Financial Obligation (Form 8-K)

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

On November 6, 2025, CMS Energy Corporation ("CMS Energy") completed the sale of $1,000,000,000 aggregate principal amount of 3.125% Convertible Senior Notes due 2031 (the "Notes"), which included an additional $150,000,000 aggregate principal amount of Notes purchased pursuant to the full exercise of the option granted to the Initial Purchasers (as defined herein) pursuant to the Purchase Agreement (as defined herein) to purchase additional Notes, in a private offering to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"). The Notes were sold under a purchase agreement (the "Purchase Agreement") dated November 3, 2025 between CMS Energy and Morgan Stanley & Co. LLC, Barclays Capital Inc., Citigroup Global Markets Inc., Mizuho Securities USA LLC and Wells Fargo Securities, LLC, as representatives of the several initial purchasers (the "Initial Purchasers") named therein. The Notes bear interest at a fixed rate of 3.125% per year, payable semiannually in arrears on May 1 and November 1 of each year, beginning on May 1, 2026. The Notes will be convertible into cash or a combination of cash and shares of CMS Energy's common stock, $0.01 par value per share ("Common Stock"), as described below. The Notes are senior unsecured obligations of CMS Energy, and will mature on May 1, 2031, unless earlier converted, repurchased or redeemed in accordance with their terms.

CMS Energy issued the Notes pursuant to an indenture (the "Indenture"), dated as of November 6, 2025 by and between CMS Energy and The Bank of New York Mellon, as trustee (the "Trustee").

Prior to the close of business on the business day immediately preceding February 1, 2031, the Notes will be convertible at the option of the holders only under certain conditions.

On or after February 1, 2031, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders of the Notes may convert all or any portion of their Notes at their option at any time at the conversion rate then in effect, irrespective of these conditions. CMS Energy will settle conversions of the Notes by paying cash up to the aggregate principal amount of the Notes to be converted and paying or delivering, as the case may be, cash, shares of its Common Stock or a combination of cash and shares of its Common Stock, at its election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the Notes being converted.

The conversion rate for the Notes will initially be 11.0360 shares of Common Stock per $1,000 principal amount of Notes (equivalent to an initial conversion price of approximately $90.61 per share of Common Stock). The initial conversion price of the Notes represents a premium of approximately 25% over the last reported sale price of CMS Energy's Common Stock on the New York Stock Exchange on November 3, 2025. The conversion rate and the corresponding conversion price will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest.

If CMS Energy undergoes a "fundamental change" (as defined in the Indenture), subject to certain conditions, holders of the Notes may require CMS Energy to repurchase for cash all or any portion of their Notes at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the "fundamental change repurchase date" (as defined in the Indenture). In addition, if certain corporate events occur prior to the maturity date or if CMS Energy delivers a notice of redemption, CMS Energy may be required, in certain circumstances, to increase the conversion rate for a holder of Notes that elects to convert its Notes in connection with such a corporate event or to convert its Notes called (or deemed called) for redemption during the related redemption period, as the case may be, by a specified number of shares of Common Stock.