUs (cycle payout) | 27,459 shares | Paid in shares; plus $523,425 cash |
2024 STIP was paid at zero across NEOs (including Taylor) based on 2024 results and Committee/Board decisions; for 2025 STIP, FE removed the O&M KPI and simplified to Core EPS as the sole financial KPI, with each KPI paid as earned and no “earnings gate” .
FE does not use stock options in its current plan design; there is no repricing of underwater options without shareholder approval .
Equity Ownership & Alignment
Beneficial ownership and guidelines
| As of | Shares Beneficially Owned | Percent of Class | Ownership Guideline | Compliance Status |
|---|---|---|---|---|
| Mar 17, 2025 | 103,558 | <1% (each director/executive below 1%) | 4x base salary multiple for Taylor | Met guideline as of Dec 31, 2024 |
- Anti‑hedging and anti‑pledging: FE prohibits hedging and monetization transactions; Designated Insiders (including executive officers) are prohibited from holding FE securities in margin accounts or pledging FE securities as collateral .
- Deferred compensation exposure: Taylor deferred $114,606 of 2024 base salary and $526,614 of 2022–2024 stock‑based RSUs into the EDCP; his aggregate EDCP balance at year‑end 2024 was $6,920,566 (stock accounts track FE shares, with 2024 stock account return 13.2%) .
Outstanding equity awards at 12/31/2024 (unvested)
| Award | Unvested Units/Shares (#) | Market/Carrying Value ($) |
|---|---|---|
| Restricted Stock | 55,273 | $2,198,753 |
| 2022 PA RSUs – Stock‑based | 27,158 | $1,080,345 |
| 2022 PA RSUs – Cash‑based | 13,498 | $536,950 |
| 2023 PA RSUs – Stock‑based | 52,484 | $2,087,814 |
| 2023 PA RSUs – Cash‑based | 26,121 | $1,039,093 |
| 2024 PA RSUs – Stock‑based | 53,905 | $2,144,341 |
| 2024 PA RSUs – Cash‑based | 26,829 | $1,067,258 |
Employment Terms
Severance and change‑in‑control (CIC)
- Executive Severance Plan (involuntary separation without cause): Lump‑sum cash equal to three weeks of base pay per year of service, with a minimum of 52 weeks and maximum of 104 weeks; for a December 31, 2024 separation, Taylor would receive $875,000 . A February 2023 policy caps any executive cash severance at ≤2.99x base salary plus target STIP without shareholder approval .
- CIC Plan (double‑trigger within 2 years post‑CIC): Cash severance equals 2x (base salary + target STIP), plus prorated STIP at target, continued health coverage for two years, outplacement up to $30,000, and equity treatment per plan; for Taylor, the cash severance would be $3,325,000 for a qualifying December 31, 2024 termination .
- Non‑compete/non‑disparagement: Participation in CIC Plan includes non‑competition and non‑disparagement obligations (e.g., two years post‑CIC for non‑compete) .
- No excise tax gross‑ups; cutback applies unless full payment is better after‑tax .
- No employment agreements for executives (company policy) .
Equity and plan treatment on termination (Taylor; values as of 12/31/2024)
| Scenario | Estimated Equity/Cash Award Value |
|---|---|
| Involuntary Separation (without cause) | $6,985,330 (prorated; adjusted to actual performance at payment) |
| Death | $6,985,330 (prorated at target) |
| Disability | $6,985,330 (prorated; based on actual performance) |
| Termination Without Cause following a CIC | $6,985,330 (double‑trigger; target treatment/proration) |
Clawbacks and trading policies
- Two clawback policies: an SEC‑compliant mandatory recoupment for restatements (current and former Section 16 officers) and a discretionary policy enabling recovery for detrimental activity causing significant harm; no double‑recovery between policies .
- Anti‑hedging and anti‑pledging policies as noted above .
Retirement and pension
- Pension present value (12/31/2024): Qualified Plan $405,756; Nonqualified Supplemental Plan $1,694,310; Total $2,100,066 (15 credited years in each of qualified and supplemental) .
- Earliest retirement eligibility at age 55 in 2028 for Taylor (pre‑2014 hire rules) .
Investment Implications
- Strong pay‑for‑performance alignment: 2024 STIP paid zero and 2022–2024 LTIP paid at 77% of target; future LTIP payouts are constrained by an absolute TSR cap and, for amended open cycles, a 100% cap on the EPS KPI, limiting windfalls and tying upside to Core EPS/TSR delivery .
- Shareholder‑friendly governance: double‑trigger CIC without excise tax gross‑ups, robust clawbacks, and anti‑hedging/pledging policies reduce governance risk and align with investor preferences .
- Ownership/retention: Taylor meets a 4x salary ownership guideline; introduction of 40% time‑based RSUs in 2025–2027 increases holding power and may mitigate near‑term selling pressure as awards settle entirely in stock (no cash component), supporting retention and alignment .
- Upcoming liquidity from vesting: Significant unvested RSUs across 2023–2026 cycles and recent 2022–2024 payouts (27,459 shares + $523,425) create periodic settlement events; while anti‑pledging and ownership guidelines limit risk, monitor Form 4s for any selling around vest dates to gauge potential technical pressure .
- Strategic execution backdrop: FE reaffirmed a 6–8% long‑term EPS growth target and advanced regulatory/investment agendas in 2024, which are the primary levers for Taylor’s incentive outcomes (EPS/TSR), making regulatory cadence and Core EPS trajectory key watch items for comp‑performance alignment .
Appendix: Additional 2024 Realized Pay View (company disclosure)
| Component (2024) | Amount |
|---|---|
| Earned Salary | $881,731 |
| STIP (Paid in 2025) | $0 |
| 2022–2024 PA RSUs (paid in 2025) | $1,576,615 |
| Total 2024 Realized Compensation | $2,458,346 |