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AEP Texas Restoration Funding LLC – ‘FWP’ on 9/11/19 re: AEP Texas Restoration Funding LLC

On:  Wednesday, 9/11/19, at 9:25pm ET   ·   As of:  9/12/19   ·   Accession #:  1140361-19-16547   ·   File #:  333-232430-01

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  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 9/12/19  AEP Texas Restoration Funding LLC FWP                    1:76K  AEP Texas Restoration Funding LLC Broadridge Fin’l So… Inc

Free-Writing Prospectus   —   Rule 163 / 433   —   SA’33
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: FWP         Free-Writing Prospectus                             HTML     41K 


This is an HTML Document rendered as filed.  [ Alternative Formats ]



 C: 
Free Writing Prospectus, dated September 11, 2019
Filed pursuant to Rule 433 under the Securities Act of 1933
Supplementing the Preliminary Prospectus, dated August 27, 2019
Registration Statement Nos. 333-232430 and 333-232430-01

AEP Texas Restoration Funding LLC
(Issuing Entity)

Pricing Term Sheet

$235,282,000 Senior Secured System Restoration Bonds

Issuing Entity:
AEP Texas Restoration Funding LLC
   
Sponsor, Depositor and Initial Servicer:
AEP Texas Inc. (“AEP Texas”)
   
Trustee:
U.S. Bank National Association, a national banking association
   
Structuring Agent:
Goldman Sachs & Co. LLC
   
Joint Bookrunners:
Goldman Sachs & Co. LLC and Citigroup Global Markets Inc.
   
Co-Managers:
Loop Capital Markets LLC and Samuel A. Ramirez & Company, Inc.
   
Expected Ratings (Moody’s / S&P):
Aaa(sf) / AAA(sf)(1)
   
Closing Date / Settlement Date:
   
Interest Payment Dates:
February 1 and August 1 of each year beginning February 1, 2020
   
Applicable Time:
3:30 PM (Eastern time) on September 11, 2019
   
Proceeds:
The total initial price to the public is $235,281,600.  The total amount of the underwriting discounts and commissions is $941,128.  The total amount of proceeds to the issuing entity before deduction of expenses (estimated to be $3,490,553) is $234,340,472.


(1)
A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time
(2)
The issuing entity expects to deliver the system restoration bonds against payment for the system restoration bonds on or about the date September 18, 2019, which will be the fifth business day following the date of pricing of the system restoration bonds. Since trades in the secondary market generally settle in two business days, purchasers who wish to trade system restoration bonds on the date of pricing or the succeeding two business days will be required, by virtue of the fact that the system restoration bonds initially will settle in T + 5, to specify alternative settlement arrangements to prevent a failed settlement.

Senior Secured
System
Restoration
Bonds
 
Expected
Weighted
Average
Life (Years)
 
Principal
Amount
Offered
 
Scheduled
Final
Payment Date
 
Final
Maturity
Date
 
Interest Rate
 
Initial
Price to
Public (3)
 
Underwriting
Discounts
and
Commissions
 
Proceeds to Issuing
Entity (Before Expenses)
Tranche A‑1
 
3.05
 
$117,641,000
 
2/1/2025
 
2/1/2027
 
2.0558%
 
99.99984%
 
0.40%
 
$117,170,248
Tranche A‑2
 
7.87
 
$117,641,000
 
8/1/2029
 
8/1/2031
 
2.2939%
 
99.99982%
 
0.40%
 
$117,170,224

(3)
Interest on the bonds will accrue from September 18, 2019 and must be paid by the purchaser if the Senior Secured System Restoration Bonds are delivered after that date.

 
Tranche A‑1
 
Tranche A‑2
CUSIP
 
ISIN
US00115BAA52
 
US00115BAB36

The senior secured system restoration bonds will be ready for delivery in book-entry form through the facilities of The Depository Trust Company against payment in New York, New York on or about September 18, 2019.

EXPECTED SINKING FUND SCHEDULE

 
Semi-Annual
Payment Date
 
Tranche A‑1
 
Tranche A‑2
 
 
2/1/2020
 
$3,309,541
 
$0
 
 
8/1/2020
 
$11,090,541
 
$0
 
 
2/1/2021
 
$11,204,541
 
$0
 
 
8/1/2021
 
$11,319,713
 
$0
 
 
2/1/2022
 
$11,436,068
 
$0
 
 
8/1/2022
 
$11,553,619
 
$0
 
 
2/1/2023
 
$11,672,379
 
$0
 
 
8/1/2023
 
$11,792,359
 
$0
 
 
2/1/2024
 
$11,913,573
 
$0
 
 
8/1/2024
 
$12,036,033
 
$0
 
 
2/1/2025
 
$10,312,632
 
$1,847,119
 
 
8/1/2025
 
$0
 
$12,286,940
 
 
2/1/2026
 
$0
 
$12,427,865
 
 
8/1/2026
 
$0
 
$12,570,407
 
 
2/1/2027
 
$0
 
$12,714,583
 
 
8/1/2027
 
$0
 
$12,860,413
 
 
2/1/2028
 
$0
 
$13,007,915
 
 
8/1/2028
 
$0
 
$13,157,110
 
 
2/1/2029
 
$0
 
$13,308,015
 
 
8/1/2029
 
$0
 
$13,460,634
 
 
Total Payments
 
$117,641,000
 
$117,641,000
 

2

EXPECTED AMORTIZATION SCHEDULE
Outstanding Principal Balance Per Tranche

 
Semi-Annual
Payment Date
 
Tranche A‑1
Balance
 
Tranche A‑2
Balance
 
 
Issuance Date
 
$117,641,000
 
$117,641,000
 
 
2/1/2020
 
$114,331,459
 
$117,641,000
 
 
8/1/2020
 
$103,240,917
 
$117,641,000
 
 
2/1/2021
 
$92,036,376
  $117,641,000  
 
8/1/2021
 
$80,716,663
  $117,641,000  
 
2/1/2022
 
$69,280,595
 
$117,641,000
 
 
8/1/2022
 
$57,726,976
  $117,641,000  
 
2/1/2023
 
$46,054,597
  $117,641,000  
 
8/1/2023
 
$34,262,238
  $117,641,000  
 
2/1/2024
 
$22,348,665
  $117,641,000  
 
8/1/2024
 
$10,312,632
  $117,641,000  
 
2/1/2025
  $—  
$115,793,881
 
 
8/1/2025
  $—  
$103,506,941
 
 
2/1/2026
  $—  
$91,079,076
 
 
8/1/2026
  $—  
$78,508,669
 
 
2/1/2027
  $—  
$65,794,086
 
 
8/1/2027
  $—  
$52,933,674
 
 
2/1/2028
  $—  
$39,925,758
 
 
8/1/2028
  $—  
$26,768,649
 
 
2/1/2029
 
$—
 
$13,460,634
 
 
8/1/2029
  $—  
$—
 

Subject to the terms and conditions in the underwriting agreement among us, AEP Texas and the underwriters, for whom Goldman Sachs & Co. LLC and Citigroup Global Markets Inc. are acting as representatives, we have agreed to sell to the underwriters, and the underwriters have severally agreed to purchase, the principal amount of the bonds listed opposite each underwriter’s name below:

Underwriter
 
Tranche A‑1
   
Tranche A‑2
   
Total
 
Goldman Sachs & Co. LLC
 
$
58,821,000
   
$
58,821,000
   
$
117,642,000
 
Citigroup Global Markets Inc.
 
$
52,938,000

 
$
52,938,000
   
$
105,876,000
 
Loop Capital Markets LLC
 
$
  2,941,000
   
$
  2,941,000
   
$
  5,882,000
 
Samuel A Ramirez & Company, Inc.
 
$
  2,941,000
   
$
  2,941,000
   
$
  5,882,000
 
Total
 
$
117,641,000
   
$
117,641,000
   
$
235,282,000
 

The underwriters may allow, and dealers may reallow, a discount not to exceed the percentage listed below for each tranche:

 
Selling Concession
 
Reallowance Discount
Tranche A‑1
0.24%
 
0.12%
Tranche A‑2
0.24%
 
0.12%

After the initial public offering, the public offering prices, selling concessions and reallowance discounts may change.

AEP Texas Restoration Funding LLC and AEP Texas 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 that registration statement and other documents AEP Texas Restoration Funding LLC and AEP Texas have filed with the SEC as exhibits to the registration statement for more complete information about and the offering.  You may get these documents for free by visiting EDGAR on the SEC web site at www.sec.gov.  Alternatively, AEP Texas Restoration Funding LLC, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Goldman Sachs & Co. LLC at 1-866-471-2526 or Citigroup Global Markets Inc. at 1-800-831-9146 or prospectus@citi.com.
3

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘FWP’ Filing    Date    Other Filings
2/1/20
9/18/19
Filed as of:9/12/19
Filed on:9/11/19
8/27/19SF-1/A
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Filing Submission 0001140361-19-016547   –   Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

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