[GRAPHIC ATEL
OMITTED] CAPITAL GROUP
July 29, 2009
BY EDGAR AND OVERNIGHT DELIVERY
Mr. Rufus Decker
Accounting Branch Chief
Division of Corporation Finance, Mail Stop 4631
Securities and Exchange Commission
450 Fifth Street. N.W.
Washington, D.C. 20549-4631
Re: ATEL Capital Equipment Fund VIII, LLC (the "Company)
Form 10-K for the fiscal year ended December 31, 2008
Form 10-Q for the period ended March 31, 2009
SEC File No. 0-33103
Dear Mr. Decker:
This letter is in response to your letter dated July 14, 2009, addressed to
me as Chief Financial Officer of the above-referenced Company, regarding the
referenced reports.
The Company's supplemental responses to the comments in your letter are set
forth below, with captions and numbered responses keyed to the captions and
numbered comments in your letter.
FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2008
General
1. The supplemental responses include the Company's proposed revisions to be
made to future filings. Subject to the Staff's concurrence with the
adequacy of the proposed revisions in response to its comments, all such
revisions will be included in future filings as appropriate.
Management's Discussion and Analysis
Results of Operations, page 9
2. The registrant will consider presenting its utilization percentages for
assets under lease in a similar manner to the presentation included on page
12 of the Form 10-K for the year ended December 31, 2008 for ATEL Capital
600 California Street, 6th Floor, San Francisco, CA 94108
Main 415.989.8800 Facsimile 415.989.3796 www.atel.com
Mr. Rufus Decker
July 29, 2009
Page 2
Equipment Fund X, LLC, and will also consider discussing any significant
changes from period to period.
Financial Statements
Notes to Financial Statements
Note 4, Reserves, Impairments and Provisions for Doubtful Accounts, page 24
3. This will confirm that a new cost basis is assigned by the registrant for
any assets for which an impairment loss is recorded and that impairment
losses are not reversed, in accordance with SFAS 144.
Note 5, Investments in Equipment and Leases, page 25
4. With respect to contingent rentals, the registrant proposes to revise its
footnote in future filings to read as follows, as appropriate to the period
reported:
The Fund earns revenues from its fleet of marine vessels based on
utilization of the vessels. Such contingent rentals (i.e. , short-term,
operating charter hire payments) and the associated expenses are recorded
when earned and/or incurred. The revenues associated with these rentals are
included as a component of Operating Lease Revenues, and totaled $________,
and $________ for the respective years ended December 31, 200x and 200y.
5. With respect to direct financing leases, the registrant proposes to include
in its footnote tabular disclosure of such leases placed in non-accrual
status as of the end of each period presented, as indicated pro forma below
(as appropriate for any period):
Direct financing leases:
As of December 31, 200y, investment in direct financing leases consists of
manufacturing equipment. The following lists the components of the Company's
investment in direct financing leases as of December 31, 200y and 200x (in
thousands):
200y 200x
------------ -------------
Total minimum lease payments receivable $ 1,647 $ 299
Estimated residual values of leased 75 615
equipment (unguaranteed)
Investment in direct financing leases 1,722 914
Less unearned income (1,092) (89)
Net investment in direct financing leases $ 630 $ 825
============ =============
Net investment in direct financing leases
placed in non-accrual status $ XXXX $ XXXX
============ =============
Mr. Rufus Decker
July 29, 2009
Page 3
Note 6, Related Party Transactions, page 26
6. The registrant proposes to include the following additional disclosure in
the footnote in future filings:
The Fund's Limited Partnership Agreement places an annual and cumulative
limit for cost reimbursements to AFS and/or its affiliates. Any
reimbursable costs incurred by AFS and/or affiliates during the year
exceeding the annual and/or cumulative limits cannot be reimbursed in the
current year, though such costs may be reimbursable in future years to the
extent such amounts may be payable if within the annual and cumulative
limits in such future years. The Fund is a finite life and self liquidating
entity, and AFS and its affiliates have no recourse against the Fund for
the amount of any unpaid excess reimbursable administrative expenses. The
Fund will continue to require administrative services from AFS and its
affiliates through the end of its term, and will therefore continue to
incur reimbursable administrative expenses in each year. The Fund has
determined that payment of any amounts in excess of the annual and
cumulative limits is not probable, and the date any portion of such amount
may be paid, if ever, is uncertain. When the Fund completes its liquidation
stage and terminates, any unpaid amount will expire unpaid, with no claim
by AFS or its affiliates against any liquidation proceeds or any party for
the unpaid balance. Accordingly, the Partnership has recorded neither an
obligation nor an expense for such contingent reimbursement of the
approximate $_____ thousand excess reimbursable administrative expenses as
of December 31, 200x.
Note 7, Non-Recourse Debt, page 27
7. The non-recourse note payable referred to in Note 7 of the registrant's
Form 10-K does not contain any material financial covenant. The note is
secured by a lien granted by the registrant to the non-recourse lender on
(and only on) the discounted lease transaction. The lender has recourse
only to the following collateral: the specific leased equipment; the
related lease chattel paper; the lease receivables; and proceeds of the
foregoing items. The non-recourse obligation is payable solely out of this
specific security and the registrant does not guarantee (nor is the
registrant otherwise contractually responsible for) the payment of
non-recourse note as a general obligation or liability of the registrant.
Although the registrant does not have any direct general liability in
connection with the non-recourse note apart from the security granted, the
registrant is directly and generally liable and responsible for certain
representations, warranties, and covenants made to the lender, such as
warranties as to genuineness of the transaction parties' signatures, as to
the genuineness of the lease chattel paper or the transaction as a whole,
or as to the registrant's good title to or perfected interest in the
secured collateral, as well as similar representations, warranties and
Mr. Rufus Decker
July 29, 2009
Page 4
covenants typically provided by non-recourse borrowers and customary in the
equipment finance industry, and are viewed by the such industry as being
consistent with a non-recourse discount financing obligation. Accordingly,
as there are no financial covenants or ratios imposed on the registrant in
connection with this non-recourse obligation, the registrant does not
believe there are any material covenants that warrant footnote disclosure.
Exhibit 31
8. We note the missing references in the introductory portions of paragraphs 4
and 5 to "internal control over financial reporting." The registrant made
the correct certification in its subsequent quarterly report on Form 10-Q
for the first quarter of 2009, and will make certain that the correct
certifications are filed with each of its future periodic reports. The
staff has directed that the registrant file an amended Form 10-K for the
year ended December 31, 2008, to replace the current Exhibits 31 with new
and updated Exhibits 31 with the corrected references in the introductory
paragraphs to those two items. The registrant requests that its undertaking
to provide the corrected certifications in all future filings be deemed to
satisfy this comment without the need to file an amended Form 10-K.
The registrant would point out that, while the introductory portions of
paragraphs 4 and 5 omit the required reference to "internal control over
financial reporting," the substantive portions of those paragraphs, items
4(b) and 4(d), and items 5(a) and 5(b), do contain the required references
to internal control over financial reporting. The officers have therefore
already certified in the Form 10-K to the design of such controls, the
disclosure of any material changes to such controls in the report, and
disclosure of any deficiencies or material weaknesses in such controls, or
fraud by any person with a significant role in such control, to the
auditors and audit committee. The registrant would further note that its
subsequent quarterly report on Form 10-Q includes the complete and correct
certifications for the quarter ended March 31, 2009.
The registrant would therefore assert that its responsible officers have
made the substantive certifications for the year ended December 31, 2008,
have made updated certifications as of the subsequent first quarter ended
March 31, 2009, and will make them as of the quarter ended June 30, 2009
and every subsequent period. The registrant believes that the potential
cost and delay in its current periodic reporting that would result from
preparing and filing an amended report for the purpose of correcting the
introductory portions of the paragraphs should therefore outweigh any
benefit to public disclosure that might be deemed necessary under these
circumstances.
As the staff is aware, the registrant and five of its affiliates are
subject to this same comment, so insistence upon an amended Form 10-K would
mean the registrant's management would be required to prepare six amended
Mr. Rufus Decker
July 29, 2009
Page 5
10-Ks, while at the same time preparing those same six registrants'
periodic reports for the quarter ended June 30, 2009, adding to the cost
and potentially delaying completion of reporting for the current period. As
correcting these certifications would be the only reason for such
amendments to the 10-Ks, the registrant hereby requests that the staff
concur that this comment is satisfied with the registrant's undertaking to
make certain that the correct certifications continue to be provided in all
subsequent periodic reports.
FORM 10-Q FOR THE PERIOD ENDED MARCH 31, 2009
General
9. The responsive changes proposed with respect to future annual reports on
Form 10-K will, upon Staff confirmation of our proposed responses, be
similarly addressed in all future interim reports.
* * * *
The Company, in connection with the staff's review of the above referenced
filing and its responses to staff comments, hereby acknowledges that:
o should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
o the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the Company from its full responsibility for the adequacy and
accuracy of the disclosure in the filing; and
o the Company may not assert staff comments and the declaration of
effectiveness as a defense in any proceeding initiated by the
Commission or any person under the federal securities laws of the
United States.
Please contact the undersigned with any further comments or questions
concerning the Company's reports.
Very truly yours,
/s/ PARITOSH K. CHOKSI
Paritosh K. Choksi
Chief Financial Officer
ATEL Capital Equipment Fund VIII, LLC
Mr. Rufus Decker
July 29, 2009
Page 6
cc: Ms. Nudrat Salik
Staff Accountant
Division of Corporation Finance, Mail Stop 4631
Securities and Exchange Commission
Paul J. Derenthal, Esq.
Mr. Samuel Schussler
Mr. Tullus Miller