OVERVIEW -- Magnetite VII Ltd./Magnetite VII Corp.'s issuance is a CLO securitization backed by a revolving pool consisting primarily of broadly syndicated senior secured loans. -- We assigned our preliminary ratings to the class A, B, C, and D notes. -- The preliminary ratings reflect our view of the transaction's credit enhancement, legal structure, diversified collateral portfolio, and projected timely interest and principal payments, among other factors. NEW YORK (Standard & Poor's) Dec. 19, 2012--Standard & Poor's Ratings Services today assigned its preliminary ratings to Magnetite VII Ltd./Magnetite VII Corp.'s $552 million floating-rate notes (see list). The note issuance is a collateralized loan obligation securitization backed by a revolving pool consisting primarily of broadly syndicated senior secured loans. The preliminary ratings are based on information as of Dec. 19, 2012. Subsequent information may result in the assignment of final ratings that differ from the preliminary ratings. The preliminary ratings reflect our view of: -- The credit enhancement provided to the preliminary rated notes through the subordination of cash flows that are payable to the subordinated notes. -- The transaction's credit enhancement, which is sufficient to withstand the defaults applicable for the supplemental tests (not counting excess spread), and cash flow structure, which can withstand the default rate projected by Standard & Poor's CDO Evaluator model, as assessed by Standard & Poor's using the assumptions and methods outlined in its corporate collateralized debt obligation criteria (see "Update To Global Methodologies And AssumptionsRELATED CRITERIA AND RESEARCH Related Criteria -- Global Investment Criteria For Temporary Investments In Transaction Accounts, May 31, 2012 -- Counterparty Risk Framework Methodology And Assumptions, May 31, 2012 -- Methodology For Analyzing Rating Confirmation Requests To Establish Subsidiary Special-Purpose Entities In CDOs, Dec. 9, 2009 -- Update To Global Methodologies And Assumptions For Corporate Cash Flow And Synthetic CDOs, Sept. 17, 2009 -- Surveillance Methodology For Global Cash Flow And Hybrid CDOs Subject To Acceleration Or Liquidation After An EOD, Sept. 2, 2009 -- Methodology For Analyzing Rating Confirmation Requests To Replace Collateral Managers In Global CDOs, Aug. 13, 2009 -- Revised CDO Current-Pay Criteria Assumptions For Corporate Debt When Issuers Announce A Distressed Exchange Or Buyback, May 18, 2009 -- The Use Of Rating-Based Haircuts In Event Of Default Overcollateralization Tests For CDOs, March 19, 2008 -- Qualification And Treatment Of Current-Pay Obligations In Global Cash Flow CLOs, July 11, 2007 -- Legal Criteria For U.S. Structured Finance Transactions: Special-Purpose Entities, Oct. 1, 2006 -- CDO Spotlight: General Cash Flow Analytics For CDO Securitizations, Aug. 25, 2004 -- Structured Finance Criteria Introduced For Cayman Islands Special-Purpose Entities, July 18, 2002 -- Global Cash Flow and Synthetic CDO Criteria: The CDO Product, March 21, 2002 Related Research -- Presale: Magnetite VII Ltd./Magnetite VII Corp., Dec. 19, 2012 -- Global Structured Finance Scenario And Sensitivity Analysis: The Effects Of The Top Five Macroeconomic Factors, Nov. 4, 2011 PRELIMINARY RATINGS ASSIGNED Magnetite VII Ltd./Magnetite VII Corp. Class Rating Amount A-1 senior notes(i) AAA (sf) 0 A-1A AAA (sf) 360.00 A-1B AAA (sf) 12.00 A-2A AA (sf) 35.00 A-2B AA (sf) 40.00 B (deferrable) A (sf) 47.40 C (deferrable) BBB (sf) 28.80 D (deferrable) BB (sf) 28.80 Subordinated notes NR 58.15 (i)The class A-1 senior note will originally be issued with a principal amount of zero. Upon a class A-1 exchange, the principal amount of the class A-1 senior notes will be equal to the aggregate outstanding amount of the class A-1A and A-1B notes. NR--Not rated.