ICON ECI Fund Sixteen 10-Q 14 May 14 2014 Q1 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information (USD $)	3 Months Ended
	Mar. 31, 2014	8-May-14
Class of Shares [Line Items]	'	'
Entity Registrant Name	'ICON ECI Fund Sixteen	'
Entity Central Index Key	'0001561679	'
Current Fiscal Year End Date	'--12-31	'
Entity Current Reporting Status	'Yes	'
Entity Filer Category	'Smaller Reporting Company	'
Entity Common Stock, Shares Outstanding	'	8,021
Document Fiscal Year Focus	'2014	'
Document Fiscal Period Focus	'Q1	'
Amendment Flag	'false	'
Document Type	'10-Q	'
Document Period End Date	31-Mar-14	'
Entity public float	$0	'
Common Class I [Member]	'	'
Class of Shares [Line Items]	'	'
Entity Common Stock, Shares Outstanding	'	65

Consolidated_Balance_Sheets_un

Consolidated Balance Sheets (unaudited) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Assets	'	'
Cash	$1,927,369	$1,027,327
Investment in Joint Ventures	5,675,638	897,996
Other assets	15,043	18,693
Total assets	7,618,050	1,944,016
Liabilities:	'	'
Due to Investment Manager and affiliates	489,720	105,564
Accrued expenses and other liabilities	249,863	92,513
Total liabilities	739,583	198,077
Shareholders' capital	'	'
Class A	6,830,838	1,693,429
Class I	47,629	52,510
Total shareholders' capital	6,878,467	1,745,939
Total liabilities and equity	$7,618,050	$1,944,016

Consolidated_Statement_of_Oper

Consolidated Statement of Operations (unaudited) (USD $)	3 Months Ended
	Mar. 31, 2014
Revenue:	'
Income from investment in joint venture	$65,231
Total revenue	65,231
Expenses:	'
Management fees	12,286
Administrative expense reimbursements	175,593
General and administrative	54,823
Interest	4,165
Organization costs	3,173
Total expenses	250,040
Net income (loss)	-184,809
Net loss attributable to Fund Sixteen allocable to:	'
Additional Class A and I shareholders	-182,961
Managing Owner	-1,848
Net income (loss) attributable to Fund Sixteen	($184,809)
Net loss attributable to Fund Sixteen allocable to additional Class A shareholders	($180,661)
Weighted average number of Class A shares outstanding	5,053
Net loss attributable to Fund Sixteen per weighted average additional Class A share	($35.76)
Net loss attributable to Fund Sixteen allocable to additional Class I shareholders	($2,300)
Weighted average number of Class I shares outstanding	65
Net loss attributable to Fund Sixteen per weighted average Class I share	($35.65)

Consolidated_Statement_of_Chan

Consolidated Statement of Changes in Equity (USD $)	Total	Managing Owner	Additional Class A Shareholders	Class I additional shareholders	Total Partners Equity [Member]
Balance at Dec. 31, 2013	$1,745,939	($1,161)	$1,694,590	$52,510	$1,693,429
Balance (in shares) at Dec. 31, 2013	2,081	0.001	2,016	65	2,016
Increase (decrease) in equity [Roll Forward]	'	'	'	'	'
Net loss	-184,809	-1,848	-180,661	-2,300	-182,509
Total shares	'	'	'6,005	'	'6,005
Proceeds from sale of shares	5,968,452	'	5,968,452	'	5,968,452
Sales and offering expenses	-588,693	'	-587,385	-1,308	-587,385
Distributions	-62,422	-625	-60,524	-1,273	-61,149
Balance (unaudited) at Mar. 31, 2014	$6,878,467	($3,634)	$6,834,472	$47,629	$6,830,838
Balance (unaudited) (in shares) at Mar. 31, 2014	8,086	0.001	8,021	65	8,021

Consolidated_Statement_of_Cash

Consolidated Statement of Cash Flows (unaudited) (USD $)	3 Months Ended
	Mar. 31, 2014
Cash flows from operating activities:	'
Net loss	($184,809)
Adjustments to reconcile net loss to net cash used in operating activities:	'
Income from investment in joint ventures	-65,231
Interest expense from amortization of debt financing costs	3,650
Interest expense from amortization of seller's credit	515
Changes in operating assets and liabilities:	'
Due to Investment Manager and affiliates	226,442
Accrued expenses and other liabilities	7,946
Distributions from joint ventures	45,614
Net cash provided by (used in) operating activities	34,127
Cash flows from investing activities:	'
Investment in joint venture	-4,904,295
Distributions received from joint venture in excess of profit	247,794
Net cash used in investing activities	-4,656,501
Cash flows from financing activities:	'
Sales commissions and dealer-manager fees	-383,902
Distributions to shareholders	-62,134
Net cash provided by financing activities	5,522,416
Net increase in cash	900,042
Cash, beginning of period	1,027,327
Cash, end of period	1,927,369
Supplemental disclosure of cash flow information:	'
Offering expenses charged to equity	55,919
Sales commissions due to third parties	148,889
Acquisition Fee payable to Investment Manager	101,524
Distribution payable to Managing Owner	$288

Organization

Organization	3 Months Ended
	Mar. 31, 2014
Organization [Abstract]	'
Organization	'
	(1) Organization
	ICON ECI Fund Sixteen (the “Fund”) was formed as a Delaware statutory trust on October 11, 2012. When used in these notes to the financial statements, the terms “we,” “us,” “our” or similar terms refer to the Fund. Our initial capitalization was $1,001. We will continue until December 31, 2027, unless terminated sooner.
	We are a direct financing fund that primarily makes investments in or that are collateralized by equipment and other corporate infrastructure (collectively, “Capital Assets”). The investments are in companies that utilize Capital Assets to operate their businesses. These investments are primarily structured as debt and debt-like financings such as loans, leases and other structured financing transactions in or that are collateralized by Capital Assets that ICON MT 16, LLC, a Delaware limited liability company and our managing owner (the “Managing Owner”), believes will provide us with a satisfactory, risk-adjusted rate of return. Our Managing Owner makes investment decisions on our behalf and manages our business.
	Our investment objectives are to preserve investors’ capital, provide distributions and provide a favorable total return. To meet our investment objectives, we will use the net proceeds from our offering to originate or acquire a diverse pool of investments described above, as well as other strategic investments collateralized by Capital Assets. ICON Capital, LLC, a Delaware limited liability company and our affiliate, is our investment manager (the “Investment Manager”). Our Investment Manager originates and services our investments. Wilmington Trust, National Association (the “Trustee”) serves as our sole trustee pursuant to our Third Amended and Restated Trust Agreement (the “Trust Agreement”). The Trustee delegated to the Managing Owner all of the power and authority to manage our business and affairs and has only nominal duties and liabilities to us.
	Our offering period commenced on July 1, 2013. We are offering to sell to the public any combination of two classes of shares, Class A shares and Class I shares (collectively, the “Shares”), on a “best efforts” basis with the intention of raising up to $250,000,000 of capital, of which $9,000,000 has been reserved for issuance pursuant to our distribution reinvestment plan (the “DRIP”). Other than differing allocable fees and expenses, Class A shares and Class I shares have identical rights and privileges, such as identical voting and distribution rights. We reserve the right to reallocate the offering amount between the primary offering and the DRIP.
	As of November 12, 2013 (the “Initial Closing Date”), we raised a minimum of $1,200,000 from the sale of our Shares, at which time shareholders were admitted and we commenced operations. As of March 31, 2014, we had not raised the $12,500,000 minimum offering amount for the Commonwealth of Pennsylvania. From the commencement of our offering period on July 1, 2013 through March 31, 2014, we sold 8,021 Class A shares to 156 Class A shareholders and 65 Class I shares to one Class I shareholder, representing an aggregate of $8,039,346 of capital contributions.  From July 1, 2013 through March 31, 2014, we incurred sales commissions to third parties of $561,458 and dealer-manager and distribution fees in the amount of $161,157 to ICON Securities, LLC, formerly known as ICON Securities Corp., the dealer-manager of our offering and an affiliate of our Investment Manager (“ICON Securities”). In addition, organization costs of $4,343 and offering expenses of $74,852 were incurred by us during such period and are included in due to Investment Manager and affiliates on our balance sheets. Organization costs are expensed when incurred and offering expenses are recorded as a reduction of shareholders’ equity.

Summary_of_Significant_Account

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2014
Summary of Significant Accounting Policies [Abstract]	'
Summary of Significant Accounting Policies	'
	(2) Summary of Significant Accounting Policies
	Basis of Presentation
	Our accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. 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 our Managing Owner, all adjustments, which are of a normal recurring nature, considered necessary for a fair presentation have been included.  These financial statements should be read together with the financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2013.  The results for the interim period are not necessarily indicative of the results for the full year.
	Credit Quality of Notes Receivable and Finance Leases and Credit Loss Reserve
	Our 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 our financing receivables, generally notes receivable and finance leases, are limited in number, our Investment Manager is able to estimate the credit loss reserve based on a detailed analysis of each financing receivable as opposed to using portfolio-based metrics and credit loss reserve. Financing receivables are analyzed quarterly and categorized as either performing or non-performing based on payment history. If a financing receivable becomes non-performing due to a borrower’s missed scheduled payments or failed financial covenants, our Investment Manager analyzes whether a credit loss reserve should be established or whether the financing receivable should be restructured. Material events would be specifically disclosed in the discussion of each financing receivable held.
	Financing receivables are generally placed in a non-accrual status when payments are more than 90 days past due. Additionally, our Investment Manager periodically reviews the creditworthiness of companies with payments outstanding less than 90 days and based upon our Investment Manager’s judgment, these accounts may be placed in a non-accrual status.
	In accordance with the cost recovery method, payments received on non-accrual financing receivables are applied to principal if there is doubt regarding the ultimate collectability of principal. If collection of the principal of non-accrual financing receivables is not in doubt, interest income is recognized on a cash basis. Financing receivables in non-accrual status may not be restored to accrual status until all delinquent payments have been received, and we believe recovery of the remaining unpaid receivable is probable.
	When our Investment Manager deems it is probable that we will not be able to collect all contractual principal and interest on a non-performing financing receivable, we perform an analysis to determine if a credit loss reserve is necessary. This analysis considers the estimated cash flows from the financing receivable, or the collateral value of the asset underlying the financing receivable when financing receivable repayment is collateral dependent. If it is determined that the impaired value of the non-performing financing receivable is less than the net carrying value, we will recognize a credit loss reserve or adjust the existing credit loss reserve with a corresponding charge to earnings. We then charge off a financing receivable in the period that it is deemed uncollectible by reducing the credit loss reserve and the balance of the financing receivable.

Investment_in_Joint_Ventures

Investment in Joint Ventures	3 Months Ended
	Mar. 31, 2014
Investment in Joint Ventures	'
Investment in Joint Ventures	'
	(4) Investment in Joint Ventures
	On September 12, 2013, a joint venture owned by us, ICON Leasing Fund Eleven, LLC (“Fund Eleven”) and ICON Leasing Fund Twelve, LLC (“Fund Twelve”), each an entity also managed by our Investment Manager, purchased mining equipment for approximately $15,107,000. The equipment is subject to a 24-month lease with Murray Energy Corporation and certain of its affiliates (collectively, “Murray”), which expires on September 30, 2015. On December 1, 2013 and February 1, 2014, we contributed capital of approximately $934,000 and $1,726,000, respectively, to the joint venture, inclusive of acquisition fees. Subsequent to our second capital contribution, the joint venture is owned 19.8% by us, 67.0% by Fund Eleven and 13.2% by Fund Twelve.
	On March 4, 2014, a joint venture owned 10% by us, 60% by Fund Twelve, 15% by ICON Equipment and Corporate Infrastructure Fund Fourteen, L.P. (“Fund Fourteen”) and 15% by ICON ECI Fund Fifteen, L.P. (“Fund Fifteen”), each an entity also managed by our Investment Manager, purchased mining equipment from an affiliate of Blackhawk Mining, LLC (“Blackhawk”). Simultaneously, the mining equipment was leased to Blackhawk and its affiliates for four years. The aggregate purchase price for the mining equipment of approximately $25,359,000 was funded by approximately $17,859,000 in cash and $7,500,000 of non-recourse long-term debt. Our contribution to the joint venture was approximately $1,732,000.
	On March 28, 2014, a joint venture owned 12.5% by us, 60% by Fund Twelve and 27.5% by Fund Fifteen purchased trucks, trailers and other equipment from subsidiaries of D&T Holdings, LLC (“D&T”) for $12,200,000. Simultaneously, the trucks, trailers and other equipment were leased to D&T and its subsidiaries for 57 months. Our contribution to the joint venture was approximately $1,447,000.
	Information as to the results of operations of ICON Murray VI, LLC is summarized as follows:
			Three Months Ended
			31-Mar-14
		Revenue	$	1,906,537
		Net income	$	331,198
		Our share of net income	$	45,614
	Information as to the results of operations of ICON Blackhawk, LLC is summarized as follows:
			Three Months Ended
			31-Mar-14
		Revenue	$	231,913
		Net income	$	177,977
		Our share of net income	$	17,985

Revolving_Line_of_Credit_Recou

Revolving Line of Credit, Recourse	3 Months Ended
	Mar. 31, 2014
Revolving Line of Credit, Recourse [Abstract]	'
Revolving Line of Credit, Recourse	'
	(5) Revolving Line of Credit, Recourse
	On December 26, 2013, we 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 our assets not subject to a first priority lien. The interest rate for general advances under the Facility is CB&T’s prime rate. We may elect to designate up to five advances on the outstanding principal balance of the Facility to bear interest at the London Interbank Offered Rate (“LIBOR”) plus 2.5% per year. In all instances, borrowings under the Facility are subject to an interest rate floor of 4.0% per year. In addition, we are obligated to pay an annualized 0.5% fee on unused commitments under the Facility. At March 31, 2014, there were no obligations outstanding and we were in compliance with all covenants related to the Facility. Amounts available under the Facility are subject to a borrowing base that is determined, subject to certain limitations, based on the present value of the future receivables under certain loans and lease agreements in which we have a beneficial interest. We had $0 available under the Facility pursuant to the borrowing base.

Transactions_with_Related_Part

Transactions with Related Parties	3 Months Ended
	Mar. 31, 2014
Transactions with Related Parties [Abstract]	'
Transactions with Related Parties	'
	(6) Transactions with Related Parties
	We have entered into certain agreements with our Investment Manager and ICON Securities whereby we pay certain fees and reimbursements to these parties. We will pay ICON Securities (i) a dealer-manager fee for the Class A shares sold in the offering equal to 2% of gross offering proceeds from sales of such Class A shares for managing the offering and to reimburse the dealer-manager for wholesaling fees and expenses and (ii) a distribution fee equal to 0.55% of gross offering proceeds from Class I shares sold in the offering for managing the distribution of the Class I shares. We will continue to pay the distribution fee with respect to the Class I shares sold in the offering until the earlier to occur of: (i) total distribution fees paid with respect to the Class I shares following the completion of the offering equaling 10% of the gross proceeds received with respect to the issuance of such shares from the primary portion of the offering or (ii) our entry into our wind down period. The distribution fee will be paid monthly in arrears. No dealer-manager or distribution fees will be paid on any Shares sold pursuant to the DRIP.
	Our Managing Owner also has a 1% interest in our profits, losses, distributions and liquidation proceeds, subject to increase based on our investors achieving a preferred return. In addition, our Investment Manager and its affiliates will be reimbursed for organization and offering expenses incurred in connection with our organization and offering of Shares and administrative expenses incurred in connection with our operations. The reimbursement of organization and offering expenses will be capped at the lesser of 1.44% of the maximum primary offering amount of $241,000,000 and the actual costs and expenses incurred by our Investment Manager and its affiliates.
	Administrative expense reimbursements are costs incurred by our Investment Manager or its affiliates that are necessary to our operations. These costs include our Investment Manager’s and its affiliates’ legal, accounting, investor relations and operations personnel, as well as professional fees and other costs that are charged to us. Excluded are salaries and related costs, office rent, travel expenses and other administrative costs incurred by individuals with a controlling interest in our Investment Manager.
	Fees and other expenses incurred by us to our Investment Manager and its affiliates were as follows:
						Three Months Ended
		Entity	Capacity	Description		31-Mar-14
		ICON Capital, LLC	Investment Manager	Offering expense
					reimbursements (1)	$	55,919
		ICON Capital, LLC	Investment Manager	Organization cost
					reimbursements (2)		3,173
		ICON Capital, LLC	Investment Manager	General and administrative
					reimbursements (2)		34,393
		ICON Capital, LLC	Investment Manager	Management fees (2)			12,286
		ICON Securities, LLC	Dealer-manager	Dealer-manager fees (1)			118,767
		ICON Capital, LLC	Investment Manager	Administrative expense
					reimbursements (2)		175,593
		ICON Capital, LLC	Investment Manager	Acquisition fees (3)			101,524
		ICON MT 16, LLC	Managing Owner	Distribution payable (1)			288
						$	501,943
		(1)  Amount charged directly to shareholders' equity.
		(2)  Amount charged directly to operations.
		(3)  Amount capitalized and amortized to operations.
	At March 31, 2014, we had a net payable of $489,720 due to our Investment Manager and its affiliates that primarily consisted of administrative expense reimbursements of approximately $256,000, offering expenses of approximately $75,000, acquisition fees payable to our Investment Manager of approximately $102,000 and general and administrative expense reimbursements of approximately $36,000. On December 31, 2013, we had a net payable of $105,564 due to the Investment Manager and its affiliates that primarily consisted of administrative expense reimbursements of approximately $80,000 and offering expenses of approximately $19,000.
	From April 1, 2014 through May 8, 2014, we raised an additional $XX in capital contributions and incurred dealer-manager fees in the amount of $XX.

Commitments_and_Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2014
Commitments and Contingencies [Abstract]	'
Commitments and Contingencies	'
	(7) Commitments and Contingencies
	At the time we acquire or divest of our interest in Capital Assets, we may, under very limited circumstances, agree to indemnify the seller or buyer for specific contingent liabilities. Our Managing Owner 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 financial condition or results of operations taken as a whole.
	We reimburse our Investment Manager and its affiliates for the organization and offering expenses they incur in connection with our organization and offering pursuant to our Trust Agreement. As of March 31, 2014, $1,491,655 was advanced by our Investment Manager and its affiliates for organization and offering expenses incurred on our behalf of which only $115,266 has been charged to us by our Investment Manager and is included in due to Investment Manager and affiliates on our balance sheets. Of the remaining $1,376,389 that we expect to reimburse to our Investment Manager and its affiliates in the future as we continue to raise offering proceeds, $475,045 is expected to be charged to earnings and $901,344 is expected to be charged to shareholders’ equity.

Organization_Details

Organization (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Organization costs	$3,173

Net_Investment_in_Notes_Receiv

Net Investment in Notes Receivable (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]	'
Proceeds from note receivable	$247,794

Transactions_with_Related_Part1

Transactions with Related Parties (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Transactions with Related Parties [Abstract]	'	'
Net income (loss) allocated to General Partner	($1,848)	'
Fees and expenses paid or accrued [Abstract]	'	'
Management fees	12,286	'
Administrative expense reimbursements	175,593	'
Interest expense	4,165	'
Due to general partner and affiliates	$489,720	$105,564