AEP Texas Central Transition Funding II LLC is a special purpose bankruptcy-remote Delaware limited liability company. AEP Texas Central Company is our sole member and owns all of our equity interests. We have no commercial operations. We were formed solely to purchase and own transition property, to issue transition bonds and to perform activities incidental thereto. Please read "AEP Texas Central Transition Funding II LLC, the Issuing Entity" in the accompanying prospectus.

In addition to the transition property, we will be capitalized with an upfront deposit of 0.5% of the Bonds' principal amount issued (to be held in the capital subaccount) and will have an excess funds subaccount to retain, until the next payment date, any amounts collected and remaining after all payments on the Bonds have been made.

We are responsible to the State of Texas and the Texas commission. Specifically, pursuant to the financing order of the Texas commission relating to the Bonds:

• Our organizational documents and transaction documents prohibit us from engaging in any activities other than acquiring transition property, issuing transition bonds and performing other activities as specifically authorized by the financing order.
• We must respond to representatives of the Texas commission throughout the process of offering the Bonds, with the fincancing order directing the Texas commission's financial advisor to advise the Texas commission of any proposal that does not comply in any material respect with the criteria established in the financing order.
• All required true-up adjustments must be filed by the servicer on our behalf.

We have also agreed that certain reports will be submitted to the Texas commission by us or on our behalf.

1539 N. Carancahua Street
Suite 1700
Corpus Christi, Texas 78401

(361) 881-5398