Icon Eci Fund Fifteen 10-Q 2012 Q3 Quarterly report

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                                  September 30, 2012

or

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

For the transition period from  to 

CommissionFile Number_                                                      000-54604

ICON ECI Fund Fifteen, L.P.

(Exact name of registrant as specified in its charter)

Delaware	27-3525849
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

3 Park Avenue, 36th Floor, New York, New York	10016
(Address of principal executive offices)	(Zip Code)

(212) 418-4700

(Registrant's telephone number, including area code)

Indicate by 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.

þ Yes    o No 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).            

þYes    o 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 the definitions of “large accelerated filer,’’ ‘‘accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o	Accelerated filer o
Non-accelerated filer þ (Do not check if a smaller reporting company)	Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). 

oYes    þ No 

 Number of outstanding limited partnership interests of the registrant on November 12, 2012 is 138,026.

Explanatory Note

The direct effects of Hurricane Sandy and its aftermath left the Registrant’s principal executive offices without electricity, communications capabilities and heat for the period from Monday, October 29th through the weekend of November 3rd.  Due to these factors and the lack of transportation in and around New York City, the Registrant’s staff were unable to access the offices until Monday, November 5th and were unable to timely complete customary pre-filing review processes and procedures.  As a result, the Registrant was not able to meet its filing deadline under Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and is relying on the Securities and Exchange Commission Release No. 68224, issued on November 14, 2012 (Order under Section 17A and Section 36 of the Securities Exchange Act of 1934 granting exemptions from specified provisions of the Exchange Act and certain rules thereunder) exempting it from such filing deadline for the period from October 29, 2012 to November 20, 2012.

ICON ECI Fund Fifteen, L.P. Table of Contents
	Page
PART I - FINANCIAL INFORMATION
Item 1.  Consolidated Financial Statements
Consolidated Balance Sheets	1
Consolidated Statements of Operations	2
Consolidated Statements of Changes in Equity	3
Consolidated Statements of Cash Flows	4
Notes to Consolidated Financial Statements	6
Item 2. General Partner’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3. Quantitative and Qualitative Disclosures About Market Risk	21
Item 4. Controls and Procedures	21
PART II – OTHER INFORMATION
Item 1. Legal Proceedings	22
Item 1A. Risk Factors	22
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 3. Defaults Upon Senior Securities	22
Item 4. Mine Safety Disclosures	22
Item 5. Other Information	22
Item 6. Exhibits	23
Signatures	24

PART I – FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

ICON ECI Fund Fifteen, L.P.
(A Delaware Limited Partnership)
Consolidated Balance Sheets
				September 30,		December 31,
				2012		2011
				(unaudited)
Assets
	Cash			$	35,982,626	$	5,383,978
	Net investment in notes receivable				37,207,000		13,014,700
	Leased equipment at cost (less accumulated depreciation of
		$907,414 and $0, respectively)			18,480,865		-
	Net investment in finance leases				25,676,781		1,681,451
	Vessel				-		9,625,000
	Deferred charges				1,084,235		1,236,399
	Other assets				8,703,706		494,942
Total assets				$	127,135,213	$	31,436,470
Liabilities and Equity
Liabilities:
	Non-recourse long-term debt			$	16,875,000	$	-
	Due to General Partner and affiliates				4,054,356		3,420,832
	Deferred revenue				11,408		-
	Accrued expenses and other current liabilities				366,478		349,835
			Total liabilities		21,307,242		3,770,667
Commitments and contingencies (Note 10)
Equity:
	Partners' equity:
		Limited partners			104,255,017		26,651,016
		General Partner			(80,298)		(14,549)
			Total partners' equity		104,174,719		26,636,467
	Noncontrolling interests				1,653,252		1,029,336
			Total equity		105,827,971		27,665,803
Total liabilities and equity				$	127,135,213	$	31,436,470
See accompanying notes to consolidated financial statements.

1

ICON ECI Fund Fifteen, L.P.
(A Delaware Limited Partnership)
Consolidated Statements of Operations
(unaudited)
					Period from				Period from
					July 28, 2011				July 28, 2011
					(Commencement				(Commencement
			Three Months		of Operations)		Nine Months		of Operations)
			Ended		through		Ended		through
			September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Revenue:
	Finance income		$	1,816,186	$	-	$	3,599,601	$	-
	Rental income			1,234,689		-		1,250,016		-
	Income from investment in joint venture			-		40,712		-		40,712
	Other income			9,747		-		22,546		-
		Total revenue		3,060,622		40,712		4,872,163		40,712
Expenses:
	Management fees			108,932		3,473		189,153		3,473
	Administrative expense reimbursements			937,778		273,965		2,731,434		273,965
	General and administrative			275,614		200,267		656,330		200,267
	Interest			350,780		13,505		774,517		13,505
	Depreciation			896,098		-		907,414		-
	Credit loss			-		-		1,984,044		-
		Total expenses		2,569,202		491,210		7,242,892		491,210
Net income (loss)				491,420		(450,498)		(2,370,729)		(450,498)
	Less: net income (loss) attributable to noncontrolling interests			92,650		-		(134,828)		-
Net income (loss) attributable to Fund Fifteen			$	398,770	$	(450,498)	$	(2,235,901)	$	(450,498)
Net income (loss) attributable to Fund Fifteen allocable to:
	Limited partners		$	394,782	$	(445,993)	$	(2,213,542)	$	(445,993)
	General Partner			3,988		(4,505)		(22,359)		(4,505)
			$	398,770	$	(450,498)	$	(2,235,901)	$	(450,498)
Weighted average number of limited partnership
	interests outstanding			111,412		5,333		81,938		5,333
Net income (loss) attributable to Fund Fifteen per weighted average
	limited partnership interest outstanding		$	3.54	$	(83.63)	$	(27.01)	$	(83.63)
See accompanying notes to consolidated financial statements.

2

ICON ECI Fund Fifteen, L.P.
(A Delaware Limited Partnership)
Consolidated Statements of Changes in Equity
		Partners' Equity
		Limited Partnership	Limited				Total Partners'		Noncontrolling		Total
		Interests	Partners		General Partner		Equity		Interests		Equity
Balance, December 31, 2011		31,529	$	26,651,016	$	(14,549)	$	26,636,467	$	1,029,336	$	27,665,803
	Net loss	-		(14,621)		(148)		(14,769)		(143,063)		(157,832)
	Proceeds from sale of limited partnership interests	37,187		37,118,509		-		37,118,509		-		37,118,509
	Sales and offering expenses	-		(3,891,204)		-		(3,891,204)		-		(3,891,204)
	Cash distributions	-		(801,455)		(8,095)		(809,550)		-		(809,550)
	Investment by noncontrolling interests	-		-		-		-		117,500		117,500
Balance, March 31, 2012 (unaudited)		68,716		59,062,245		(22,792)		59,039,453		1,003,773		60,043,226
	Net loss	-		(2,593,703)		(26,199)		(2,619,902)		(84,415)		(2,704,317)
	Proceeds from sale of limited partnership interests	26,652		26,539,721		-		26,539,721		-		26,539,721
	Sales and offering expenses	-		(2,854,766)		-		(2,854,766)		-		(2,854,766)
	Cash distributions	-		(1,454,000)		(14,687)		(1,468,687)		(211,773)		(1,680,460)
	Investment by noncontrolling interests	-		-		-		-		490,712		490,712
Balance, June 30, 2012 (unaudited)		95,368		78,699,497		(63,678)		78,635,819		1,198,297		79,834,116
	Net income	-		394,782		3,988		398,770		92,650		491,420
	Proceeds from sale of limited partnership interests	30,650		30,485,135		-		30,485,135		-		30,485,135
	Sales and offering expenses	-		(3,284,285)		-		(3,284,285)		-		(3,284,285)
	Cash distributions	-		(2,040,112)		(20,608)		(2,060,720)		(37,688)		(2,098,408)
	Investment by noncontrolling interests	-		-		-		-		399,993		399,993
Balance, September 30, 2012 (unaudited)		126,018	$	104,255,017	$	(80,298)	$	104,174,719	$	1,653,252	$	105,827,971
See accompanying notes to consolidated financial statements.

3

ICON ECI Fund Fifteen, L.P.
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows
(unaudited)
						Period from
						July 28, 2011
						(Commencement
				Nine Months		of Operations)
				Ended		through
				September 30, 2012		September 30, 2011
Cash flows from operating activities:
	Net loss			$	(2,370,729)	$	(450,498)
	Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
		Finance income			270,466		-
		Income from investment in joint venture			-		(40,712)
		Depreciation			907,414		-
		Interest expense from amortization of debt financing costs			36,287		4,130
		Credit loss			1,984,044		-
		Paid-in-kind interest			269,133		-
		Changes in operating assets and liabilities:
			Distributions from joint venture		-		39,689
			Other assets		(719,853)		-
			Deferred revenue		11,408		-
			Due to General Partner and affiliates, net		158,237		304,287
			Accrued expenses and other liabilities		307,726		74,481
Net cash provided by (used in) operating activities					854,133		(68,623)
Cash flows from investing activities:
	Purchase of equipment				(34,632,279)		-
	Investment in joint venture				-		(1,835,843)
	Principal repayment on net investment in finance leases				826,190		-
	Investment in notes receivable				(33,637,772)		-
	Principal repayment on notes receivable				740,910		-
Net cash used in investing activities					(66,702,951)		(1,835,843)
Cash flows from financing activities:
	Redemption of limited partnership interest				-		(1,000)
	Proceeds from non-recourse long-term debt				17,500,000		-
	Repayment of non-recourse long-term debt				(625,000)		-
	Repayment of note payable issued by joint venture				(642,600)		-
	Sale of limited partnership interests				94,143,365		10,756,718
	Sales and offering expenses paid				(9,119,281)		(1,044,094)
	Deferred charges paid				(934,151)		(500,000)
	Investment in joint ventures by noncontrolling interests				890,705		-
	Distributions to noncontrolling interests				(249,461)		-
	Debt financing costs				(176,250)		-
	Cash distributions to partners				(4,339,861)		(42,057)
Net cash provided by financing activities					96,447,466		9,169,567
Net increase in cash					30,598,648		7,265,101
Cash, beginning of period					5,383,978		1,001
Cash, end of period				$	35,982,626	$	7,266,102
See accompanying notes to consolidated financial statements.

4

ICON ECI Fund Fifteen, L.P.
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows
(unaudited)
				Period from July 28,
				2011 (Commencement
		Nine Months Ended		of Operations) through
		September 30, 2012		September 30, 2011
Supplemental disclosure of cash flow information:
	Cash paid for interest	$	134,086	$	-
Supplemental disclosure of non-cash investing and financing activities:
	Organizational and offering expenses due to Investment Manager	$	8,193	$	601,735
	Organizational and offering expenses charged to equity	$	922,465	$	93,803
	Underwriting fees due to ICON Securities	$	-	$	13,382
	Reclassification of vessel to net investment in finance leases	$	9,625,000	$	-
	Debt financing costs paid by noncontrolling interest	$	117,500	$	-
	Acquisition fees due to Investment Manager	$	1,025,000	$	-
	Distributions due to ICON GP 15, LLC	$	-	$	425
See accompanying notes to consolidated financial statements.

5

ICON ECI Fund Fifteen, L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

September 30, 2012

(unaudited)

(1)Organization 

ICON ECI Fund Fifteen, L.P. (the “Partnership”) was formed on September 23, 2010 as a Delaware limited partnership. The initial capitalization of the Partnership was $1,001. The Partnership will continue until December 31, 2025, unless terminated sooner. The Partnership is offering limited partnership interests (“Interests”) on a “best efforts” basis with the intention of raising up to $418,000,000 of capital, consisting of 420,000 Interests, of which 20,000 have been reserved for the Partnership’s distribution reinvestment plan (the “DRIP Plan”). The DRIP Plan allows limited partners to purchase Interests with distributions received from the Partnership and/or certain affiliates of the Partnership.

At any time prior to the time that the offering of Interests is terminated, the Partnership may, at its sole discretion, increase the offering to a maximum of up to $618,000,000 of capital, consisting of 620,000 Interests; provided, however, that the offering period may not be extended in connection with such change. The Partnership is currently in its offering period, which commenced on June 6, 2011 and is anticipated to end no later than June 6, 2013.

With the proceeds from Interests sold, the Partnership will (i) primarily originate or acquire a diverse pool of investments in domestic and global companies, which investments will primarily be structured as debt and debt-like financings (such as loans and leases) that are collateralized by equipment and other corporate infrastructure (collectively, “Capital Assets”) utilized by such companies to operate their businesses, as well as other strategic investments in or collateralized by Capital Assets that ICON GP 15, LLC, a Delaware limited liability company and the general partner of the Partnership (the “General Partner”), believes will provide the Partnership with a satisfactory, risk-adjusted rate of return, (ii) pay fees and expenses, and (iii) establish a cash reserve. The General Partner will make investment decisions on behalf of and manage the business of the Partnership. Additionally, the General Partner has a 1% interest in the profits, losses, cash distributions and liquidation proceeds of the Partnership.

As of July 28, 2011 (the “Initial Closing Date”), the Partnership raised a minimum of $1,200,000 from the sale of Interests, at which time the Partnership commenced operations. Upon the commencement of operations on the Initial Closing Date, the Partnership returned the initial capital contribution of $1,000 to ICON Capital Corp., a Delaware corporation and the investment manager of the Partnership (the “Investment Manager”). During the period from June 6, 2011 through September 30, 2012, the Partnership sold 126,018 Interests to 3,096 limited partners, representing $125,610,297 of capital contributions. Investors from the Commonwealth of Pennsylvania and the State of Tennessee were not admitted until the Partnership raised total equity in the amount of $20,000,000, which the Partnership achieved on November 17, 2011. During the period from the Initial Closing Date through September 30, 2012, the Partnership paid or accrued the following commissions and fees in connection with its offering of Interests: (i) sales commissions to third parties in the amount of $8,483,718 and (ii) underwriting fees in the amount of $3,713,874 to ICON Securities Corp., an affiliate of the General Partner and the dealer-manager of the offering of the Interests (“ICON Securities”). In addition, during such period, the General Partner and its affiliates, on behalf of the Partnership, incurred organizational and offering expenses in the amount of $2,292,344. From the Initial Closing Date through September 30, 2012, organizational and offering expenses in the amount of $1,208,109 were recorded as a reduction of partners’ equity.

Partners’ capital accounts are increased for their initial capital contribution plus their proportionate share of earnings and decreased by their proportionate share of losses and distributions. Profits, losses, cash distributions and liquidation proceeds are allocated 99% to the limited partners and 1% to the General Partner until the aggregate amount of cash distributions paid to limited partners equals the sum of the limited partners’ aggregate capital contributions, plus an 8% cumulative annual return on their aggregate unreturned capital contributions,

6

ICON ECI Fund Fifteen, L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

September 30, 2012

(unaudited)

compounded daily. After such time, distributions will be allocated 90% to the limited partners and 10% to the General Partner.

(2)Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying consolidated financial statements of the Partnership have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission for Quarterly Reports on Form 10-Q.  In the opinion of the General Partner, all adjustments, which are of a normal recurring nature, considered necessary for a fair presentation have been included. These consolidated financial statements should be read together with the consolidated financial statements and notes included in the Partnership’s Annual Report on Form 10-K for the period from the Initial Closing Date through December 31, 2011. The results for the interim period are not necessarily indicative of the results for the full year.

The consolidated financial statements include the accounts of the Partnership and its majority-owned subsidiaries and other controlled entities.  All intercompany accounts and transactions have been eliminated in consolidation.  In joint ventures where the Partnership has a controlling financial interest, the financial condition and results of operations of the joint venture are consolidated.  Noncontrolling interest represents the minority owner’s proportionate share of its equity in the joint venture.  The noncontrolling interest is adjusted for the minority owner’s share of the earnings, losses, investments and distributions of the joint venture.

The Partnership accounts for its noncontrolling interests in joint ventures where the Partnership has influence over financial and operational matters, generally 50% or less ownership interest, under the equity method of accounting.  In such cases, the Partnership’s original investments are recorded at cost and adjusted for its share of earnings, losses and distributions.  The Partnership accounts for investments in joint ventures where the Partnership has virtually no influence over financial and operational matters using the cost method of accounting.  In such cases, the Partnership’s original investments are recorded at cost and any distributions received are recorded as revenue.  All of the Partnership’s investments in joint ventures are subject to its impairment review policy.

Net income (loss) attributable to the Partnership per weighted average Interest outstanding is based upon the weighted average number of Interests outstanding during the applicable period.

Credit Quality of Notes Receivable and Direct Finance Leases and Credit Loss Reserve

The Investment Manager weighs all credit decisions based on a combination of external credit ratings as well as internal credit evaluations of all borrowers. A borrower’s credit is analyzed using those credit ratings as well as the borrower’s financial statements and other financial data deemed relevant.

As the Partnership’s notes receivable and direct finance leases (each, a “Note” and, collectively, the “Notes”) are limited in number, the Partnership is able to estimate the credit loss reserve based on a detailed analysis of each Note as opposed to using portfolio based metrics and credit loss reserve. Notes are analyzed quarterly and categorized as either performing or non-performing based on payment history. If a Note becomes non-performing due to a borrower’s missed scheduled payments or failed financial covenants, the Investment Manager analyzes whether a credit loss reserve should be established or whether the Note should be restructured. Material events would be specifically disclosed in the discussion of each Note held.

Recent Accounting Pronouncements

7

ICON ECI Fund Fifteen, L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

September 30, 2012

(unaudited)

In May 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in US GAAP and IFRSs, which amends its guidance related to fair value measurements in order to align the definition of fair value measurements and the related disclosure requirements between US GAAP and International Financial Reporting Standards. The new pronouncement also changes certain existing fair value measurement principles and disclosure requirements. The adoption of ASU 2011-04 became effective for the Partnership on January 1, 2012 and did not have a material impact on the Partnership’s consolidated financial statements.

In June 2011, the FASB issued ASU No. 2011-05, Presentation of Comprehensive Income, which revises the manner in which companies present comprehensive income in their financial statements. The new pronouncement removes the option to report other comprehensive income and its components in the statement of changes in equity and instead requires presentation in one continuous statement of comprehensive income or two separate but consecutive statements. The adoption of ASU 2011-05 became effective for the Partnership on January 1, 2012 and did not have a material impact on the Partnership’s consolidated financial statements, as it only required a change in the format of presentation.

(3)Net Investment in Notes Receivable

Net investment in notes receivable consisted of the following:

	September 30,		December 31,
	2012		2011
Principal outstanding	$	37,717,255	$	12,148,947
Initial direct costs		2,040,196		1,060,602
Deferred fees		(590,451)		(194,849)
Credit loss reserve		(1,960,000)		-
Net investment in notes receivable	$	37,207,000	$	13,014,700

On February 3, 2012, the Partnership made a term loan in the amount of $7,250,000 to subsidiaries of Revstone Transportation, LLC (collectively, “Revstone”). The loan bears interest at 15% per year and is for a period of 60 months. The loan is secured by all of Revstone’s assets, including a mortgage on real property. In addition, the Partnership agreed to make a secured capital expenditure loan (the “CapEx Loan”). On April 2, 2012 and July 30, 2012, Revstone borrowed approximately $500,000 and $642,000, respectively, in connection with the CapEx Loan. The CapEx Loan bears interest at 17% per year and matures on March 1, 2017. The CapEx Loan is secured by a first priority security interest in the automotive manufacturing equipment purchased with the proceeds from the CapEx Loan and a second priority security interest in the term loan collateral.

On February 29, 2012, the Partnership made a term loan in the amount of $2,000,000 to VAS Aero Services, LLC.  The loan bears interest at variable rates ranging between 12% and 14.5% per year and is for a period of 31 months. The loan is secured by a second priority interest in all of VAS’s assets.

On March 9, 2012, the Partnership made a term loan in the amount of $5,000,000 to Kanza Construction, Inc. The loan bears interest at 13% per year and is for a period of 60 months.  The loan is secured by all of Kanza’s assets. During the three months ended June 30, 2012, as a result of the borrower’s unexpected financial hardship and failure to meet certain payment obligations, the loan was placed on nonaccrual status and the Partnership recorded a credit loss reserve of $1,960,000 based on the estimated value of the recoverable collateral. During the three months ended September 30, 2012, Kanza repaid approximately $285,000 of principal, reducing the outstanding balance of the loan at September 30, 2012 to approximately $2,755,000. Subsequent to September 30,

8

ICON ECI Fund Fifteen, L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

September 30, 2012

(unaudited)

2012, Kanza repaid an additional $2,164,000 of principal on the loan. Finance income recognized on the impaired loan was approximately $0 and $97,000 for the three and nine months ended September 30, 2012, respectively. As a nonaccrual status loan, any future change in the fair value of the recoverable collateral will be recorded as an adjustment to credit loss.  However, the net carrying amount of the loan shall at no time exceed the recorded investment in the loan at the time it was deemed impaired.

On June 22, 2012, the Partnership increased the loan facility with NTS Communications, Inc. (f/k/a Xfone USA, Inc.) and certain of its affiliates (collectively, “NTS”) by making an additional $1,540,000 term loan to NTS. The loan bears interest at 12.75% per year and is for a period of 60 months. The loan is secured by, among other things, equipment used in NTS’s high speed broadband services operation, which provides internet access, digital cable television programming and local and long distance telephone service to residential and business customers. In addition, on September 27, 2012, the Partnership made an additional term loan to NTS (the “Second Term Loan”) in the amount of $1,127,500.  The Second Term Loan bears interest at 12.75% per year and is for a period of 57 months.  The loan is secured by the assets acquired with the proceeds from the Second Term Loan.

On July 10, 2012, the Partnership made a term loan in the amount of $5,750,000 to Vintage Partners, LLC to finance the acquisition of two containership vessels (collectively, the “Vintage Vessels”).  The loan bears interest at 15% per year and is for a period of 60 months.  The loan is secured by, among other things, a first priority security interest in the Vintage Vessels.

On July 24, 2012, the Partnership made a secured term loan in the amount of $2,500,000 to affiliates of Frontier Oilfield Services, Inc (collectively, “Frontier”). The loan bears interest at 14% per year and is for a period of 66 months. The loan is secured by among other things, a first lien on Frontier’s saltwater disposal wells and related equipment and a second lien on Frontier’s other assets, including real estate, machinery and accounts receivable.

On September 12, 2012, the Partnership entered into a secured term loan facility in the amount of $7,000,000 with Ocean Product Tankers AS pursuant to which the Partnership agreed to finance the acquisition of three product tanker vessels valued at over $41,000,000. On September 28, 2012, the Partnership deposited the loan proceeds into a third-party escrow account in order to position the funds in anticipation of an overseas closing. On October 4, 2012, the loan was funded. The loan bears interest at 15% per year and is for a period of 60 months. It is secured by, among other things, a second priority mortgage on the three product tanker vessels. At September 30, 2012, the escrowed loan proceeds are included in other assets on the consolidated balance sheet.

(4)     Leased Equipment at Cost

Leased equipment at cost consisted of the following:

	September 30,
	2012
Mining equipment	$	19,388,279
Less: accumulated depreciation		907,414
Leased equipment at cost, less accumulated depreciation	$	18,480,865

On June 29, 2012, the Partnership, through a joint venture owned 94.2% by the Partnership and 5.8% by ICON

ECI Partners, L.P., an entity managed by the Investment Manager (“ECI Partners”), purchased certain mining equipment for approximately $8,869,000 that was subject to lease with The American Coal Company, American Energy Corporation, The Ohio Valley Coal Corporation and Murray Energy Corporation. The lease is for a period of 39 months and commenced on July 1, 2012.

9

ICON ECI Fund Fifteen, L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

September 30, 2012

(unaudited)

On August 3, 2012, the Partnership, through a joint venture owned 96% by the Partnership and 4% by ECI Partners, purchased mining equipment for approximately $10,519,000. The equipment is subject to a 39 month lease with Murray Energy Corporation and certain affiliates that expires on October 31, 2015.

(5)Net Investment in Finance Leases

Net investment in finance leases consisted of the following:

	September 30,		December 31,
	2012		2011
Minimum rents receivable	$	39,503,813	$	1,786,018
Estimated residual values		328,191		328,191
Initial direct costs		618,333		40,812
Unearned income		(14,773,556)		(473,570)
Net investment in finance leases	$	25,676,781	$	1,681,451

On December 19, 2011, the Partnership, through a joint venture owned 60% by the Partnership and 40% by ICON Equipment and Corporate Infrastructure Fund Fourteen, L.P., an entity managed by the Investment Manager (“Fund Fourteen”), agreed to purchase the offshore support vessel, the Lewek Ambassador. The purchase price of the vessel was to be the lesser of $25,000,000 and the fair market value of the vessel as determined before the vessel’s delivery date. On December 20, 2011, the joint venture funded $9,000,000 of the purchase price, with the remaining portion to be funded upon delivery of the vessel.  Simultaneously with the initial funding, the joint venture entered into a bareboat charter with Gallatin Maritime Management for a period of nine years to commence on the delivery date of the vessel. The vessel was delivered on June 4, 2012 for a final purchase price of $24,869,000. The joint venture financed the remaining purchase price with non-recourse long-term debt totaling $17,500,000.

For the purpose of purchasing the Lewek Ambassador, the joint venture was initially capitalized using a combination of debt and equity. As of September 30, 2012, the joint venture has recorded notes payable to the Partnership and Fund Fourteen in the amounts of approximately $3,640,000 and $2,427,000, respectively. The notes bear interest at 17% per year and mature on June 4, 2019. As the joint venture is consolidated by the Partnership, the note payable between the joint venture and the Partnership is eliminated in consolidation. The note payable to Fund Fourteen is presented within due to General Partner and affiliates on the consolidated balance sheets.

(6)Non-Recourse Long-Term Debt

As of September 30, 2012, the Partnership had a non-recourse long-term debt obligation of $16,875,000 related to the Lewek Ambassador, with a maturity date of June 4, 2019, and an interest rate of 4.997%.

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ICON ECI Fund Fifteen, L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

September 30, 2012

(unaudited)

(7)Revolving Line of Credit, Recourse

On May 10, 2011, the Partnership entered into an agreement with California Bank & Trust (“CB&T”) for a revolving line of credit of up to $5,000,000 (the “Facility”), which is secured by all of the Partnership’s assets not subject to a first priority lien. Amounts available under the Facility are subject to a borrowing base that is determined, subject to certain limitations, on the present value of the future receivables under certain loans and lease agreements in which the Partnership has a beneficial interest. At September 30, 2012, the Partnership had $5,000,000 available under the Facility pursuant to the borrowing base.

The Facility expires on March 31, 2013 and the Partnership may request a one-year extension to the revolving line of credit within 390 days of the then-current expiration date, but CB&T has no obligation to extend. The interest rate for general advances under the Facility is CB&T’s prime rate and the interest rate on up to five separate non-prime rate advances that are permitted to be made under the Facility is the 90-day rate at which U.S. dollar deposits can be acquired by CB&T in the London Interbank Eurocurrency Market plus 2.5% per year, provided that all interest rates on advances under the Facility are subject to an interest rate floor of 4.0% per year. In addition, the Partnership is obligated to pay a commitment fee based on an annual rate of 0.50% on unused commitments under the Facility. At September 30, 2012, there were no obligations outstanding under the Facility.

 At September 30, 2012, the Partnership was in compliance with all covenants related to the Facility.

(8)Transactions with Related Parties

The Partnership has entered into agreements with the General Partner, the Investment Manager and ICON Securities, whereby the Partnership pays certain fees and reimbursements to these parties. ICON Securities is entitled to receive a 3.0% underwriting fee from the gross proceeds from sales of Interests.

The General Partner has a 1% interest in the Partnership’s profits, losses, cash distributions and liquidation proceeds. In addition, the General Partner and its affiliates will be reimbursed for organizational and offering expenses incurred in connection with the Partnership’s organization and offering of Interests and administrative expenses incurred in connection with the Partnership’s operations.

Administrative expense reimbursements are costs incurred by the General Partner or its affiliates that are necessary to the Partnership’s operations. These costs include the General Partner’s and its affiliates’ legal, accounting, investor relations and operations personnel, as well as professional fees and other costs that are charged to the Partnership based upon the percentage of time such personnel dedicate to the Partnership. Excluded are salaries and related costs, office rent, travel expenses and other administrative costs incurred by individuals with a controlling interest in the General Partner.

The Partnership pays the Investment Manager (i) a monthly management fee equal to 3.50% of the gross periodic payments due and paid from the Partnership’s investments and (ii) acquisition fees, through the end of the operating period, equal to 2.50% of the total purchase price paid by or on behalf of the Partnership for each of the Partnership’s investments, including, but not limited to, the cash paid, indebtedness incurred or assumed, plus all fees and expenses incurred in connection therewith.

Fees and other expenses paid or accrued by the Partnership to the General Partner or its affiliates were as follows:

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ICON ECI Fund Fifteen, L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

September 30, 2012

(unaudited)

					Period from				Period from
			Three		July 28, 2011		Nine		July 28, 2011
			Months Ended		(Commencement of		Months Ended		(Commencement of
			September 30,		Operations) through		September 30,		Operations) through
Entity	Capacity	Description	2012		September 30, 2011		2012		September 30, 2011
		Organizational and
		offering expense
ICON Capital Corp.	Investment Manager	reimbursements (1)	$	238,830	$	1,101,735	$	770,301	$	1,101,735
ICON Securities Corp.	Dealer-Manager	Underwriting fees (2)		895,238		321,151		2,776,414		321,151
ICON Capital Corp.	Investment Manager	Acquisition fees (3)		1,986,966		-		2,898,378		-
ICON Capital Corp.	Investment Manager	Management fees (4)		108,932		3,473		189,153		3,473
		Administrative expense
ICON Capital Corp.	Investment Manager	reimbursements (4)		937,778		273,965		2,731,434		273,965
Fund Fourteen	Noncontrolling interest	Interest expense (4)		104,305		-		345,693		-
			$	4,272,049	$	1,700,324	$	9,711,373	$	1,700,324

(1)  Amount capitalized and amortized to partners' equity. 

(2)  Amount charged directly to partners' equity. 

(3)  Amount capitalized and amortized to operations over the estimated service period.

(4)  Amount charged directly to operations. 

At September 30, 2012, the Partnership had a net payable of $4,054,356 due to the General Partner and its affiliates that consisted of a payable of approximately $2,715,000 due to Fund Fourteen, primarily related to its noncontrolling interest in the Lewek Ambassador, an acquisition fee payable to the Partnership’s Investment Manager and administrative expense reimbursements.

From October 1, 2012 through November 9, 2012, the Partnership raised an additional $11,539,725 in capital contributions and paid or accrued underwriting fees to ICON Securities in the amount of $326,544.

(9)Fair Value Measurements

Assets and liabilities carried at fair value are classified and disclosed in one of the following three categories:

·Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

·Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

·Level 3: Pricing inputs that are generally unobservable and cannot be corroborated by market data.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

The Partnership is required, on a nonrecurring basis, to adjust the carrying value or provide valuation allowances for certain assets and liabilities using fair value measurements. The Partnership’s non-financial assets, such as leased equipment at cost, are measured at fair value when there is an indicator of impairment and recorded at fair value only when an impairment charge is recognized. The valuation of the Partnership’s financial assets, such as notes receivable or direct financing leases, is included below only when fair value has been measured and recorded based on the fair value of the underlying collateral. The following table summarizes the valuation of the

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ICON ECI Fund Fifteen, L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

September 30, 2012

(unaudited)

Partnership’s material financial assets measured at fair value on a nonrecurring basis, of which the fair value information presented is not current but rather as of the date the impairment was recorded, and the carrying value of the asset at September 30, 2012:

									Credit loss for the
	Carrying Value at			Fair Value at Impairment Date					Nine Months Ended
	September 30, 2012		Level 1		Level 2		Level 3		September 30, 2012
Net investment in note receivable	$	2,755,146	$	-	$	-	$	3,040,000	$	1,984,044

The Partnership’s collateral dependent note receivable was valued using inputs that are generally unobservable and cannot be corroborated by market data and are classified within Level 3. The Partnership utilized a market approach based on published market prices for fair value measurements of the collateral underlying the note receivable adjusted by the Investment Manager to reflect the age and location of such collateral.

Fair value information with respect to the Partnership’s leased assets and liabilities is not separately provided since (i) the current accounting pronouncements do not require fair value disclosures of lease arrangements and (ii) the carrying value of financial assets, other than lease-related investments, approximates fair value due to their short-term maturities and variable interest rates. The estimated fair value of the Partnership’s fixed-rate notes receivable and fixed-rate non-recourse debt was based on the discounted value of future cash flows related to the loans based on recent transactions of this type. Principal outstanding on fixed-rate notes receivable was discounted at rates ranging between 12.75% and 17.0% per year. Principal outstanding on fixed-rate non-recourse debt was discounted at a rate of 3.71% per year.

	September 30, 2012
				Fair Value
		Carrying Value		(Level 3)
Principal outstanding on fixed-rate notes receivable	$	35,757,255	$	35,757,255
Principal outstanding on fixed-rate non-recourse long term debt	$	16,875,000	$	17,684,950

(10)Commitments and Contingencies

At the time the Partnership acquires or divests of its interest in Capital Assets, the Partnership may, under very limited circumstances, agree to indemnify the seller or buyer for specific contingent liabilities.  The General Partner believes that any liability of the Partnership that may arise as a result of any such indemnification obligations will not have a material adverse effect on the consolidated financial condition or results of operations of the Partnership taken as a whole.

In connection with certain investments, the Partnership is required to maintain restricted cash accounts with certain banks. Restricted cash of approximately $375,000 and $0 is presented within other assets in the Partnership’s consolidated balance sheets at September 30, 2012 and December 31, 2011, respectively.

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Item 2. General Partner's Discussion and Analysis of Financial Condition and Results of Operations

The following is a discussion of our current financial position and results of operations. This discussion should be read together with our unaudited consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the period from the Initial Closing Date through December 31, 2011. This discussion should also be read in conjunction with the disclosures below regarding “Forward-Looking Statements” and the “Risk Factors” set forth in Item 1A of Part II of this Quarterly Report on Form 10-Q. 

As used in this Quarterly Report on Form 10-Q, references to “we,” “us,” “our” or similar terms include ICON ECI Fund Fifteen, L.P. and its consolidated subsidiaries.

Forward-Looking Statements

Certain statements within this Quarterly Report on Form 10-Q may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”).  These statements are being made pursuant to the PSLRA, with the intention of obtaining the benefits of the “safe harbor” provisions of the PSLRA, and, other than as required by law, we assume no obligation to update or supplement such statements.  Forward-looking statements are those that do not relate solely to historical fact.  They include, but are not limited to, any statement that may predict, forecast, indicate or imply future results, performance, achievements or events.  You can identify these statements by the use of words such as “may,” “will,” “could,” “anticipate,” “believe,” “estimate,” “expect,” “continue,” “further,” “plan,” “seek,” “intend,” “predict” or “project” and variations of these words or comparable words or phrases of similar meaning.  These forward-looking statements reflect our current beliefs and expectations with respect to future events. They are based on assumptions and are subject to risks and uncertainties and other factors outside our control that may cause actual results to differ materially from those projected.  We undertake no obligation to update publicly or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Overview

We are a direct financing fund that invests primarily in domestic and global companies, which investments will primarily be structured as debt and debt-like financings (such as loans and leases) that are collateralized by Capital Assets utilized by such companies to operate their businesses, as well as other strategic investments in or collateralized by Capital Assets that our General Partner believes will provide us with a satisfactory, risk-adjusted rate of return. We were formed as a Delaware limited partnership and have elected to be treated as a partnership for federal income tax purposes. As of the Initial Closing Date, we raised a minimum of $1,200,000 from the sale of our Interests, at which time we commenced operations. Subsequent to the Initial Closing Date, we returned the initial capital contribution of $1,000 to the Investment Manager. From the commencement of our offering period on June 6, 2011 through September 30, 2012, we sold 126,018 Interests to 3,096 limited partners, representing $125,610,297 of capital contributions. Investors from the Commonwealth of Pennsylvania and the State of Tennessee were not admitted until we raised total equity in the amount of $20,000,000, which we achieved on November 17, 2011.  During the period from June 6, 2011 through November 9, 2012, we raised $137,150,022 in total equity, and will continue to raise equity until our offering period ends on or before June 6, 2013.

After the net offering proceeds have been invested, it is anticipated that additional investments will be made with the cash generated from our initial investments to the extent that cash is not used for our expenses, reserves and distributions to our partners.  The investment in additional Capital Assets in this manner is called “reinvestment.”  We anticipate investing and reinvesting in Capital Assets from time to time for five years from the date we complete the offering.  This time frame is called the “operating period” and may be extended, at our General Partner’s discretion, for up to an additional three years.  After the operating period, we will then sell our assets in the ordinary course of business, during a time frame called the “liquidation period.”

We will seek to generate returns in three ways. We will seek to generate:

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·current cash flow from payments of principal and/or interest (in the case of secured loans and other financing transactions) and rental payments (in the case of leases);

·deferred cash flow by realizing the value of certain Capital Assets that we lease at the maturity of the investment; and

·a combination of both current and deferred cash flow from other structured investments.

In the case of secured loans and other financing transactions, the principal and interest payments due under the loan are expected to provide a return of and a return on the amount we lend. In the case of leases where there is significant current cash flow generated during the primary term of the lease and the value of the Capital Assets at the end of the term will be minimal or is not considered a primary reason for making the investment, the rental payments due under the lease are expected to be, in the aggregate, sufficient to provide a return of and a return on our investment.

In the case of investments in leased Capital Assets that decline in value at a slow rate due to the long economic life of such Capital Assets, we expect that we will generate sufficient net proceeds at the end of the investment from the sale or re-lease of such Capital Assets. In the case of operating leases, we expect most, if not all, of the return of and the return on such investments to be realized upon the sale or re-lease of the Capital Assets. For leveraged leases, we expect the rental income we receive to be less than the purchase price of the Capital Assets because we will structure these transactions to utilize some or all of the lease rental payments to reduce the amount of non-recourse indebtedness used to acquire such assets.

In some cases with respect to the above investments, we may acquire equity interests, as well as warrants or other rights to acquire equity interests, in the borrower or lessee that may increase the expected return on our investment.

Our General Partner manages and controls our business affairs, including, but not limited to, our investments in Capital Assets, under the terms of our limited partnership agreement.  Our Investment Manager, an affiliate of our General Partner, will originate and service our investments.  Our Investment Manager manages or is the investment manager or managing trustee for six other public equipment funds.

Recent Significant Transactions

We engaged in the following significant transactions since December 31, 2011:

Net Investment in Notes Receivable

·On February 3, 2012, we made a term loan in the amount of $7,250,000 to Revstone. The loan bears interest at 15% per year and is for a period of 60 months. The loan is secured by all of Revstone’s assets, including a mortgage on real property. In addition, we agreed to make the CapEx Loan. On April 2, 2012 and July 30, 2012, Revstone borrowed approximately $500,000 and $642,000, respectively, in connection with the CapEx Loan. The CapEx Loan bears interest at 17% per year and matures on March 1, 2017. The CapEx Loan is secured by a first priority security interest in the automotive manufacturing equipment purchased with the proceeds from the CapEx Loan and a second priority security interest in the term loan collateral.

·On February 29, 2012, we made a term loan in the amount of $2,000,000 to VAS.  The loan bears interest at variable rates ranging between 12% and 14.5% per year and is for a period of 31 months. The loan is secured by a second priority interest on all of VAS’s assets.

·On March 9, 2012, we made a term loan in the amount of $5,000,000 to Kanza Construction, Inc. The loan bears interest at 13% per year and is for a period of 60 months.  The loan is secured by all of Kanza’s assets. During the three months ended June 30, 2012, as a result of the borrower’s unexpected financial hardship and failure to meet certain payment obligations, the loan was placed on nonaccrual status and we recorded a credit

15

loss reserve of $1,960,000 based on the estimated value of the recoverable collateral. During the three months ended September 30, 2012, Kanza repaid approximately $285,000 of principal, reducing the outstanding balance of the loan at September 30, 2012 to approximately $2,755,000. Subsequent to September 30, 2012, Kanza repaid an additional $2,164,000 of principal on the loan. Finance income recognized on the impaired loan was approximately $0 and $97,000 for the three and nine months ended September 30, 2012, respectively. As a nonaccrual status loan, any future change in the fair value of the recoverable collateral will be recorded as an adjustment to credit loss.  However, the net carrying amount of the loan shall at no time exceed the recorded investment in the loan at the time it was deemed impaired.

·On June 22, 2012, we increased our loan facility with NTS by making an additional $1,540,000 term loan to NTS. The loan bears interest at 12.75% per year and is for a period of 60 months. The loan is secured by, among other things, equipment used in NTS’s high speed broadband services operation, which provides internet access, digital cable television programming and local and long distance telephone service to residential and business customers. In addition, on September 27, 2012, we made the Second Term Loan in the amount of $1,127,500.  The Second Term Loan bears interest at 12.75% per year and is for a period of 57 months.  The loan is secured by the assets acquired with the proceeds from the Second Term Loan.

·On July 10, 2012, we made a term loan in the amount of $5,750,000 to Vintage Partners, LLC to finance the acquisition of the Vintage Vessels.  The loan bears interest at 15% per year and is for a period of 60 months.  The loan is secured by, among other things, a first priority security interest in the Vintage Vessels.

·On July 24, 2012, we made a secured term loan in the amount of $2,500,000 to Frontier. The loan bears interest at 14% per year and is for a period of 66 months. The loan is secured by, among other things, a first lien on Frontier’s saltwater disposal wells and related equipment and a second lien on Frontier’s other assets, including real estate, machinery and accounts receivable.

·On September 12, 2012, we entered into a secured term loan facility in the amount of $7,000,000 with Ocean Product Tankers AS pursuant to which we agreed to finance the acquisition of three product tanker vessels valued at over $41,000,000. On September 28, 2012, we deposited the loan proceeds into a third-party escrow account in order to position the funds in anticipation of an overseas closing. On October 4, 2012, the loan was funded. The loan bears interest at 15% per year and is for a period of 60 months. It is secured by, among other things, a second priority mortgage on the three product tanker vessels. At September 30, 2012, the escrowed loan proceeds are included in other assets on the consolidated balance sheet.

Net Investment in Finance Lease

·On December 19, 2011, we, through a joint venture owned 60% by us and 40% by Fund Fourteen, agreed to purchase the offshore support vessel, the Lewek Ambassador. On December 20, 2011, the joint venture funded $9,000,000 of the purchase price. The vessel was delivered on June 4, 2012 for a final purchase price of $24,869,000. The joint venture financed the remaining purchase price through non-recourse long-term debt totaling $17,500,000.

Leased Equipment at Cost

·On June 29, 2012, we, through a joint venture owned 94.2% by us and 5.8% by ECI Partners, purchased certain mining equipment for approximately $8,869,000 that was subject to lease with The American Coal Company, American Energy Corporation, The Ohio Valley Coal Corporation and Murray Energy Corporation.  The lease is for a period of 39 months and commenced on July 1, 2012.

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·On August 3, 2012, we, through a joint venture owned 96% by us and 4% by ECI Partners, purchased mining equipment for approximately $10,519,000. The equipment is subject to a 39 month lease with Murray Energy Corporation and certain affiliates that expires on October 31, 2015.

Acquisition Fees

In connection with the new investments made since December 31, 2011 through September, 30, 2012, we paid or accrued total acquisition fees to our Investment Manager of approximately $2,898,378.

Recent Accounting Pronouncements

      We do not believe any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on our consolidated financial statements.

Results of Operations for the Three Months Ended September 30, 2012 (the “2012 Quarter”) and the Period from the Commencement of Operations through September 30, 2011 (the “2011 Period”)

Total revenue increased $3,019,910, from $40,712 in the 2011 Period  to $3,060,622 in the 2012 Quarter. The increase was primarily attributable to finance income generated from our notes receivable and finance leases and rental income generated from our operating leases.

Total expenses increased $2,077,992, from $491,210 in the 2011 Period to $2,569,202 in the 2012 Quarter. The increase was primarily due to depreciation of assets related to our operating leases, interest expense related to our non-recourse long-term debt and administrative expense reimbursements and management fees to our Investment Manager. Administrative expense reimbursements are costs incurred by our Investment Manager or its affiliates that are necessary to our operations.

Noncontrolling Interests

Net income attributable to noncontrolling interests for the 2012 Quarter was $92,650, which consisted of ECI Partners’ investment in new operating leases and Fund Fourteen’s investment in the Lewek Ambassador. We did not have net income attributable to noncontrolling interests in the 2011 Period.

Net Income (Loss) Attributable to Fund Fifteen

      As a result of the foregoing factors, net income (loss) attributable to us for the 2012 Quarter and the 2011 Period was $398,770 and $(450,498), respectively. The net income (loss) attributable to us per weighted average Interest outstanding for the 2012 Quarter and the 2011 Period was $3.54 and ($83.63), respectively.

Results of Operations for the Nine Months Ended September 30, 2012 (the “2012 Period”) and the 2011 Period

Total revenue increased $4,831,451, from $40,712 in the 2011 Period to $4,872,163 in the 2012 Period. The increase was primarily attributable to finance income generated from our notes receivable and finance leases and rental income generated from our operating leases.

Total expenses increased $6,751,682, from $491,210 in the 2011 Period to $7,242,892 in the 2012 Period. The increase was primarily due to administrative expense reimbursements and management fees to our Investment Manager, a credit loss on net investment in notes receivable, depreciation of assets related to our operating leases and interest expense related to our non-recourse long-term debt. Administrative expense reimbursements are costs incurred by our Investment Manager or its affiliates that are necessary to our operations.

Noncontrolling Interests

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Net loss attributable to noncontrolling interests for the 2012 Period was $134,828, which was the result of ECI Partners’ investment in new operating leases and Fund Fourteen’s investment in the Lewek Ambassador. We did not have any net loss or net gain attributable to noncontrolling interests in the 2011 Period.

Net Loss Attributable to Fund Fifteen

As a result of the foregoing factors, net loss attributable to us for the 2012 Period and the 2011 Period was $2,235,901 and $450,498, respectively. The net loss attributable to us per weighted average Interest outstanding for the 2012 Period and the 2011 Period was $27.01 and $83.63, respectively.

Financial Condition

This section discusses the major balance sheet variances at September 30, 2012 compared to December 31, 2011.

Total Assets

Total assets increased $95,698,743, from $31,436,470 at December 31, 2011 to $127,135,213 at September 30, 2012. The increase in total assets was the result of cash proceeds received from the sale of Interests, which were then used to make investments in 11 notes receivable, two operating leases and one leveraged finance lease. This increase was partially offset by a credit loss reserve of $1,960,000. 

Total Liabilities

Total liabilities increased $17,536,575, from $3,770,667 at December 31, 2011 to $21,307,242 at September 30, 2012. The increase was primarily the result of borrowing $17,500,000 of non-recourse long-term debt related to the investment in the Lewek Ambassador offshore support vessel.

Equity

Equity increased $78,162,168, from $27,665,803 at December 31, 2011 to $105,827,971 at September 30, 2012. The increase primarily related to the cash proceeds received from the sale of Interests, which were partially offset by the net loss recorded, sales and offering expenses incurred and distributions paid to our partners in the 2012 Period.

Liquidity and Capital Resources

Summary

At September 30, 2012 and December 31, 2011, we had cash of $35,982,626 and $5,383,978, respectively.  Pursuant to the terms of our offering, we have established a reserve in the amount of 0.50% of the gross offering proceeds from the sale of our Interests.  As of September 30, 2012, the cash reserve was $628,051. During our offering period, our main source of cash is from financing activities and our main use of cash is in investing activities.

We are offering our Interests on a “best efforts” basis with the current intention of raising up to $418,000,000.  As additional Interests are sold, we will experience a relative increase in liquidity as cash is received, and then a relative decrease in liquidity as cash is expended to make investments. 

We are using the net proceeds of the offering to invest in Capital Assets located in North America, Europe and other developed markets, including those in Asia, South America and elsewhere.  We seek to acquire a portfolio of Capital Assets that is comprised of transactions that generate (a) current cash flow from payments of principal and/or interest (in the case of secured loans and other financing transactions) and rental payments (in the case of leases), (b) deferred cash flow by realizing the value of certain Capital Assets that we lease at the maturity of the investment, or (c) a combination of both.

Unanticipated or greater than anticipated operating costs or losses (including a borrower’s inability to make timely loan payments or a lessee’s inability to make timely lease payments) would adversely affect our liquidity. To

18

the extent that working capital may be insufficient to satisfy our cash requirements, we anticipate that we would fund our operations from cash flow generated by operating and financing activities. In addition, as of September 30, 2012, we have $5,000,000 available to us under the Facility pursuant to the borrowing base. Our General Partner does not intend to fund any cash flow deficit of ours or provide other financial assistance to us.

From the commencement of our offering period on June 6, 2011 through September 30, 2012, we sold 126,018 Interests to 3,096 limited partners, representing $125,610,297 of capital contributions. From the Initial Closing Date on July 28, 2011 through September 30, 2012, we paid or accrued sales commissions to third parties of $8,483,718 and underwriting commissions to ICON Securities of $3,713,874.  In addition, organizational and offering expenses of $2,292,344 were paid or accrued by us, our General Partner or its affiliates during this period.

Operating Activities 

Cash provided by operating activities increased $922,756 from a use of cash of $68,623 in the 2011 Period to a source of cash of $854,133 in the 2012 Period. The increase was primarily related to interest payments received on our notes receivable and finance leases, partially offset by payments made for administrative expense reimbursements and management fees to our Investment Manager and interest expense.

Investing Activities

Cash used in investing activities increased $64,867,108 from $1,835,843 in the 2011 Period to $66,702,951 in the 2012 Period. The increase was primarily related to our investment in 11 notes receivable, two operating leases and one leveraged finance lease.

Financing Activities

Cash provided by financing activities increased $87,277,899 from $9,169,567 in the 2011 Period to $96,447,466 in the 2012 Period. The increase was primarily related to additional proceeds from the sale of Interests and proceeds from non-recourse long-term debt related to the investment in the Lewek Ambassador offshore support vessel, which were partially offset by increased sales and offering expenses, cash distributions paid to partners and principal repayments of debt related to the investment in the Lewek Ambassador offshore support vessel during the 2012 Period.

Non-Recourse Long-Term Debt

We had a non-recourse long-term debt obligation at September 30, 2012 of $16,875,000 related to the Lewek Ambassador. Our non-recourse long-term debt obligation consists of a note payable in which the lender has a security interest in the underlying equipment. If the lessee were to default on the underlying lease resulting in our default on the non-recourse long-term debt, the equipment would be returned to the lender in extinguishment of that debt.

Sources of Liquidity

We believe that cash generated from the sale of Interests pursuant to our offering and other financing activities, as well as the expected results of our operations, will be sufficient to finance our liquidity requirements for the foreseeable future, including distributions to our partners, general and administrative expenses, new investment opportunities, management fees and administrative expense reimbursements.  In addition, our revolving line of credit, which expires on March 31, 2013, is available for additional working capital needs or new investment opportunities. Our revolving line of credit is discussed in further detail below.

Our ability to generate cash in the future is subject to general economic, financial, competitive, regulatory and other factors that affect us and our lessees’ and borrowers’ businesses that are beyond our control.

Revolving Line of Credit, Recourse

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At September 30, 2012, we had $5,000,000 available under the Facility, which is secured by all of our assets not subject to a first priority lien. Amounts available under the Facility are subject to a borrowing base that is determined, subject to certain limitations, on the present value of the future receivables under certain loans and lease agreements in which we have a beneficial interest. 

The Facility expires on March 31, 2013 and we may request a one-year extension to the revolving line of credit within 390 days of the then-current expiration date, but CB&T has no obligation to extend. The interest rate for general advances under the Facility is CB&T’s prime rate and the interest rate on up to five separate non-prime rate advances that are permitted to be made under the Facility is the 90-day rate at which U.S. dollar deposits can be acquired by CB&T in the London Interbank Eurocurrency Market plus 2.50% per year, provided that all interest rates on advances under the Facility are subject to an interest rate floor of 4.0% per year. In addition, we are obligated to pay a commitment fee based on an annual rate of 0.50% on unused commitments under the Facility.

There are no obligations outstanding under the Facility at September 30, 2012.

At September 30, 2012, we were in compliance with all covenants related to the Facility.

Distributions

We, at our General Partner’s discretion, pay monthly distributions to each of our limited partners beginning with the first month after each such limited partner’s admission and expect to continue to pay such distributions until the termination of our operating period.  We paid distributions of $43,390, $4,295,567 and $249,461 to our General Partner, limited partners and noncontrolling interests, respectively, during the 2012 Period.

Commitments and Contingencies and Off-Balance Sheet Transactions

Commitments and Contingencies

At the time we acquire or divest an interest in Capital Assets, we may, under very limited circumstances, agree to indemnify the seller or buyer for specific contingent liabilities.  Our General Partner believes that any liability of ours that may arise as a result of any such indemnification obligations will not have a material adverse effect on our consolidated financial condition or results of our operations taken as a whole.

In connection with certain investments, we are required to maintain restricted cash accounts with certain banks. Restricted cash of approximately $375,000 and $0 is presented within other assets in our consolidated balance sheets at September 30, 2012 and December 31, 2011, respectively.

Off-Balance Sheet Transactions

None.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

There are no material changes to the disclosures related to this item since the filing of our Annual Report on Form 10-K for the year ended December 31, 2011.

Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures

In connection with the preparation of this Quarterly Report on Form 10-Q for the three months ended September 30, 2012, as well as the financial statements for our General Partner, our General Partner carried out an evaluation, under the supervision and with the participation of the management of our General Partner, including its Co-Chief Executive Officers and the Principal Financial and Accounting Officer, of the effectiveness of the design and operation of our General Partner’s disclosure controls and procedures as of the end of the period covered by this report pursuant to the Securities Exchange Act of 1934, as amended.  Based on the foregoing evaluation, the Co-Chief Executive Officers and the Principal Financial and Accounting Officer concluded that our General Partner’s disclosure controls and procedures were effective.

In designing and evaluating our General Partner’s disclosure controls and procedures, our General Partner recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met.  Our General Partner’s disclosure controls and procedures have been designed to meet reasonable assurance standards. Disclosure controls and procedures cannot detect or prevent all error and fraud. Some inherent limitations in disclosure controls and procedures include costs of implementation, faulty decision-making, simple error and mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based, in part, upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all anticipated and unanticipated future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with established policies or procedures.  

Evaluation of internal control over financial reporting

There have been no changes in our internal control over financial reporting during the three months ended September 30, 2012 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

In the ordinary course of conducting our business, we may be subject to certain claims, suits and complaints filed against us.  In our General Partner’s opinion, the outcome of such matters, if any, will not have a material impact on our consolidated financial position, cash flows or results of operations.  We are not aware of any material legal proceedings that are currently pending against us or against any of our assets.

Item 1A. Risk Factors

There have been no material changes from the risk factors disclosed in “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2011.

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

On September 23, 2010, we were capitalized with the issuance to (i) ICON GP 15, LLC of a general partnership interest for the purchase price of $1.00 and (ii) ICON Capital Corp. of one Interest for the purchase price of $1,000. These partnership interests were purchased for investment and for the purpose of organizing us. We issued the partnership interests in reliance on an exemption from registration under Section 4(2) of the Securities Act of 1933.

Our Registration Statement on Form S-1, as amended, was declared effective by the Securities and Exchange Commission on June 6, 2011 (SEC File No. 333-169794).  Our offering period commenced on June 6, 2011 and will end no later than June 6, 2013. 

Our Initial Closing Date was July 28, 2011. Following such date, we returned the initial capital contribution of $1,000 to our Investment Manager. During the period from June 6, 2011 through September 30, 2012, we received additional capital contributions in the amount of $125,610,297.  For the period from the Initial Closing Date through September 30, 2012, we paid or accrued sales commissions to third parties of $8,483,718 and underwriting commissions to ICON Securities of $3,713,874.  In addition, organizational and offering expenses in the amount of $2,292,344 were paid or accrued by us, our General Partner or its affiliates during this period.  Net offering proceeds to us after deducting the expenses described were $111,120,361 during this period.

From October 1, 2012 through November 9, 2012, we received additional capital contributions in the amount of $11,539,725. For the period from October 1, 2012 through November 9, 2012, we paid or accrued sales commissions to third parties of $755,826 and underwriting commissions to ICON Securities of $326,544.

See the disclosure under “Recent Significant Transactions” in Item 2 of Part I for a discussion of the investments we have made with our net offering proceeds.

Item 3.  Defaults Upon Senior Securities

Not applicable.

Item 4.  Mine Safety Disclosures

Not applicable.

Item 5.  Other Information

Not applicable.

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Item 6. Exhibits

3.1    Certificate of Limited Partnership of Registrant (Incorporated by reference to Exhibit 3.1 to Registrant’s Registration Statement on Form S-1 filed with the SEC on October 6, 2010 (File No. 333-169794)).

4.1    Limited Partnership Agreement of Registrant (Incorporated by reference to Exhibit A to Registrant’s Prospectus filed with the SEC on June 6, 2011 (File No. 333-169794)).

10.1   Investment Management Agreement, by and between ICON ECI Fund Fifteen, L.P. and ICON Capital Corp., dated as of June 3, 2011 (Incorporated by reference to Exhibit 10.2 to Amendment No. 6 to the Registrant’s Registration Statement on Form S-1 filed with the SEC on June 3, 2011 (File No. 333-169794)).

10.2  Commercial Loan Agreement, by and between California Bank & Trust and ICON ECI Fund Fifteen, L.P., dated as of May 10, 2011 (Incorporated by reference to Exhibit 10.2 to Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2011, filed on August 12, 2011).

31.1  Rule 13a-14(a)/15d-14(a) Certification of Co-Chief Executive Officer.

   31.2  Rule 13a-14(a)/15d-14(a) Certification of Co-Chief Executive Officer.

   31.3  Rule 13a-14(a)/15d-14(a) Certification of Principal Financial and Accounting Officer. 

32.1  Certification of Co-Chief Executive Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2  Certification of Co-Chief Executive Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.3  Certification of Principal Financial and Accounting Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*      XBRL Instance Document.

101.SCH*     XBRL Taxonomy Extension Schema Document.

101.CAL*     XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*     XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB*     XBRL Taxonomy Extension Labels Linkbase Document.

101.PRE*     XBRL Taxonomy Extension Presentation Linkbase Document.

XBRL (eXtensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections. 

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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.

ICON ECI Fund Fifteen, L.P.

(Registrant)

By: ICON GP 15, LLC

      (General Partner of the Registrant)

November 15, 2012

By:/s/ Michael A. Reisner

Michael A. Reisner

Co-Chief Executive Officer and Co-President

(Co-Principal Executive Officer)

By:/s/ Mark Gatto

Mark Gatto

Co-Chief Executive Officer and Co-President

(Co-Principal Executive Officer)

By:/s/ Keith S. Franz

Keith S. Franz

Managing Director

(Principal Financial and Accounting Officer)

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