Company Quick10K Filing
Quick10K
Atel Capital Equipment Fund Ix
10-Q 2019-03-31 Quarter: 2019-03-31
10-K 2018-12-31 Annual: 2018-12-31
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
10-Q 2017-09-30 Quarter: 2017-09-30
10-Q 2017-06-30 Quarter: 2017-06-30
10-Q 2017-03-31 Quarter: 2017-03-31
10-K 2016-12-31 Annual: 2016-12-31
10-Q 2016-09-30 Quarter: 2016-09-30
10-Q 2016-06-30 Quarter: 2016-06-30
10-Q 2016-03-31 Quarter: 2016-03-31
10-K 2015-12-31 Annual: 2015-12-31
10-Q 2015-09-30 Quarter: 2015-09-30
10-Q 2015-06-30 Quarter: 2015-06-30
10-Q 2015-03-31 Quarter: 2015-03-31
10-K 2014-12-31 Annual: 2014-12-31
10-Q 2014-09-30 Quarter: 2014-09-30
10-Q 2014-06-30 Quarter: 2014-06-30
10-Q 2014-03-31 Quarter: 2014-03-31
10-K 2013-12-31 Annual: 2013-12-31
LVS Las Vegas Sands 50,140
CS Credit Suisse 30,870
CHEF Chefs' Warehouse 988
XENT Intersect Ent 866
ACV Alberto-Culver 251
CLPS CLPS 97
BREIT Blackstone Real Estate Income Trust 0
NBGV Newbridge Global Ventures 0
PTPRO All Marketing Solutions 0
CVG Convergys 0
ZZHJC 2019-03-31
Part I. Financial Information
Item 1. Financial Statements (Unaudited).
Item 2. Management’S Discussion and Analysis of Financial Condition and Results of Operations.
Item 4. Controls and Procedures.
Part II. Other Information
Item 1. Legal Proceedings.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Item 3. Defaults Upon Senior Securities.
Item 4. Mine Safety Disclosures.
Item 5. Other Information.
Item 6. Exhibits.
EX-31.1 atel-20190331ex31124a849.htm
EX-31.2 atel-20190331ex312f503b6.htm
EX-32.1 atel-20190331ex321b37171.htm
EX-32.2 atel-20190331ex3225a14c9.htm

Atel Capital Equipment Fund Ix Earnings 2019-03-31

ZZHJC 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

10-Q 1 atel-20190331x10q.htm 10-Q atel9_Current_Folio_10Q

 

 

Form 10‑Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

☒          Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

For the quarterly period ended March 31, 2019

☐          Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

For the transition period from        to

Commission File number 000‑50210

ATEL Capital Equipment Fund IX, LLC

(Exact name of registrant as specified in its charter)

California

94‑3375584

(State or other jurisdiction of
Incorporation or organization)

(I. R. S. Employer
Identification No.)

 

The Transamerica Pyramid, 600 Montgomery Street, 9th Floor, San Francisco, California 94111

(Address of principal executive offices)

Registrant’s telephone number, including area code (415) 989‑8800

Securities registered pursuant to section 12(b) of the Act: None

Securities registered pursuant to section 12(g) of the Act: Limited Liability Company Units

Securities registered pursuant to Section 12(b) of the Act:

 

 

 

 

 

Title of each class:

    

Trading Symbol

    

Name of each exchange on which registered:

N/A

 

N/A

 

N/A

Indicate by a check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit files).  Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer, large accelerated filer and smaller reporting company” in Rule 12b‑2 of the Exchange Act.

Large accelerated filer ☐

Accelerated filer ☐

Non-accelerated filer ☒

Smaller reporting company ☒

Emerging growth company ☐

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Act). Yes ☐ No ☒

The number of Limited Liability Company Units outstanding as of April 30, 2019 was 12,055,016.

DOCUMENTS INCORPORATED BY REFERENCE

None.

 

 

 

 

 

 


 

ATEL CAPITAL EQUIPMENT FUND IX, LLC

INDEX

 

 

 

 

Part I.

Financial Information

3

 

 

 

Item 1. 

Financial Statements (Unaudited)

3

 

Balance Sheets, March 31, 2019 and December 31, 2018

3

 

Statements of Income for the three months ended March 31, 2019 and 2018

4

 

Statements of Changes in Members’ Capital for the three months ended March 31, 2019 and 2018

5

 

Statements of Cash Flows for the three months ended March 31, 2019 and 2018

6

 

Notes to the Financial Statements

7

 

 

 

Item 2. 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

17

 

 

 

Item 4. 

Controls and Procedures

19

 

 

 

Part II. 

Other Information

20

 

 

 

Item 1. 

Legal Proceedings

20

 

 

 

Item 2. 

Unregistered Sales of Equity Securities and Use of Proceeds

20

 

 

 

Item 3. 

Defaults Upon Senior Securities

20

 

 

 

Item 4. 

Mine Safety Disclosures

20

 

 

 

Item 5. 

Other Information

20

 

 

 

Item 6. 

Exhibits

20

 

 

2


 

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited).

ATEL CAPITAL EQUIPMENT FUND IX, LLC

BALANCE SHEETS

MARCH 31, 2019 AND DECEMBER 31, 2018

(in thousands)

 

 

 

 

 

 

 

 

    

March 31, 

    

December 31, 

 

 

2019

    

2018

 

 

(Unaudited)

 

 

 

ASSETS

 

 

  

 

 

  

Cash and cash equivalents

 

$

633

 

$

1,283

Accounts receivable, net

 

 

223

 

 

276

Due from Managing Member

 

 

20

 

 

21

Investment in securities

 

 

 5

 

 

 5

Equipment under operating leases, net

 

 

3,111

 

 

3,198

Prepaid expenses and other assets

 

 

72

 

 

77

Total assets

 

$

4,064

 

$

4,860

 

 

 

 

 

 

 

LIABILITIES AND MEMBERS’ CAPITAL

 

 

  

 

 

  

 

 

 

 

 

 

 

Accounts payable and accrued liabilities:

 

 

  

 

 

  

Due to Managing Member

 

$

66

 

$

 —

Other

 

 

157

 

 

143

Deposits due lessees

 

 

 1

 

 

 1

Unearned operating lease income

 

 

68

 

 

44

Total liabilities

 

 

292

 

 

188

 

 

 

 

 

 

 

Commitments and contingencies

 

 

  

 

 

  

 

 

 

 

 

 

 

Members’ capital:

 

 

  

 

 

  

Managing Member

 

 

 —

 

 

 —

Other Members

 

 

3,772

 

 

4,672

Total Members’ capital

 

 

3,772

 

 

4,672

Total liabilities and Members’ capital

 

$

4,064

 

$

4,860

 

See accompanying notes.

3


 

ATEL CAPITAL EQUIPMENT FUND IX, LLC

STATEMENTS OF INCOME

FOR THE THREE MONTHS ENDED

MARCH 31, 2019 AND 2018

(in thousands, except for units and per unit data)

(Unaudited)

 

 

 

 

 

 

 

 

 

    

Three Months Ended

 

 

 

March 31, 

 

 

 

2019

    

2018

 

Revenues:

 

 

  

 

 

  

 

Leasing activities:

 

 

  

 

 

  

 

Operating leases

 

$

520

 

$

472

 

Direct financing leases

 

 

 7

 

 

 —

 

Gain on sales of equipment under operating leases

 

 

20

 

 

83

 

Other revenue

 

 

 —

 

 

 2

 

Total revenues

 

 

547

 

 

557

 

 

 

 

 

 

 

 

 

Expenses:

 

 

  

 

 

  

 

Depreciation of operating lease assets

 

 

75

 

 

83

 

Asset management fees to Managing Member and/or affiliates

 

 

22

 

 

14

 

Cost reimbursements to Managing Member and/or affiliates

 

 

51

 

 

111

 

Amortization of initial direct costs

 

 

 1

 

 

 1

 

Other management fees

 

 

 2

 

 

 5

 

Professional fees

 

 

61

 

 

55

 

Outside services

 

 

28

 

 

39

 

Insurance

 

 

11

 

 

12

 

Marine vessel maintenance and other operating costs

 

 

123

 

 

 —

 

Railcar and equipment maintenance

 

 

36

 

 

22

 

Income taxes and franchise fees

 

 

18

 

 

 1

 

Storage fees

 

 

 7

 

 

11

 

Postage

 

 

 4

 

 

 5

 

Printing and photocopying

 

 

 8

 

 

 3

 

Other

 

 

24

 

 

12

 

Total operating expenses

 

 

471

 

 

374

 

Other income, net

 

 

 —

 

 

 2

 

Net income

 

$

76

 

$

185

 

 

 

 

 

 

 

 

 

Net income:

 

 

  

 

 

  

 

Managing Member

 

$

73

 

$

 —

 

Other Members

 

 

 3

 

 

185

 

 

 

$

76

 

$

185

 

 

 

 

 

 

 

 

 

Net income per Limited Liability Company Unit (Other Members)

 

$

0.00

 

$

0.02

 

Weighted average number of Units outstanding

 

 

12,055,016

 

 

12,055,016

 

 

See accompanying notes.

4


 

ATEL CAPITAL EQUIPMENT FUND IX, LLC

STATEMENTS OF CHANGES IN MEMBERS’ CAPITAL

FOR THE THREE MONTHS ENDED

MARCH 31, 2019 AND 2018

(in thousands, except for units and per unit data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amount

 

 

 

 

 

Other Members

 

Other

 

Managing

 

 

 

 

    

Units

    

Members

    

Member

    

Total

Balance December 31, 2017

 

12,055,016

 

$

4,080

 

$

 —

 

$

4,080

Net income

 

 —

 

 

185

 

 

 —

 

 

185

Balance March 31, 2018 (Unaudited)

 

12,055,016

 

$

4,265

 

$

 —

 

$

4,265

 

 

 

 

 

 

 

 

 

 

 

 

Balance December 31, 2018

 

12,055,016

 

$

4,672

 

$

 —

 

$

4,672

Distributions to Other Members ($0.07 per Unit)

 

 —

 

 

(903)

 

 

 —

 

 

(903)

Distributions to Managing Member

 

 —

 

 

 —

 

 

(73)

 

 

(73)

Net income

 

 —

 

 

 3

 

 

73

 

 

76

Balance March 31, 2019 (Unaudited)

 

12,055,016

 

$

3,772

 

$

 —

 

$

3,772

 

See accompanying notes.

5


 

ATEL CAPITAL EQUIPMENT FUND IX, LLC

STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED

MARCH 31, 2019 AND 2018

(in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

    

Three Months Ended

 

 

 

March 31, 

 

 

 

2019

    

2018

 

Operating activities:

 

 

  

 

 

  

 

Net income

 

$

76

 

$

185

 

Adjustment to reconcile net income to cash provided by

  operating activities:

 

 

 

 

 

 

 

Gain on sales of equipment under operating leases

 

 

(20)

 

 

(83)

 

Depreciation of operating lease assets

 

 

75

 

 

83

 

Amortization of initial direct costs

 

 

 1

 

 

 1

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

   Accounts receivable

 

 

53

 

 

(30)

 

Prepaid expenses and other assets

 

 

 5

 

 

 7

 

Accounts payable, Managing Member and affiliates

 

 

67

 

 

 7

 

Accounts payable, other

 

 

14

 

 

10

 

Unearned operating lease income

 

 

24

 

 

19

 

Net cash provided by operating activities

 

 

295

 

 

199

 

 

 

 

 

 

 

 

 

Investing activities:

 

 

  

 

 

  

 

Proceeds from sales of equipment under operating leases

 

 

31

 

 

223

 

Net cash provided by investing activities

 

 

31

 

 

223

 

 

 

 

 

 

 

 

 

Financing activities:

 

 

  

 

 

  

 

Distributions to Other Members

 

 

(903)

 

 

 —

 

Distributions to Managing Member

 

 

(73)

 

 

 —

 

Net cash used in financing activities

 

 

(976)

 

 

 —

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

 

(650)

 

 

422

 

Cash and cash equivalents at beginning of period

 

 

1,283

 

 

441

 

Cash and cash equivalents at end of period

 

$

633

 

$

863

 

 

 

 

 

 

 

 

 

Supplemental disclosures of cash flow information:

 

 

  

 

 

  

 

Cash paid during the period for taxes

 

$

 4

 

$

 3

 

 

See accompanying notes.

 

6


 

Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

1. Organization and Limited Liability Company matters:

ATEL Capital Equipment Fund IX, LLC (the “Company” or the “Fund”) was formed under the laws of the State of California on September 27, 2000 for the purpose of engaging in the sale of limited liability company investment units and acquiring equipment to engage in equipment leasing, lending and sales activities, primarily in the United States. The Managing Member or Manager of the Company is ATEL Financial Services, LLC (“AFS”), a California limited liability company. The Company may continue until December 31, 2020. Contributions in the amount of $600 were received as of December 31, 2000, $100 of which represented AFS’s continuing interest, and $500 of which represented the initial Member’s capital investment.

As of January 15, 2003, the offering was terminated. As of that date, the Company had received subscriptions for 12,065,266 Units ($120.7 million). Subsequent to January 15, 2003, Units totaling 10,250 were rescinded or repurchased and funds returned to investors (net of distributions paid and allocated syndication costs, as applicable). As of March 31, 2019, 12,055,016 Units remain issued and outstanding.

The Company is governed by the Limited Liability Company Operating Agreement (“Operating Agreement”), as amended. On January 1, 2010, the Company commenced liquidation phase activities pursuant to the guidelines of the Operating Agreement. Pursuant to the terms of the Operating Agreement, AFS receives compensation and reimbursements for services rendered on behalf of the Company (See Note 5). The Company is required to maintain reasonable cash reserves for working capital, for the repurchase of Units and for contingencies. The repurchase of Units is solely at the discretion of AFS.

These unaudited interim financial statements should be read in conjunction with the financial statements and notes thereto contained in the report on Form 10‑K for the year ended December 31, 2018, filed with the Securities and Exchange Commission.

 

2. Summary of significant accounting policies:

Basis of presentation:

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10‑Q as mandated by the Securities and Exchange Commission. The unaudited interim financial statements reflect all adjustments which are, in the opinion of the Managing Member, necessary for a fair statement of financial position and results of operations for the interim periods presented. All such adjustments are of a normal recurring nature. Operating results for the three months ended March 31, 2019 and 2018 are not necessarily indicative of the results to be expected for the full year.  Certain month’s prior period amounts may have been reclassified to conform to the current period presentation.  These reclassifications had no significant effect on the reported financial position or results of operations.

Certain prior period amounts may have been reclassified to conform to the current period presentation. These reclassifications had no significant impact on the reported financial position or results of operations.

Footnote and tabular amounts are presented in thousands, except as to Units and per Unit data.

In preparing the accompanying unaudited financial statements, the Company has reviewed, as determined necessary by the Managing Member, events that have occurred after March 31, 2019 up until the issuance of the financial statements. No events were noted which would require additional disclosure in the footnotes to the financial statements, or adjustments thereto.

7


 

Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

Use of estimates:

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Such estimates primarily relate to the determination of residual values at the end of the lease term and expected future cash flows used for impairment analysis purposes and for determination of the allowance for doubtful accounts.

Segment reporting:

The Company is not organized by multiple operating segments for the purpose of making operating decisions or assessing performance. Accordingly, the Company operates in one reportable operating segment in the United States.

The primary geographic regions in which the Company seeks leasing opportunities are North America and Europe. The table below summarizes geographic information relating to the sources, by nation, of the Company’s total revenues for the three months ended March 31, 2019 and 2018, and long-lived tangible assets as of March 31, 2019 and December 31, 2018 (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 

 

 

 

    

2019

    

% of Total

 

    

2018

    

% of Total

 

 

Revenue

 

 

  

 

  

 

 

 

  

 

  

 

 

United States

 

$

529

 

97

%  

 

$

538

 

97

%

 

Canada

 

 

18

 

 3

%  

 

 

19

 

 3

%

 

Total

 

$

547

 

100

%  

 

$

557

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31, 

 

 

As of December 31, 

 

 

 

    

2019

    

% of Total

 

    

2018

    

% of Total

 

 

Long-lived assets

 

 

  

 

  

 

 

 

  

 

  

 

 

United States

 

$

3,020

 

97

%  

 

$

3,107

 

97

%

 

Canada

 

 

91

 

 3

%  

 

 

91

 

 3

%

 

Total

 

$

3,111

 

 100

%  

 

$

3,198

 

100

%

 

 

Investment in securities:

Purchased securities

The Company`s investment securities not registered for public sale that do not have readily determinable fair values are measured at cost minus impairment, and adjusted for changes in observable prices. There were neither impaired securities at March 31, 2019 and December 31, 2018 nor investment securities sold or disposed of during the three months ended March 31, 2019 and 2018.

Other income, net:

Other income, net consisted solely of net gains and losses on foreign exchange transactions.

Per Unit data:

The Company issues only one class of Units, none of which are considered dilutive. Net income and distributions per Unit are based upon the weighted average number of Other Members’ Units outstanding during the period.

8


 

Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

Equipment under operating leases, net and related revenue recognition:

Equipment subject to operating leases is stated at cost. Depreciation is being recognized on a straight-line method over the terms of the related leases to the equipment’s estimated residual values. Off-lease equipment is generally not subject to depreciation. The Company depreciates all lease assets, in accordance with guidelines consistent with ASC 360‑20‑35‑3, over the periods of the lease terms contained in each asset’s respective lease contract to the estimated residual value at the end of the lease contract. All lease assets are purchased only concurrent with the execution of a lease commitment by the lessee. Thus, the original depreciation period corresponds with the term of the original lease. Once the term of an original lease contract is completed, the subject property is typically sold to the existing user, re-leased to the existing user, or, when off-lease, is held for sale. Assets which are re-leased continue to be depreciated using the terms of the new lease agreements and the estimated residual values at the end of the new lease terms, adjusted downward as necessary. Assets classified as held-for-sale are carried at the lower of carrying amount, or the fair value less cost to sell (ASC 360‑10‑35‑43).

The Company does not use the equipment held in its portfolio, but holds it solely for lease and ultimate sale. In the course of marketing equipment that has come off-lease, management may determine at some point that re-leasing the assets may provide a superior return for investors and would then execute another lease. Upon entering into a new lease contract, management will estimate the residual value once again and resume depreciation. If, and when, the Company, at any time, determines that depreciation in value may have occurred with respect to an asset held-for-sale, the Company would review the value to determine whether a material reduction in value had occurred and recognize any appropriate impairment. All lease assets, including off-lease assets, are subject to the Company’s quarterly impairment analysis, as described below. Maintenance costs associated with the Fund’s portfolio of leased assets are expensed as incurred. Major additions and betterments are capitalized.

Operating lease revenue is recognized on a straight-line basis over the term of the underlying leases. The initial lease terms will vary as to the type of equipment subject to the leases, the needs of the lessees and the terms to be negotiated, but initial leases are generally on terms from 36 to 120 months. The difference between rent received and rental revenue cognized is recorded as unearned operating lease income on the balance sheet. Operating leases are generally placed in a non-accrual status (i.e., no revenue is recognized) when payments are more than 90 days past due. Additionally, management considers the equipment underlying the lease contracts for impairment and periodically reviews the credit worthiness of all operating lessees with payments outstanding less than 90 days. Based upon management’s judgment, the related operating leases may be placed on non-accrual status. Leases placed on non-accrual status are only returned to an accrual status when the account has been brought current and management believes recovery of the remaining unpaid lease payments is probable. Until such time, revenues are recognized on a cash basis.

Fair value:

Fair value measurements and disclosures are based on a fair value hierarchy as determined by significant inputs used to measure fair value. The three levels of inputs within the fair value hierarchy are defined as follows:

Level 1 – Quoted prices in active markets for identical assets or liabilities. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis, generally on a national exchange.

Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuations in which all significant inputs are observable in the market.

Level 3 – Valuation is modeled using significant inputs that are unobservable in the market. These unobservable inputs reflect the Company`s own estimates of assumptions that market participants would use in pricing the asset or liability.

9


 

Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

The Company’s valuation policy is determined by members of the Asset Management, Credit and Accounting departments. Whenever possible, the policy is to obtain quoted market prices in active markets to estimate fair values for recognition and disclosure purposes. Where quoted market prices in active markets are not available, fair values are estimated using discounted cash flow analyses, broker quotes, information from third party remarketing agents, third party appraisals of collateral and/or other valuation techniques. These techniques are significantly affected by certain of the Company’s assumptions, including discount rates and estimates of future cash flows. Potential taxes and other transaction costs are not considered in estimating fair values. As the Company is responsible for determining fair value, an analysis is performed on prices obtained from third parties. Such analysis is performed by asset management and credit department personnel who are familiar with the Company’s investments in equipment, and equity securities of venture companies. The analysis may include a periodic review of price fluctuations and validation of numbers obtained from a specific third party by reference to multiple representative sources.

Recent accounting pronouncements:

In February 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, No. 2016-02, Leases. In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases and ASU No. 2018-11, Leases (Topic 842): Targeted Improvements.  In December 2018, the FASB issued ASU No. 2018-20, Leases (Topic 842), Narrow-Scope Improvements for Lessors. In March 2019, the FASB issued ASU No. 2019-01, Leases: Codification Improvements. Collectively referred to hereafter as ASU No. 2016-02, these standards set out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract to control an asset (i.e., lessees and lessors). The Company does not have any non-cancelable leases where it is a lessee.

 

ASU No. 2016-02 requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales type leases, direct financing leases and operating leases. These standards were effective as of January 1, 2019. Upon adoption, we applied the package of practical expedients that has allowed us to not reassess (i) whether any expired or existing contracts are or contain leases, (ii) lease classification for any expired or existing leases and (iii) initial direct costs for any expired or existing leases. Furthermore, we applied the optional transition method in ASU No. 2018-11, which has allowed us to initially apply the new leases standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings in the adoption period, although we did not have an adjustment. Additionally, our leases met the criteria in ASU No. 2018-11 to not separate non-lease components from the related lease component; therefore, the accounting for these leases remained largely unchanged from the previous standard. 

 

The adoption of ASU No. 2016-02 and the related improvements did not have a material impact in our financial statements. Upon adoption, (i) amounts previously recognized as lessee reimbursements and other income, for the three months ended March 31, 2019, have been classified as lease or financing income, (ii) allowances for bad debts are now recognized as a direct reduction of operating lease income, and (iii) certain costs associated with the execution of our leases, which were previously capitalized and amortized over the life of their respective leases, are expensed as incurred. Subsequent to January 1, 2019, provisions for credit losses relating to operating leases are now included in lease income in the Company’s financial statements.  Provisions for credit losses prior to January 1, 2019 were previously included in operating expenses in our financial statements and prior periods are not reclassified to conform to the current presentation.

 

In June 2016, the FASB issued Accounting Standards Update 2016-13, Financial Instruments — Credit Losses (Topic 326) (“ASU 2016-13”). The main objective of this Update is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this Update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The

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Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

amendments affect entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018. Management is currently evaluating the standard and expects the Update may potentially result in an increase in the allowance for credit losses given the change to estimated losses over the contractual life adjusted for expected prepayments.

 

In November 2018, the FASB issued Accounting Standards Update 2018-19, Codification Improvements to Topic 326, Financial Instruments — Credit Losses (“ASU 2018-19”). The new standard clarifies certain aspects of the new current expected credit losses (CECL) impairment model in ASU 2016-13. The amendment clarifies that receivables arising from operating leases are within the scope of ASC 842, rather than ASC 326; however, it will be applicable to our note receivables and direct financing leases, if any. The effective date and transition requirements in this Update are the same as the effective dates and transition requirements in Update 2016-13, as amended by this Update, which is for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Management is currently evaluating the impact of the standard on the financial statements and related disclosure requirements.

 

In August 2018, the FASB issued Accounting Standards Update 2018-13, Fair Value Measurement (“ASU 2018-13”), which amends the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement. This ASU modifies disclosure requirements for fair value measurements by removing, modifying or adding certain disclosures. The amendments in this Update are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted upon issuance of this Update. An entity is permitted to early adopt any removed or modified disclosures upon issuance of this Update and delay adoption of the additional disclosures until their effective date. Management is currently evaluating the impact of this standard on the financial statements and related disclosure requirements.

 

In August 2016, the FASB issued Accounting Standards Update 2016-15 — Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”). ASU 2016-15 addresses specific cash flow issues with the objective of reducing the existing diversity in practice. The amendments in this Update are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. This guidance was adopted beginning on January 1, 2018. The adoption of ASU 2016-15 did not have a material impact on its financial statements and disclosures.

 

Initial direct costs:

With the adoption of ASU No. 2016-02 certain costs associated with the execution of the Company’s leases, which were previously capitalized and amortized over the life of their respective leases, are expensed as incurred. In 2018 and prior, the Company capitalized initial direct costs (“IDC”) associated with the origination of lease assets. IDC includes both internal costs (e.g., the costs of employees’ activities in connection with successful lease originations) and external broker fees incurred with such originations. The costs are amortized on a lease by lease basis based on actual contract term using a straight-line method for operating leases. Upon disposal of the underlying lease assets, both the initial direct costs and the associated accumulated amortization are relieved. Costs related to leases that are not consummated are not eligible for capitalization as initial direct costs and are expensed as acquisition expense.

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Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

 

 

 

 

3. Allowance for credit losses:

The Company’s allowance for credit losses are as follows (in thousands):

 

 

 

 

 

 

Accounts Receivable

 

 

Allowance

 

 

for Doubtful Accounts

  

 

Operating

 

     

Leases

Balance December 31, 2017

 

$

12

Provision

 

 

59

Balance December 31, 2018

 

 

71

Provision

 

 

 —

Balance March 31, 2019

 

$

71

 

 

4. Equipment under operating leases, net:

The Company’s equipment under operating leases, net consists of the following (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

 

 

    

 

 

    

Depreciation/

    

 

 

 

 

 

 

 

 

 

 

Amortization

 

 

 

 

 

Balance

 

Reclassifications,

 

Expenses or

 

Balance

 

 

December 31, 

 

Additions/

 

Amortization

 

March 31, 

 

 

2018

 

Dispositions

 

of Leases

 

2019

Equipment under operating leases, net

 

$

2,909

 

$

(9)

 

$

(75)

 

$

2,825

Assets held for sale or lease, net

 

 

276

 

 

 —

 

 

 1

 

 

277

Initial direct costs, net of accumulated amortization of $3 at March 31, 2019 and December 31, 2018

 

 

10

 

 

 —

 

 

(1)

 

 

 9

Total

 

$

3,195

 

$

(9)

 

$

(75)

 

$

3,111

 

Impairment of equipment under operating leases, net held for sale or lease:

Recorded values of the Company’s leased asset portfolio are reviewed each quarter to confirm the reasonableness of established residual values and to determine whether there is indication that an asset impairment might have taken place. The Company uses a variety of sources and considers many factors in evaluating whether the respective book values of its assets are appropriate. In addition, the Company may direct a residual value review at any time if it becomes aware of issues regarding the ability of a lessee to continue to make payments on its lease contract. An impairment loss is measured and recognized only if the estimated undiscounted future cash flows of the asset are less than their net book value. The estimated undiscounted future cash flows are the sum of the residual value of the asset at the end of the asset’s lease contract and undiscounted future rents from the existing lease contract, if any. The residual value assumes, among other things, that the asset is utilized normally in an open, unrestricted and stable market. Short-term fluctuations in the marketplace are disregarded and it is assumed that there is no necessity either to dispose of a significant number of the assets simultaneously, if held in quantity, or to dispose of the asset quickly. Impairment is measured as the difference between the fair value (as determined by a valuation method using discounted estimated future cash flows, third party appraisals or comparable sales of similar assets as applicable based on asset type) of the asset and its carrying value on the measurement date. Upward adjustments for impairments recognized in prior periods are not made in any circumstances.

12


 

Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

As a result of these reviews, management determined that no impairment losses existed during the three months ended March 31, 2019 and 2018.

The Company utilizes a straight line depreciation method for equipment in all of the categories currently in its portfolio of operating lease transactions. Depreciation expense on the Company’s equipment was $75 thousand and $83 thousand for the respective three months ended March 31, 2019 and 2018.  The Company recorded $1 thousand initial direct cost amortization for both three months ended March 31, 2019 and 2018.

All of the leased property was acquired beginning in 2001 through 2010.

Operating leases:

Property on operating leases consists of the following (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Balance

    

 

 

    

 

 

    

Balance

 

 

December 31, 

 

 

 

 

Reclassifications or

 

March 31, 

 

 

2018

 

Additions

 

Dispositions

 

2019

Transportation, rail

 

$

11,961

 

$

 —

 

$

(96)

 

$

11,865

Marine vessels

 

 

11,362

 

 

 —

 

 

 —

 

 

11,362

Transportation, other

 

 

1,371

 

 

 —

 

 

 —

 

 

1,371

Materials handling

 

 

331

 

 

 —

 

 

 —

 

 

331

 

 

 

25,025

 

 

 —

 

 

(96)

 

 

24,929

Less accumulated depreciation

 

 

(22,116)

 

 

(75)

 

 

87

 

 

(22,104)

Total

 

$

2,909

 

$

(75)

 

$

(9)

 

$

2,825

 

The average estimated residual value for assets on operating leases was 9% of the assets’ original cost at both March 31, 2019 and December 31, 2018  There were no operating leases placed in nonaccrual status as of the same dates.

The Company may earn revenues from its containers, marine vessel and certain other assets based on utilization of such assets on a fixed-term lease. Contingent rentals (i.e., short-term, operating charter hire payments) and the associated expenses are recorded when earned and/or incurred. The revenues associated with these rentals are included as a component of operating lease revenues and totaled $29 thousand and $15 thousand for the respective three months ended March 31, 2019 and 2018.

At March 31, 2019, the aggregate amounts of future minimum lease payments receivable are as follows (in thousands):

 

 

 

 

 

    

Operating

 

 

Leases

Nine months ending December 31, 2019

 

$

727

Year ending December 31, 2020

 

 

588

2021

 

 

164

2022

 

 

53

2023

 

 

12

 

 

$

1,544

 

13


 

Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

The useful lives for each category of leases is reviewed at a minimum of once per quarter. As of March 31, 2019, the respective useful lives of each category of lease assets in the Company’s portfolio are as follows (in years):

 

 

 

Equipment category

    

Useful Life

Transportation, rail

 

35 - 50

Marine vessels

 

20 - 30

Manufacturing

 

10 - 15

Construction

 

7 - 10

Materials handling

 

7 - 10

Transportation, other

 

7 - 10

 

 

5. Related party transactions:

The terms of the Operating Agreement provide that AFS and/or affiliates are entitled to receive certain fees for equipment management and resale and for management of the Company.

The Operating Agreement allows for the reimbursement of costs incurred by AFS for providing administrative services to the Company. Administrative services provided include Company accounting, finance/treasury, investor relations, legal counsel and lease and equipment documentation. AFS is not reimbursed for services whereby it is entitled to receive a separate fee as compensation for such services, such as management of equipment. The Company would be liable for certain future costs to be incurred by AFS to manage the administrative services provided to the Company.

Each of ATEL Leasing Corporation (“ALC”) and AFS is a wholly-owned subsidiary of ATEL Capital Group and performs services for the Company. Acquisition services, equipment management, lease administration and asset disposition services are performed by ALC; investor relations, communications and general administrative services for the Company are performed by AFS.

Cost reimbursements to the Managing Member are based on its costs incurred in performing administrative services for the Company. These costs are allocated to each managed entity based on certain criteria such as managed assets, number of investors or contributed capital based upon the type of cost incurred. The Operating Agreement places an annual limit and a cumulative limit for cost reimbursements to AFS and/or affiliates. Any reimbursable costs incurred by AFS and/or affiliates during the year exceeding the annual and/or cumulative limits cannot be reimbursed in the current year, though such costs may be recovered in future years to the extent of the cumulative limit. As of March 31, 2019, the Company has not exceeded the annual and/or cumulative limitations discussed above.

During the three months ended March 31, 2019 and 2018, AFS and/or affiliates earned fees and billed for reimbursements of costs and expenses pursuant to the Operating Agreement as follows (in thousands):

 

 

 

 

 

 

 

 

 

    

Three Months Ended

 

 

 

March 31, 

 

 

 

2019

    

2018

 

Costs reimbursed to Managing Member and/or affiliates

 

$

51

 

$

111

 

Asset management fees to Managing Member and/or affiliates

 

 

22

 

 

14

 

 

 

$

73

 

$

125

 

 

 

6. Commitments and Contingencies:

At March 31, 2019, the Company had no commitments to purchase lease assets or fund investments in notes receivable.

 

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Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

7. Members’ capital:

As of March 31, 2019 and December 31, 2018, 12,055,016 Units were issued and outstanding. The Company was authorized to issue up to 15,000,000 Units in addition to the Units issued to the initial Members (50 Units).

Distributions to the Other Members were as follows (in thousands, except for Units and per Unit data):

 

 

 

 

 

 

 

 

 

    

Three Months Ended

 

 

 

March 31, 

 

 

 

2019

    

2018

 

Distributions declared

 

$

903

 

$

 —

 

Weighted average number of Units outstanding

 

 

12,055,016

 

 

12,055,016

 

Weighted average distributions per Unit

 

$

0.07

 

$

 —

 

 

 

8. Fair value measurements:

Under applicable accounting standards, fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

The following disclosure of the estimated fair value of financial instruments is made in accordance with the guidance provided by the Financial Instruments Topic of the FASB Accounting Standards Codification. Fair value estimates, methods and assumptions, set forth below for the Company’s financial instruments, are made solely to comply with the requirements of the Financial Instruments Topic.

The Company has determined the estimated fair value amounts by using market information and valuation methodologies that it considers appropriate and consistent with the fair value accounting guidance. Considerable judgment is required to interpret market data to develop the estimates of fair value. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

The measurement methodologies are as follows:

Cash and cash equivalents

The recorded amounts of the Company’s cash and cash equivalents approximate fair value because of the liquidity and short-term maturity of these instruments.

Commitments and Contingencies

Management has determined that the fair value of contingent liabilities (or guarantees) is not considered material because management believes there has been no event that has occurred wherein a guarantee liability has been incurred or will likely be incurred.

15


 

Table of Contents

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

The following tables present estimated fair values of the Company’s financial instruments in accordance with the guidance provided by the Financial Instruments Topic of the FASB Accounting Standards Codification at March 31, 2019 and December 31, 2018 (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value Measurements at March 31, 2019

 

    

Carrying

    

 

 

    

 

 

    

 

 

    

 

 

 

 

Amount

 

Level 1

 

Level 2

 

Level 3

 

Total

Financial assets:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Cash and cash equivalents

 

$

633

 

$

633

 

$

 —

 

$

 —

 

$

633

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value Measurements at December 31, 2018

 

    

Carrying

    

 

 

    

 

 

    

 

 

    

 

 

 

 

Amount

 

Level 1

 

Level 2

 

Level 3

 

Total

Financial assets:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Cash and cash equivalents

 

$

1,283

 

$

1,283

 

$

 —

 

$

 —

 

$

1,283

 

 

 

16


 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Statements contained in this Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this Form 10-Q, which are not historical facts, may be forward-looking statements. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. In particular, economic recession and changes in general economic conditions, including fluctuations in demand for equipment, lease rates, and interest rates, may result in delays in investment and reinvestment, delays in leasing, re-leasing, and disposition of equipment, and reduced returns on invested capital. The Company’s performance is subject to risks relating to lessee defaults and the creditworthiness of its lessees. The Company’s performance is also subject to risks relating to the value of its equipment at the end of its leases, which may be affected by the condition of the equipment, technological obsolescence and the markets for new and used equipment at the end of lease terms. Investors are cautioned not to attribute undue certainty to these forward-looking statements which speak only as of the date of this Form 10-Q. We undertake no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this Form 10-Q or to reflect the occurrence of unanticipated events, other than as required by law.

 Overview

ATEL Capital Equipment Fund IX, LLC (the “Company” or the “Fund”) is a California limited liability company that was formed in September 2000 for the purpose of engaging in the sale of limited liability company investment units and acquiring equipment to generate revenues from equipment leasing, lending and sales activities, primarily in the United States. The Managing Member of the Company is ATEL Financial Services, LLC (“AFS”), a California limited liability company.

Results of Operations

The three months ended March 31, 2019 versus the three months ended March 31, 2018

The Company had net income of $76 thousand and $185 thousand for the three months ended March 31, 2019 and 2018, respectively. The net results for the first quarter of 2019 reflected a decrease in total revenues and an increase in total operating expenses when compared to the prior year period.

Revenues

Total revenues for the three months ended March 31, 2019 decreased by $10 thousand, or 2%, as compared to the prior year period. Such decrease was largely due to a $63 thousand, or 76% unfavorable change in  gain on sales of equipment under operating leases; offset, in part, by a $48 thousand, or 10% increase in operating lease revenues.

Expenses

Total operating expenses for the three months ended March 31, 2019 increased by $97 thousand, or 26%, as compared to the prior year period. Such increase in total expenses was largely the result of $123 thousand expense increase in marine vessel maintenance cost; an $8 thousand increase in asset management fees to Managing Member due to the cash distribution of incentive management fees in January 2019; a $14 thousand increase in railcar and equipment maintenance expense due to increasing seasonal repair costs; and a $17 thousand increase in accrued quarterly income taxes and franchise fees compared to the prior year period in which the Company received a tax credit adjustment; offset in part by a $60 thousand, or 54%, decrease in cost reimbursement to Managing Member and /or affiliates;  an $11 thousand, or 28%, decrease in outside services expense; and an $8 thousand decrease in depreciation expense as a result of run-off and sales of equipment under operating leases.  

Capital Resources and Liquidity

The Company’s cash and cash equivalents totaled $633 thousand and $1.2 million at March 31, 2019 and December 31, 2018, respectively. The liquidity of the Company varies, increasing to the extent cash flows from leases

17


 

and proceeds of asset sales exceed expenses and decreasing as distributions are made to Members and to the extent expenses exceed cash flows from leases and proceeds from asset sales.

The primary source of liquidity for the Company is its cash flow from leasing activities. As initial lease terms expire, the Company re-leases or sells the equipment. The future liquidity beyond the contractual minimum rentals will depend on the Company’s success in remarketing or selling the equipment as it comes off-rental.

The Company currently believes it has available adequate reserves to meet its immediate cash requirements and those of the next twelve months, but in the event those reserves are found to be inadequate, the Company would likely be in a position to borrow against its current portfolio to meet such requirements. AFS envisions no such requirements for operating purposes.

Cash Flows

The following table sets forth summary cash flow data (in thousands):

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

March 31, 

  

 

2019

 

2018

Net cash provided by (used in):

 

 

  

 

 

  

 Operating activities

 

$

295

 

$

199

 Investing activities

 

 

31

 

 

223

 Financing activities

 

 

(976)

 

 

 —

Net increase (decrease) in cash and cash equivalents

 

$

(650)

 

$

422

 

The three months ended March 31, 2019 versus the three months ended March 31, 2018

During the three months ended March 31, 2019 and 2018, the Company’s primary sources of liquidity were cash flows from its portfolio of operating lease contracts. In addition, the Company realized $31 thousand and $223 thousand of proceeds from sales of equipment under operating leases during the respective three months ended March 31, 2019 and 2018.

During the three months ended March 31, 2019, cash was primarily used to pay improvements to operating lease equipment and distributions to both Other Members and the Managing Member.  Distributions paid to Members totaled $976 thousand and $0 during the respective three months ended March 31, 2019 and 2018. In addition, cash was also used to pay invoices related to management fees and expenses, and other.

Distributions

Beginning with the month of February 2001, the Company commenced periodic distributions based on cash flows from operations. The monthly distributions were discontinued in 2010 as the Company entered its liquidation phase. The rates and frequency of periodic distributions paid by the Fund during its liquidation phase are solely at the discretion of the Manager.

Commitments and Contingencies and Off-Balance Sheet Transactions

Commitments and Contingencies

At March 31, 2019, the Company had no commitments to purchase lease assets or fund investments in notes receivable.

Off-Balance Sheet Transactions

None.

18


 

Recent Accounting Pronouncements

For detailed information on recent accounting pronouncements, see Note 2, Summary of significant accounting policies.

Significant Accounting Policies and Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, the Company evaluates its estimates, which are based upon historical experiences, market trends and financial forecasts, and upon various other assumptions that management believes to be reasonable under the circumstances and at that certain point in time. Actual results may differ, significantly at times, from these estimates under different assumptions or conditions.

The Company’s significant accounting policies are described in its Annual Report on Form 10-K for the year ended December 31, 2018. There have been no material changes to the Company’s significant accounting policies since December 31, 2018.

 

Item 4. Controls and Procedures.

Evaluation of disclosure controls and procedures

The Company’s Managing Member’s President and Chief Executive Officer, and Executive Vice President and Chief Financial Officer and Chief Operating Officer (“Management”), evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)) as of the end of the period covered by this report. Based on the evaluation of the Company’s disclosure controls and procedures, Management concluded that as of the end of the period covered by this report, the design and operation of these disclosure controls and procedures were effective.

 

The Company does not control the financial reporting process, and is solely dependent on the Management of the Managing Member, who is responsible for providing the Company with financial statements in accordance with generally accepted accounting principles in the United States. The Managing Member’s disclosure controls and procedures, as they are applicable to the Company, means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Act (15 U.S.C. 78a et seq.) is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Changes in internal control

There were no changes in the Managing Member’s internal control over financial reporting, as it is applicable to the Company, during the quarter ended March 31, 2019 that have materially affected, or are reasonably likely to materially affect, the Managing Member’s internal control over financial reporting, as it is applicable to the Company.

19


 

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

In the ordinary course of conducting business, there may be certain claims, suits, and complaints filed against the Company. In the opinion of management, the outcome of such matters, if any, will not have a material impact on the Company’s financial position or results of operations. No material legal proceedings are currently pending against the Company or against any of its assets.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

 

Item 3. Defaults Upon Senior Securities.

None.

 

Item 4. Mine Safety Disclosures.

Not Applicable.

 

Item 5. Other Information.

None.

 

Item 6. Exhibits.

Documents filed as a part of this report:

1.       Financial Statement Schedules

All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore have been omitted.

2.       Other Exhibits

 

31.1

Certification of Dean L. Cash

31.2

Certification of Paritosh K. Choksi

32.1

Certification Pursuant to 18 U.S.C. section 1350 of Dean L. Cash

32.2

Certification Pursuant to 18 U.S.C. section 1350 of Paritosh K. Choksi

101.INS

XBRL Instance Document

101.SCH

XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB

XBRL Taxonomy Extension Label Linkbase Document

101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

 

20


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: May 10, 2019

ATEL CAPITAL EQUIPMENT FUND IX, LLC

(Registrant)

 

 

By:

ATEL Financial Services, LLC

 

 

 

Managing Member of Registrant

By:

/s/ Dean L. Cash

 

 

 

Dean L. Cash

 

 

 

President and Chief Executive Officer of ATEL Financial Services, LLC (Managing Member)

 

 

 

 

 

 

 

 

 

 

By:

/s/ Paritosh K. Choksi

 

 

 

Paritosh K. Choksi

 

 

 

Executive Vice President and Chief Financial Officer and Chief Operating Officer of ATEL Financial Services, LLC (Managing Member)

 

 

 

 

 

 

 

 

 

 

By:

/s/ Samuel Schussler

 

 

 

Samuel Schussler

 

 

 

Senior Vice President and Chief Accounting Officer of ATEL Financial Services, LLC (Managing Member)

 

 

 

 

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