Kroll Bond Rating Agency assigned preliminary ratings to the Series 2020-1 Class A and Class B notes issued by CLI Funding VI, a container leasing securitization. The issuer is a special purpose entity and wholly owned subsidiary of Container Leasing International (SeaCube) and has been structured to issue multiple series of notes. The issuer currently has three series of notes outstanding, Series 2017-1, Series 2018-1 and Series 2019-1.

Once the Series 2020-1 is issued, the securitization will be collateralized by a portfolio of 274,349 containers and their respective leases. The portfolio of containers has a net book value (NBV) of $1,245.4 million. The fleet consists of approximately 25% refrigerated units (reefers), 72% dry units and 3.5% special units such as Gensets. As reefers cost approximately $15,000 versus approximately $1,900 for standard dry container boxes, the NBV percentage of the portfolio represented by reefers is 64% and the proportion of dry units is 29%. Approximately 65% of the collateral pool by NBV is on long-term lease with an average remaining term of 53 months. Approximately 31% of the collateral pool by NBV is on finance lease and 3% is on master lease. The remaining 1.5% of the collateral pool by NBV is off-lease. The containers have a weighted average age of 3.5 years.

All series feature the same amortization structures. After interest is paid sequentially to both classes, principal is paid sequentially based on a minimum schedule (15-year amortization), followed by scheduled principal (10-year amortization) and any supplemental principal. Supplemental principal is paid when the outstanding principal balance of a respective class is greater than its asset base. The series asset base is calculated by multiplying the aggregate asset value of the containers by the advance rate and then by the series asset allocation. All series also include early amortization events whereby the senior class receives all funds after interest is paid on both classes. Series specific early amortization events include series specific events of default, if an interest coverage ratio is less than 2x for four consecutive months or if the weighted average age of the collateral pool exceeds nine years.