ATEL. Financing America

Transcription

1 ATEL 15

2 Investors are encouraged to read the Prospectus for ATEL 15, LLC carefully. The Prospectus has been provided in conjunction with this presentation. This presentation constitutes neither an offer to sell nor a solicitation of an offer to buy the securities described herein. The offering is made only by the means of the Prospectus delivered prior to, or at the time of this presentation. An investment in the Fund is not suitable for all investors. See the Prospectus under Who Should Invest for detailed information on applicable Fund and state suitability standards. RISK FACTORS* Investors are advised that there are significant risks associated with an investment in the Fund, including: most of the Fund s distributions will be, and most of the prior ATEL programs distributions have been, a return of capital Economic recession and changes in general economic conditions, including fluctuations in demand for equipment, lease rates, and interest rates may, and in certain past programs have, resulted in delays in investment and reinvestment, delays in leasing, re-leasing and disposition of its investments, and reduced returns on invested capital The Fund s performance is subject to risks relating to lessee and borrower defaults The Fund s performance is subject to risks relating to the value of its investments when it seeks to sell them in its liquidation phase The Fund will borrow to buy some of its investments and, if fund revenues are insufficient to repay borrowed funds, the Fund will incur a loss of assets used as collateral No market exists for the units, and an investor may be unable to sell the units or able to sell the units only at a significant discount Except as may be set forth in a supplement to the prospectus, the Fund has not specified any of its investments, so that investors cannot evaluate the risks or potential returns from such investments Investors must rely on ATEL to manage the Fund; the Fund will pay ATEL substantial fees which may result in conflicts of interest The Fund does not guarantee its distributions or the return of investors capital. The Fund may be harmed if a lessee or borrower defaults and the Fund is unable to collect the revenue anticipated from the defaulted investment. The Fund cannot assure that its value assumptions will be accurate or that the leased assets will not lose value more rapidly than anticipated. Investors should consider an investment in the Fund as a long term investment. The Fund expects to make its final distribution approximately ten or eleven years after the termination of the offering, however, there can be no assurance as to the final liquidation date. Equipment lessees and manufacturers depicted and identified herein are from prior ATEL Funds. Although representative of the types of equipment, lessees and manufacturers intended to be acquired by the Fund, investors in the Fund will not acquire an interest in any of the equipment or transactions described herein. *For a complete discussion of the risk factors associated with an investment in ATEL 15, LLC., refer to pages 13 through 20 in the Fund s prospectus.

3 ATEL Financing America

4 A MESSAGE TO OUR INVESTORS It is with great pride and excitement that we introduce to you our fourteenth public equipment leasing program, ATEL 15, LLC ( ATEL 15 ). ATEL 15 provides investors with the opportunity to acquire an interest in a portfolio of high quality equipment leased to a diverse group of major corporations. ATEL Capital Group celebrates its 35th year in the equipment leasing business in With this corporate leasing experience and the outstanding depth within our acquisition and asset management teams, ATEL Capital Group continues to establish and maintain relationships with many top corporations around the world. In fact, after extensive due diligence, many Fortune 500 companies have selected ATEL as a preferred business partner. American industry increasingly depends on leasing to supply the equipment needed to remain competitive in today s global economy. Leasing has become one of the major methods by which American businesses finance their capital equipment needs. Many companies use leasing to help manage the financial complexities of acquiring the assets that are important to their current success and future operations. ATEL is pleased to offer ATEL 15 to you through an extensive network of financial planning professionals encompassing many of the best known broker/dealers in America. We hope the information that follows will give you an understanding of how the strength of the leasing industry, combined with our seasoned fund management and depth of experience create a truly unique investment opportunity. In the face of unpredictable economic conditions, diversification is essential to maintaining a healthy and well-balanced investment portfolio. While all investments involve some risk, ATEL 15 will offer you the opportunity to enhance the diversification of your investment portfolio while potentially reducing portfolio volatility and risk. We invite you to review this information with your financial advisor and we look forward to helping you reach your financial goals. Yours Truly, DEAN CASH PRESIDENT & CHIEF EXECUTIVE OFFICER ATEL CAPITAL GROUP

5 For over three decades, ATEL has been a valued resource for companies seeking to lease and finance capital equipment by providing funding for the equipment they need for their day-to-day operations. 80% of U.S. businesses lease or finance all or some of their equipment THE FUND ATEL 15 ATEL 15 s portfolio objective is to diversify by equipment type, industry, lessee, geographic location, and asset class. The Fund gives individual investors an opportunity to invest in the equipment leasing industry. The Fund s objective is to preserve and return invested capital, provide regular cash distributions through its operating period and additional cash distributions through liquidation. By investing in a portfolio of long-lived capital equipment, a significant portion of cash distributions may be tax deferred during the early years of operations, primarily from depreciation deductions. Additionally, the value of Fund equipment may provide investors with a hedge against inflation. ATEL CAPITAL GROUP Since 1977, ATEL has specialized in leasing primarily low-obsolescence, business-necessary equipment to the most successful corporations in the U.S. and abroad. For 35 years, we have worked with 45,000 investors, financed $2 billion of equipment with more than 1,000 customers and more than 3,000 lease contracts. In total, we have priced, structured, and managed over $30 billion of lease transactions. THE LEASING INDUSTRY PAGE 5 PAGE 8 PAGE 12 In the U.S., 80% of businesses lease or finance all or some of their equipment. The Equipment Leasing and Finance Association s Monthly Leasing and Finance Index (MLFI-25), which reports economic activity for the equipment finance sector, was up 23% in 2010 compared to the same period in This improvement in leasing activity was the largest year-over-year increase since THE MARKETPLACE PAGE 14 Steady often wins the race. ATEL employs time-tested investment strategies to reduce investor risk. 3

6 Recognizing that residual values and renewal rents can potentially provide significant enhancements to the Funds total return, ATEL 15 intends to primarily acquire long-life, lowobsolescence equipment.

7 f. 15 ATEL 15 ATEL 15 S PORTFOLIO IS A UNIQUE ASSET CLASS THAT IS DIVERSIFIED BY EQUIPMENT TYPE, INDUSTRY, LESSEE, GEOGRAPHIC LOCATION, AND ASSET CLASS. THE FUND GIVES INDIVIDUAL INVESTORS AN OPPORTUNITY TO INVEST IN THE EQUIPMENT LEASING INDUSTRY. THE FUND S OBJECTIVES ARE TO PRESERVE AND RETURN INVESTED CAPITAL AND PROVIDE REGULAR CASH DISTRIBUTIONS THROUGH ITS OPERATING PERIOD AND ADDITIONAL CASH DISTRIBUTIONS THROUGH LIQUIDATION. BY INVESTING IN A PORTFOLIO OF LONG-LIVED CAPITAL EQUIPMENT, A SIGNIFICANT PORTION OF CASH DISTRIBUTIONS MAY BE TAX DEFERRED DURING THE EARLY YEARS OF OPERATIONS, PRIMARILY FROM DEPRECIATION DEDUCTIONS. ADDITIONALLY, THE VALUE OF FUND EQUIPMENT MAY ALSO PROVIDE INVESTORS WITH A HEDGE AGAINST INFLATION. THROUGH ATEL 15, INVESTORS CAN OWN AND FINANCE THE ASSETS THAT KEEP OUR ECONOMY MOVING. ACCESS TO AN ALTERNATIVE ASSET CLASS ATEL 15 provides investors a unique opportunity to own a diversified portfolio composed of businessnecessary equipment leased to Fortune 500 companies and emerging high-growth enterprises. The Fund s objectives are to preserve invested capital and provide investors with regular tax-advantaged distributions, thus helping to optimize their overall investment portfolios.* *Equipment programs provide significant tax benefits through equipment depreciation. Each distribution typically represents in part, both return of and return on original capital and can carry with it certain tax advantages as well. There can be no assurance as to the timing and amount of distributions and there is no way to predict future interest or inflation rates with certainty. BENEFITS OF OWNING ATEL 15** The value of used low technology equipment tends to rise simultaneously along with the prices of new equipment. Thus, leasing offers a potential hedge against inflation. Owning a diversified portfolio across several asset classes is a proven investment strategy that can significantly reduce risk in an investor s portfolio. Lease renewal payments and interest rates tend to move in tandem which may help ATEL 15 keep pace with other investments during periods of rising interest rates. Depreciation provides federal and state tax-advantaged cash distributions. **There is no way to predict with certainty future interest or inflation rates and there can be no assurance that the ATEL 15 investment objectives will be achieved. There can be no assurance as to the timing or amount of distributions. A tax benefit is achieved through depreciation deductions which may defer federal and state tax liabilities. 5

8 f. 15ATEL 15 IMPORTANCE OF ASSET ALLOCATION Asset allocation is one of the most important factors in determining a portfolio s performance. According to an independent study*, more than 90% of a portfolio s performance is contingent on the way its assets are allocated. ATEL 15 represents a unique class of investments that will help you diversify your portfolio. PORTFOLIO PERFORMANCE* The determining factors** Asset Allocation 91.5% Investment Selection 4.6% Other 2.1% Market Timing 1.8% *Source: Ibbotson Associates, Inc. **Diversification and asset allocation do not guarantee a profit or eliminate the risk of principal loss. 6

9 Over the past 40 years, American business has increasingly utilized leasing, recognizing that the value of equipment comes from its use, not its ownership. -Equipment Leasing and Finance Association CASH FLOW AND GROWTH THROUGH REINVESTMENT After the initial funding period and through the end of the six year reinvestment period, the Fund must make minimum distributions to investors equal to 9% per annum on invested capital before reinvesting in additional portfolio assets. Reinvestment of any excess cash flow creates the potential for portfolio growth and enhanced diversification. While ATEL 15 s investment portfolio will be structured to provide regular cash distributions to investors, a portion of which will be a return of capital, there can be no assurance as to the timing or amount of those distributions until the investment portfolio has been acquired. ATEL 15 LIFE CYCLE Funding Period Operating and Reinvestment Period Liquidation Period 2 Years 6 Years 2-4 Years Funding Period: Units are only sold during the offering period ATEL has 6 months to invest it after the offering is terminated Investment dollars are used to purchase equipment Investors are extremely limited in their ability to sell units during the life of the Fund Cash distributions are expected to begin immediately after minimum funding and are expected to be paid monthly or quarterly Operating and Reinvestment Period: Equity raised during the offering period and, if available, excess operating revenues, may be used to make additional investments in equipment Cash distributions are expected to be paid monthly or quarterly and are largely tax deferred Depreciation on equipment leases may offset a portion of income to investors The investment portfolio is actively managed throughout the life of the Fund Liquidation Period: Liquidation period is expected to last around 2+ years Investments will be sold at maturity and no new investments will be made Distributions are paid periodically to investors and the amount will fluctuate 7

10 f. 15ATEL CAPITAL GROUP SUCCEEDING WITH INTEGRITY AND CONFIDENCE Since 1977, ATEL has specialized in leasing primarily low-obsolescence, business-necessary equipment to the most successful corporations in the U.S. and abroad. For over 34 years, we have worked with 45,000 investors, financed $2 billion of equipment with more than 1,000 customers and more than 3,000 lease contracts. In total, we have priced, structured, and managed over $30 billion of lease transactions. ATEL s management team is comprised of highly skilled and knowledgeable professionals. We average over 25 years of industry experience and over 15 years average tenure with ATEL. Dean Cash, CEO & President of ATEL Capital Group since 2001, has led ATEL for over 32 years. In 2012, ATEL celebrates 35 years in the leasing business. The longevity of our experienced and stable management team helps ATEL realize its goals and objectives. WHY COMPANIES LEASE FROM ATEL Knowledge gained from over three decades in the leasing business. We provide the utmost customer service by providing the resources, flexibility, and creativity to meet the needs of our customers. Over ATEL s 35 years, we have developed trust and credibility with many lessees that are leaders in their industries. After extensive due diligence, companies including Cargill, General Electric, IBM, Rubbermaid, Tyson Foods, and Wal-Mart have selected ATEL as a leasing partner. 8

11 Ownership of a diversified portfolio of low-obsolescence equipment produces regular distributions plus the ATEL investment may offer protection against inflation. Diversification, Diversification, Diversification EFFECTIVE RISK MANAGEMENT OBJECTIVES Diversification is a proven investment strategy whether building an investment portfolio or an equipment leasing portfolio. In fact, research has proven that the addition of multiple asset classes to a portfolio can result in a reduction of overall investment risk. ATEL provides further diversification by earning returns on both the rental income stream as well as the residual value of the equipment. This two-prong approach should further reduce investor risk. The four primary criteria that diversify our portfolio are: industry sector, equipment type, geographic location, and asset class. Industry Sector Trucking Agricultural Medical Food Processing & Services Marine Power Rail Transport Logistics Manufacturing Oil & Gas Retail Equipment Type Railroad Construction Mining Material Handling Containers Truck & Trailers Diagnostic Medical Manufacturing Petroleum & Natural Gas Geographic Location All 50 States (Interstate Commerce, Intrastate Commerce) Asset Lives 5 years to 15 years plus 9

12 f. 15ATEL CAPITAL GROUP 90% of assets retained by lessee at end of lease term HISTORICALLY HIGH ASSET RETENTION At the end of an equipment lease, the lessor still owns the equipment while the lessee generally has three options: (1) purchase the equipment for fair market value, (2) renew the lease for an additional period or (3) return the equipment. The economic value of this ownership interest, referred to as the residual value, is dependent upon many variables. A primary element of the residual value is often a function of the equipment s remaining technological and economic useful life. At ATEL, we focus on low-obsolescence equipment which retains a high residual value. A renewal following the initial lease term often helps to increase the economic return of the lease portfolio. As a consequence, ATEL s objective is to renew the equipment at the end of the initial lease term whenever possible. 100% 90% OUTSTANDING ASSET RETENTION 80% 60% 40% RETAINED Short - Term Renewals Long - Term Renewals Purchased by Lessee RETURNED Returned to ATEL 20% 10% This chart illustrates the decisions exercised by ATEL lessees at the original lease maturity date from 3/11/1986 to 12/30/2010. Past performance is no guarantee of future results. 10 0%

13 Each increase of $1 Billion in equipment investment creates approximately 30,000 jobs. Leasing not only equips America, it helps put America to work! -Equipment Leasing and Finance Association 25-year historical default rate of.04% EXCELLENT CREDIT QUALITY Since its inception, ATEL s business strategy has always focused on equipment leasing and we have stayed true to this model throughout our history. This single-minded approach has allowed ATEL s prior programs to avoid the pitfalls of investing in real estate, working capital lines, distressed credits, high-yield bonds, and other investment vehicles that did not perform well during the credit dislocation that began in Our focus on high quality lessees with excellent credit ratings, combined with our comprehensive diversification strategy has resulted in an extremely low default rate. Since the launch of our first public offering in 1986, our total losses from lease defaults have approximated.04% of assets acquired per annum. This is substantially less than the defaults projected by ATEL in structuring these lease portfolios. CONSISTENT INVESTMENT STRATEGY Past performance is no guarantee of future results. Since 1986, ATEL s equipment lease investment strategy has consistently focused on financing high quality corporate credits consisting of corporations with debt rated investment grade by international debt rating services and other major corporations with equivalent credit quality as determined by ATEL. While high quality credits are no guarantee against lease defaults, these investments are further secured by owning long-lived capital equipment. An illustration of this strategy is evidenced by looking at the recent investments in 2010 and 2011 made by prior programs with Wal-Mart, Tyson Foods, IBM Corporation, Cargill, Bayer Corporation, Mosaic, Cummins, and Newell Rubbermaid. With long-lived, low obsolescence equipment leased to these high quality corporate credits, the Fund seeks to provide investors with a source of regular cash distributions. These steady rent streams are coupled with our asset retention policy to help further reduce investor risk. 11

14 f. 15THE LEASING INDUSTRY AN ALTERNATIVE INVESTMENT CLASS At its core, an equipment lease is a much different investment vehicle than other products such as equities, bonds or alternatives such as a real estate investment trust. The majority of high-value equipment leases have been historically originated by a few large bank holding companies, diversified financial institutions and Fortune 200 multi-national enterprises. This group of financial institutions represent a majority of the equipment finance market. Accordingly, ATEL 15 is an investment opportunity that allows an individual investor to participate in an alternative investment vehicle owning a portfolio of leased assets generally only available to institutional investors. SECURED PRIORITY PAYMENTS The lease contract can provide additional security to the Fund and its investors because the lessee is obligated to make lease payments before paying dividends to its shareholders or making payments to its unsecured bond holders. While all investments involve some level of risk, the Fund s ownership of leased equipment provides collateral for the lessee payment obligations, while most corporate debt is a general obligation of the issuer. An aspect of a lease which provides security is the fact that most ATEL leases are non-cancellable contracts that obligate the lessee to remit a fixed payment every month for a specified term. Further security is provided because most Fund leases are expected to be considered triple net from the standpoint that the lessee (rather than the lessor) is required to (1) repair and maintain the equipment, (2) carry property and liability insurance and (3) pay sales and property taxes. 12

15 Investors are increasingly looking for opportunities to balance their portfolio returns through varying market cycles. WHO LEASES EQUIPMENT AND WHY? Leasing, rather than purchasing, allows a company to pay over time rather than all at once. Leasing enables companies to: Acquire New Equipment Refinance Existing Debt Expand Operations Make Strategic Investments and Acquisitions Expense the Entire Lease Payment Both large and small businesses often lease rather than buy equipment in order to deploy capital effectively and to match revenues and expenses, thus enabling them to manage cash flows efficiently. In fact, 80% of U.S. businesses lease all or some of their equipment. In summary, leasing provides businesses with the ability to preserve capital while keeping their lines of credit available for operating requirements. Equipment Acquisition Financing Methods Large Size Firm (= > 1000 Employees) Cash 48.0% Lease 33.6% Line of Credit 13.6% Term Loan 3.9% Other.9% Source: Global Insight from the U.S. Equipment Finance Market Study

16 f. 15THE MARKETPLACE The most rewarding investment decisions are those made with knowledge and confidence. STEADY OFTEN WINS THE RACE ATEL s consistent investment strategy has helped the company avoid losses due to delinquencies, charge-offs, forbearance agreements, defaults, or bankruptcies. Since the launch of our first public offering in 1986, our total losses from lease defaults have approximated.04% of assets acquired per annum. For the last 35 years, ATEL has developed an investment methodology that focuses on leasing business-necessary low-obsolescence assets, while at the same time diversifying our portfolio by equipment, industry, and geography to reduce risk. The Volume by Equipment Type chart on the following page illustrates our investment methodology. Note that of the 15 major equipment categories, ATEL makes significant investments in only six of the equipment types listed. The second chart, Diversification by Equipment Type, reflects ATEL s other approach to risk management by spreading out our leasing investment dollars across many asset categories, thus reducing risk to our investors. 14 MARKET VOLATILITY Since 2008, the U.S. global stock markets and investment exchanges have experienced significant volatility. An investment in ATEL provides diversification in a non-market correlated asset type.

17 VOLUME BY EQUIPMENT TYPE AGRICULTURE 0.01% 9.3% *AVIATION 3.22% 4.2% COMPUTERS 0.59% 26.6% EQUIPMENT TYPE CONSTRUCTION CONTAINERS MANUFACTURING MARINE MATERIAL HANDLING MEDICAL 0.2% 0.01% FURNITURE & FIXTURES 3.2% 0.94% 3.3% 0.44% 1.5% 0.28% 2.4% 7.28% 7.7% 7.6% 10.88% 16.97% ATEL Public Funds V-14 *Combined as Transportation MARKETPLACE ATEL MINING 1.2% 9.43% OTHER 7.79% 21.3% *MOTOR VEHICLES 2.49% 2.0% RAILROAD 1.2% 33.55% *TRUCKS & TRAILERS 6.12% 8.3% 0% 5% 10% 15% 20% 25% 30% 35% % SHARE OF TOTAL VOLUME DIVERSIFICATION BY EQUIPMENT TYPE Rail 33% Material Handling 17% Mining & Construction Equipment 17% Transportation 12% Containers 11% Other 10%

18 ATEL finances the equipment that uses to grow and harvest its grain which is then transported using ATEL-leased railcars operated by to the manufacturer where equipment leased by ATEL to produces consumer foods which are sold by retailers such as which uses ATEL equipment to distribute their goods.* * ATEL Financing America Equipment types, lessees and manufacturers depicted and identified in this presentation are from prior ATEL programs, and, while representative of the types of equipment, lessees and manufacturers intended to be in the portfolio acquired by the Fund, investors in the Fund will not acquire an interest in any of the prior program transactions, and there is no assurance as to the composition or diversification of the Fund s portfolio.

19 f. 15 HOW TO INVEST A Dynamic Opportunity Owning a diversified investment portfolio across several asset classes is a proven investment strategy. However, it is imperative to note that no single investment category can continuously remain the best and no one can predict the top-performing asset class of the future. Your financial advisor can help identify a variety of opportunities designed to meet your personal investment goals. Utilizing asset allocation techniques, you and your advisor can select a well-diversified portfolio designed to maximize return and minimize risk. Since equipment leasing is available as an investment primarily to institutional investors, you can generally only access this opportunity through a program such as ATEL 15, LLC available exclusively through our extensive national network of financial planning professionals. We are pleased to invite you to invest in ATEL 15, LLC. Participation in the Fund offers the potential for diversification and regular, tax-advantaged cash distributions.* WE LOOK FORWARD TO WELCOMING YOU TO THE ATEL FAMILY OF FUNDS. Please review the enclosed prospectus for complete details. When you are ready to finalize your investment in ATEL 15, LLC: Complete the subscription agreement, initial, and sign where indicated Make your check payable to ATEL 15, LLC Your financial consultant will fill out Section 7 and confirm the address before mailing in your completed subscription offer and check As a complimentary service, your distribution checks can be directed to multiple accounts and investment plans. We encourage you to take advantage of this opportunity to help further diversify your investment portfolio. * These are ATEL 15 s objectives. There can be no assurance as to the timing or amount of distributions. The tax benefit is achieved through depreciation deductions which may defer federal and state tax liabilities. An investment in ATEL 15 involves material tax consequences, and investors are urged to review the information in the prospectus under the caption Federal Income Tax Consequences and to consult with their personal advisors to understand these tax consequences. 17

20 600 California Street, 6th Floor San Francisco, CA t f f. 15 MEMBER FINRA