KBRA assigns preliminary ratings to notes issued CPC Asset Securitization IV. CPC Asset Securitization IV LLC will issue four classes of Series 2025-1 Notes totaling $85 million initially. Channel Partners Capital (CPC) is the sponsor, seller and servicer for CPC 2025-1.

The proceeds from CPC Series 2025-1 will be used to pay off CPC Asset Securitization II LLC, Series 2023-1 (CPC 2023-1). The Series 2025-1 Notes are “expandable” term notes such that at any time during the revolving period, the issuer may periodically upsize the Series 2025-1 Notes, up to a maximum amount of $500 million, as long as certain conditions are met, including receipt of Rating Agency Confirmation. Noteholder consent is not required for these upsizes.

The transaction also features a revolving period, which will end on the earlier of (i) prior to the close of business on July 31, 2028, approximately 36 months after the initial closing date and (ii) the date on which a rapid amortization event has occurred. During the revolving period, the seller will transfer additional receivables to the issuer, who will purchase such additional eligible receivables so long as (a) the issuer and the receivables satisfy all conditions set forth in the transaction documents and (b) a rapid amortization event has not occurred and is not continuing.

Credit enhancement will consist of subordination (except for the Class D Notes), excess spread, a reserve account (funded at closing) and the excess funding account.