Form 10-Q

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, A6obnpmvwQQ4iPgbId1opSiEn+MAL7F6yPFMTKMHIeYK6Tk1J82JJ4q0dhpnCr78 LQT6+4264QmTs/VuLg5BPw== 0001193125-08-178163.txt : 20080814 0001193125-08-178163.hdr.sgml : 20080814 20080814145632 ACCESSION NUMBER: 0001193125-08-178163 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20080630 FILED AS OF DATE: 20080814 DATE AS OF CHANGE: 20080814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATEL CAPITAL EQUIPMENT FUND X LLC CENTRAL INDEX KEY: 0001186258 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-EQUIPMENT RENTAL & LEASING, NEC [7359] IRS NUMBER: 680517690 STATE OF INCORPORATION: CA FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-50687 FILM NUMBER: 081018093 BUSINESS ADDRESS: STREET 1: 600 CALIFORNIA ST STREET 2: 6TH FLOOR CITY: SAN FRANCISCO STATE: CA ZIP: 94108 BUSINESS PHONE: 4159898800 MAIL ADDRESS: STREET 1: 600 CALIFORNIA ST STREET 2: 6TH FLOOR CITY: SAN FRANCISCO STATE: CA ZIP: 94108 10-Q 1 d10q.htm FORM 10-Q Form 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

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

For the quarterly period ended June 30, 2008

¨	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 000-50687

ATEL Capital Equipment Fund X, LLC

(Exact name of registrant as specified in its charter)

California

68-0517690

(State or other jurisdiction of

Incorporation or organization)

(I. R. S. Employer

Identification No.)

600 California Street, 6th Floor, San Francisco, California 94108-2733

(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

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 x 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 x
	(Do not check if smaller reporting company)

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

The number of Limited Liability Company Units outstanding as of July 31, 2008 was 13,975,486.

DOCUMENTS INCORPORATED BY REFERENCE

None.

ATEL CAPITAL EQUIPMENT FUND X, LLC

Index


Part I.	Financial Information	3

Item 1.	Financial Statements (Unaudited)	3

	Balance Sheets, June 30, 2008 and December 31, 2007	3

	Statements of Operations for the three and six months ended June 30, 2008 and 2007	4

	Statements of Changes in Members’ Capital for the year ended December 31, 2007 and for the six months ended June 30, 2008	5

	Statements of Cash Flows for the three and six months ended June 30, 2008 and 2007	6

	Notes to the Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

Item 4.	Controls and Procedures	28

Part II.	Other Information	29

Item 1.	Legal Proceedings	29

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29

Item 3.	Defaults Upon Senior Securities	29

Item 4.	Submission of Matters to a Vote of Security Holders	29

Item 5.	Other Information	29

Item 6.	Exhibits	29

	EXHIBIT 31.1

	EXHIBIT 31.2

	EXHIBIT 32.1

	EXHIBIT 32.2

Part I. FINANCIAL INFORMATION

Item 1.

Financial Statements (Unaudited).

ATEL CAPITAL EQUIPMENT FUND X, LLC

BALANCE SHEETS

JUNE 30, 2008 AND DECEMBER 31, 2007

(In Thousands)


	June 30, 2008		December 31, 2007
	(Unaudited)
ASSETS
Cash and cash equivalents	$	3,922	$	5,951
Accounts receivable, net of allowance for doubtful accounts of $35 at June 30, 2008 and $43 at December 31, 2007		1,913		1,182
Notes receivable, net of unearned interest income of $1,132 at June 30, 2008 and $1,441 at December 31, 2007		6,570		7,947
Prepaid expenses and other assets		63		126
Investment in securities		388		433
Investments in equipment and leases, net of accumulated depreciation of $47,911 at June 30, 2008 and $37,773 at December 31, 2007		107,364		89,669

Total assets	$	120,220	$	105,308

LIABILITIES AND MEMBERS’ CAPITAL
Accounts payable and accrued liabilities:
Managing Member	$	243	$	145
Accrued distributions to Other Members		1,313		1,314
Affiliates		—		146
Other		1,171		1,872
Accrued interest payable		74		48
Interest rate swap contracts		369		464
Deposits due lessees		109		111
Acquisition facility obligation		—		2,500
Receivables funding program obligation		47,491		22,013
Unearned operating lease income		1,710		1,881

Total liabilities		52,480		30,494

Commitments and contingencies
Members’ capital:
Managing Member		—		—
Other Members		67,740		74,814

Total Members’ capital		67,740		74,814

Total liabilities and Members’ capital	$	120,220	$	105,308

See accompanying notes.

ATEL CAPITAL EQUIPMENT FUND X, LLC

STATEMENTS OF OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED

JUNE 30, 2008 AND 2007

(In Thousands, Except for Units and Per Unit Data)

(Unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2008			2007			2008			2007
Revenues:
Leasing activities:
Operating leases	$	6,419		$	5,000		$	12,348		$	9,891
Direct financing leases		46			20			61			44
Interest on notes receivable		185			244			393			502
Gain on sales of assets and early termination of notes		23			76			23			232
Gain on sales of securities		13			—			27			9
Other interest		49			29			92			72
Other		6			2			12			21

Total revenues		6,741			5,371			12,956			10,771
Expenses:
Depreciation of operating lease assets		5,286			4,156			10,190			8,167
Asset management fees to Managing Member		261			221			515			436
Acquisition expense		418			212			880			420
Cost reimbursements to Managing Member		202			394			541			763
Amortization of initial direct costs		103			88			203			177
Interest expense		632			333			1,113			583
Provision (reversal of provision) for losses and doubtful accounts		20			(83	)		43			(19	)
Professional fees		164			258			350			711
Franchise fees and taxes		(5	)		69			5			69
Outside services		26			189			49			470
Other		94			33			188			91

Total operating expenses		7,201			5,870			14,077			11,868
Other income, net		782			148			157			81

Net income (loss)	$	322		$	(351	)	$	(964	)	$	(1,016	)

Net income (loss):
Managing Member	$	227		$	227		$	454		$	454
Other Members		95			(578	)		(1,418	)		(1,470	)

	$	322		$	(351	)	$	(964	)	$	(1,016	)

Net income (loss) per Limited Liability Company Unit (Other Members)	$	0.01		$	(0.04	)	$	(0.10	)	$	(0.11	)
Weighted average number of Units outstanding		13,975,486			13,987,486			13,978,343			13,987,486

See accompanying notes.

ATEL CAPITAL EQUIPMENT FUND X, LLC

STATEMENTS OF CHANGES IN MEMBERS’ CAPITAL

FOR THE YEAR ENDED DECEMBER 31, 2007

AND FOR THE SIX MONTHS

ENDED JUNE 30, 2008

(In Thousands, Except for Units and Per Unit Data)

(Unaudited)


	Other Members					Managing Member			Total
	Units		Amount			Managing Member			Total
Balance December 31, 2006	13,987,486		$	88,458		$	—		$	88,458
Rescissions of capital contributions	(2,000	)		(13	)		—			(13	)
Distributions to Other Members ($0.80 per Unit)	—			(11,188	)		—			(11,188	)
Distributions to Managing Member	—			—			(907	)		(907	)
Net (loss) income	—			(2,443	)		907			(1,536	)

Balance December 31, 2007	13,985,486			74,814			—			74,814
Rescissions of capital contributions	(10,000	)		(74	)		—			(74	)
Syndication costs allocation adjustment	—			8			—			8
Distributions to Other Members ($0.40 per Unit)	—			(5,590	)		—			(5,590	)
Distributions to Managing Member	—			—			(454	)		(454	)
Net (loss) income	—			(1,418	)		454			(964	)

Balance June 30, 2008	13,975,486		$	67,740		$	—		$	67,740

See accompanying notes.

ATEL CAPITAL EQUIPMENT FUND X, LLC

STATEMENTS OF CASH FLOWS

FOR THE THREE AND SIX MONTHS ENDED

JUNE 30, 2008 AND 2007

(In Thousands)

(Unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2008			2007			2008			2007
Operating activities:
Net income (loss)	$	322		$	(351	)	$	(964	)	$	(1,016	)
Adjustment to reconcile net income (loss) to cash provided by operating activities:
Gain on sales of lease assets and early termination of notes		(23	)		(76	)		(23	)		(232	)
Depreciation of operating lease assets		5,286			4,156			10,190			8,167
Amortization of initial direct costs		103			88			203			177
Amortization of unearned income on direct finance leases		(46	)		(20	)		(61	)		(44	)
Amortization of unearned income on notes receivable		(185	)		(248	)		(393	)		(506	)
Provision (reversal of provision) for losses and doubtful accounts		20			(83	)		43			(19	)
Gain on interest rate swap contracts		(726	)		(78	)		(95	)		(13	)
Gain on sale of securities		(13	)		—			(27	)		(9	)
Changes in operating assets and liabilities:
Accounts receivable		(480	)		(351	)		(774	)		(336	)
Prepaid expenses and other assets		24			(10	)		63			8
Accounts payable, Managing Member		(167	)		(173	)		98			3
Accounts payable, other		(1,034	)		269			(848	)		(1,867	)
Accrued interest payable		23			16			26			15
Deposits due lessees		—			—			(2	)		—
Unearned operating lease income		(32	)		12			(171	)		(88	)

Net cash provided by operating activities		3,072			3,151			7,265			4,240

Investing activities:
Purchases of equipment on operating leases		(11,794	)		(3,857	)		(22,680	)		(10,582	)
Purchases of equipment under direct finance leases		(5,491	)		—			(5,563	)		—
Proceeds from sales of lease assets		304			283			391			1,670
Payments of initial direct costs		(92	)		(54	)		(154	)		(198	)
Payments received on direct finance leases		238			145			361			303
Notes receivable advances		(125	)		(79	)		(250	)		(921	)
Purchase of investment securities		—			(63	)		—			(63	)
Proceeds from sale of investment securities		58			—			72			9
Payments received on notes receivable		854			963			1,661			1,952

Net cash used in investing activities		(16,048	)		(2,662	)		(26,162	)		(7,830	)

Financing activities:
Borrowings under acquisition facility		6,250			5,000			10,250			10,000
Repayments under acquisition facility		(6,250	)		(500	)		(12,750	)		(13,000	)
Borrowings under receivables funding program		15,664			—			31,092			12,365
Repayments under receivables funding program		(3,286	)		(885	)		(5,614	)		(1,388	)
Rescissions of capital contributions		—			—			(74	)		—
Syndication costs refunded to Managing Member		8			—			8			—
Distributions to Other Members		(2,795	)		(2,797	)		(5,590	)		(5,594	)
Distributions to Managing Member		(227	)		(227	)		(454	)		(454	)

Net cash provided by financing activities		9,364			591			16,868			1,929

Net (decrease) increase in cash and cash equivalents		(3,612	)		1,080			(2,029	)		(1,661	)
Cash and cash equivalents at beginning of period		7,534			3,216			5,951			5,957

Cash and cash equivalents at end of period	$	3,922		$	4,296		$	3,922		$	4,296

Supplemental disclosures of cash flow information:
Cash paid during the period for interest	$	609		$	344		$	1,087		$	587

Cash paid during the period for taxes	$	51		$	69		$	61		$	69

Schedule of non-cash transactions:
Distributions declared and payable to Managing Member at period-end	$	106		$	107		$	106		$	107

Distributions declared and payable to Other Members at period-end	$	1,313		$	1,314		$	1,313		$	1,314

See accompanying notes.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

1. Organization and Limited Liability Company matters:

ATEL Capital Equipment Fund X, LLC (the “Company”) was formed under the laws of the State of California on August 12, 2002 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 of the Company is ATEL Financial Services, LLC (“AFS”), a California limited liability company. The Company may continue until December 31, 2021.

The Company conducted a public offering of 15,000,000 Limited Liability Company Units (“Units”), at a price of $10 per Unit. On April 9, 2003, subscriptions for the minimum number of Units (120,000, representing $1.2 million) had been received (excluding subscriptions from Pennsylvania investors) and AFS requested that the subscriptions be released to the Company. On that date, the Company commenced operations in its primary business (acquiring equipment to engage in equipment leasing, lending and sales activities).

As of March 11, 2005, the offering was terminated. As of that date, subscriptions for 14,059,136 Units ($140.6 million) had been received, of which 83,650 Units ($720 thousand) were rescinded or repurchased by the Company through June 30, 2008. As of June 30, 2008, 13,975,486 Units were issued and outstanding.

Pursuant to the terms of the Limited Liability Company Operating Agreement (“Operating Agreement”), AFS receives compensation and reimbursements for services rendered on behalf of the Company (Note 5). AFS is required to maintain in the Company reasonable cash reserves for working capital, the repurchase of Units and contingencies. The repurchase of Units is solely at the discretion of the Managing Member.

The Company, or AFS on behalf of the Company, has incurred costs in connection with the organization, registration and issuance of the Limited Liability Company Units (Note 5). The amount of such costs to be borne by the Company is limited by certain provisions of the Company’s Operating Agreement. The Company will pay AFS and affiliates of AFS substantial fees which may result in a conflict of interest. The Company will pay substantial fees to AFS and its affiliates before distributions are paid to investors even if the Company does not produce profits. Therefore, the financial position of the Company could change significantly.

The Company’s principal objectives are to invest in a diversified portfolio of equipment that (i) preserves, protects and returns the Company’s invested capital; (ii) generates regular distributions to the members of cash from operations and cash from sales or refinancing, with any balance remaining after certain minimum distributions to be used to purchase additional equipment during the reinvestment period (“Reinvestment Period”) (defined as six full years following the year the offering was terminated) which ends on December 31, 2011 and (iii) provides additional distributions following the Reinvestment Period and until all equipment has been sold. The Company is governed by the Operating Agreement, as amended.

2. Summary of significant accounting policies:

Basis of presentation:

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States, (“GAAP”) for interim financial information and with instructions to Form 10-Q and Article 8 of Regulation S-X. 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. The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that effect reported amounts in the financial statements and accompanying notes. Therefore, actual results could differ from those estimates. Operating results for the three and six months ended June 30, 2008 are not necessarily indicative of the results for the year ending December 31, 2008.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

2. Summary of significant accounting policies (continued):

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, 2007, filed with the Securities and Exchange Commission.

Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no effect on equity or net income.

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

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 determination of the allowances for doubtful accounts and notes receivable.

Initial direct costs:

The Company capitalizes initial direct costs (“IDC”) associated with the origination and funding of lease assets and investments in notes receivable as defined in Statement of Financial Accounting Standards (“SFAS”) No. 91 (“SFAS No. 91”) “Accounting for Nonrefundable Fees and Costs Associated with Originating or Acquiring Loans and Initial Direct Costs of Leases.” IDC includes both internal costs (e.g., the costs of employees’ activities in connection with successful lease and loan originations) and external broker fees incurred with such originations. The costs are amortized on a lease by lease (or note by note) basis based on actual contract term using a straight-line method for operating leases and the effective interest rate method for direct finance leases and notes receivable. Upon disposal of the underlying lease and loan assets, both the initial direct costs and the associated accumulated amortization are relieved. Costs related to leases or notes receivable that are not consummated are not eligible for capitalization as initial direct costs and are expensed as acquisition expense.

Segment reporting:

The Company reports segment information in accordance with SFAS No. 131 “Disclosures about Segments of an Enterprise and Related Information.” SFAS No. 131 establishes annual and interim standards for operating segments of a company. It also requires entity-wide disclosures about the products and services an entity provides, the material countries in which it holds assets and reports revenue, and its major customers. 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 Company’s principal decision makers are the Managing Member’s Chief Executive Officer and its Chief Operating Officer. The Company believes that its equipment leasing business operates as one reportable segment because: a) the Company measures profit and loss at the equipment portfolio level as a whole; b) the principal decision makers do not review information based on any operating segment other than the equipment leasing transaction portfolio; c) the Company does not maintain discrete financial information on any specific segment other than its equipment financing operations; d) the Company has not chosen to organize its business around different products and services other than equipment lease financing; and e) the Company has not chosen to organize its business around geographic areas.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

2. Summary of significant accounting policies (continued):

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 six months ended June 30, 2008 and 2007 and long-lived tangible assets as of June 30, 2008 and December 31, 2007 (in thousands):


	For the six months ended June 30,
	2008		% of Total		2007		% of Total
Revenue:
United States	$	11,861	91	%	$	9,663	90	%

United Kingdom		986	8	%		986	9	%
Canada		109	1	%		122	1	%

Total International		1,095	9	%		1,108	10	%

Total	$	12,956	100	%	$	10,771	100	%


	As of June 30,				As of December 31,
	2008		% of Total		2007		% of Total
Long-lived tangible assets:
United States	$	101,499	95	%	$	83,009	93	%

United Kingdom		5,865	5	%		6,660	7	%

Total International		5,865	5	%		6,660	7	%

Total	$	107,364	100	%	$	89,669	100	%

Foreign currency transactions:

Foreign currency transaction gains and losses are reported in the results of operations as other income in the period in which they occur. Currently, the Company does not use derivative instruments to hedge its economic exposure with respect to assets, liabilities and firm commitments as the foreign currency transactions and risks to date have not been significant. The Company recognized net foreign currency gains of $56 thousand and $70 thousand for the respective three months ended June 30, 2008 and 2007; and net foreign currency gains of $62 thousand and $68 thousand for the respective six months ended June 30, 2008 and 2007.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

2. Summary of significant accounting policies (continued):

Investment in securities

Purchased securities

Purchased securities are not registered for public sale and are carried at cost. Securities are adjusted to fair value if the carrying value is less than fair value and such impairment is deemed by the Managing Member to be other than temporary. The Company utilizes quoted market prices to value its investments in publicly traded borrowers, and uses the borrowers’ subsequent private placements, on a per share basis, to estimate the fair value of its investments in non-publicly traded borrowers. Such determination of fair value may be adjusted pursuant to other factors which include, but are not limited to, available financial information, the terms and condition of subsequent placements, the issuer’s ability to meet its current obligations and indications of the issuer’s subsequent ability to raise capital. The Managing Member’s estimate and assumption of fair value of the private securities may differ significantly from the values that would have been used had a ready market existed, and the differences could be material. Purchased securities in publicly traded borrowers are carried at fair value. See note 11 for further discussion.

Warrants

Warrants owned by the Company are not registered for public sale, but are considered derivatives and are carried at an estimated fair value on the balance sheet at the end of the period, as determined by the Managing Member. The fair values of the warrants are determined based either upon the Black-Scholes pricing model for warrants with borrowers who are in S-1 registration with industry recognized investment bankers, or the price per share of subsequent private placements. Such determination of fair value may be adjusted pursuant to other factors which include, but are not limited to, available financial information, the terms and condition of subsequent placements, the issuer’s ability to meet its current obligations and indications of the issuer’s subsequent ability to raise capital. The Managing Member’s estimate and assumption of fair value of the private securities may differ significantly from the values that would have been used had a ready market existed, and the differences could be material. At June 30, 2008 and December 31, 2007, the Managing Member estimated the fair value of the warrants to be nominal in amount. See note 11 for further discussion.

Other income, net:

The Company’s other income consists of the following (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2008		2007		2008		2007
Foreign currency gain	$	56	$	70	$	62	$	68
Change in fair value of interest rate swap contracts		726		78		95		13

	$	782	$	148	$	157	$	81

Per Unit data:

Net income (loss) and distributions per Unit are based upon the weighted average number of Other Members’ Units outstanding during the period.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

2. Summary of significant accounting policies (continued):

Recent accounting pronouncements:

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities” (“SFAS 161”), as an amendment to SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities.” SFAS 161 requires that objectives for using derivative instruments be disclosed in terms of underlying risk and accounting designation. The fair value of derivative instruments and their gains and losses will need to be presented in tabular format in order to present a more complete picture of the effects of using derivative instruments. SFAS 161 is effective for financial statements issued for fiscal years beginning after November 15, 2008. The Company is currently evaluating the impact of adopting this pronouncement.

In December 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 141R, “Business Combinations” (“SFAS 141R”). SFAS 141R replaces SFAS 141 and establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non controlling interest in the acquiree and the goodwill acquired. SFAS 141R also establishes disclosure requirements which will enable users to evaluate the nature and financial effects of the business combination. This standard is effective for fiscal years beginning after December 15, 2008. The Company does not presently anticipate the adoption of SFAS 141R to significantly impact its financial position, results of operations or cash flows.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities—including an amendment of FASB Statement No. 115” (“SFAS 159”). This Statement permits entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This Statement is expected to expand the use of fair value measurement, which is consistent with the Board’s long-term measurement objectives for accounting for financial instruments. The Company adopted the provisions of SFAS 159 on January 1, 2008. The adoption of SFAS 159 did not have a significant effect on the Company’s financial position, results of operations or cash flows.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS 157”). This standard clarifies the definition of fair value for financial reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements. The provisions of SFAS 157 were to be effective for fiscal years beginning after November 15, 2007. However, in February 2008, the FASB issued FASB Staff Position (“FSP”) No. 157-2, which defers the effective date of SFAS 157 as it pertains to fair value measurements of nonfinancial assets and nonfinancial liabilities until fiscal years beginning after November 15, 2008. On January 1, 2008, the Company adopted the provisions of SFAS 157 except as it applied to its investment in equipment and leases, and other nonfinancial assets and nonfinancial liabilities as noted in FSP No. 157-2. The partial adoption of SFAS 157 did not have a significant effect on the Company’s financial position, results of operations or cash flows.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

3. Notes receivable, net:

The Company has various notes receivable from borrowers who have financed the purchase of equipment through the Company. The terms of the notes receivable are 24 to 120 months and bear interest at rates ranging from 9% to 17%. The notes are secured by the equipment financed. At June 30, 2008, the Company established a $52 thousand reserve for impairment losses related to two notes receivable. There were no impaired notes at December 31, 2007.

As of June 30, 2008, the minimum future payments receivable are as follows (in thousands):


Six months ending December 31, 2008	$	1,330
Year ending December 31, 2009		3,451
2010		1,241
2011		452
2012		393
2013		295
Thereafter		575

		7,737
Less: portion representing unearned interest income		(1,132	)

		6,605
Unamortized indirect costs		17
Less: reserve for impairment		(52	)

Notes receivable, net	$	6,570

IDC amortization expense related to notes receivable and the Company’s operating and direct finance leases for the three and six months ended June 30, 2008 and 2007 are as follows (in thousands):


	Three months ended June 30,				Six months ended June 30,
	2008		2007		2008		2007
IDC amortization - notes receivable	$	5	$	8	$	12	$	22
IDC amortization - lease assets		98		80		191		155

Total	$	103	$	88	$	203	$	177

4. Investment in equipment and leases, net:

The Company’s investment in equipment leases consists of the following (in thousands):


	Balance December 31, 2007		Reclassifications & Additions / Dispositions		Depreciation/ Amortization Expense or Amortization of Leases			Balance June 30, 2008
Net investment in operating leases	$	87,569	$	22,211	$	(10,190	)	$	99,590
Net investment in direct financing leases		1,107		5,995		(299	)		6,803
Assets held for sale or lease, net		—		14		—			14
Initial direct costs, net of accumulated amortization of $847 at June 30, 2008 and $680 at December 31, 2007		993		155		(191	)		957

Total	$	89,669	$	28,375	$	(10,680	)	$	107,364

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

4. Investment in equipment and leases, net (continued):

Additions to net investment in operating leases are stated at cost and include amounts accrued at June 30, 2008 related to asset purchase obligations.

Impairment of investments in leases and assets held for sale or lease:

Management periodically reviews the carrying values of its assets on leases and assets held for lease or sale. Impairment losses are recorded as an adjustment to the net investment in operating leases. No impairment losses were recorded for the three and six months ended June 30, 2008 and 2007. Depreciation expense on property subject to operating leases and property held for lease or sale was $5.3 million and $4.2 million for the respective three months ended June 30, 2008 and 2007; and $10.2 million and $8.2 million for the respective six months ended June 30, 2008 and 2007.

All of the leased property was acquired in years beginning with 2003 through 2008.

Operating leases:

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


	Balance December 31, 2007			Additions			Reclassifications or Dispositions			Balance June 30, 2008
Material handling	$	35,105		$	—		$	6,841		$	41,946
Transportation, rail		21,176			10,831			(10,878	)		21,129
Transportation, other		19,243			8,486			2,345			30,074
Mining		18,468			624			(2,432	)		16,660
Manufacturing		12,228			—			295			12,523
Construction		10,461			824			53			11,338
Logging & lumber		4,728			97			(97	)		4,728
Aircraft		3,026			206			(206	)		3,026
Furniture & fixtures		320			—			(320	)		—
Petro/natural gas		309			—			2,137			2,446
Data processing		279			—			658			937
Other		—			1,613			1,050			2,663

		125,343			22,681			(554	)		147,470
Less accumulated depreciation		(37,774	)		(10,190	)		84			(47,880	)

Total	$	87,569		$	12,491		$	(470	)	$	99,590

The average estimated residual value for assets on operating leases was 23% of the assets’ original cost at June 30, 2008 and December 31, 2007.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

4. Investment in equipment and leases, net (continued):

Direct financing leases:

As of June 30, 2008, investment in direct financing leases consists of railcars, manufacturing and material handling equipment. The following lists the components of the Company’s investment in direct financing leases as of June 30, 2008 and December 31, 2007 (in thousands):


	June 30, 2008			December 31, 2007
Total minimum lease payments receivable	$	4,137		$	890
Estimated residual values of leased equipment (unguaranteed)		3,134			288

Investment in direct financing leases		7,271			1,178
Less unearned income		(468	)		(71	)

Net investment in direct financing leases	$	6,803		$	1,107

At June 30, 2008, the aggregate amounts of future minimum lease payments receivable are as follows (in thousands):


	Operating Leases		Direct Financing Leases		Total
Six months ending December 31, 2008	$	14,047	$	751	$	14,798
Year ending December 31, 2009		23,412		1,408		24,820
2010		17,120		1,008		18,128
2011		10,291		623		10,914
2012		6,962		279		7,241
2013		4,402		68		4,470
Thereafter		2,561		—		2,561

	$	78,795	$	4,137	$	82,932

The Company utilizes a straight line depreciation method for equipment in all of the categories currently in its portfolio of lease transactions. The useful lives for investment in leases by category are as follows (in years):


Equipment category		Useful Life
Mining		30 - 40
Transportation, rail		30 - 35
Aircraft		20 - 30
Manufacturing		10 - 20
Construction		7 - 10
Logging & lumber		7 - 10
Material handling		7 - 10
Petro/natural gas		7 - 10
Transportation, other		7 - 10
Data processing		3 - 5
Furniture & fixtures		3 - 5

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

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. Reimbursable costs incurred by AFS are allocated to the Company based upon estimated time incurred by employees working on Company business and an allocation of rent and other costs based on utilization studies. 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”), ATEL Equipment Corporation (“AEC”), ATEL Investor Services (“AIS”), and AFS is a wholly-owned subsidiary of ATEL Capital Group and performs services for the Company. Acquisition services are performed for the Company by ALC; equipment management, lease administration and asset disposition services are performed by AEC; investor relations and communications services are performed by AIS; 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 total assets, number of investors or contributed capital based upon the type of cost incurred.

During the three and six months ended June 30, 2008 and 2007, AFS and/or affiliates earned fees, commissions and reimbursements, pursuant to the Operating Agreement as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2008		2007		2008		2007
Costs reimbursed to Managing Member and/or affiliates	$	202	$	394	$	541	$	763
Asset management fees to Managing Member and/or affiliates		261		221		515		436
Acquisition and initial direct costs paid to Managing Member		478		257		996		608

	$	941	$	872	$	2,052	$	1,807

6. Borrowing facilities:

The Company participates with AFS and certain of its affiliates in a financing arrangement ((the “Master Terms Agreement”) comprised of a working capital facility to AFS, an acquisition facility and a warehouse facility to AFS, the Company and affiliates, and a venture facility available to an affiliate) with a group of financial institutions that includes certain financial and non-financial covenants. The financial arrangement was originally $75 million and expired on June 28, 2007. The facility was renewed for an additional two years with an availability of $65 million pending redefinition of the lender base. On July 28, 2007, with a redefinition of the lender base, the facility was amended to reset availability to $75 million. The arrangement expires in June 2009.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

6. Borrowing facilities (continued):

As of June 30, 2008 and December 31, 2007, borrowings under the facility were as follows (in thousands):


	June 30, 2008			December 31, 2007
Total amount available under the financing arrangement	$	75,000		$	75,000
Amount borrowed by the Company under the acquisition facility		—			(2,500	)
Amounts borrowed by affiliated partnerships and Limited Liability Companies under the acquisition facility		(3,510	)		(6,125	)

Total remaining available under the acquisition and warehouse facilities	$	71,490		$	66,375

The interest rate on the Master Terms Agreement is based on either the LIBOR/Eurocurrency rate of 1-, 2-, 3- or 6-month maturity plus a lender designated spread, or the bank’s Prime rate, which re-prices daily. Principal amounts of loans made under the Master Terms Agreement that are prepaid may be re-borrowed on the terms and subject to the conditions set forth under the Master Terms Agreement. The entire amount of outstanding borrowings under the acquisition facility was repaid by June 30, 2008. During the three and six months ended June 30, 2008, the weighted average interest rate on borrowings were 5.2% and 4.9%, respectively. These rates compare to weighted average interest rates of 6.5% and 6.7% for the respective three and six months ended June 30, 2007. At December 31, 2007, the effective interest rate on borrowings ranged from 6.22% to 7.25%. During the fiscal year ended December 31, 2007, the weighted average interest rate on borrowings was 5.74%.

Draws on the acquisition facility by any affiliated partnership and/or limited liability company borrower are secured only by that borrower’s assets, including but not limited to equipment and related leases. The Company is contingently liable for principal payments under the warehouse facility as borrowings are recourse jointly and severally to the extent of the pro-rata share of the Company’s net worth as compared to the aggregate net worth of certain of the affiliated partnerships and limited liability companies of the Company and including AFS and ALC (which latter two entities are 100% liable). The Company and its affiliates pay an annual commitment fee to have access to this line of credit. There were no borrowings under the warehouse facility as of June 30, 2008 and December 31, 2007.

To manage the warehousing facility for the holding of assets prior to allocation to specific investor programs, a Warehousing Trust Agreement has been entered into by the Company, AFS, ALC, and certain of the affiliated partnerships and limited liability companies. The warehousing facility is used to acquire and hold, on a short-term basis, certain lease transactions that meet the investment objectives of each of such entities. Each of the leasing programs sponsored by AFS and ALC currently in its acquisition stage is a pro rata participant in the Warehousing Trust Agreement, as described below. When a program no longer has a need for short term financing provided by the warehousing facility, it is removed from participation, and as new leasing investment entities are formed by AFS and ALC and commence their acquisition stages, these new entities will be added. As of June 30, 2008, the investment program participants were ATEL Capital Equipment Fund IX, LLC, the Company, ATEL Capital Equipment Fund XI, LLC and ATEL 12, LLC. Pursuant to the Warehousing Trust Agreement, the benefit of the lease transaction assets, and the corresponding liabilities under the warehouse borrowing facility, inure to each of such entities based upon each entity’s pro-rata share in the warehousing trust estate. The “pro-rata share” is calculated as a ratio of the net worth of each entity over the aggregate net worth of all entities benefiting from the warehouse trust estate, excepting that the trustees, AFS and ALC, are both liable for their pro-rata shares of the obligations based on their respective net worth, and jointly liable for the pro rata portion of the obligations of each of the affiliated partnerships and limited liability companies participating under the borrowing facility. Transactions are financed through this warehousing facility only until the transactions are allocated to a specific program for purchase or are otherwise disposed by AFS and ALC. When a determination is made to allocate the transaction to a specific program for purchase by the program, the purchaser repays the debt associated with the asset, either with cash or by means of the acquisition facility financing, the asset is removed from the warehouse facility collateral, and ownership of the asset and any debt obligation associated with the asset are assumed solely by the purchasing entity.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

6. Borrowing facilities (continued):

As of June 30, 2008, the full amount remaining available under the joint acquisition and warehouse facility is potentially available to the Company. However, as amounts are drawn on the facility by each of the Company and the affiliates who are borrowers under the facility, the amount available to all is reduced. As the warehousing facility is a short term bridge facility, any amounts borrowed under the warehousing facility, and then repaid by the affiliated borrowers (including the Company) upon allocation of an acquisition to a specific purchaser, become available under the warehouse facility for further short term borrowing.

Under the terms of the acquisition facility agreement, ATEL 12, LLC may only participate once its tangible net worth, as therein defined, equals or exceeds $15 million.

The financing arrangement discussed above includes certain financial and non-financial covenants applicable to each borrower. The Company and affiliates were in compliance with all covenants as of June 30, 2008. The financial institutions providing the above discussed financing arrangement have a blanket lien on the Company’s assets as collateral on any and all borrowings.

7. Receivables funding program:

In July 2006, the Company established a receivables funding program (“Program”) with a receivables financing company that issues commercial paper rated A1 from Standard and Poor’s and P1 from Moody’s Investor Services. The Program amount is currently $80 million. Prior to October 17, 2007, the Program amount was $100 million. Under the Program, the lenders would receive liens against the Company’s assets. Under the terms of the Program, the lender will be in a first position against certain specified assets and will be in either a subordinated or shared position against the remaining assets. The Program expires in July 2014.

The Program provides for borrowing at a variable interest rate and requires AFS, on behalf of the Company, to enter into interest rate swap agreements with certain hedge counterparties (also rated A1/P1) to mitigate the interest rate risk associated with a variable interest rate note. The program allows the Company to have a more cost effective means of obtaining debt financing than available for individual non-recourse debt transactions.

The Company had approximately $47.5 million and $22.0 million outstanding under this Program at June 30, 2008 and December 31, 2007, respectively. During the three months ended June 30, 2008 and 2007, the Company paid program fees, as defined in the receivables funding agreement, totaling $66 thousand and $78 thousand, respectively. During the six months ended June 30, 2008 and 2007, such fees totaled $128 thousand and $155 thousand, respectively. The program fees are included in interest expense in the Company’s statement of operations.

As of June 30, 2008, the Company has entered into interest rate swap agreements to receive or pay interest on a notional principal of $47.5 million based on the difference between nominal rates ranging from 3.21% to 5.39% and variable rates that ranged from 2.48% to 4.95% under the Program. As of December 31, 2007, the Company has entered into interest rate swap agreements to receive or pay interest on a notional principal of $22.0 million based on the difference between nominal rates ranging from 4.83% to 5.39% and variable rates that ranged from 5.57% to 6.19% under the Program. No actual borrowing or lending is involved. The termination of the swaps coincides with the maturity of the debt. Through the swap agreements, the interest rates have been effectively fixed. The differential to be paid or received is accrued as interest rates change and is recognized currently as an adjustment to interest expense related to the debt. The interest rate swaps are carried at fair value on the balance sheet with unrealized gain/loss included in the statement of operations in other income/(loss).

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

7. Receivables funding program (continued):

Borrowings under the Program are as follows (in thousands):


Date Borrowed	Original Amount Borrowed		Balance June 30, 2008		Notional Balance June 30, 2008		Swap Value June 30, 2008			Payment Rate on Interest Swap Agreement
January 16, 2007	$	12,365	$	8,191	$	8,191	$	(218	)	5.15	%
July 2, 2007		7,222		4,626		4,626		(127	)	5.39	%
September 19, 2007		6,874		5,718		5,718		(131	)	4.83	%
January 15, 2008		10,018		8,411		8,411		(3	)	3.58	%
March 27, 2008		5,410		5,201		5,201		102		3.21	%
May 16, 2008		10,194		10,031		10,031		8		3.69	%
May 28, 2008		5,470		5,313		5,313		—		3.49	%

	$	57,553	$	47,491	$	47,491	$	(369	)


Date Borrowed	Original Amount Borrowed		Balance December 31, 2007		Notional Balance December 31, 2007		Swap Value December 31, 2007			Payment Rate on Interest Swap Agreement
January 16, 2007	$	12,365	$	9,611	$	9,611	$	(213	)	5.15	%
July 2, 2007		7,222		5,910		5,910		(131	)	5.39	%
September 19, 2007		6,874		6,492		6,492		(120	)	4.83	%

	$	26,461	$	22,013	$	22,013	$	(464	)

At June 30, 2008, the minimum repayment schedule under the accounts receivable funding program is as follows (in thousands):


Six Months Ending December 31, 2008	$	7,575
Year ending December 31, 2009		14,135
2010		11,258
2011		6,857
2012		4,358
2013		2,528
Thereafter		780

	$	47,491

At June 30, 2008, there are specific leases that are identified as collateral under the Program with expected future lease receivables of approximately $47.9 million at their discounted present value.

The weighted average interest rate on the Program was 4.0% and 8.4% during the respective three months ended June 30, 2008 and 2007; and 4.5% and 8.4% during the respective six months ended June 30, 2008 and 2007.

The Program discussed above includes certain financial and non-financial covenants applicable to each borrower. The Company and affiliates were in compliance with all covenants as of June 30, 2008.

On May 15, 2008 the Company provided its lender 30 day notice of acceleration of the expiration of the borrowing period under the Receivables Funding Agreement (the “RFA”) to June 15, 2008.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

7. Receivables funding program (continued):

On June 25, 2008 the Company and its lender executed Amendment No. 3 to the RFA. Under this amendment the parties changed their agreement regarding a concentration limitation threshold. This was as a result of a one-notch ratings downgrade of an investment grade lessee by one of the two national rating agencies. In addition, the Company agreed, in conjunction with the finalization of this amendment, to substitute other qualifying lessees for the above-referenced lessee in the RFA pool.

8. Commitments:

At June 30, 2008, there were commitments to purchase lease assets totaling approximately $14.0 million. This amount represents contract awards which may be cancelled by the prospective lessee or may not be accepted by the Company.

9. Guarantees:

The Company enters into contracts that contain a variety of indemnifications. The Company’s maximum exposure under these arrangements is unknown. However, the Company has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.

In the normal course of business, the Company enters into contracts of various types, including lease contracts, contracts for the sale or purchase of lease assets, management contracts, loan agreements, credit lines and other debt facilities. It is prevalent industry practice for most contracts of any significant value to include provisions that each of the contracting parties—in addition to assuming liability for breaches of the representations, warranties, and covenants that are part of the underlying contractual obligations—also assume an obligation to indemnify and hold the other contracting party harmless for such breaches, for harm caused by such party’s gross negligence and willful misconduct, including, in certain instances, certain costs and expenses arising from the contract. The Managing Member has substantial experience in managing similar leasing programs subject to similar contractual commitments in similar transactions, and the losses and claims arising from these commitments have been insignificant, if any. Generally, to the extent these contracts are performed in the ordinary course of business under the reasonable business judgment of the Managing Member, no liability will arise as a result of these provisions. The Managing Member has no reason to believe that the facts and circumstances relating to the Company’s contractual commitments differ from those it has entered into on behalf of the prior programs it has managed.

The Managing Member knows of no facts or circumstances that would make the Company’s contractual commitments outside standard mutual covenants applicable to commercial transactions between businesses. Accordingly, the Company believes that these indemnification obligations are made in the ordinary course of business as part of standard commercial and industry practice, and that any potential liability under the Company’s similar commitments is remote. Should any such indemnification obligation become payable, the Company would separately record and/or disclose such liability in accordance with GAAP.

10. Member’s capital:

Units issued and outstanding were 13,975,486 and 13,985,486 at June 30, 2008 and December 31, 2007, respectively. The Company was authorized to issue up to 15,000,000 Units in addition to the Units issued to the initial members (50 Units). The Company ceased offering Units on March 11, 2005.

As defined in the Operating Agreement, the Company’s net income, net losses, and distributions, are to be allocated 92.5% to the Other Members and 7.5% to AFS. In accordance with the terms of the Operating Agreement, additional allocations of income were made to AFS in 2007 and 2006. The amounts allocated were determined to bring AFS’s ending capital account balance to zero at the end of the period.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

10. Member’s capital (continued):

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


	Three Months Ended June 30,				Six Months Ended June 30,
	2008		2007		2008		2007
Distributions declared	$	2,795	$	2,797	$	5,590	$	5,594
Weighted average number of Units outstanding		13,975,486		13,987,486		13,978,343		13,987,486

Weighted average distributions per Unit	$	0.20	$	0.20	$	0.40	$	0.40

11. Fair value of financial instruments:

On January 1, 2008, the Company adopted SFAS 157, “Fair Value Measurements”. SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosure requirements for fair value measurements. The Company deferred the application of SFAS 157 for nonfinancial assets and nonfinancial liabilities as provided for by FSP No. 157-2, “Effective Date of FASB Statement No. 157”. Issued in February 2008, FSP No. 157-2 defers the effective date of SFAS 157 to fiscal years beginning after November 15, 2008, and interim periods within those fiscal years for nonfinancial assets and nonfinancial liabilities, except items that are recognized or disclosed at fair value in an entity’s financial statements on a recurring basis (at least annually).

SFAS 157 defines the term “fair value” as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability.

SFAS 157 established a fair value hierarchy that prioritizes the inputs used to measure fair value into three broad levels, considering the relative reliability of the inputs. The fair value hierarchy assigns the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of an input to the valuation that is significant to the fair value measurement.

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.

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.

Estimation of Fair Value

Fair value is based on quoted prices in an active market when available. In certain cases where a quoted price for an asset or liability is not available, the Company estimates the fair value based on various factors which include original cost, the type and risk characteristics of the asset or liability, expected cash flow and market volatilities. Such estimates of fair value cannot be determined with precision and may not be realized in an actual sale or transfer of the asset or liability in a current market exchange.

ATEL CAPITAL EQUIPMENT FUND X, LLC

NOTES TO FINANCIAL STATEMENTS

11. Fair value of financial instruments (continued):

The following is a description of the valuation methodologies used for certain assets and liabilities and the general classification of these instruments pursuant to the fair value hierarchy.

Purchased securities

The Company utilizes quoted market prices to value its investments in publicly traded borrowers, and uses the borrowers’ subsequent private placements, on a per share basis, to estimate the fair value of its investments in non-publicly traded borrowers. Such determination of fair value may be adjusted pursuant to other factors which include, but are not limited to, available financial information, the terms and conditions of subsequent placements, the issuer’s ability to meet its current obligations and indications of the issuer’s subsequent ability to raise capital.

Investments in shares of borrowers who have subsequently completed a public offering and are actively traded are classified as Level 1 instruments. Securities where fair value is based on subsequent private placements generally involve unobservable inputs that reflect management’s own assumptions and are classified as Level 3 instruments. At June 30, 2008, the carrying value of purchased securities approximates fair value.

Warrants

Warrants owned by the Company are not registered for public sale. The fair values of the warrants are determined based either upon the Black-Scholes pricing model for warrants with borrowers who are in S-1 registration with industry recognized investment bankers, or the price per share of subsequent private placements. Such determination of fair value may be adjusted pursuant to other factors which include, but are not limited to, available financial information, the terms and conditions of subsequent placements, the issuer’s ability to meet its current obligations and indications of the issuer’s subsequent ability to raise capital.

Warrants on shares of borrowers who are in S-1 registration are classified as Level 2 instruments. Warrants where fair value is based on subsequent private placements generally involve unobservable inputs that reflect management’s own assumptions and are classified as Level 3 instruments. At June 30, 2008 and December 31, 2007, the Managing Member estimated the fair value of the warrants to be nominal in amount.

Interest rate swaps

The fair value of interest rate swaps is the estimated amount that the Company would receive or pay to terminate the swap agreements at the reporting date, taking into account current interest rates and the current creditworthiness of the swap counterparties. Significant market inputs can be validated through external sources, including brokers, market transactions and third-party pricing services. These instruments fall within Level 2. At June 30, 2008 and December 31, 2007, the value of the Company’s interest rate swap contracts were $369 thousand and $464 thousand, respectively, and were recorded as liabilities on the Company’s balance sheet.

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 market 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 X, LLC (the “Company”) is a California limited liability company that was formed in August 2002 for the purpose of engaging in the sale of limited liability company investment units and acquiring equipment to generate revenues from equipment leasing 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.

The Company conducted a public offering of 15,000,000 Limited Liability Company Units (“Units”), at a price of $10 per Unit. The offering was terminated in March 2005. During 2005, the Company completed its initial acquisition stage with the investment of the net proceeds from the public offering of Units. Subsequently, during the reinvestment period (“Reinvestment Period”) (defined as six full years following the year the offering was terminated), the Company has utilized its credit facilities and reinvested cash flow in excess of certain amounts required to be distributed to the Other Members to acquire additional equipment. Throughout the Reinvestment Period, which ends December 31, 2011, the Company anticipates continued reinvestment of cash flow in excess of minimum distributions and other obligations.

The Company may continue until December 31, 2021. Periodic distributions are paid at the discretion of the Managing Member.

Capital Resources and Liquidity

The liquidity of the Company varies, increasing to the extent cash flows from leases and proceeds of asset sales exceed expenses and decreasing as lease assets are acquired, as distributions are made to the 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 the lease terms expire, the Company will re-lease or sell the equipment. The future liquidity beyond the contractual minimum rentals will depend on AFS’s success in remarketing or selling the equipment as it comes off rental.

The Company participates with AFS and certain of its affiliates, as defined in the Operating Agreement, in a financing arrangement ((the “Master Terms Agreement”) comprised of a working capital facility to AFS, an acquisition facility and a warehouse facility to AFS, the Company and affiliates, and a venture facility available to an affiliate) with a group of financial institutions that includes certain financial and non-financial covenants. The financial arrangement was originally $75 million and expired on June 28, 2007. The facility was renewed for an additional two years with an availability of $65 million pending redefinition of the lender base. On July 28, 2007, with a redefinition of the lender base, the facility was amended to reset availability to $75 million.

Borrowings under the financing arrangement as of June 30, 2008 were as follows:


Total amount available under the financing arrangement	$	75,000
Amount borrowed by the Company under the acquisition facility		—
Amounts borrowed by affiliated partnerships and Limited Liability Companies under the acquisition facility		(3,510	)

Total remaining available under the acquisition and warehouse facilities	$	71,490

The Company is contingently liable for principal payments under the warehouse facility as borrowings are recourse jointly and severally to the extent of the pro-rata share of the Company’s net worth as compared to the aggregate net worth of certain of the affiliated partnerships and limited liability companies of the Company and including AFS and ATEL Leasing Corporation (“ALC”) (which latter two entities are 100% liable). There were no borrowings under the warehouse facility at June 30, 2008. The Company and its affiliates pay an annual commitment fee to have access to this line of credit.

Under the terms of the acquisition facility agreement, ATEL 12, LLC may only participate once its tangible net worth, as therein defined, equals or exceeds $15 million.

amount is currently $80 million. Prior to October 17, 2007, the Program amount was $100 million. Under the Program, the lenders would receive liens against the Company’s assets. Under the terms of the Program, the lender will be in a first position against certain specified assets and will be in either a subordinated or shared position against the remaining assets. The Program provides for borrowing at a variable interest rate and requires AFS, on behalf of the Company, to enter into interest rate swap agreements with certain hedge counterparties (also rated A1/P1) to mitigate the interest rate risk associated with a variable interest rate note. The Program expires in July 2014. As more fully described in Note 7 to the financial statements, Receivables funding program, as set forth in Item 1, Financial Statements, the Company had $47.5 million outstanding under the Program as of June 30, 2008.

On May 15, 2008 the Company provided its lender 30 day notice of acceleration of the expiration of the borrowing period under the Receivables Funding Agreement (the “RFA”) to June 15, 2008.

Throughout the reinvestment period, the Company anticipates reinvesting a portion of lease payments from assets owned, and/or payments received on notes receivable, in new leasing or financing transactions. Such reinvestment will occur only after the payment of all current obligations including debt (both principal and interest), the payment of management and acquisition fees to AFS and providing for cash distributions to the members.

AFS or an affiliate may purchase equipment in its own name, the name of an affiliate or the name of a nominee, a trust or otherwise and hold title thereto on a temporary or interim basis for the purpose of facilitating the acquisition of such equipment or the completion of manufacture of the equipment or for any other purpose related to the business of the Company, provided, however that: (i) the transaction is in the best interest of the Company; (ii) such equipment is purchased by the Company for a purchase price no greater than the cost of such equipment to AFS or affiliate (including any out-of-pocket carrying costs), except for compensation permitted by the Operating Agreement; (iii) there is no difference in interest terms of the loans secured by the equipment at the time acquired by AFS or affiliate and the time acquired by the Company; (iv) there is no benefit arising out of such transaction to AFS or an affiliate apart from the compensation otherwise permitted by the Operating Agreement; and (v) all income generated by, and all expenses associated with, equipment so acquired will be treated as belonging to the Company.

The Company currently has available adequate reserves to meet its immediate cash requirements and those of the next twelve months, but in the event those reserves were 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.

If inflation in the general economy becomes significant, it may affect the Company in as much as the residual (resale) values and rates on re-leases of the Company’s leased assets may increase as the costs of similar assets increase. However, the Company’s revenues from existing leases and notes would not increase as such rates are generally fixed for the terms of the leases and notes without adjustment for inflation.

If interest rates increase significantly, the rates that the Company can obtain on future leases or financing transactions will be expected to increase as the cost of capital is a significant factor in the pricing of lease financing and investments in notes receivable. Leases and notes already in place, for the most part, would not be affected by changes in interest rates.

AFS expects that aggregate borrowings in the future will be approximately 50% of aggregate equipment cost. In any event, the Operating Agreement limits such borrowings to 50% of the total cost of equipment, in aggregate.

As of June 30, 2008, cash balances consisted of working capital and amounts reserved for distributions to be paid in July 2008.

At June 30, 2008, there were commitments to purchase lease assets totaling approximately $14.0 million. This amount represents contract awards which may be canceled by the prospective lessee or may not be accepted by the Company. There were no cancellations subsequent to quarter-end.

The Company commenced periodic distributions, based on cash flows from operations, beginning with the month of April 2003. Additional distributions have been consistently made through June 2008.

Cash Flows

The three months ended June 30, 2008 versus the three months ended June 30, 2007

Operating Activities

The Company’s primary source of cash from operations has been rents from operating leases. Additionally, its cash flows are impacted by changes in certain operating assets and liabilities.

Net cash provided by operating activities during the second quarter of 2008 decreased by $79 thousand as compared to the second quarter of 2007. The net decrease in cash flow was mainly due to increased payments made against accounts payable and accrued liabilities, and increased levels of accounts receivable offset, in part, by a period over period increase in results of operations as adjusted for non-cash revenue and expense such as gains on sales of assets and depreciation expense.

The increase in payments made against accounts payable and accrued liabilities reduced cash flow by $1.3 million and was attributable to settlements of prior period accruals related to lease assets purchases during the current quarter. The increased levels of accounts receivable further reduced cash by $129 thousand and was primarily attributable to the funding and deployment of newly purchased lease assets.

The above noted decreases in cash flow were partially offset by an increase of $1.4 million due primarily to the period over period net improvement in operating results, as adjusted for non-cash items, resulting primarily from increased operating lease revenues.

Investing Activities

Net cash used in investing activities during the second quarter of 2008 increased by $13.4 million as compared to the second quarter of 2007. The net increase (net decrease in cash flow) was mainly due to a $13.4 million increase in purchased lease assets and a $109 thousand decrease in payments received on notes receivable.

The increase in lease asset purchases was primarily due to an increase in acquisition phase activity resulting from increased origination and funding of appropriate lease investments as defined by the Fund’s Prospectus.

The decrease in payments on notes receivable was attributable to run-off and early termination of certain notes.

Financing Activities

Net cash provided by financing activities during the second quarter of 2008 increased by $8.8 million, as compared to the second quarter of 2007, due primarily to a $16.9 million increase in borrowings made against the Company’s credit facilities partially offset by an $8.2 million increase in repayments.

The six months ended June 30, 2008 versus the six months ended June 30, 2007

Operating Activities

Net cash provided by operating activities during the first six months of 2008 increased by $3.0 million as compared to the first six months of 2007. The net increase in cash flow was mainly due to a period over period increase in results of operations as adjusted for non-cash revenue and expense such as gains on sales of assets and depreciation expense, and a reduction in payments made against accounts payable and accrued liabilities offset, in part, by increased levels of accounts receivable.

The net improvement in operating results, as adjusted for non-cash items, improved cash flow by $2.4 million and was primarily a result of increased operating lease revenues.

The reduction in payments made against accounts payable further improved cash flow by $1.1 million. The net decrease was primarily attributable to lower first quarter 2008 payments, when compared to first quarter 2007, as the first quarter 2007 activity included payments for 2006 equipment purchases, partially offset by higher second quarter 2008 payments as previously discussed.

The aforementioned increases in cash flow were partially offset by a decrease of $438 thousand resulting from increased levels of accounts receivable. The increase in accounts receivable was attributable to the funding and deployment of newly purchased lease assets.

Investing Activities

Net cash used in investing activities during the first six months of 2008 increased by $18.3 million as compared to the first six months of 2007. The net increase (net decrease in cash flow) was mainly due to a $17.7 million increase in purchased lease assets, a $1.3 million decline in proceeds from sales of lease assets and early termination of notes receivable, and a $291 thousand decrease in payments received on notes receivable. The aforementioned decreases in cash were partially offset by a $671 thousand increase resulting from a reduction in funding of investments in notes receivable.

Proceeds from sales of lease assets and early termination of notes declined due to a first quarter 2007 early termination of a note receivable which benefited year-to-date 2007 cash flow by $1.4 million. The decrease in payments on notes receivable was attributable to run-off and early termination of the notes.

Partly offsetting the aforementioned decreases in cash was an increase of $671 thousand resulting from the period over period decline in funding of investments in notes receivable, which declined primarily due to a weaker borrower demand and the absence of appropriate investments as defined by the Fund’s Prospectus.

Financing Activities

Net cash provided by financing activities during the first six months of 2008 increased by $14.9 million, as compared to the first six months of 2007, due primarily to a $19.0 million increase in borrowings made against the Company’s credit facilities offset, in part, by a $4.0 million net increase in repayments.

Results of Operations

The three months ended June 30, 2008 versus the three months ended June 30, 2007

The Company had net income of $322 thousand for the second quarter of 2008 compared to a net loss of $351 thousand for the second quarter of 2007, an improvement of $673 thousand or 192%. Results for the second quarter of 2008 reflect increases in total revenues and other income, net offset, in part, by an increase in total operating expenses.

Revenues

Total revenues for the second quarter of 2008 increased by $1.4 million, or 26%, as compared to the second quarter of 2007. The net increase in revenues was mainly a result of an increase in operating lease revenue offset by a decrease in interest income on the notes receivable, and gains recognized on sales of assets and early termination of notes.

Operating lease revenues during the second quarter of 2008 increased by $1.4 million, or 28%, as compared to the second quarter of 2007, as a result of revenues generated from approximately $34 million of lease assets purchased since June 30, 2007.

Interest on notes receivable decreased by $59 thousand primarily due to the $2.1 million period over period decrease in notes receivable balances, due primarily to run-off and early termination of the notes. Net gains on the sales of assets and early termination of notes declined by $53 thousand primarily due to the period over period decline in prepayments of notes receivable.

Expenses

Total expenses during the second quarter of 2008 increased by $1.3 million, or 23%, as compared to the second quarter of 2007. The net rise in expenses was primarily due to increases in depreciation, interest and acquisition expenses offset, in part, by deceases in costs reimbursed to AFS, outside services expense, professional fees and state franchise and income tax expense.

The increase in depreciation expense totaled $1.1 million and was primarily due to the period over period increase in depreciable lease assets resulting from acquisitions since June 30, 2007. The increase in interest expense totaled $299 thousand and was primarily due to an increase in net borrowings of approximately $29.5 million since June 30, 2007. The increase in acquisition expense totaled $206 thousand and was primarily due to the $33.7 million increase in purchased lease assets since June 30, 2007.

Partly offsetting the above mentioned increases in expenses were decreases of $192 thousand, $163 thousand, $94 thousand and $74 thousand in costs reimbursed to AFS, outside services expense, professional fees and state franchise fees and taxes, respectively. Costs reimbursed to AFS decreased due to the refinement of cost allocation methodologies employed by the Managing Member which resulted in lower costs allocated to the Fund. The decreases in outside services expense and professional expense were a result of the elimination of costs associated with the audit and restatement of the Company’s prior year financial statements, which were largely completed during the second quarter of 2007; and the decrease in state franchise fees and tax expense was primarily due to a drop in current year estimated tax liability and payments when compared to prior year.

Other

Other income, net for the second quarter of 2008 increased by $634 thousand as compared to the second quarter of 2007. The increase was attributable to a favorable fair value adjustment on interest rate swap contracts resulting from a period over period increase in interest rate.

The six months ended June 30, 2008 versus the six months ended June 30, 2007

The Company had net losses of $964 thousand and $1.0 million for the first six months of 2008 and 2007, respectively. Results for the first six months of 2008 reflect increases in total revenues and other income, net offset, in part by an increase in total operating expenses.

Revenues

Total revenues for the first six months of 2008 increased by $2.2 million, or 20%, as compared to the first six months of 2007. The net increase in revenues was mainly a result of a period over period growth in operating lease revenue offset by a decline in gains on sales of assets and early termination of notes, and interest on notes receivable.

Operating lease revenues during the first six months of 2008 increased by $2.5 million, or 25%, as compared to the first six months of 2007, as a result of revenues generated from lease assets purchased since June 30, 2007.

Net gains recognized on the sales of assets and early termination of notes declined by $209 thousand primarily due to the period over period decline in prepayments of notes receivable; and interest on notes receivable decreased by $109 thousand primarily due to the lower notes receivable balances, due primarily to run-off and early termination of the notes.

Expenses

Total expenses during the first six months of 2008 increased by $2.2 million, or 19%, as compared to the first six months of 2007. The net increase in operating expenses was primarily due to increased depreciation, interest and acquisition expenses offset, in part, by decreased outside services expense, professional fees and costs reimbursed to AFS and outside services expense.

The increase in depreciation expense totaled $2.0 million and was primarily due to the increase in depreciable lease assets resulting from acquisitions since June 30, 2007. The increase in interest expense totaled $530 thousand and was primarily due to an increase in net borrowings of approximately $29.5 million since June 30, 2007; and the increase in acquisition expense totaled $460 thousand and was primarily due to the increase in lease assets acquired since June 30, 2007.

Partly offsetting the above mentioned increases in expenses were decreases of $421 thousand, $361 thousand and $222 thousand in outside services expense, professional fees and costs reimbursed to AFS, respectively. The decreases in outside services expense and professional expense were a result of the elimination of costs associated with the audit and restatement of the Company’s prior year financial statements, which were largely completed during the second quarter of 2007; and the decrease in state franchise fees and tax expense was primarily due to a drop in current year estimated tax liability and payments when compared to prior year. Costs reimbursed to AFS decreased due to the refinement of cost allocation methodologies employed by the Managing Member which resulted in lower costs allocated to the Fund.

Other

Other income, net for the first six months of 2008 increased by $76 thousand as compared to the first six months of 2007. The increase was mainly due to a favorable fair value adjustment on interest rate swap contracts resulting from a period over period increase in interest rates.

Item 4.

Controls and procedures.

Evaluation of disclosure controls and procedures

The Company’s Managing Member’s 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)) as of the end of the period covered by this report. Based on the evaluation of the Company’s disclosure controls and procedures, the Chief Executive Officer and Executive Vice President and Chief Financial Officer and Chief Operating Officer 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 it is applicable to the Company, were effective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States.

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 June 30, 2008 that has materially affected, or is reasonably likely to materially affect, the Managing Member’s internal control over financial reporting, as it is applicable to the Company.

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.

Submission Of Matters To A Vote Of Security Holders.

None.

Item 5.

Other Information.

None.

Item 6.

Exhibits.

Documents filed as a part of this report:

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.

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

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: August 13, 2008


			ATEL Capital Equipment Fund X, 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
			Vice President and Chief Accounting Officer of ATEL Financial Services, LLC (Managing Member)

EX-31.1 2 dex311.htm CERTIFICATION OF DEAN L. CASH Certification of Dean L. Cash

Exhibit 31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR RULE 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Dean L. Cash, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of ATEL Capital Equipment Fund X, LLC;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparations of financial statements for external purposes in accordance with generally accepted accounting principles;

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 13, 2008

/s/ Dean L. Cash

Dean L. Cash

President and Chief Executive Officer of

ATEL Financial Services, LLC (Managing Member)

EX-31.2 3 dex312.htm CERTIFICATION OF PARITOSH K. CHOKSI Certification of Paritosh K. Choksi

Exhibit 31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR RULE 15d-14(a)

OF THE SECURITIES EXCHANGE ACT OF 1934

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Paritosh K. Choksi, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of ATEL Capital Equipment Fund X, LLC;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and have:

5.	The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 13, 2008

/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)

EX-32.1 4 dex321.htm CERTIFICATION OF DEAN L. CASH Certification of Dean L. Cash

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. §1350,

AS ADOPTED PURSUANT TO

§906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ATEL Capital Equipment Fund X, LLC (the “Company”) on Form 10-Q for the period ended June 30, 2008 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Dean L. Cash, President and Chief Executive Officer of ATEL Financial Services, LLC, Managing Member of the Company, hereby certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 13, 2008

/s/ Dean L. Cash

Dean L. Cash

President and Chief Executive Officer of

ATEL Financial Services, LLC (Managing Member)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2 5 dex322.htm CERTIFICATION OF PARITOSH K. CHOKSI Certification of Paritosh K. Choksi

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. §1350,

AS ADOPTED PURSUANT TO

§906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ATEL Capital Equipment Fund X, LLC (the “Company”) on Form 10-Q for the period ended June 30, 2008 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Paritosh K. Choksi, Executive Vice President and Chief Financial Officer and Chief Operating Officer of ATEL Financial Services, LLC, Managing Member of the Company, hereby certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 13, 2008

/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)

-----END PRIVACY-ENHANCED MESSAGE-----

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents