AEP (NASDAQ: AEP) arranges 23.5M-share forward stock sale with settlement by 2028

Rhea-AI Filing Summary

American Electric Power Company, Inc. entered into forward sale agreements covering a total of 23,543,308 shares of its common stock in connection with an underwritten offering. The initial forward sale price is set at $124.968 per share, matching the price paid by the underwriters.

The company will receive cash only if it elects to physically settle the forward sale agreements by issuing shares to the forward purchasers, which it currently expects to do on or before May 31, 2028. Alternatively, it may choose cash or net share settlement, which could result in reduced or no cash proceeds, or even a cash or share delivery obligation.

The forward purchasers can accelerate settlement upon specified events, including stock borrow constraints, certain large or unusual dividends, ownership threshold issues, extraordinary corporate events, or defaults. In those cases, AEP could be required to issue shares regardless of its capital needs, which would dilute earnings per share and may affect the market price of its stock.

Insights

Capital markets & utilities analyst

AEP sets up a sizable forward equity raise with flexible but dilutive mechanics.

American Electric Power has arranged forward sale agreements tied to 23,543,308 shares of common stock at an initial price of $124.968 per share. The shares have already been borrowed and sold by the forward purchasers, with AEP’s actual cash inflow deferred until settlement.

The structure lets AEP choose physical, cash, or net share settlement, with settlement expected on or before May 31, 2028. A floating interest-rate adjustment based on the overnight bank funding rate and reductions for expected dividends will change the ultimate forward price, so net proceeds will depend on rates, dividends, and timing.

Forward purchasers can accelerate settlement if stock borrow becomes difficult, large or nonstandard dividends occur, ownership limits are hit, or certain corporate events or defaults arise. In such cases, AEP might have to issue shares irrespective of its financing plans, creating dilution and potential pressure on earnings per share, while bankruptcy would terminate the agreements with no shares issued or proceeds received.

8-K Event Classification

3 items: 1.01, 8.01, 9.01

3 items

Item 1.01 Entry into a Material Definitive Agreement Business

The company signed a significant contract such as a merger agreement, credit facility, or major partnership.

Item 8.01 Other Events Other

Voluntary disclosure of events the company deems important to shareholders but not covered by other items.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

Key Figures

Initial forward shares: 20,472,442 shares Option shares: 3,070,866 shares Total shares hedged: 23,543,308 shares +2 more

5 metrics

Initial forward shares 20,472,442 shares Original forward sale agreements dated May 12, 2026

Option shares 3,070,866 shares Additional shares from underwriters’ option exercised May 13, 2026

Total shares hedged 23,543,308 shares Aggregate sold by forward purchasers to underwriters

Initial forward price $124.968 per share Matches price underwriters paid for common stock

Expected latest settlement May 31, 2028 Company expects settlement on or before this date

Key Terms

Forward Sale Agreements, overnight bank funding rate, net share settlement, extraordinary event, +1 more

5 terms

Forward Sale Agreements financial

"In connection with the Original Forward Sale Agreements and the Additional Forward Sale Agreements"

A forward sale agreement is a deal where two parties agree today to sell and buy an asset at a set price on a future date. It’s like promising to sell your car to a friend next month at today's price, regardless of how the car's value changes. These agreements help businesses lock in prices and reduce uncertainty about future costs or income.

overnight bank funding rate financial

"subject to adjustment based on a floating interest rate factor equal to the overnight bank funding rate less a spread"

net share settlement financial

"the Company has the right to elect cash settlement or net share settlement under the Forward Sale Agreements"

Net share settlement is a way of paying for financial transactions using only the difference in shares rather than exchanging full amounts of stock or cash. It’s like settling a debt by giving someone the exact number of shares needed to balance the books, making trades quicker and simpler. This method helps reduce the number of shares changing hands, saving time and costs.

extraordinary event regulatory

"an event is announced that, if consummated, would result in an extraordinary event (as defined in such Forward Sale Agreement)"

Underwriting Agreement financial

"the Company entered into an Underwriting Agreement with BofA Securities, Inc., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC"

An underwriting agreement is a contract where a company selling new stocks or bonds hires financial firms to buy those securities and resell them to investors. It matters because the agreement sets the offering price, number of securities, fees and which party bears the risk if sales fall short—think of it as a promise that the sale will happen and a roadmap investors can use to understand how the new securities reach the market.

Understanding 8-K Material Events →

AMERICAN ELECTRIC POWER CO INC false 0000004904 0000004904 2026-05-12 2026-05-12

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported) May 12, 2026

AMERICAN ELECTRIC POWER COMPANY, INC.

(Exact Name of Registrant as Specified in Its Charter)

New York		1-3525		13-4922640
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

1 Riverside Plaza, Columbus, OH		43215
(Address of Principal Executive Offices)		(Zip Code)

(Registrant’s Telephone Number, Including Area Code) (614) 716-1000

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $6.50 par value		AEP		The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry Into a Material Definitive Agreement.

On May 12, 2026, American Electric Power Company, Inc. (the “Company”) entered into separate forward sale agreements relating to 20,472,442 shares of the Company’s common stock, par value $6.50 per share, documented under individual confirmations subject to separate master agreements and incorporating certain other terms (together, the “Original Forward Sale Agreements”) with each of Bank of America, N.A., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC, acting in their capacity as forward purchasers (the “Forward Purchasers”). On May 13, 2026, the underwriters exercised in full an option that they had been granted by the Company pursuant to the underwriting agreement described below relating to an additional 3,070,866 shares of the Company’s common stock. In connection therewith, the Company and each of the Forward Purchasers entered into additional forward sale agreements relating to such number of shares, documented under individual confirmations subject to separate master agreements and incorporating certain other terms (together, the “Additional Forward Sale Agreements”).

In connection with the Original Forward Sale Agreements and the Additional Forward Sale Agreements (each, a “Forward Sale Agreement” and collectively, the “Forward Sale Agreements”), the Company entered into an Underwriting Agreement (as defined herein) with BofA Securities, Inc., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC, as representatives of the several underwriters named therein, BofA Securities, Inc., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC, as forward sellers, and the Forward Purchasers, pursuant to which the Forward Purchasers borrowed from third parties and sold to the underwriters an aggregate of 23,543,308 shares.

The Company will receive an amount equal to the net proceeds from the sale of the borrowed shares of common stock sold pursuant to the Underwriting Agreement, subject to certain adjustments pursuant to the Forward Sale Agreements, from the Forward Purchasers upon physical settlement of the Forward Sale Agreements. The Company will only receive such proceeds if it elects to physically settle the Forward Sale Agreements. The forward sale price will initially be $124.968 per share, which is the price at which the underwriters have agreed to buy the shares of common stock offered pursuant to the Underwriting Agreement.

The Forward Sale Agreements provide for settlement on a settlement date or dates to be specified at the Company’s discretion, but which the Company expects to occur on or prior to May 31, 2028.

On a settlement date or dates, if the Company decides to physically settle a Forward Sale Agreement, the Company will issue shares of common stock to the relevant Forward Purchaser at the then-applicable forward sale price. Each Forward Sale Agreement provides that the initial forward sale price will be subject to adjustment based on a floating interest rate factor equal to the overnight bank funding rate less a spread, and will be subject to decrease on each of certain dates specified in the relevant Forward Sale Agreement by amounts related to expected dividends on shares of the Company’s common stock during the term of such Forward Sale Agreement. If the overnight bank funding rate is less than the spread on any day, the interest rate factor will result in a reduction of the forward sale price for such day.

Except in certain circumstances, the Company has the right to elect cash settlement or net share settlement under the Forward Sale Agreements. Although the Company expects to settle each Forward Sale Agreement entirely by physical delivery of shares of the Company’s common stock in exchange for cash proceeds, the Company may elect cash settlement or net share settlement for all or a portion of its obligations under a Forward Sale Agreement. If the Company elects to cash settle a Forward Sale Agreement in full, it would expect to receive an amount of net proceeds that is significantly lower than the estimate set forth above, and it may not receive any net proceeds (or it may owe cash, which could be a significant amount, to the relevant Forward Purchaser). If the Company elects to net share settle a Forward Sale Agreement in full, it would not receive any cash proceeds from the Forward Purchasers (and it may be required to deliver shares of the Company’s common stock to the relevant Forward Purchaser).

Each Forward Purchaser will have the right to accelerate its Forward Sale Agreement (or, in certain cases, the portion thereof that it determines is affected by the relevant event) and require the Company to physically settle the applicable Forward Sale Agreement on a date specified by such Forward Purchaser if: (i) in the good faith, commercially reasonable judgment of such Forward Purchaser, it or its affiliate is unable to hedge its exposure to the transactions contemplated by such Forward Sale Agreement because of the lack of sufficient shares of the Company’s common stock being made available for borrowing by stock lenders; or it or its affiliate is unable to borrow such number of shares at a rate equal to or less than an agreed maximum stock loan rate; (ii) the Company declares any dividend or distribution on shares of the Company’s common stock payable in (a) cash in excess of a specified amount (other than extraordinary dividends); (b) securities of another company acquired or owned by the Company as a result of a spin-off or other similar transaction; or (c) any other type of securities (other than the Company’s common stock), rights, warrants or other assets for payment at less than the prevailing market price, as reasonably determined by such Forward Purchaser; (iii) certain ownership thresholds applicable to such Forward Purchaser are exceeded; (iv) an event is announced that, if consummated, would result in an extraordinary event (as defined in such Forward Sale Agreement), including, among other things, certain mergers and tender offers, as well as certain events such as a delisting or nationalization of the Company’s common stock, or the occurrence of certain changes in law (each as more fully described in such Forward Sale Agreement); or (v) certain events of default or termination events occur, including, among other things, any material misrepresentation made by the Company in connection with its entry into such applicable forward sale agreement, the Company’s bankruptcy (except as described below) or the occurrence of an event or circumstance causing certain payments or deliveries under, or material compliance with, such Forward Sale Agreement to be unlawful (each as more fully described in such Forward Sale Agreement).

Each Forward Purchaser’s decision to exercise its right to accelerate its Forward Sale Agreement (or, in certain cases, the portion thereof that it determines is affected by the relevant event) and to require the Company to settle such Forward Sale Agreement will be made irrespective of the Company’s interests, including the Company’s need for capital. In such cases, the Company could be required to issue and deliver shares of its common stock under the terms of the physical settlement provisions of the applicable Forward Sale Agreement irrespective of its capital needs, which would result in dilution to the Company’s earnings per share and may adversely affect the market price of the Company’s common stock. In addition, upon bankruptcy or insolvency filings related to the Company, each Forward Sale Agreement will automatically terminate without further liability of either party to such agreement. Following any such termination, the Company would not issue any shares of common stock or receive any proceeds pursuant to such Forward Sale Agreement.

The description of the Forward Sale Agreements set forth above does not purport to be complete and is qualified in its entirety by reference to the terms and conditions of the Forward Sale Agreements, which are filed as Exhibits 10.1, 10.2, 10.3, 10.4, 10.5 and 10.6, respectively, and are incorporated herein by reference.

Item 8.01. Other Events.

On May 12, 2026, the Company entered into an Underwriting Agreement (the “Underwriting Agreement”) with BofA Securities, Inc., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC, as representatives of the several underwriters named therein (the “Underwriters”), BofA Securities, Inc., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC, as forward sellers (the “Forward Sellers”), and the Forward Purchasers, relating to the registered public offering and sale by the Forward Purchasers of 20,472,442 shares of the Company’s common stock, par value $6.50 per share. On May 13, 2026, the underwriters exercised in full their option to purchase an additional 3,070,866 shares of the Company’s common stock pursuant to the Underwriting Agreement.

The description of the Underwriting Agreement set forth above does not purport to be complete and is qualified in its entirety by reference to the terms and conditions of the Underwriting Agreement, which is filed as Exhibit 1.1 and incorporated herein by reference. An opinion of David C. House is filed as Exhibit 5.1 and the consent of David C. House is filed as Exhibit 23.1. This Current Report on Form 8-K shall not constitute an offer to sell or a solicitation of an offer to buy any securities, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

1.1		Underwriting Agreement, dated May 12, 2026, by and among the Company, the Underwriters, the Forward Sellers and the Forward Purchasers
5.1		Opinion of David C. House, Esq.
10.1		Confirmation of Forward Sale Transaction, dated May 12, 2026, between the Company and Bank of America, N.A. in its capacity as a Forward Purchaser
10.2		Confirmation of Forward Sale Transaction, dated May 12, 2026, between the Company and Goldman Sachs & Co. LLC, in its capacity as a Forward Purchaser
10.3		Confirmation of Forward Sale Transaction, dated May 12, 2026, between the Company and Morgan Stanley & Co, LLC in its capacity as a Forward Purchaser
10.4		Confirmation of Forward Sale Transaction, dated May 13, 2026, between the Company and Bank of America, N.A., in its capacity as a Forward Purchaser
10.5		Confirmation of Forward Sale Transaction, dated May 13, 2026, between the Company and Goldman Sachs & Co. LLC, in its capacity as a Forward Purchaser
10.6		Confirmation of Forward Sale Transaction, dated May 13, 2026, between the Company and Morgan Stanley & Co, LLC in its capacity as a Forward Purchaser
23.1		Consent of David C. House, Esq. (included in Exhibit 5.1).
104		Cover Page Interactive Data File - The cover page iXBRL tags are embedded within the inline XBRL document.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

AMERICAN ELECTRIC POWER COMPANY, INC.
By:		/s/ David C. House
Name:		David C. House
Title		Assistant Secretary

Date May 14, 2026

FAQ

What forward equity transaction did AEP (AEP) enter into?

American Electric Power entered into forward sale agreements tied to 23,543,308 common shares. Forward purchasers borrowed and sold these shares to underwriters, with AEP’s cash proceeds deferred until it chooses how and when to settle the agreements.

How many AEP shares are covered by the forward sale agreements?

The agreements relate to 23,543,308 AEP common shares, combining 20,472,442 shares from the initial transaction and 3,070,866 shares from the underwriters’ option. All were sold by forward purchasers to underwriters at a set initial forward price.

What is the initial forward sale price for AEP’s stock offering?

The initial forward sale price is $124.968 per AEP share, matching the price underwriters paid for the borrowed shares. This price will later be adjusted for a floating interest rate factor and reductions tied to expected dividends during the term.

When does AEP expect to settle the forward sale agreements?

AEP expects to settle the forward sale agreements on or before May 31, 2028. The company can choose one or multiple settlement dates within this window, which will affect the final forward price and the net cash proceeds it ultimately receives.

How will AEP receive proceeds from these forward sale agreements?

AEP receives cash only if it elects physical settlement, issuing shares to forward purchasers at the adjusted forward price. Under cash or net share settlement, AEP could receive less or no cash, and in some cases may owe cash or shares instead of receiving proceeds.

What risks do the forward sale agreements pose for AEP shareholders?

The agreements can be accelerated by forward purchasers after specified events like stock borrow constraints or extraordinary corporate actions. Acceleration may force AEP to issue shares regardless of capital needs, creating dilution and potentially affecting earnings per share and stock price.

Filing Exhibits & Attachments

11 documents

Agreements & Contracts

• EX-10.1 EX-10.1 167.0 KB
• EX-10.2 EX-10.2 177.8 KB
• EX-10.3 EX-10.3 168.4 KB
• EX-10.4 EX-10.4 171.1 KB
• EX-10.5 EX-10.5 185.5 KB
• EX-10.6 EX-10.6 169.9 KB

Other Documents

• EX-1.1 EX-1.1 160.6 KB
• EX-5.1 EX-5.1 6.4 KB
• EX-101 XBRL TAXONOMY EXTENSION SCHEMA 3.1 KB
• EX-101 XBRL TAXONOMY EXTENSION LABEL LINKBASE 16.8 KB
• EX-101 XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE 10.5 KB