Consumers 2023 Securitization Finance LLC

Consumers 2023 Securitization Finance LLC

Free Writing Bulletin dated November 29, 2023
Filed pursuant to Rule 433 of the Securities Exchange Act of 1933
Supplement to the preliminary prospectus dated November 13, 2023
Registration Statement No. 333-274648 and 333-274648-01

This preliminary term sheet is prepared for informational purposes only and is not an offer to buy or sell or a solicitation of an offer to buy or sell any securities in any jurisdiction in which such offer or sale is prohibited. Please read important information and qualifications below.

Consumers 2023 Securitization Finance LLC
(“Issuing entity”)

Initial term sheet

$646,000,000 Senior Securitized Notes, Series 2023A (the “Notes”).

November 29, 2023

Issuing entity: Consumers 2023 Securitization Finance LLC

Sponsor, depositor and initial service: Consumer energy company

Guardian: Bank of New York Mellon

Sole Book Manager: Citigroup International Markets Company

Co-Directors: RBC Capital Markets, LLC
SMBC Nikko Securities America, Inc

Drexel Hamilton, LLC

Samuel A. Ramirez & Associates, Inc

Expected ratings (Moody’s/Standard & Poor’s): Aa (sf) / AAA (sf)
A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time.

Interest payment dates: March 1 and September 1, starting September 1, 2024
In any case where the payment due date is not a business day, payment may be made on the next business day.

slice is expected
weighted
Average life
(years)*
Principal amount offered* The decision
last
Premium
date*
last
maturity
date*
Cosip inside
A-1 1.78 $ 250,000,000 1/3/2027 3/1/2028 21071BAA3 US21071BAA35
A-2 5.12 $ 396,000,000 9/1/2030 9/1/2031 21071BAB1 US21071BAB18

*
Primary, subject to change.

Consumer Energy and the Issuer have filed a registration statement (including a prospectus) with the Securities and Exchange Commission (“SEC”) for the offering to which this communication relates. Before you invest, you should read the prospectus in this registration statement and other documents that Consumer Energy and the Issuer have filed with the Securities and Exchange Commission as exhibits to the registration statement to obtain more complete information about the Issuer and this offering. You can obtain these documents for free by visiting EDGAR on the SEC’s website at www.sec.gov. Alternatively, Consumers Energy, the Issuer, any underwriter or any dealer participating in the offering will arrange to send you a prospectus if you request it by contacting Citigroup Global Markets Inc. Toll free at 1-800-831-9146.

This Preliminary Term Sheet is not required to contain all of the information required to be included in the prospectus for the offering of securities to which this Preliminary Term Sheet relates. The Prospectus contains material information not contained therein, and prospective purchasers are referred to the Prospectus where it may be amended or supplemented. This Initial Term Sheet is neither an offer to sell nor a solicitation of an offer to buy these securities in any jurisdiction in which such offer, solicitation or sale is not permitted.

The information contained in this initial term sheet is preliminary and may be superseded by an additional term sheet provided to you prior to the time of concluding the sales contract. This preliminary term sheet is being delivered to you only to provide you with information about the offering of securities referred to herein. Securities are shown when and if they are issued. In particular, you are advised that these securities, and the securitization fees underlying them, are subject to modification or revision (including, among other things, the possibility of subdividing, consolidating or deleting one or more tranches of the securities), at any time. The time before the final prospectus is issued or made available. As a result, you may be obligated to purchase securities with characteristics that may change, and you are advised that all or part of securities with characteristics described in these materials may not be issued. The issuer’s obligation to sell securities to you is conditional on the securities and the underlying transaction having the characteristics described in these materials.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined whether this preliminary term sheet is accurate or complete. Any statement to the contrary is considered a criminal offence.

Price and availability of bonds are subject to change without notice.

The Contract for Sale will be concluded no later than the date on which the Notes are priced and the Underwriters confirm the assignment of the Notes to you; Any “indications of interest” expressed by you, and any “soft circles” generated by the Insurers, will not create binding contractual obligations on you or the Insurers (or any other person or entity). You may withdraw your offer to purchase securities at any time before the underwriters accept your offer.

Any clarifications, disclaimers or other notices that may appear at the bottom of the email to which this Initial Term Sheet is attached with respect to (i) these materials do not constitute an offer (or a solicitation of an offer), (ii) no representation is being made that these The Material is accurate or complete and may not be updated or (iii) is likely to be confidential and not applicable and should be discarded. Such clarifications, disclaimers or other notices are automatically generated as a result of your submission of such materials via Bloomberg or other system.

Projected timeline for the sinking fund(1)

Semi-annually
Payment Date
Slide A-1 Slide A-2
final date $ 0.00 $ 0.00
9/1/2024 $ 57,596,092.08 $ 0.00
1/3/2025 $ 41,734,168.35 $ 0.00
9/1/2025 $ 42,970,334.42 $ 0.00
1/3/2026 $ 44,243,115.72 $ 0.00
1/9/2026 $ 45,553,596.81 $ 0.00
1/3/2027 $ 17,902,692.62 $ 29,000,201.72
9/1/2027 $ 0.00 $ 48,235,462.69
3/1/2028 $ 0.00 $ 49,569,896.76
1/9/2028 $ 0.00 $ 50,941,247.95
3/1/2029 $ 0.00 $ 52,350,537.57
1/9/2029 $ 0.00 $ 53,798,815.20
1/3/2030 $ 0.00 $ 55,287,159.42
9/1/2030 $ 0.00 $ 56,816,678.69
Total payments $ 250,000,000.00 $ 396,000,000.00

(1)

Terms are preliminary and subject to change.

Expected amortization schedule
The outstanding principal balance for each tranche(1)

Semi-annually
Payment Date
Slide A-1 Slide A-2
final date $ 250,000,000.00 $ 396,000,000.00
9/1/2024 $ 192,403,907.92 $ 396,000,000.00
1/3/2025 $ 150,669,739.57 $ 396,000,000.00
9/1/2025 $ 107,699,405.15 $ 396,000,000.00
1/3/2026 $ 63,456,289.43 $ 396,000,000.00
1/9/2026 $ 17,902,692.62 $ 396,000,000.00
1/3/2027 $ 0.00 $ 366,999,798.28
9/1/2027 $ 0.00 $ 318,764,335.59
3/1/2028 $ 0.00 $ 269,194,438.83
1/9/2028 $ 0.00 $ 218,253,190.88
3/1/2029 $ 0.00 $ 165,902,653.31
1/9/2029 $ 0.00 $ 112,103,838.11
1/3/2030 $ 0.00 $ 56,816,678.69
9/1/2030 $ 0.00 $ 0.00

(1)

Terms are preliminary and subject to change.

Weighted average life sensitivity

Expected probability -5%
(1.35 standard deviations from the mean)
-15%
(4.90 standard deviations from the mean)
slice Average age (in years)(1) wall (years)(1) change (days)(1)(2) wall (years)(1) change (days)(1)(2)
A-1 1.78 1.78 1.80 7
A-2 5.12 5.12 5.13 4

(1)

preliminary; Subject to change

(2)

The number is rounded to whole days

For the purposes of preparing the above chart, the following assumptions have been made, among others:

· For the initial forecast, the forecast error remains constant throughout the life of the bond and equals the overestimation of electricity consumption by 5% (1.35 standard deviations from the mean) or 15% (4.90 standard deviations from the mean);

· The service provider prepares accurate and timely files to make correct adjustments to securitization fees on a semi-annual basis;

· Customer discount rates remain constant at 0.37% for all customer categories;

· Days outstanding are based on historical averages;

· All securitization fees are remitted 43 days after such fees are invoiced;

· Operating expenses equal expectations.

· There is no acceleration of the final maturity date of the bonds;

· No permanent loss of all customers; And

· The bond issuance date is December 12, 2023.

There is no guarantee that the weighted average life of the bonds will be as shown.

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