Cornerstone Acquisition. On June 15, 2026, the Company completed the Cornerstone Acquisition, which increases the Company’s generation by approximately 2.6 GW and provides efficient baseload and peaker generation and cash flow diversification. The aggregate purchase price was $3.5 billion, comprised of the following:



Cash consideration	$	2,615
Shares of TEC common stock issued ($0.001 par value)	2,399,998
Closing price per share of TEC common stock on June 15, 2026	$	386.21
Equity consideration	$	927
Total consideration	$	3,542

The Cornerstone Acquisition was accounted for as a business combination. Accordingly, fair value measurements were allocated to acquired assets and assumed liabilities with no resulting goodwill or bargain purchase adjustments. Such fair value measurements are provisional, and revisions may occur up to one year from the date of the acquisition as new information is obtained. The following table summarizes the provisional purchase price allocation for the identifiable assets acquired and liabilities assumed:


	June 15, 2026
Cash and cash equivalents	$	47
Accounts receivable	40
Inventory	31
Other current assets	13
Property, plant and equipment	4,211


Total assets acquired	$	4,342

Accounts payable and other accrued liabilities	$	45
Derivative liabilities, current	93

Asset retirement obligations	5
Acquired contract liabilities	151
Deferred income taxes	457
Derivative liabilities, noncurrent	49
Total liabilities assumed	$	800
Fair value of net assets acquired	$	3,542

The fair values allocated to property, plant and equipment were determined using the income approach valuation technique that discounted the projected future net cash flows expected to be generated by Cornerstone over their remaining economic lives utilizing market participant discount rates. Significant assumptions included the forecasted prices for capacity, wholesale power, and natural gas, volumetric assumptions, and discount rates.

Impact of Cornerstone Acquisition. The following table presents revenues and earnings included in the Consolidated Statements of Operations for the entities acquired in the Cornerstone Acquisition since the acquisition date (June 15, 2026) through June 30, 2026:

Pro Forma Financial Information. The following unaudited pro forma financial information for the three and six months ended June 30, 2026 and June 30, 2025 assumes the Cornerstone Acquisition occurred on January 1, 2025. The unaudited pro forma financial information is provided for informational purposes only and is not necessarily indicative of the results of operations that would have occurred had the Cornerstone Acquisition been completed on January 1, 2025, nor is the unaudited pro forma financial information indicative of future results of operations.


	Three Months Ended June 30, 2026		Three Months Ended June 30, 2025		Six Months Ended June 30, 2026		Six Months Ended June 30, 2025
Operating Revenues	$	879	$	805	$	2,270	$	1,288
Net Income (Loss) Attributable to Stockholders	(69)		12		(5)		(243)

The unaudited pro forma financial information presented above reflects adjustments for: (i) incremental depreciation associated with the provisional fair value allocated to acquired net assets; (ii) the elimination of historical interest expense of the acquired entities; (iii) the elimination of interest expense related to the Secured Notes redemption; (iv) interest expense associated with debt issued to finance the Cornerstone Acquisition and redeem the Secured Notes; (v) transaction costs associated with the Cornerstone Acquisition and expenses associated with the Secured Notes redemption; (vi) the income tax effects of the Cornerstone Acquisition and related financing transactions; and (vii) the alignment of certain accounting policies.

The Company incurred $24 million and $29 million of acquisition-related transaction costs during the three and six months ended June 30, 2026, respectively, presented as “Other operating income (expense), net” on the Consolidated Statements of Operations, and deferred financing costs of $55 million during the three and six months ended June 30, 2026, respectively, presented as “Long-term debt” on the Consolidated Balance Sheets. See Note 10 for information on recent financing transactions related to the Cornerstone Acquisition.

Amortization of acquired contract liabilities. The acquisition fair value of a capacity contract presented as “Acquired contract liabilities” on the Consolidated Balance Sheets is subject to periodic amortization. Amortization associated with this contract will begin at the start of the contract term in 2028 and will be presented as an increase to “Capacity revenues.”

Sale of Keystone Interests. In June 2026, the Company entered into a purchase and sale agreement with an unaffiliated party to sell its 12.34% interest in the Keystone generation facility and certain related assets for an aggregate $85 million in cash, subject to certain working capital adjustments and potential adjustments based on PJM BRA results. Additionally, under the terms of the agreement, the buyer is entitled to the net cash flow attributable to the interests from and after July 1, 2026. The transaction is expected to close in the second half of 2026 and is subject to the satisfaction of customary closing conditions and regulatory approvals from the FERC.