8-KFinancial EventsExhibits & Filings

CMS ENERGY CORP 8-K Report, Financial Obligation (Sep 28, 2017)

Filed September 28, 2017For Securities:CMSCMS-PCCMSACMSCCMSD

Summary

CMS Energy Corporation (CMS), through its principal subsidiary Consumers Energy, announced the closing of the first issuance of its previously agreed-upon private placement of First Mortgage Bonds (FMBs). This transaction, executed on September 28, 2017, involved the sale of an aggregate principal amount of $185 million in FMBs, comprised of $40 million due 2032, $125 million due 2037, and $20 million due 2052. These bonds carry fixed interest rates ranging from 3.18% to 3.86% and are secured by Consumers Energy's mortgage indenture. This issuance represents the initial tranche of a larger $485 million private placement agreement. Investors should note that these bonds are redeemable by Consumers Energy prior to maturity under specified terms, including a potential applicable premium.

Key Highlights

  • 1Consumers Energy closed on the first issuance of $185 million in First Mortgage Bonds (FMBs) on September 28, 2017.
  • 2The issued bonds consist of three tranches: $40 million due 2032 (3.18% interest), $125 million due 2037 (3.52% interest), and $20 million due 2052 (3.86% interest).
  • 3This issuance is part of a larger $485 million private placement agreement previously announced.
  • 4The bonds are secured under Consumers Energy's mortgage indenture, with the 129th Supplemental Indenture executed for this specific issuance.
  • 5The bonds bear fixed interest rates, payable semi-annually.
  • 6Consumers Energy retains the option to redeem the bonds prior to maturity, subject to terms that may include an applicable premium.

Frequently Asked Questions

In this specific closing on September 28, 2017, Consumers Energy issued an aggregate principal amount of $185 million in First Mortgage Bonds.

The issued bonds have the following terms: $40 million due September 28, 2032, at 3.18% interest; $125 million due September 28, 2037, at 3.52% interest; and $20 million due September 28, 2052, at 3.86% interest.

This $185 million issuance is the first closing and funding event under a larger Bond Purchase Agreement for an aggregate principal amount of $485 million.

Yes, Consumers Energy may redeem any or all of the issued bonds at any time prior to maturity. The redemption price will be 100% of the principal amount plus any applicable premium (if redeemed before a specific 'par call' date) and accrued interest.