Investment Programs

Managed Container Program

Florens offers outside investors an opportunity to invest in container portfolios as part of its Managed Container Program (“MCP”). In such an arrangement, Florens works with the potential investor to select a group of containers matching the age and return criteria set by the investor. Once the pool of containers is established, Florens and the investor will determine a price for the equipment and, ultimately, a purchase agreement will be finalized. Concurrently, both parties will set mutually agreeable management fees to be paid to Florens for its services in leasing, monitoring, maintaining and, eventually, selling the equipment. The terms and conditions are spelled out in a management agreement signed by both parties. Florens continues to manage the equipment, as Lessor, from the time of acquisition until such time as the equipment is disposed. Cash is distributed to the investors from the ongoing collection of lease receivables. The management fees earned by Florens are deducted from the collections prior to investor distribution.

The benefit of MCP to the investor is the steady cash flow generated by leased containers enjoying high utilization in the international shipping market. In working with Florens the investor has a trusted, experienced partner well equipped to address the vagaries of the market and properly manage the risk inherent in the global shipping environment.

Sale and Lease Back

One of the many tools available to Florens to grow its fleet and expand market share is the Sale and Leaseback (“SLB”) program. In a typical SLB transaction, Florens will purchase a selection of containers from one of the shipping companies in its global customer base. Generally, the containers will be older units with a remaining life span from two to seven years. While it is feasible that new containers could be offered in an SLB, such a transaction is unusual.

At the same time as the purchase, Florens and the shipping company agree on terms and conditions for Florens to “lease back” the containers to the previous owner. Those conditions are defined in a standard Florens lease agreement signed by both parties. The critical elements of the agreement are the tenure, rental rates and the disposition of the equipment at the end of the lease agreement. The lease can end in one of two ways -- the lessee “buys back” the containers at a predetermined price or it returns the containers to Florens. In the latter case, Florens is free to lease the equipment to other customers or to sell them in the secondary market.