FALSE000162253600016225362026-09-252026-09-25
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): September 25, 2026
Talen Energy Corporation
(Exact name of registrant as specified in its charter)
| | | | | | | | | | | | | | |
Delaware | | 001-37388 | | 47-1197305 |
(State or other jurisdiction of incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) |
2929 Allen Pkwy, Suite 2200
Houston, TX 77019
(Address of principal executive offices) (Zip Code)
(888) 211-6011
(Registrant’s telephone number, including area code)
Not applicable
(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:
| | | | | |
| ☐ | 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, par value $0.001 per share | | TLN | | The Nasdaq Global Select Market |
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 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Executive Officer Updates
On September 29, 2026, as part of its coordinated, on-going succession and retention planning, Talen Energy Corporation (the “Company”) announced that the Company’s board of directors (the “Board”) has named Terry L. Nutt as the Company’s next Chief Executive Officer (“CEO”) and President, effective January 1, 2027 (the “Effective Date”), at which time Mr. Nutt will also join the Board. As further described below, Mr. Nutt has entered into a second amended and restated employment agreement (the “Employment Agreement”) reflecting his new responsibilities as CEO and continued responsibilities as President that will become effective on the Effective Date.
In addition, Mark “Mac” A. McFarland, the Company’s current CEO, has given the Company notice of his intent to step down as CEO and as a member of the Board, effective on the Effective Date. Following the Effective Date, Mr. McFarland will serve as a Senior Advisor to the Company beginning on January 1, 2027 until his retirement on March 1, 2027 (the “Separation Date”). As further described below, Mr. McFarland has entered into a transition and retirement agreement with the Company (the “Transition Agreement”).
Mr. Nutt was not appointed to his new positions under any arrangement or understanding between him and any other person. There are no transactions with Mr. Nutt that would be reportable under Item 404(a) of Regulation S-K and no family relationships exist between Mr. Nutt and any of the directors or other officers of the Company. Mr. McFarland’s retirement is not the result of any disagreement with the Company related to its operations, policies, or practices.
Biography of Mr. Nutt
Mr. Nutt, age 50, has served as the Company’s President since December 2025, prior to which he served as the Company’s Chief Financial Officer from July 2023 through December 2025. He has over 25 years of experience in the energy industry, including time spent at independent power producers and energy trading firms. From 2018 until 2023, he served as Chief Financial Officer and Managing Director for EDF Trading North America (“EDF”), the energy commodity trading subsidiary of Électricité de France (EDF) S.A., a multinational energy utility headquartered in France. Prior to his service at EDF, Mr. Nutt served in multiple senior finance positions at Vistra Corporation (and its predecessor entities) (“Vistra”), including as Senior Vice President and Controller and Senior Vice President of Risk Management. Prior to his time at Vistra, Mr. Nutt worked in various finance roles at Dynegy Inc. Mr. Nutt earned his M.S. in Accounting and his B.B.A., summa cum laude, from Texas A&M University. Mr. Nutt has also completed the MIT Nuclear Reactor Technology Course for Utility Executives.
Employment and Transition and Retirement Arrangements – Named Executive Officers
Salary and Incentive Compensation Changes
In connection with Mr. Nutt’s appointment and the approval of his revised Employment Agreement, the Board set his base salary at $1,200,000; target short-term annual incentive bonus at 135% of base salary; and target grant date value of long-term incentive award amounts at 700% of base salary.
Employment Agreement
In connection with Mr. Nutt’s appointment, he entered into the Employment Agreement, effective January 1, 2027, with an initial term through February 28, 2028 (subject to automatic annual renewals thereafter unless Mr. Nutt or the Company provides 90 days’ written notice of their intent not to extend the term). The terms of Mr. Nutt’s existing employment agreement will continue to apply until January 1, 2027.
The Employment Agreement provides that, in the event that Mr. Nutt’s employment is terminated by the Company without Cause, the Company does not renew the term of the Employment Agreement, or Mr. Nutt resigns for Good Reason (each, as defined in the Employment Agreement and herein, a “Qualifying Termination”) and such termination is not on or within 18 months following a Change of Control (as defined in the Employment Agreement), Mr. Nutt will receive any earned but unpaid annual bonus for the year preceding the year in which the termination occurs (the “Prior Year Bonus”) and, subject to Mr. Nutt’s execution and nonrevocation of a release of claims in favor of the Company and continued compliance with his restrictive covenant obligations, (i) two times the sum of his annual base salary and target annual bonus, payable over 24 months following the Qualifying Termination, (ii) a pro-rated target bonus amount for the year of termination, and (iii) eligibility to continue on the Company’s health plan at a monthly rate equal to the Company’s full Consolidated Omnibus Budget Reconciliation Act (“COBRA”) rates for up to 36
months at Mr. Nutt’s sole expense (the “COBRA Continuation”). If Mr. Nutt experiences a Qualifying Termination within 18 months following a Change of Control, he will receive the Prior Year Bonus and, subject to his execution and nonrevocation of a release in favor of the Company and continued compliance with his restrictive covenant obligations, (i) a lump sum equal to 2.99 times the sum of his annual base salary and target annual bonus, (ii) a pro-rated target bonus amount for the year of termination, and (iii) eligibility for COBRA Continuation at a monthly rate that is no greater than the premiums he paid for coverage under the Company’s group health plan immediately prior to the termination date for up to 36 months. In the event Mr. Nutt’s employment is terminated due to Mr. Nutt’s death or disability, he shall receive (i) the Prior Year Bonus, (ii) a pro-rated portion of his target bonus for the year of termination, and (iii) eligibility for COBRA Continuation at a monthly rate equal to the Company’s full COBRA rates for up to 36 months. Additionally, where Mr. Nutt provides 90 days’ notice on a non-renewal of the term of the Employment Agreement, he shall be entitled to receive the Prior Year Bonus, subject to his execution and nonrevocation of a release of claims in favor of the Company and continued compliance with his restrictive covenant obligations.
Under the terms of the Employment Agreement, Mr. Nutt is subject to perpetual confidentiality, assignment of intellectual property and non-disparagement covenants as well as non-competition and non-solicitation covenants applicable during employment and for one year thereafter.
The foregoing description is qualified in its entirety by reference to the full text of the Employment Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K (this “Report”) and which is incorporated by reference into this Item 5.02.
Transition and Retirement Agreement
In connection with Mr. McFarland’s retirement, Mr. McFarland entered into the Transition Agreement with the Company, dated as of September 28, 2026, which provides for a transition from his current role as CEO and as a member of the Board to a role as Senior Advisor to the Company, reporting to the Chairman of the Board, beginning on January 1, 2027 and ending on the Separation Date. Mr. McFarland will be paid $100,000 for his services as a Senior Advisor and will continue to receive his current benefits through the Separation Date (other than any new grants of equity). Upon his separation, subject to his execution and non-revocation of a general release of claims in favor of the Company and his continued compliance with his restrictive covenant obligations to the Company, its subsidiaries, and affiliates, he will receive (x) the COBRA Continuation for up to 36 months and (y) his annual bonus for the 2026 fiscal year, based on actual performance.
The foregoing description is qualified in its entirety by reference to the full text of the Transition Agreement, a copy of which is filed as Exhibit 10.2 to this Report and which is incorporated by reference into this Item 5.02.
Item 7.01. Regulation FD Disclosure.
On September 29, 2026, the Company issued a press release regarding the executive matters described above, and additionally announcing its entry into the capacity monetization transaction, the upsize of the Company’s share repurchase program and its entry into accelerated share repurchase agreements, each as described below, a copy of which is furnished as Exhibit 99.1 to this Report and which is incorporated by reference into this Item 7.01.
The information provided under this Item 7.01 and in Exhibit 99.1 to this Report is being furnished and shall not be deemed “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. Such information shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, or the Exchange Act.
Item 8.01. Other Events.
Capacity Monetization Transaction
On September 25, 2026, Talen Energy Marketing, LLC (“TEM”), an indirect wholly owned subsidiary of the Company, entered into an arrangement with an unaffiliated third party to sell future capacity revenues awarded by PJM and cleared by TEM in PJM’s capacity auctions for the 2027/2028 and 2028/2029 delivery years (the “Capacity Monetization Transaction”) related to certain of the Company’s generation fleet. Under the terms of the Capacity Monetization Transaction, TEM transferred the rights of future cash flows for certain cleared capacity with volumes of approximately 6.5 GW and 6.0 GW for the 2027/2028 and 2028/2029 delivery years, respectively, and aggregate revenues of approximately $1.5 billion. In exchange, TEM was advanced proceeds equal to the aggregate capacity revenues less a rate of SOFR plus 200 basis points, with SOFR to be calculated on October 1, 2026. The Company remains responsible for operating its generation facilities, retains the obligation to perform as a PJM generation capacity resource with respect to the capacity sold in the transaction, has retained its rights for any earned capacity performance bonus payments, and has retained the risks associated with performance deficiency penalties. The Capacity Monetization Transaction is only for capacity and does not include the sale of energy.
Upsize of Share Repurchase Program
On September 23, 2026, the Board approved the upsizing of its existing share repurchase program (the “SRP”) to increase the amount of shares of its common stock, par value $0.001 per share (the “common stock”), which the Company may repurchase by $1.5 billion (the “Additional Authorization”). As a result of the Additional Authorization, the aggregate authorization remaining under the Company’s SRP increased from $1.5 billion to $3.0 billion (subject to any utilization for the ASR Agreements described below).
The Company intends to fund the SRP with proceeds of the Capacity Monetization Transaction, cash on hand and cash generated by operations. The shares of common stock may be repurchased from time to time in open market transactions at prevailing market prices, negotiated transactions, accelerated share repurchase agreements, or other means in accordance with federal securities laws. The timing, number, and value of shares of common stock repurchased under the SRP (other than the ASR Agreements) will be at management’s discretion and will depend on several factors, including the market price of the Company’s common stock, alternate uses of capital, general market and economic conditions, and applicable legal requirements. The Company has no obligation to repurchase any amount of its common stock under the program. The program may be suspended, modified, or discontinued by the Board at any time without prior notice.
Accelerated Share Repurchases
On September 29, 2026, the Company entered into ASR Agreements with multiple dealers to repurchase an aggregate of $1.5 billion of shares of the Company’s common stock using the proceeds of the Capacity Monetization Transaction and cash on hand. The ASR Agreements were undertaken as part of the Additional Authorization of the Company’s SRP.
Under the terms of the ASR Agreements, the Company will initially receive approximately 4.0 million shares, representing approximately 80% of the total shares the Company expects to repurchase under the respective ASR Agreements assuming the share price at market close on September 28, 2026. The final number of shares repurchased will be based on the arithmetic average of the daily volume-weighted average prices of the Company’s common stock during the term of the ASR Agreements less an agreed discount and subject to customary adjustments related to the terms and conditions of the ASR Agreements. The final settlement of the ASR Agreements is expected to be completed no later than the first quarter of 2027. As of September 28, 2026, the Company had approximately 47.3 million shares of common stock outstanding.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| | | | | |
| Exhibit No. | Description |
10.1†^ | Second Amended and Restated Employment Agreement, effective January 1, 2027, by and between Talen Energy Corporation and Terry L. Nutt. |
10.2†^ | Transition and Retirement Agreement and Release of Claims, dated as of September 28, 2026, by and between Talen Energy Corporation and Mark “Mac” A. McFarland. |
| 99.1 | Press Release dated September 29, 2026. |
| 104 | Cover Page Interactive Data File (cover page XBRL tags embedded within the Inline XBRL document). |
________________† Management contract or compensatory plan or arrangement.
^ Certain private and immaterial portions of the exhibit have been redacted pursuant to Item 601(a)(6) of Regulation S-K.
SIGNATURES
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 hereunto duly authorized.
| | | | | | | | | | | |
| | | TALEN ENERGY CORPORATION |
Date: | September 29, 2026 | By: | /s/ Cole Muller |
| | Name: | Cole Muller |
| | Title: | Chief Financial Officer |
Talen Names Terry Nutt Chief Executive Officer and Announces $1.5 Billion Accelerated Share Repurchase
Mac McFarland to retire as CEO at year-end and serve as senior advisor through March 2027
Upsizes share repurchase program to a total of $3.0 billion through 2028
HOUSTON, Sept. 29, 2026 – Talen Energy Corporation (“Talen,” the “Company,” “we,” or “our”) (NASDAQ: TLN), a leading independent power producer, today announced a planned CEO succession, $1.5 billion accelerated share repurchase transactions (“ASRs”) and an upsized $3.0 billion share repurchase program (“SRP”).
The Board of Directors (the “Board”) has named Terry Nutt as Talen’s next Chief Executive Officer (“CEO”), effective January 1, 2027. Mr. Nutt, currently Talen’s President, will also join the Board upon his appointment as CEO. Mac McFarland will remain CEO and a member of the Board through December 31, 2026, and will then serve as a senior advisor until his retirement in March 2027. The transition period is intended to support an orderly handoff and continuity in the Company’s strategy, operations and capital allocation priorities.
“Terry is the right leader to be Talen’s next CEO,” said Stephen Schaefer, Chairman of the Board. “He combines broad industry experience with deep knowledge of Talen’s assets, people and strategy. As President and previously as Chief Financial Officer, he has helped lead the Company’s operations, commercial activities and capital allocation. The Board has worked closely with Terry over the past three-plus years and has complete confidence in his ability to build on Talen’s strong performance and continue its focus on shareholder value.”
“I am honored to succeed Mac and grateful for his leadership and mentorship,” said Mr. Nutt. “As I prepare to lead Talen, my priorities are clear: maintain safe and reliable operations, execute Talen’s flywheel strategy and allocate capital with discipline. Today’s ASRs reflect that approach by reducing our share count at what we believe is an attractive free cash flow yield, while preserving liquidity and strategic flexibility.”
“It has been a privilege to work alongside Talen’s employees to build a company grounded in operational excellence and a relentless focus on creating value for our shareholders,” said Mr. McFarland. “What we have accomplished has been a true team effort — across our leadership and throughout Talen. Terry knows our company, our people, our markets and our opportunities, and he is the right person to lead this team forward. I look forward to supporting him and the entire team through the transition, and I am confident Talen is well positioned for continued success under his leadership.”
Mr. Schaefer added, “Mac’s vision, discipline and focus on results have had a lasting impact on Talen. Under his leadership, the Company strengthened its operations, expanded its growth opportunities and delivered substantial value for shareholders. On behalf of the Board, I thank Mac for his leadership and contributions.”
Jonathan Krautmann, Partner at Rubric Capital Management, added, “During Mac’s tenure, Talen built an exceptional record of disciplined execution and value creation, and we thank him for the foundation he has laid. As Talen’s largest actively managed shareholder, we are deeply invested in this management team and Board, and we have seen firsthand how integral Terry has been to that success — across the balance sheet, capital allocation and commercial strategy. We congratulate Terry on his appointment as CEO. We have full confidence in his leadership and strongly support him and the entire Talen team as they build on the Company’s momentum and continue to create value for all shareholders.”
“As a significant shareholder of Talen, Energy Capital Partners is proud of what the Company has accomplished and excited about its future,” said Andrew Gilbert, Partner at Energy Capital Partners. “We thank Mac for his leadership and the significant value he and the Talen team have created. Talen is well positioned, with an exceptional team and meaningful opportunities ahead. We congratulate Terry on his appointment and are confident he is the right leader to build on this foundation and guide Talen through its next phase of growth and value creation.”
About Terry Nutt
Mr. Nutt has more than 25 years of experience in the deregulated energy industry. He has served as Talen’s President since December 2025, overseeing the Company’s operations, commercial activities, administrative functions and external affairs. He previously served as Talen’s Chief Financial Officer from July 2023 through December 2025.
Before joining Talen, Mr. Nutt was Chief Financial Officer and Managing Director of EDF Trading North America from 2018 to 2023. Earlier, he held senior finance and risk management roles at Vistra Corporation and its predecessor entities. He earned an M.S. in Accounting and a B.B.A., summa cum laude, from Texas A&M University.
Mr. Nutt has entered into a new employment agreement reflecting his responsibilities as CEO. The agreement has an initial term through February 28, 2028, followed by automatic one-year renewals unless either party provides 90 days’ written notice of nonrenewal.
SRP and ASRs
The Board also increased the remaining capacity under Talen’s SRP to $3.0 billion through December 31, 2028. The authorization includes the $1.5 billion ASR agreements announced today, leaving $1.5 billion available for further repurchases through 2028, in addition to the ASRs and repurchases completed before today. Talen has repurchased 600,000 shares quarter-to-date in the third quarter of 2026.
The uncollared ASRs are expected to be completed by the end of the first quarter of 2027 and, at the current stock price, would repurchase more than 10% of Talen’s shares outstanding. The final number of shares repurchased pursuant to the ASRs will be based on the arithmetic average of the daily volume-weighted average prices of Talen’s common stock during the ASRs’ terms, less an agreed discount and subject to customary adjustments. The ASRs are expected to be accretive to free cash flow per share.
Talen expects to fund the ASRs principally through the monetization of approximately $1.5 billion of cleared capacity revenues associated with the PJM 2027/2028 and 2028/2029 delivery years. The capacity monetization was executed with Citi at a rate of SOFR + 200 basis points. The transaction brings forward a portion of contracted future cash flows while maintaining Talen’s liquidity position, consistent with its targeted net leverage ratio of 3.5x. Talen expects to meet the targeted net leverage level during the second half of 2027, and that level is expected to decline further as the associated capacity revenues are generated and the remaining obligation is reduced.
Talen forecasts approximately $4 billion of adjusted free cash flow from 2H 2026 through year-end 2028, supported by locked-in and highly visible cash flows. After giving effect to the monetized capacity revenues, the Company expects approximately $2.8 billion of adjusted free cash flow during that period, preserving capacity for additional repurchases, strategic investments and other value-enhancing opportunities.
“Talen’s strong balance sheet, durable cash flow outlook and disciplined capital allocation framework provide us with the flexibility to return substantial capital to shareholders while maintaining our financial strength,” said Cole Muller, Talen’s Chief Financial Officer. “This accelerated repurchase reflects our confidence in Talen and the strength of our future cash flows and allows us to acquire a meaningful number of shares at what we believe are highly attractive free cash flow yields. After executing this transaction, Talen will have bought back approximately one-third of the shares outstanding at emergence three years ago. We continue to have a direct line of sight to achieving our targeted net leverage ratio of 3.5x by the second half of 2027.”
Under the ASR agreements with Goldman Sachs & Co. LLC and Banco Santander, S.A., Talen will pay an aggregate of $1.5 billion and will initially receive approximately 4.0 million shares, or about 80% of the expected number of shares to be repurchased assuming the share price at market close on September 28, 2026. At final settlement, depending on the average of the daily volume-weighted average price of Talen’s common stock over the terms of the ASRs (less an agreed discount and subject to customary adjustments), Talen may receive additional shares or, in certain circumstances, be required to make a settlement payment in cash or shares at the Company’s election and subject to the terms of the agreements.
The timing and amount of any repurchases under the remaining $1.5 billion of SRP capacity will depend on market conditions, the Company’s capital needs and other factors. The Board’s approval of the $3.0 billion SRP capacity does not obligate Talen to repurchase any particular amount of common stock beyond the ASRs, and the SRP may be suspended, modified or discontinued at any time.
About Talen
Talen Energy (NASDAQ: TLN) is a leading independent power producer and energy infrastructure company dedicated to powering the future. We own and operate approximately 15.5 gigawatts of power infrastructure in the United States, including 2.2 gigawatts of nuclear power and a significant dispatchable fossil fleet. We produce and sell electricity, capacity, and ancillary services into wholesale U.S. power markets, with generation in the Mid-Atlantic, Ohio, Indiana, and Montana. Our team is committed to generating power safely and reliably while delivering the most value per megawatt produced. Talen is also powering the digital infrastructure revolution. We are well positioned to serve this growing industry, as artificial intelligence data centers increasingly demand more reliable power. Talen is headquartered in Houston, Texas. For more information, visit https://www.talenenergy.com/.
Investor Relations
Bill Appicelli
Senior Vice President, Investor Relations
InvestorRelations@talenenergy.com
Media
Taryne Williams
Director, Corporate Communications
Taryne.Williams@talenenergy.com
Forward-Looking Statements
This communication contains forward-looking statements within the meaning of the federal securities laws, which statements are subject to substantial risks and uncertainties. These forward-looking statements are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this communication, or incorporated by reference into this communication, are forward-looking statements. Throughout this communication, we have attempted to identify forward-looking statements by using words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecasts,” “goal,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “will,” or other forms of these words or similar words or expressions or the negative thereof, although not all forward-looking statements contain these terms. Forward-looking statements address future events and conditions concerning, among other things, the leadership transition, the timing, size, completion, and impacts of the capacity monetization, ASR, and remaining SRP, capital expenditures, earnings, litigation, regulatory matters, hedging, liquidity and capital resources, accounting matters, expectations, beliefs, plans, objectives, goals, strategies, future events or performance, shareholder returns and underlying assumptions.
Forward-looking statements are subject to substantial risks and uncertainties that could cause our future business, financial condition, results of operations or performance to differ materially from our historical results or those expressed or implied in any forward-looking statement contained in this communication. All of our forward-looking statements include assumptions underlying or relating to such statements that may cause actual results to differ materially from expectations and are subject to numerous factors that present considerable risks and uncertainties.
Non-GAAP Financial Measures
This press release refers to adjusted free cash flow, which is not a financial measure prepared under GAAP. Non-GAAP financial measures do not have definitions under GAAP and may be defined and calculated differently by, and not be comparable to, similarly titled measures used by other companies. Non-GAAP measures have limitations as analytical tools and should not be considered in isolation or as a substitute for analyzing our results as reported under GAAP. Please see our August 5, 2026 earnings presentation for a definition of adjusted free cash flow, additional information regarding its uses and limitations, and a reconciliation to the most directly comparable GAAP measure.
