Morningstar DBRS Assigns Provisional Credit Rating to MP 2023 LLC, Series 2025-1

DBRS, Inc. (Morningstar DBRS) assigned a provisional credit rating to the following class of notes (the Notes) to be issued by MP 2023 LLC (the Issuer):

-- $281,700,000 Series 2025-1 Class A Secured Vessel Notes at (P) A (sf)

CREDIT RATING RATIONALE/DESCRIPTION
The provisional credit rating is based on Morningstar DBRS' review of the following analytical considerations:
(1) The transaction capital structure, proposed credit rating, and the form and sufficiency of available credit enhancement.
-- Overcollateralization and a liquidity facility provide credit enhancement levels that are commensurate with the credit rating on the Series 2025-1 Class A Notes.
-- The ability of the transaction to withstand stressed cash flow assumptions and repay investors according to the terms under which they have invested. For this transaction, the credit rating addresses the timely payment of the Series 2025-1 Class A Interest and the ultimate payment of principal by the Final Maturity Date. The transaction documents include provisions for the payment of additional interest amounts, accruing from the Anticipated Repayment Date, and redemption premiums under certain circumstances. Morningstar DBRS' credit rating does not address any such additional interest amounts, nor any redemption premiums. Failure to pay additional interest amounts is not an event of default.
-- The cash flows expected to be generated by the collateral pool under the stressed cash flow scenarios are sufficient to repay investors in accordance with the terms of the Related Documents.

(2) Inland marine vessels leased are primarily operating in domestic Jones Act trade. The Jones Act is a federal law that regulates maritime commerce in the U.S. It requires goods shipped between ports in the U.S. to be transported on ships that are built in the United States and registered under the U.S. flag, and are owned and crewed by at least 75% U.S. citizens. Initially passed in 1920, the Jones Act, also known as The Merchant Marine Act of 1920, was put in place to boost the shipping industry. Maritime Partner's fleet is used in the transportation of integral commodities including agricultural products, chemicals, aggregates, and energy products. With U.S. inland marine vessels being an important part of the U.S. economy, Maritime Partners has historically had over 99% of its fleet utilized and on lease.

(3) While the Company has only been in operation since 2015, the executive management team has deep experience with maritime leasing, investing, operations, commercial management, and shipbuilding. Through their knowledge of the industry, and relationships within, Maritime Partners has experienced significant growth. Maritime Partners has grown significantly since inception, including acquiring multiple companies in the industry. With the exception of the large increase in fair market value (FMV) due to acquisitions, the FMV of their fleet shows steady growth.
-- Morningstar DBRS conducted an operational risk review of Maritime Partners and as a result considers them to be an acceptable manager and servicer of brown water vessels.

(4) The Company has historically had a utilization rate of 100% from inception through 2Q2020. During the Coronavirus Disease (COVID-19) pandemic, utilization dropped slightly to 98.4%. Although demand in the market decreased and actual vessel usage by operators dropped to less than 70%, Maritime Partners was not as affected given that utilization and lease obligations are not affected by actual vessel usage. Maritime Partners experienced neither customer defaults nor bankruptcies as a result of the COVID-19 pandemic. Even with the decreased demand, operators continued to make timely payments on charter hire.

(5) Historically, the Company had to write off only one receivable, in 2020. This write-off was related to a minor contract dispute and represented only 0.06% of the charter revenue for the year.

(6) The master trust collateral pool consists of 595 vessels, 594 of which are on lease to 25 different charterers and one of which is ready to lease. The leased vessels are on long-term leases with a weighted average (WA) original charter term of 6 years and a WA remaining charter term of 2.9 years, as of the Statistical Date. As a percentage of total Initial Appraised Value (IAV), approximately 66.2% of the pool currently have charters expiring during or after 2028. The collateral backing the Series 2025-1 Notes is relatively young, with the WA age (by IAV) of 8.9 years, while the collateral have useful lives of 25-40 years. Additionally, the collateral is fairly evenly distributed across 3 different main vessel types, which account for ~97.1% of the total IAV.
-- Amongst the 25 charterers leasing vessels associated with the total master trust collateral pool, the top two account for 53.2% of the total IAV, and 52.6% of the 595 vessels in total. Excluding the top 2, the rest of the collateral pool is fairly diverse as a percentage total IAV, with the next largest accounting for only 7.9%.
-- The collateral contributed in connection with the Series 2025-1 Notes issuance consists of 281 vessels. As of the statistical cut-off-date, 280 of the vessels are on lease to 15 different charterers and one is ready to lease. Of the vessels that are on long-term leases, the WA original charter term is 4.6 years and the WA remaining charter term is 2.7 years. As a percentage of total IAV, approximately 59.3% of the pool currently have charters expiring during or after 2028. No vessels are subject to short-term lease agreements. The collateral backing the Series 2025-1 Notes is relatively young, with the WA (by Appraised Value) age of 6.8 years, while the collateral includes vessels with useful lives of 25-40 years. Additionally, the collateral is fairly evenly distributed across 3 different main vessel types, which account for ~98.1% of the total appraised value.

(7) While the transaction has no named backup servicer, U.S. Bank Trust Company, National Association serves in the role of Transition Manager and is in place to assist with identifying and facilitating the implementation of a servicer replacement in the event it becomes necessary. Identifying a Transition Manager rather than engaging a formal backup servicer at the start of the transaction is not an uncommon practice in operating asset securitizations. However, this arrangement can result in additional time as the parties consider (in the absence of majority noteholder direction) whether or not to replace the Servicer following a Servicer Default or Servicer Replacement Event. In addition, once the decision to replace is made, up to 180 days may elapse before occurrence of an EOD when a successor servicer is not yet formally engaged, DBRS Morningstar reviewed and considered the following provisions and factors in its analysis: (1) to the extent possible, it would be expected that the parties seek to retain the Servicer in its role prior to any such election; (2) a required majority of noteholders would be reasonably expected to act quickly to protect its collateral; (3) the Servicer cannot be terminated prior to the time that a successor servicer is in place; (4) in the context of a 40 year final transaction, a transition period of five to six months represents a small portion of the total tenor (approximately 1%), implying a small impact on transaction cash flow; (5) bareboat charterers, for whom the barges are mission critical, generally make their payments via ACH (99%) and within the first five days of the month (95%), so it is reasonably expected that payments will continue with limited interruption; (6) the transaction includes a liquidity facility to cover interest for up to nine months during such a replacement period; and (7) the Transition Manager is expected to provide advice within 30 days of a Servicer Termination Event, which may accelerate the process.

(8) The legal structure and expected legal opinions that will address the true sale of the assets to the Issuer, the non-consolidation of the trust with Maritime Partners, LLC, that the trust has a valid, first-priority security interest in the assets. The legal structure is consistent with Morningstar DBRS' Legal Criteria for U.S. Structured Finance.

(9) Morningstar DBRS materially deviated from its principal methodology when determining the rating assigned to the Series 2025-1 Class A Notes by adjusting certain cash flow assumptions. These adjustments, and the resulting material deviation, are warranted given analysis of historical data, relative asset cashflow, and value stability based on limited supply of inland marine vessels with steady demand and the unique regulatory environment.

(10) In light of the U.S. government shutdown, Morningstar DBRS considered the mortgage process, including (a) the benefit of the submission along with (b) the expected unqualified security interest opinion in respect of the preferred ship mortgage, in its analysis.

(11) The transaction assumptions consider Morningstar DBRS' baseline macroeconomic scenarios for rated sovereign economies, available in its commentary Baseline Macroeconomic Scenarios for Rated Sovereigns: September 2025 Update, published on September 30, 2025. These baseline macroeconomic scenarios replace Morningstar DBRS' moderate and adverse coronavirus pandemic scenarios, which were first published in April 2020.

Morningstar DBRS' credit rating on the Series 2025-1 Class A Notes addresses the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. The associated financial obligations are the Outstanding Note Balance and the Stated Interest Amount on the Series 2025-1 Class A Notes.

Morningstar DBRS' credit rating does not address nonpayment risk associated with contractual payment obligations contemplated in the applicable transaction document(s) that are not financial obligations. For example, Interest on the unpaid Stated Interest Amount, the Additional Interest Amount, and the Redemption Premium.

Morningstar DBRS' long-term credit ratings provide opinions on risk of default. Morningstar DBRS considers risk of default to be the risk that an issuer will fail to satisfy the financial obligations in accordance with the terms under which a long-term obligation has been issued. The Morningstar DBRS short-term debt rating scale provides an opinion on the risk that an issuer will not meet its short-term financial obligations in a timely manner.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.

A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Factors in Credit Ratings (May 16, 2025) https://dbrs.morningstar.com/research/454196.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology applicable to the credit rating is Rating Marine Container Securitizations (August 6, 2024) https://dbrs.morningstar.com/research/437539.

Other methodologies referenced in this transaction are listed at the end of this press release.

Morningstar DBRS materially deviated from its principal methodology when determining the credit rating assigned to the Series 2025-1 Class A Notes by adjusting the following cash flow assumptions.
-- Recessions
-- Long-Term Lease Per Diem Rate Haircut
-- Long-Term Lease Re-lease Term
-- Haircut to Long-Term Lease Per Diem Rates at Renewal
-- Residual Realization Haircut
-- Direct Operating Expenses

These adjustments, and the resulting material deviation are warranted given analysis of historical data, relative asset cashflow and value stability based on limited supply of inland marine vessels with steady demand and the unique regulatory environment.

Further details on such assumptions are included in the related presale report. https://www.dbrsmorningstar.com/research/466789.

The credit rating was initiated at the request of the rated entity.

The rated entity or its related entities did participate in the credit rating process for this credit rating action.

Morningstar DBRS had access to the accounts, management, and other relevant internal documents of the rated entity or its related entities in connection with this credit rating action.

This is a solicited credit rating.

For more information on Morningstar DBRS' policy regarding the solicitation status of credit ratings, please refer to the Credit Ratings Global Policy, which can be found in the Morningstar DBRS Understanding Ratings section of the website: https://dbrs.morningstar.com/understanding-ratings

A provisional credit rating is not a final credit rating with respect to the above-mentioned security and may change or be different than the final credit rating assigned or may be discontinued. The assignment of a final credit rating on the above-mentioned security is subject to receipt by Morningstar DBRS of all data and/or information and final documentation that Morningstar DBRS deems necessary to finalize the credit rating.

Morningstar DBRS expects Structured Finance issuers and originators of Structured Finance products to make all relevant information regarding these products available to investors to conduct their own analyses.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the credit rating process.

DBRS, Inc.
140 Broadway, 43rd Floor
New York, NY 10005 USA
Tel. +1 212 806-3277

The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.

-- Rating U.S. Structured Finance Transactions (October 27, 2025)
https://dbrs.morningstar.com/research/465621
-- Operational Risk Assessment for U.S. ABS Originators and Servicers (March 26, 2025)
https://dbrs.morningstar.com/research/450709
-- Legal Criteria for U.S. Structured Finance (December 3, 2024)
https://dbrs.morningstar.com/research/444064

For more information on this credit or on this industry, visit https://dbrs.morningstar.com/ or contact us at [email protected].