e425
Filed by FirstEnergy Corp.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934, as amended
Subject Company: Allegheny Energy, Inc.
Commission File No: 333-165640
On April 16, 2010, FirstEnergy Corp. issued the following newsletter to its employees relating to
the proposed merger with Allegheny Energy, Inc.
April 11, 2010
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Integration Team Leads Meet for KICKOFF IN GREENSBURG, PA.
Nearly 30 FirstEnergy and Allegheny Energy employees
leads of the nine merger Integration Teams and members of
the Program Management Office (PMO) gathered at
Allegheny Energys Greensburg, Pa., headquarters on
Monday, April 12. The kickoff provided the opportunity for
the leads to meet one another and understand expectations
for the integration work.
Executive Vice President and President, FirstEnergy
Generation and Steering Committee Chair Gary Leidich, and
Chief Operating Officer, Generation and Allegheny Steering
Committee Lead Curtis Davis, opened the meeting by offering
their thoughts on how the teams will work together,
including the deliverables each is responsible for
producing.
As the teams begin their work, initial decisions
include which functions should be operationalized
(applying one existing company model to the other
company); merged (by combining both companies
practices); or reinvented (by starting with a clean
sheet of paper and crafting new practices for certain
functions).
The real opportunity for our team leads is to ensure that
when the merger closes, their work will result in a better
company, says Gary. We need the teams to determine what
approaches make sense and to accomplish our integration
work.
Curtis covered the expectations for the teams and stated,
It will be critical for these teams to work well together
to help build a better company. Everyone will need to be
open-minded and communicate with candor. Its crucial that
we all respect the process. Merger Integration Teams will
work on combining company operations post-merger, while the
rest of our respective companies continue to focus on
delivering 2010 results.
The schedule for deliverables also was presented, which
includes charter documents that team leads will complete by
the April 28 full-team kickoff. The teams also will develop
preliminary recommendations, then final recommendations for
Day One (the first day the two companies can operate as one
company), Day 100 after the merger closes and long-term
plans for each functional area.
Continued on page 2
IN THIS ISSUE
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Additional Informational Materials Available: FirstEnergy Fact Book, Joint Merger Web Site |
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FirstEnergy Files Preliminary S-4 Containing Information Related to the Proposed Merger |
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Calendar |
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Questions and Answers |
Team Leads Meet in Greensburg (Continued from the cover)
Program Management Office (PMO)
Responsibilities
Program Managers Marty Hall, vice president, Energy
Policy, FirstEnergy, and Allegheny Lead David Fisfis,
Deputy General Counsel and executive director, Special
Projects, presented information on the role of the PMO,
which coordinates and supports the teams and their work and
reports to the Steering Committee. The PMO will help
support an efficient, streamlined integration process and
track and report the work of each team.
One of the significant responsibilities for the PMO is
to address cases in which the same subject occurs in various
business functions and, therefore, across teams, such as
safety. Several teams, including Human Resources (HR),
Generation, Utility Operations and Transmission have safety
practices, processes and procedures as part of their work
scopes to review. Although such subjects must be assessed by
each team, one team must be assigned responsibility for
final recommendations on that common item, and in our safety
example, that is HR. The coordination among teams in
addressing shared business aspects will be key to an
efficient process.
Legal
Guidelines
FirstEnergy attorneys John Luecken and Morgan Parke provided the rules of the road for
working with confidential company materials. John and Morgan reemphasized that until the merger
closes, FirstEnergy and Allegheny Energy must remain separate and independent companies. They
provided additional guidelines for the teams work, including:
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The focus of integration planning efforts must be on the post-merger world. No coordination of
pre-closing conduct is permissible. |
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Planning activities and information gathered by the
Integration Teams should be confined to approved planning
team members. |
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Teams should follow approved plans for team member
roles, scope of the teams work and scope of information
of the merging companies that will need to be
gathered/reviewed. |
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Information obtained in the integration planning
process should not be used for current business
purposes. |
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Different Integration Team members may have different
restrictions on the types of information they are permitted
to review. |
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Both companies Legal Departments must be consulted
before Integration Teams hold meetings that involve
discussions of competitively sensitive information.
Meeting agendas and participant lists must be prepared in
advance, approved by Legal and retained by the
Integration Teams. |
Legal
Contacts
Its very important that we all strictly comply with
important legal requirements related to mergers. If you
have questions, here are the contacts:
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FIRSTENERGY |
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ALLEGHENY |
John Luecken
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David Fisfis |
Morgan Parke
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James Arcuri |
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Merger News
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April 11, 2010 |
Additional Informational Materials Available:
Firstenergy Fact
Book, Joint Merger Web Site
Additional information is available to employees in a
published and online booklet that further describes
FirstEnergy as well as in a joint Web site created for
investors.
FirstEnergy:
Building a Better Company Fact Book was
developed for those who are not familiar with FirstEnergy.
The introduction provides an overview of the new combined
company, then highlights many aspects about FirstEnergy,
including:
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Capital investments |
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Training programs for new craft workers |
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Increased generating capability |
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Reliability investment and improvements |
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Safety performance |
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Statistics for each state in the FirstEnergy footprint, including number of employees,
retirees, shareholders, kilowatt-hours sold, taxes paid |
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Shareholder value creation since the Centerior merger in 1997 |
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Activities supporting FirstEnergy communities |
This booklet is available electronically on both
FirstEnergys FirstPlace portal and Allegheny Energys
Passport intranet site. Hard copies also will be available.
Joint Merger Web Site
A new Web site,
www.firstenergycorp.com/alleghenymerger, has been developed to provide one location
to access merger-related press releases, investor materials,
regulatory filings and other documents detailing additional
facts about the merger. Users can sign up on the Web site to
receive e-mails when new material has been added.
We developed this site because we want investors and
financial analysts to have easy access to information about
our proposed merger, says Ron Seeholzer, vice president,
Investor Relations for FirstEnergy. We have a great story
to tell about the combination of the two companies, and we
want financial decision makers to find it in one place.
Above: FirstEnergy-Allegheny Energy
Merger Information Web site.
Left: Cover of the new FirstEnergy:
Building a Better Company Fact Book.
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Merger News
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April 11, 2010 |
FirstEnergy Files Preliminary S-4 Containing
Information Related to the Proposed Merger
On March 23, FirstEnergy filed with the U.S.
Securities and Exchange Commission (SEC) a preliminary
Registration Statement on Form S-4 (S-4) relating to its
merger with Allegheny Energy. The filing, which serves as a
joint proxy statement/prospectus, is one of several
regulatory steps in the merger process that must be
accomplished before the merger may be completed.
Once the S-4 is cleared by the SEC, FirstEnergy and
Allegheny anticipate sending the joint proxy
statement/prospectus to their respective shareholders and
setting dates for separate meetings of shareholders to vote
on proposals relating to the merger. At Allegheny Energys
special meeting, shareholders will be asked to vote on the
proposed merger transaction; at FirstEnergys special
meeting, shareholders will vote on whether to issue the
shares of stock to Allegheny Energy stockholders that will
be used to finance the transaction and on other matters
relating to the merger. The S-4 is a required filing for
most publicly traded companies planning to merge operations
in stock-for-stock transactions.
Whats in the S-4?
The S-4 contains a significant amount of information about
the merger, announced Feb. 11, 2010, including:
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Key financial information for both companies, including pro
forma* calculations of the combined
company |
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A summary of the merger agreement, along with a copy of the full agreement |
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A narrative of the significant activities taken by each company leading up to the announcement
of the merger |
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A summary of the required regulatory approvals |
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Questions and answers about the special shareholder meetings |
The preliminary S-4 is available on the new joint merger
Web site, www.firstenergycorp.com/alleghenymerger, and on the SECs Web site,
www.sec.gov.
The merger is expected to close in the first half of
2011, subject to customary closing conditions that
include regulatory approvals.
As this work progresses, we will keep you updated in
the Merger News. In the meantime, please send your questions
to: merger@firstenergycorp.com or
merger@alleghenyenergy.com.
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*Pro forma financial data comprises historical
financial data that has been changed and combined to indicate the
effect of the proposed transaction on historical results. |
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Merger News
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April 11, 2010 |
Q Ive heard that many mergers in the utility industry fail
to close. Why do we think FirstEnergy will be able to
successfully complete the merger with Allegheny Energy?
A While its true that some announced mergers do not always
close, FirstEnergy has had different experiences.
FirstEnergy is
a result of two successful mergers in the last 15 years.
The boards of both FirstEnergy and Allegheny believe
shareholders will benefit from owning a larger, stronger
company that is better positioned for future growth and
success in competitive markets. A description of the reasons
supporting the decision of both companies to enter into the
merger agreement is included in the Registration Statement
on Form S-4.
Pension, Hiring
Q Will Allegheny employees lose credit for their years of
service with the company or have to work five years with
FirstEnergy before being vested in the pension plan?
A No, Allegheny employees who are employees on Day One will
retain their years of service for the purposes of vesting
in the pension plan and/or eligibility for other benefits.
Q I am an Allegheny retiree. How will the merger affect the
retirements of those who are already collecting a pension?
Will our retirement amount be the same as it is now?
A For those retirees who already receive benefits from the
Allegheny Energy Retirement Plan, there will be no change.
Those who are vested in the plan retain the right to
receive the benefits accrued (earned), irrespective of the
merger.
Q Allegheny Energy recently posted 14 new positions in its
Customer Management group to implement energy efficiency
and conservation programs. In light of the merger, why are
we adding these jobs now?
A Until the merger is completed, both Allegheny and
FirstEnergy must operate as independent companies. Both
Allegheny and FirstEnergy will continue to post for
positions that each believe are critical to running their
respective businesses.
Q As a New Jersey Line crew supervisor with FirstEnergy,
how much flexibility would I have to relocate to
Alleghenys territory after the merger?
A The new company will have an internal job posting Web
site that will list open positions from all over our
system to which employees may apply.
Integration Teams
Q Where will the Integration Teams be physically located?
A The Integration Teams and Program Management Office (PMO)
will be located at Summit Park Square, a building in Akron,
Ohio, where FirstEnergy leases space, about seven miles from
the FirstEnergy General Office in downtown Akron.
Q Will there be a transition team established for
Customer Service?
A Customer Service integration will be addressed by the
Utility Operations Team.
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Merger News
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April 11, 2010 |
Questions and Answers (Continued from page 5)
REGULATORY APPROVALS
Q What is the timeline for shareholder approvals?
A
SEC
review of the S-4 typically takes two to three
months. The S-4 is expected to be finalized in the
May-to-June timeframe. Special shareholder meetings and
votes would be held in the third quarter of 2010, assuming
the targeted dates are met.
Q When will you file the applications for state regulatory
approval?
A We anticipate making filings in Pennsylvania, Maryland,
West Virginia and Virginia in the second quarter of 2010.
Merger News
Q How often will the Merger News be published?
A
The Merger News will be published as needed, when there is
information to report regarding the progress of the merger
approvals or the work of the Integration Teams.
Q What is the expected time for a response to questions
regarding the merger that are sent via e-mail?
A Although we may be unable to answer all questions we
receive, look for answers to employee questions in upcoming
editions of Merger News.
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
In addition to historical information, this newsletter may contain a number of forward-looking
statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as
anticipate, expect, project, intend, plan, believe, and words and terms of similar substance used
in connection with any discussion of future plans, actions, or events identify forward-looking
statements. Forward-looking statements relating to the proposed merger include, but are not limited
to: statements about the benefits of the proposed merger involving FirstEnergy and Allegheny
Energy, including future financial and operating results; FirstEnergys and Allegheny Enegys
plans, objectives, expectations and intentions; the expected timing of completion of the
transaction; and other statements relating to the merger that are not historical facts.
Forward-looking statements involve estimates, expectations and projections and, as a result, are
subject to risks and uncertainties. There can be no assurance that actual results will not
materially differ from expectations. Important factors could cause actual results to differ
materially from those indicated by such forward-looking statements. With respect to the proposed
merger, these factors include, but are not limited to: risks and uncertainties relating to the
ability to obtain the requisite FirstEnergy and Allegheny Energy shareholder approvals; the risk
that FirstEnergy or Allegheny Energy may be unable to obtain governmental and regulatory approvals
required for the merger, or required governmental and regulatory approvals may delay the merger or
result in the imposition of conditions that could reduce the anticipated benefits from the merger
or cause the parties to abandon the merger; the risk that a condition to closing of the merger may
not be satisfied; the length of time necessary to consummate the proposed merger; the risk that the
businesses will not be integrated successfully; the risk that the cost savings and any other
synergies from the transaction may not be fully realized or may take longer to realize than
expected; disruption from the transaction making it more difficult to maintain relationships with
customers, employees or suppliers; the diversion of management time on merger-related issues; the
effect of future regulatory or legislative actions on the companies; and the risk that the credit
ratings of the combined company or its subsidiaries may be different from what the companies
expect. These risks, as well as other risks associated with the merger, are more fully discussed in
the preliminary joint proxy statement/prospectus that is included in the Registration Statement on
Form S-4 (Registration No. 333-165640) that was filed by FirstEnergy with the SEC in connection
with the merger. Additional risks and uncertainties are identified and discussed in FirstEnergys
and Allegheny Energys reports filed with the SEC and available at the SECs website at
www.sec.gov. Forward-looking statements included in this document speak only as of the date of this
document. Neither FirstEnergy nor Allegheny Energy undertakes any obligation to update its
forward-looking statements to reflect events or circumstances after the date of this document.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed merger, FirstEnergy filed a Registration Statement on Form S-4
(Registration No. 333-165640) with the SEC that includes a preliminary joint proxy statement of
FirstEnergy and Allegheny Energy and that also constitutes a preliminary prospectus of FirstEnergy.
FirstEnergy and Allegheny Energy will mail the definitive joint proxy statement/prospectus to their
respective shareholders. FirstEnergy and Allegheny Energy urge investors and shareholders to read
the definitive joint proxy statement/prospectus regarding the proposed merger when it becomes
available, as well as other documents filed with the SEC, because they will contain important
information. You may obtain copies of all documents filed with the SEC regarding this proposed
transaction, free of charge, at the SECs website (www.sec.gov). You may also obtain these
documents, free of charge, from FirstEnergys website (www.firstenergycorp.com) under the tab
Investors and then under the heading Financial Information and then under the item SEC
Filings. You may also obtain these documents, free of charge, from Allegheny Energys website
(www.alleghenyenergy.com) under the tab Investors and then under the heading SEC Filings.
PARTICIPANTS IN THE MERGER SOLICITATION
FirstEnergy, Allegheny Energy and their respective directors, executive officers and certain other
members of management and employees may be soliciting proxies from FirstEnergy and Allegheny Energy
shareholders in favor of the merger and related matters. Information regarding the persons who may,
under the rules of the SEC, be deemed participants in the solicitation of FirstEnergy and Allegheny
Energy shareholders in connection with the proposed merger is set forth in the preliminary joint
proxy statement/prospectus contained in the above-referenced Registration Statement on Form S-4.
You can find information about FirstEnergys executive officers and directors in its definitive
proxy statement filed with the SEC on April 1, 2010 and Annual Report on Form 10-K filed with the
SEC on February 19, 2010. You can find information about Allegheny Energys executive officers and
directors in its definitive proxy statement filed with the SEC on March 19, 2010 and Annual Report
on Form 10-K filed with the SEC on March 1, 2010. Additional information about FirstEnergys
executive officers and directors and Allegheny Energys executive officers and directors can be
found in the above-referenced Registration Statement on Form S-4. You can obtain free copies of
these documents from FirstEnergy and Allegheny using the website information above.
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Merger News
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April 11, 2010 |