Form 10K

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                   |X| Annual report pursuant to section 13 or 15(d) of the
                       Securities Exchange Act of 1934 (fee required)
                       For the Year Ended December 31, 2004
                                       OR
                   |_| Transition report pursuant to section 13 or 15(d) of the
                       Securities Exchange Act of 1934 (no fee required)
                       For the transition period from _______ to _______

                        Commission File number 000-50687

                       ATEL Capital Equipment Fund X, LLC

             California                                         68-0517690
  (State or other jurisdiction of                           (I. R. S. Employer
   incorporation or organization)                           Identification No.)

        600 California Street, 6th Floor, San Francisco, California 94108
                    (Address of principal executive offices)

        Registrant's telephone number, including area code (415) 989-8800
        Securities registered pursuant to section 12(b) of the Act: None
        Securities registered pursuant to section 12(g) of the Act: None

Indicate  by a check  mark  whether  the  registrant  (1) has filed all  reports
required to be filed by section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes |X| No |_|

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of  Regulation  S-K  (ss.229.405)  is not  contained  herein,  and  will  not be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information  statements  incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. |X|

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Act). Yes |_| No |X|

State the aggregate market value of voting stock held by  non-affiliates  of the
registrant: Inapplicable

The number of Limited  Liability  Company Units  outstanding  as of December 31,
2004 was 11,722,823.



                       DOCUMENTS INCORPORATED BY REFERENCE

Prospectus dated March 12, 2003, filed pursuant to Rule 424(b)  (Commission File
No. 000-50687) is hereby incorporated by reference into Part IV hereof.



                                       1


                                     PART I

Item 1:  BUSINESS

General Development of Business

ATEL Capital  Equipment  Fund X, LLC (the  Company) was formed under the laws of
the state of  California  on August 12,  2002.  The  Company  was formed for the
purpose  of  acquiring  equipment  to  engage  in  equipment  leasing  and sales
activities.  The Managing  Member of the Company is ATEL Financial  Services LLC
(AFS), a California limited liability corporation.

The Company conducted a public offering of 15,000,000  Limited Liability Company
Units (Units),  at a price of $10 per Unit. On April 9, 2003,  subscriptions for
the minimum number of Units (120,000, representing $1,200,000) had been received
and AFS requested  that the  subscriptions  be released to the Company.  On that
date,  the  Company  commenced  operations  in  its  primary  business  (leasing
activities).  As of June 2, 2003,  the Company had  received  subscriptions  for
774,383 Units  ($7,743,830),  thus exceeding the $7,500,000 minimum  requirement
for  Pennsylvania,  and AFS requested  that the remaining  funds in escrow (from
Pennsylvania  investors) be released to the Company.  The offering terminated on
March 12, 2005, and subscriptions of 14,036,636 ($140,366,360) were received and
accepted by the Company.

As of  December  31,  2004,  11,722,823  Units  ($117,228,230)  were  issued and
outstanding.

The Company's principal  objectives are to invest in a diversified  portfolio of
equipment  that will (i)  preserve,  protect and return the  Company's  invested
capital;  (ii)  generate  regular  distributions  to the  members  of cash  from
operations and cash from sales or refinancing,  with any balance remaining after
certain minimum distributions to be used to purchase additional equipment during
the reinvestment period ("Reinvestment Period"), ending six calendar years after
the termination of the offering (which will be no later than March 11, 2011) and
(iii) provide  additional  distributions  following the Reinvestment  Period and
until all  equipment  has been sold.  The  Company is  governed  by its  Limited
Liability Company Operating Agreement (Operating Agreement).

Narrative Description of Business

The Company has acquired and intends to acquire  various  types of equipment and
to lease such equipment pursuant to "Operating" leases and "High Payout" leases,
whereby  "Operating"  leases are  defined as being  leases in which the  minimum
lease payments during the initial lease term do not recover the full cost of the
equipment and "High Payout"  leases recover at least 90% of such cost. It is the
intention of AFS that a majority of the  aggregate  purchase  price of equipment
will represent equipment leased under "High Payout" leases upon final investment
of the Net Proceeds of the  Offering and that no more than 20% of the  aggregate
purchase price of equipment will be invested in equipment acquired from a single
manufacturer.

The Company will only purchase equipment for which a lease exists or for which a
lease will be entered into at the time of the purchase.

Through  December 31, 2004,  the Company had  purchased  equipment  with a total
acquisition price of $42,851,084.

The Company's  objective is to lease a minimum of 75% of the equipment  acquired
with the net  proceeds  of the  offering to lessees  that (i) have an  aggregate
credit rating by Moody's Investor Service,  Inc. of Baa or better, or the credit
equivalent as determined by AFS, with the aggregate  rating  weighted to account
for the  original  equipment  cost for each item leased or (ii) are  established
hospitals with histories of profitability or municipalities.  The balance of the
original  equipment  portfolio may include  equipment  leased to lessees  which,
although deemed creditworthy by AFS, would not satisfy the general credit rating
criteria for the portfolio.  In excess of 75% of the equipment acquired with the
net proceeds of the offering  (based on original  purchase cost) has been leased
to lessees with an aggregate credit rating of Baa or better or to such hospitals
or  municipalities  as  described in (ii) above.  During 2004 and 2003,  certain
lessees generated  significant portions of the Company's total lease revenues as
follows:

Lessee                       Type of Equipment            2004        2003

GE Aircraft Engines          Manufacturing                22%          *
Ball Corporation             Materials handling           19%         26%
Colowyo Coal Company L.P.    Mining                       11%         37%
ARYx Therapeutics, Inc.      Telecommunications            *          14%

*  Less than 10%.

These percentages are not expected to be comparable in future periods.



                                       2


The equipment leasing industry is highly competitive.  Equipment  manufacturers,
corporations, partnerships and others offer users an alternative to the purchase
of most types of equipment with payment terms that vary widely  depending on the
lease  term  and type of  equipment.  The  ability  of the  Company  to keep the
equipment leased and/or operating and the terms of the acquisitions,  leases and
dispositions  of equipment  depends on various factors (many of which are not in
the  control  of AFS or the  Company),  such  as  general  economic  conditions,
including the effects of inflation or recession,  and fluctuations in supply and
demand for various  types of  equipment  resulting  from,  among  other  things,
technological and economic obsolescence.

AFS will seek to limit the amount  invested in equipment to any single lessee to
not more than 20% of the aggregate purchase price of equipment owned at any time
during the Reinvestment Period.

The business of the Company is not seasonal.

The Company has no full time employees.

Equipment Leasing Activities

The Company has acquired a diversified portfolio of equipment. The equipment has
been leased to lessees in various industries. The following tables set forth the
types of  equipment  acquired by the Company  through  December 31, 2004 and the
industries  to which the assets have been  leased.  The  Company  has  purchased
certain assets subject to existing non-recourse debt.

                        Purchase Price Excluding          Percentage of Total
Asset Types                 Acquisition Fees                 Acquisitions
Mining equipment              $16,022,058                           37.39%
Materials handling              9,657,329                           22.54%
Transportation                  7,946,939                           18.55%
Manufacturing                   6,960,296                           16.24%
Office automation               2,264,462                            5.28%
                            --------------                  ---------------
                              $42,851,084                          100.00%
                            ==============                  ===============

                        Purchase Price Excluding          Percentage of Total
Industry of Lessee          Acquisition Fees                 Acquisitions
Mining                        $18,008,699                           42.03%
Manufacturing                  14,943,509                           34.87%
Transportation                  7,099,966                           16.57%
Health Care                     2,798,910                            6.53%
                            --------------                  ---------------
                              $42,851,084                          100.00%
                            ==============                  ===============

For further information  regarding the Company's equipment lease portfolio as of
December 31, 2004, see Note 3 to the financial statements, Investment in leases,
as set forth in Part II, Item 8, Financial Statements and Supplementary Data.

Item 2.  PROPERTIES

The Company does not own or lease any real property,  plant or material physical
properties other than the equipment held for lease as set forth in Item 1.

Item 3.  LEGAL PROCEEDINGS

In the ordinary  course of  conducting  business,  there may be certain  claims,
suits, and complaints  filed against the Company.  In the opinion of management,
the  outcome of such  matters,  if any,  will not have a material  impact on the
Company's consolidated financial position or results of operations.  No material
legal  proceedings  are currently  pending against the Company or against any of
its assets.

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not applicable.

                                     PART II

Item 5.  MARKET FOR REGISTRANT'S LIMITED LIABILITY COMPANY UNITS
              AND RELATED MATTERS

Market Information

There are certain material  conditions and restrictions on the transfer of Units
imposed  by the terms of the  Limited  Liability  Company  Operating  Agreement.
Consequently, there is no public market for Units and it is not anticipated that
a public  market for Units will  develop.  In the absence of a public market for
the Units, there is no currently ascertainable fair market value for the Units.



                                       3


Holders

As of December 31, 2004, a total of 2,760 investors were record holders of Units
in the Company.

Dividends

The Company does not make dividend  distributions.  However,  the Members of the
Company are entitled to certain  distributions  as provided  under the Operating
Agreement.

AFS has sole  discretion in determining the amount of  distributions;  provided,
however, that AFS will not reinvest in equipment,  but will distribute,  subject
to  payment  of any  obligations  of  the  Company,  such  available  cash  from
operations and cash from sales or refinancing as may be necessary to cause total
distributions  to the Members for each year  during the  Reinvestment  Period to
equal an amount of $0.80 per Unit.

The rate for monthly distributions from 2004 operations was $0.0667 per Unit for
January through December 2004. The  distributions  were paid in February through
December 2004 and in January 2005. The rate for quarterly  distributions paid in
April,  July,  October 2004 and January 2005 was $0.20, per Unit.  Distributions
were from 2004 cash flows from operations.

The rate for monthly distributions from 2003 operations was $0.0667 per Unit for
April through December 2003. The distributions were paid in May through December
2003 and in January  2004.  The rate for quarterly  distributions  paid in July,
October 2003 and January 2004 was $0.20, per Unit.  Distributions were from 2003
cash flows from operations.

The following table presents summarized  information regarding  distributions to
members other than the Managing Member ("Other Members"):

                                                2004            2003
Net loss per Unit, based on weighted
   average Units outstanding                       ($0.04)        $ (0.12)
Return of investment                                 0.75            0.54
                                            -------------- ---------------
Distributions per Unit, based on
   weighted average Units outstanding                0.72            0.42
Differences due to timing of distributions           0.08            0.18
                                            -------------- ---------------
Actual distribution rates per Unit                 $ 0.80          $ 0.60
                                            ============== ===============



                                       4


Use of Proceeds from Registered Securities

Information provided pursuant to ss. 228.701 (Item 701(f))(formerly  included in
Form SR):

(1) Effective date of the offering: March 12, 2003; File Number: 000-50687

(2) Offering commenced: March 12, 2003

(3) The offering did not terminate before any securities were sold.

(4) The  offering  has  not  been  terminated  prior  to the  sale of all of the
securities.

(5) The managing underwriter is ATEL Securities Corporation.

(6) The  title of the  registered  class of  securities  is  "Units  of  Limited
Liability Company interest."

(7) Aggregate amount and offering price of securities  registered and sold as of
February 24, 2005:




                                                                        Aggregate                        Aggregate
                                                                         price of                         price of
                                                                         offering                         offering
                                                          Amount          amount           Units           amount
              Title of Security                         Registered      registered          sold            sold

                                                                                            
         Units of Limited Liability Company interest      15,000,000    $150,000,000       12,920,745   $ 129,207,450

(8) Costs incurred for the issuers  account in connection  with the issuance and
distribution of the securities registered for each category listed below:

                                                     Direct or indirect payments to
                                                      directors, officers, Managing
                                                      Member of the issuer or their
                                                      associates; to persons owning
                                                        ten percent or more of any       Direct or
                                                       class of equity securities of      indirect
                                                     the issuer; and to affiliates of   payments to
                                                      the issuer                           others          Total

                         Underwriting discounts and
                         commissions                     $ 1,938,112                      $ 9,690,559    $ 11,628,671

                         Other expenses                            -                        6,710,372       6,710,372

                                                       --------------                  --------------- ---------------
                         Total expenses                  $ 1,938,112                     $ 16,400,931    $ 18,339,043
                                                       ==============                  =============== ===============

(9) Net offering proceeds to the issuer after the total expenses in item 8:                             $ 110,868,407

(10) The amount of net  offering  proceeds  to the  issuer  used for each of the
purposes listed below:

                                                     Direct or indirect payments to
                                                      directors, officers, Managing
                                                      Member of the issuer or their
                                                      associates; to persons owning
                                                        ten percent or more of any       Direct or
                                                       class of equity securities of      indirect
                                                     the issuer; and to affiliates of   payments to
                                                      the issuer                           others          Total
                         Purchase and installation of
                         machinery and equipment         $ 1,956,694                    $ 108,265,676   $ 110,222,370

                         Working capital                           -                          646,037         646,037
                                                       --------------                  --------------- ---------------
                                                         $ 1,956,694                    $ 108,911,713   $ 110,868,407
                                                       ==============                  =============== ===============


(11) The use of the proceeds in Item 10 does not represent a material  change in
the uses of proceeds described in the prospectus.



                                       5


Item 6.  SELECTED FINANCIAL DATA

The following table presents selected  financial data of the Company at December
31, 2004,  2003 and 2002 and for the periods  then ended.  This  financial  data
should be read in  conjunction  with the financial  statements and related notes
included under Part II Item 8.



                                                           2004            2003             2002
                                                                                        
Gross revenues                                           $ 4,969,654       $ 907,914              $ -
Net income (loss)                                          $ 169,752      $ (183,013)             $ -
Weighted average Units                                     7,913,617       2,229,909               10
Net loss allocated to Other Members                       $ (290,814)     $ (258,926)             $ -
Net loss per Unit, based on weighted
   average Units outstanding                                  ($0.04)         ($0.12)           $0.00
Distributions per Unit, based on weighted average
   Units outstanding                                          $ 0.72          $ 0.42              $ -
Total Assets                                             $95,527,159    $ 37,815,563            $ 600
Total Members' Capital                                   $94,861,396    $ 37,110,663            $ 600



Item 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                AND RESULTS OF OPERATIONS

Statements  contained in this Item 7,  "Management's  Discussion and Analysis of
Financial Condition and Results of Operations," and elsewhere in this Form 10-K,
which  are  not  historical  facts,  may  be  forward-looking  statements.  Such
statements  are  subject  to risks and  uncertainties  that could  cause  actual
results to differ  materially  form those  projected.  In  particular,  economic
recession and changes in general economic conditions, including, fluctuations in
demand for equipment,  lease rates,  and interest rates, may result in delays in
investment and reinvestment,  delays in leasing,  re-leasing, and disposition of
equipment, and reduced returns on invested capital. The Company's performance is
subject to risks  relating to lessee  defaults and the  creditworthiness  of its
lessees.  The Fund's  performance is also subject to risks relating to the value
of  its  equipment  at the  end of its  leases,  which  may be  affected  by the
condition of the equipment,  technological  obsolescence and the markets for new
and used  equipment at the end of lease terms.  Investors  are  cautioned not to
attribute undue certainty to these forward-looking statements,  which speak only
as of the date of this Form 10-K. We undertake no obligation to publicly release
any  revisions  to  these  forward-looking   statements  to  reflect  events  or
circumstances  after the date of this Form 10-K or to reflect the  occurrence of
unanticipated events, other than as required by law.

Capital Resources and Liquidity

The Company commenced its offering of Units on March 12, 2003. On April 9, 2003,
the Company commenced  operations in its primary business (leasing  activities).
Until the Company's  initial  portfolio of equipment has been  purchased,  funds
that  have  been  received,  but  that  have  not yet been  invested  in  leased
equipment, are invested in interest-bearing accounts or  high-quality/short-term
commercial  paper.  The Company's  public offering  provides for a total maximum
capitalization of $150,000,000.

During the funding  period,  the Company's  primary  source of liquidity will be
subscription  proceeds from the public  offering of Units.  The liquidity of the
Company  will vary in the future,  increasing  to the extent  proceeds  from the
offering,  cash flows from leases and proceeds of asset sales  exceed  expenses,
and decreasing as lease assets are acquired,  as  distributions  are made to the
Other  Members  and to the extent  expenses  exceed  cash flows from  leases and
proceeds from asset sales.

As another  source of  liquidity,  the Company is  expected to have  contractual
obligations  with a diversified  group of lessees for fixed lease terms at fixed
rental amounts.  As the initial lease terms expire, the Company will re-lease or
sell the equipment.  The future liquidity beyond the contractual minimum rentals
will depend on AFS's  success in re-leasing or selling the equipment as it comes
off lease.

Throughout  the  Reinvestment  Period,  the Company  anticipates  reinvesting  a
portion of lease  payments from assets owned in new leasing  transactions.  Such
reinvestment  will occur only after the  payment of all  obligations,  including
debt service (both  principal and interest),  the payment of management  fees to
AFS and providing for cash  distributions to the Other Members.  At December 31,
2004,  the  Company  had   commitments   to  purchase   lease  assets   totaling
approximately $21,788,000.



                                       6


The Company  participates  with AFS and certain of its affiliates in a financing
arrangement  (comprised  of a term loan to AFS, an  acquisition  facility  and a
warehouse facility) with a group of financial institutions that includes certain
financial  covenants.  The financial  arrangement is $75,000,000  and expires in
June 2006. The  availability  of borrowings  available to the Company under this
financing  arrangement  is reduced by the amount AFS has  outstanding  as a term
loan. As of December 31, 2004, the Company did not have any borrowings under the
facility.  Borrowings  under the  facility  as of  December  31,  2004,  were as
follows:

Total amount available under the financing arrangement           $  75,000,000
Term loan to AFS as of December 31, 2004                            (2,027,636)
                                                                 --------------
Total available under the acquisition and warehouse facilities      72,972,364

Amount borrowed by the Company under the acquisition facility                -
Amounts borrowed by affiliated partnerships and limited liability
   companies under the acquisition facility                        (30,500,000)
                                                                 --------------
Total remaining available under the acquisition and warehouse
   facilities                                                    $  42,472,364
                                                                 ==============

Draws on the acquisition facility by any individual borrower are secured only by
that borrower's assets,  including  equipment and related leases.  Borrowings on
the  warehouse  facility  are  recourse  jointly to  certain  of the  affiliated
partnerships and limited liability companies, the Company and AFS.

The credit agreement  includes certain  financial  covenants  applicable to each
borrower.  The Company was in  compliance  with its covenants as of December 31,
2004.

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

The Company currently has available adequate reserves to meet its immediate cash
requirements  and  those of the  next  twelve  months,  but in the  event  those
reserves were found to be inadequate,  the Company would likely be in a position
to  borrow  against  its  current  portfolio  to meet  such  requirements.  ATEL
envisions no such requirements for operating purposes.

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

The  Company  commenced  regular   distributions,   based  on  cash  flows  from
operations, beginning with the month of April 2003. The distribution was made in
May 2003 and  additional  distributions  have  been  consistently  made  through
December 2004.

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

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



                                       7


Cash Flows

2004 vs. 2003:

In both  2004 and 2003,  our  primary  source  of cash flow was from the  public
offering.  Cash flows from financing  activities  increased from  $37,293,076 in
2003 to $57,580,981 in 2004, an increase of $20,287,905. The increase is largely
the result of the capital contributions  received from investors.  An additional
7,281,891  units were  invested  in 2004  compared to  4,483,332  units in 2003.
Offsetting  this  increase is a higher  distributions  amount of  $5,675,247  to
members in 2004  versus  distributions  of  $937,496 in 2003,  a  difference  of
$4,737,751.

The Company has completed the public offering of its Units on March 12, 2005.

In 2004 and 2003, our primary  source of cash from  operating  sources was rents
from operating leases.

During 2004 and 2003, we used cash in investing activities to purchase operating
and direct  financing  lease assets and advance notes  receivable.  Purchases of
equipment on operating  leases increased to $26,125,770 in 2004 from $14,144,965
in 2003,  an rise of  $11,980,805.  Purchases of  equipment on direct  financing
leases  increased to $1,882,879 in 2004 from $697,468 in 2003.  Note advances of
$5,035,320 were made in 2004. No advances were made in 2003.

Results of Operations

As of April 9,  2003,  subscriptions  for the  minimum  amount  of the  offering
($1,200,000) had been received and accepted by the Company. As of that date, the
Company  commenced  operations  in its primary  business  (leasing  activities).
Because of the timing of the  commencement  of operations  and the fact that the
initial  portfolio  acquisitions  were not  completed at December 31, 2004,  the
results  of  operations  in 2004 are not  expected  to be  comparable  to future
periods.  After the Company's public offering and its initial asset  acquisition
stage terminate, the results of operations are expected to change significantly.

As of December 31, 2004 and 2003, there were  concentrations  (greater than 10%)
of equipment leased to lessees and/or financial  borrowers in certain industries
(as a percentage of total equipment cost) as follows:

                                             2004            2003
           Mining                             42%            14%
           Manufacturing                      31%            79%
           Transportation                     20%             *
           * less than 10%

In 2004 and 2003, operations resulted in a net income of $169,752 and a net loss
of $183,013,  respectively.  Our primary source of revenues is operating leases.
Operating lease revenues  surged  $3,265,846 from $786,291 in 2003 to $4,052,137
in 2004. Our  depreciation  expense is directly related to the assets we have on
operating leases. As expected,  depreciation on operating lease assets increased
to $3,601,196 in 2004 from $796,842 in 2003.

Cost  reimbursements  to Managing  Member are based on costs  incurred by AFS in
performing  administrative  services for the Company that are  allocated to each
Company  that AFS  manages  based on certain  criteria  such as  existing or new
leases,  number of investors or equity  depending on the type of cost  incurred.
AFS  believes  that the  costs  reimbursed  are the  lower of (i)  actual  costs
incurred  on behalf of the  Company  or (ii) the  amount  the  Company  would be
required to pay independent  parties for comparable  administrative  services in
the same geographic location.

Under the terms of the Limited  Liability Company  Operating  Agreement,  AFS is
entitled certain fees and  reimbursements of costs.  Management fees in 2004 and
2003 were  $211,761 and $48,550,  respectively,  and costs  reimbursements  were
$356,797and  $48,235,  respectively.  These  amounts are expected to increase in
future periods as the operations of the Company expand.

Derivative Financial Instruments

In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial  Accounting  Standards ("SFAS") No. 133,  Accounting for Derivative
Instruments  and  Hedging  Activities,  which  established  new  accounting  and
reporting standards for derivative instruments. SFAS No. 133 has been amended by
SFAS No. 137,  issued in June 1999, by SFAS No. 138,  issued in June 2000 and by
SFAS No. 149, issued in June 2003.

SFAS No. 133, as amended,  requires the Company to recognize all  derivatives as
either assets or liabilities in the balance sheet and measure those  instruments
at fair value.  It further  provides  criteria for derivative  instruments to be
designated as fair value, cash flow, or foreign currency hedges, and establishes
accounting  standards for reporting  changes in the fair value of the derivative
instruments.  If derivative financial instruments are utilized, the Company will
be required to record derivative  instruments at fair value in the balance sheet
and recognize the  offsetting  gains or losses as  adjustments  to net income or
other comprehensive income, as appropriate.



                                       8


Recent Accounting Pronouncements

On October 13, 2004, the FASB concluded that SFAS No. 123R,  Share-Based Payment
("SFAS 123R"), which requires all companies to measure compensation cost for all
share-based payments (including stock options and employee stock purchase plans)
at fair value,  will be  effective  for public  companies  for interim or annual
periods beginning after June 15, 2005.  Nonpublic  companies will be required to
adopt the new statement at the  beginning of the first annual  period  beginning
after  December 15, 2005.  The Company does not expect the adoption of SFAS 123R
to have a material impact on its financial statements.

In  January   2003,   the  FASB  issued   Interpretation   No.  46  ("FIN  46"),
"Consolidation of Variable Interest Entities,  an interpretation of ARB 51." The
primary  objectives  of  this  interpretation  are to  provide  guidance  on the
identification  of entities for which  control is achieved  through  means other
than through voting rights ("variable  interest  entities") and how to determine
when  and  which  business   enterprise  (the  "primary   beneficiary")   should
consolidate  the  variable  interest  entity.  This new model for  consolidation
applies to an entity in which  either (i) the equity  investors  (if any) do not
have a controlling  financial interest; or (ii) the equity investment at risk is
insufficient to finance that entity's  activities  without receiving  additional
subordinated  financial support from other parties. In addition, FIN 46 requires
that  the  primary  beneficiary,  as  well  as  all  other  enterprises  with  a
significant  variable  interest in a variable  interest entity,  make additional
disclosures.  Certain  disclosure  requirements  of FIN 46  were  effective  for
financial statements issued after January 31, 2003.

In  December  2003,  the  FASB  issued  FIN  No.  46  (revised  December  2003),
"Consolidation  of Variable  Interest  Entities" ("FIN 46-R") to address certain
FIN 46 implementation  issues.  The effective dates and impact of FIN 46 and FIN
46-R are as follows:

(i) Special  purpose  entities  ("SPEs")  created prior to February 1, 2003. The
company must apply either the provisions of FIN 46 or early adopt the provisions
of FIN 46-R at the end of the first  interim or annual  reporting  period ending
after December 15, 2003.

(ii)  Non-SPEs  created  prior to February  1, 2003.  The company is required to
adopt FIN 46-R at the end of the first interim or annual reporting period ending
after March 15, 2004.

(iii) All entities, regardless of whether a SPE, that were created subsequent to
January  31,  2003.  The  provisions  of FIN 46  were  applicable  for  variable
interests in entities obtained after January 31, 2003.

The Company  adopted FIN 46-R as of March 31, 2004.  The adoption of FIN 46-R as
of March 31,  2004 did not have a  material  impact on the  Company's  position,
results of operations, or liquidity.

Critical Accounting Policies

The policies  discussed  below are considered by management of the Company to be
critical to an understanding of the Company's financial statements because their
application requires significant complex or subjective judgments,  decisions, or
assessments,  with financial  reporting  results relying on estimation about the
effect  of  matters  that are  inherently  uncertain.  Specific  risks for these
critical  accounting  policies are  described in the following  paragraphs.  The
Company  also states  these  accounting  policies in the notes to the  financial
statements and in relevant sections in this discussion and analysis.  For all of
these policies, management cautions that future events rarely develop exactly as
forecast, and the best estimates routinely require adjustment.

Equipment on operating leases:

Equipment on operating leases is stated at cost.  Depreciation is being provided
by use of the  straight-line  method over the terms of the related leases to the
equipment's  estimated  residual values at the end of the leases.  Revenues from
operating  leases are recognized on as straight line basis over the lives of the
related leases.

Direct financing leases:

Income from direct financing lease  transactions is reported using the financing
method of accounting,  in which the Company's  investment in the leased property
is reported  as a  receivable  from the lessee to be  recovered  through  future
rentals.  The income  portion of each  rental  payment  is  calculated  so as to
generate a constant rate of return on the net receivable outstanding.

Allowances for losses on direct financing leases are typically established based
on historical charge offs and collections  experience and are usually determined
by specifically identified lessees and billed and unbilled receivables.

Direct  financing  leases  are  placed  in  a  non-accrual  status  (no  revenue
recognized)  based on  specifically  identified  lessees.  Such  leases are only
returned  to an accrual  status  based on a case by case  review of AFS.  Direct
financing leases are charged off on specific identification by AFS.



                                       9


Use of Estimates:

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting  period.  Actual  results  could  differ  from those  estimates.  Such
estimates primarily relate to the determination of residual values at the end of
the lease term.

Asset Valuation:

Recorded values of the Company's asset portfolio are  periodically  reviewed for
impairment in accordance with Statement of Financial Accounting Standards (SFAS)
No. 144,  Accounting  for the  Impairment or Disposal of Long-Lived  Assets.  An
impairment  loss is measured and recognized  only if the estimated  undiscounted
future cash flows of the asset are less than their net book value. The estimated
undiscounted  future cash flows are the sum of the estimated  residual  value of
the asset at the end of the asset's  expected  holding  period and  estimates of
undiscounted future rents. The residual value assumes,  among other things, that
the asset is  utilized  normally  in an open,  unrestricted  and stable  market.
Short-term  fluctuations  in the market place are  disregarded and it is assumed
that there is no  necessity  either to dispose  of a  significant  number of the
assets, if held in quantity,  simultaneously or to dispose of the asset quickly.
Impairment is measured as the  difference  between the fair value (as determined
by the  discounted  estimated  future cash flows) of the assets and its carrying
value on the measurement date.


Item 7a.  QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK

The Company,  like most other  companies,  is exposed to certain  market  risks,
including primarily changes in interest rates. The Company believes its exposure
to other market risks,  including foreign currency exchange rate risk, commodity
risk and equity price risk, are insignificant to both its financial position and
results of operations.

In general,  the Company expects to manage its exposure to interest rate risk by
obtaining  fixed rate debt. The fixed rate debt is structured so as to match the
cash flows required to service the debt to the payment  streams under fixed rate
lease receivables.  The payments under the leases are assigned to the lenders in
satisfaction of the debt. Furthermore,  AFS, in conjunction with other companies
it manages,  has historically  been able to maintain a stable spread between its
cost of funds and lease  yields in both  periods of rising and falling  interest
rates.  Nevertheless,  the  Company  expects to  frequently  fund  leases with a
floating interest rate revolving line of credit and will, therefore,  be exposed
to interest  rate risk until fixed rate  financing is arranged,  or the floating
interest rate revolving  line of credit is repaid.  As of December 31, 2004, the
Company has not been included in the floating rate revolving line of credit as a
borrower and there were no variable rate borrowings as of that date.

Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

See the Report of  Independent  Registered  Public  Accounting  Firm,  Financial
Statements and Notes to Financial Statements attached hereto at pages 11 through
24.


                                       10










   REPORT OF ERNST & YOUNG LLP, INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



The Members
ATEL Capital Equipment Fund X, LLC

We have audited the accompanying  balance sheets of ATEL Capital  Equipment Fund
X,  LLC  (the  Company)  as of  December  31,  2004 and  2003,  and the  related
statements of operations, changes in members' capital and cash flows for each of
the two years in the period  ended  December  31,  2004 and for the period  from
August  12,  2002  (inception)   through  December  31,  2002.  These  financial
statements are the responsibility of the Fund's  management.  Our responsibility
is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  We were not engaged to perform an
audit of the Company's  internal  control over  financial  reporting.  Our audit
included  consideration of internal control over financial  reporting as a basis
for designing audit  procedures that are appropriate in the  circumstances,  but
not for the  purpose  of  expressing  an  opinion  on the  effectiveness  of the
Company's internal control over financial reporting.  Accordingly, we express no
such  opinion.  An audit also  includes  examining,  on a test  basis,  evidence
supporting the amounts and  disclosures in the financial  statements,  assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall  financial  statement  presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of ATEL Capital Equipment Fund X,
LLC at December 31, 2004 and 2003,  and the results of its  operations  and cash
flows for the each of the two years in the period  ended  December  31, 2004 and
for the period from August 12, 2002  (inception)  through  December 31, 2002, in
conformity with U.S. generally accepted accounting principles.

                                                           /s/ ERNST & YOUNG LLP

San Francisco, California
March 9, 2005



                                       11


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                                 BALANCE SHEETS

                           DECEMBER 31, 2004 AND 2003


                                     ASSETS

                                                      2004            2003

Cash and cash equivalents                          $ 50,767,859    $ 22,680,652
Accounts receivable                                     575,365           3,179
Notes receivable                                      4,549,389               -
Due from Managing Member                                363,397               -
Due from affiliate                                            -         248,428
Prepaid syndication costs                                     -         156,624
Other assets                                             62,499               -
Investments in leases                                39,208,650      14,726,680
                                                 --------------- ---------------
Total assets                                       $ 95,527,159    $ 37,815,563
                                                 =============== ===============


                        LIABILITIES AND MEMBERS' CAPITAL

Accounts payable:
   Other                                               $ 64,249       $ 127,131
   Managing Member                                            -         472,041
Deposits due to lessees                                 131,017               -
Unearned operating lease income                         470,497         105,728
                                                 --------------- ---------------
Total liabilities                                       665,763         704,900

Members' capital                                     94,861,396      37,110,663
                                                 --------------- ---------------
Total liabilities and Members' capital             $ 95,527,159    $ 37,815,563
                                                 =============== ===============




                             See accompanying notes.


                                       12


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                            STATEMENTS OF OPERATIONS

                   FOR THE YEARS ENDED DECEMBER 2004 AND 2003
                            AND FOR THE PERIOD ENDED
                           AUGUST 12, 2002 (INCEPTION)
                            THROUGH DECEMBER 31, 2002




                                                   2004             2003            2002
Revenues:
Leasing activities:
                                                                                 
   Operating leases                              $ 4,052,137        $ 786,291             $ -
   Direct finance leases                             153,357           44,134               -
   Gain on sales of assets                                 -           10,991               -
Interest:
Interest earned on cash deposits                     369,854           66,325               -
Interest earned on notes receivable                  316,451                -               -
Other                                                 77,855              173               -
                                              ---------------  --------------- ---------------
                                                   4,969,654          907,914               -
Expenses:
Depreciation of operating lease assets             3,601,196          796,842               -
Amortization of initial direct costs                 338,435           66,861               -
Asset management fees to Managing Member             211,761           48,550               -
Cost reimbursements to Managing Member               356,797           48,235               -
Professional fees                                    106,093           33,563               -
Franchise fees and state taxes                        31,886                -               -
Other                                                153,734           96,876               -
                                              ---------------  --------------- ---------------
                                                   4,799,902        1,090,927               -
                                              ---------------  --------------- ---------------
Net income (loss)                                  $ 169,752       $ (183,013)            $ -
                                              ===============  =============== ===============

Net income (loss):
   Managing Member                                 $ 460,566         $ 75,913               -
   Other Members                                    (290,814)        (258,926)              -
                                              ---------------  --------------- ---------------
                                                   $ 169,752       $ (183,013)            $ -
                                              ===============  =============== ===============

Net loss per Limited Liability Company Unit           ($0.04)          ($0.12)          $0.00

Weighted average number of Units outstanding       7,913,617        2,229,909              10





                             See accompanying notes.




                                       13


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                    STATEMENTS OF CHANGES IN MEMBERS' CAPITAL

                   FOR THE YEARS ENDED DECEMBER 2004 AND 2003
                            AND FOR THE PERIOD ENDED
                           AUGUST 12, 2002 (INCEPTION)
                            THROUGH DECEMBER 31, 2002





                                                               Other Members              Managing
                                                           Units          Amount           Member          Total

                                                                                               
Initial capital contributions                                     50           $ 500            $ 100           $ 600
                                                       -------------- ---------------  --------------- ---------------
Balance December 31, 2002                                         50             500              100             600

Capital contributions                                      4,483,332      44,833,320                -      44,833,320
Less selling commissions to affiliates                             -      (4,034,999)               -      (4,034,999)
Other syndication costs to affiliates                              -      (2,491,736)               -      (2,491,736)
Distributions to other members ($0.42 per Unit)                    -        (937,496)         (76,013)     (1,013,509)
Net income (loss)                                                  -        (258,926)          75,913        (183,013)
                                                       -------------- ---------------  --------------- ---------------
Balance December 31, 2003                                  4,483,382      37,110,663                -      37,110,663

Capital contributions                                      7,281,891      72,818,910                -      72,818,910
Less selling commissions to affiliates                             -      (6,553,702)               -      (6,553,702)
Other syndication costs to affiliates                              -      (2,126,737)               -      (2,126,737)
Rescissions of capital contributions                         (39,200)       (392,000)               -        (392,000)
Units repurchased                                             (3,250)        (29,677)               -         (29,677)
Distributions to other members ($0.48 per Unit)                    -      (5,675,247)               -      (5,675,247)
Distributions to managing members                                  -               -         (460,566)       (460,566)
Net income (loss)                                                  -        (290,814)         460,566         169,752
                                                       -------------- ---------------  --------------- ---------------
Balance December 31, 2004                                 11,722,823    $ 94,861,396              $ -    $ 94,861,396
                                                       ============== ===============  =============== ===============




                             See accompanying notes.


                                       14


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                            STATEMENTS OF CASH FLOWS

                   FOR THE YEARS ENDED DECEMBER 2004 AND 2003
                            AND FOR THE PERIOD ENDED
                           AUGUST 12, 2002 (INCEPTION)
                            THROUGH DECEMBER 31, 2002



                                                                           2004             2003            2002
Operating activities:
                                                                                                       
Net income (loss)                                                          $ 169,752       $ (183,013)            $ -
Adjustments to reconcile net income (loss) to
   cash provided by operating activities:
   Gain on sales of assets                                                         -          (10,991)              -
   Gain on sale of marketable securities                                     (71,166)
   Depreciation                                                            3,601,196          796,842               -
   Amortization                                                              338,435           66,861               -
   Changes in operating assets and liabilities:
      Accounts receivable                                                   (572,186)          (3,179)              -
Due from Managing Member                                                    (363,397)               -               -
      Prepaid syndication costs                                              156,624         (156,624)              -
      Accounts payable, Managing Member                                     (472,041)         472,041               -
      Accounts payable, other                                                (62,882)         127,131               -
Deposits due to lessees                                                      131,017                -               -
      Unearned operating lease income                                        364,769          105,728               -
                                                                      ---------------  --------------- ---------------
Net cash provided by operations                                            3,220,121        1,214,796               -
                                                                      ---------------  --------------- ---------------

Investing activities:
Purchases of equipment on operating leases                               (26,125,770)     (14,144,965)              -
Note receivable advances                                                  (5,035,320)               -               -
Proceeds from sales of assets                                                      -          257,206               -
Due from affiliate                                                           248,428         (248,428)              -
Purchases of equipment on direct financing leases                         (1,882,879)        (697,468)              -
Payments received on notes receivable                                        485,931                -               -
Payments of initial direct costs to Managing Member, net                    (866,326)      (1,092,193)              -
Reduction of net investment in direct financing leases                       453,374           98,028               -
Purchase of marketable securities                                            (62,499)               -               -
Proceeds from sale of marketable securities                                   71,166                -               -
                                                                      ---------------  --------------- ---------------
Net cash used in investing activities                                    (32,713,895)     (15,827,820)              -
                                                                      ---------------  --------------- ---------------

Financing activities:
Capital contributions received                                            72,818,910       44,833,320             600
Payment of syndication costs to Managing Member                           (8,680,439)      (6,526,735)              -
Repurchase of limited liability company units                                (29,677)               -               -
Rescissions of capital contributions                                        (392,000)               -               -
Distributions to Other Members                                            (5,675,247)        (937,496)              -
Distributions to Managing Member                                            (460,566)         (76,013)              -
                                                                      ---------------  --------------- ---------------
Net cash provided by financing activities                                 57,580,981       37,293,076             600
                                                                      ---------------  --------------- ---------------

Net increase in cash and cash equivalents                                 28,087,207       22,680,052             600

Cash and cash equivalents at beginning of period                          22,680,652              600               -
                                                                      ---------------  --------------- ---------------
Cash and cash equivalents at end of period                              $ 50,767,859     $ 22,680,652           $ 600
                                                                      ===============  =============== ===============

Supplemental disclosures of cash flow information:
Cash paid during the period for interest                                       $ 615          $ 8,045             $ -
                                                                      ===============  =============== ===============




                             See accompanying notes.


                                       15


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004


1. Organization and Limited Liability Company matters:

ATEL Capital  Equipment  Fund X, LLC (the  Company) was formed under the laws of
the  state of  California  on  August  12,  2002 for the  purpose  of  acquiring
equipment to engage in equipment leasing and sales  activities.  The Company may
continue until December 31, 2021.

The Company is  conducting a public  offering of  15,000,000  Limited  Liability
Company Units (Units),  at a price of $10 per Unit. Upon the sale of the minimum
amount of Units of Limited  Liability  Company interest (Units) of 120,000 Units
($1,200,000)  and the  receipt of the  proceeds  thereof  on April 9, 2003,  the
Company commenced operations.  As of December 31, 2001, the Company had received
subscriptions for 4,483,382  ($44,833,820) Units, including the Initial Members'
Units. All of the Units were issued and outstanding as of December 31, 2004. The
Company's offering will terminate on or before March 11, 2005.

ATEL Financial  Services,  LLC (AFS), an affiliated entity, acts as the Managing
Member of the Company.

The  Company,  or AFS on behalf of the Company,  will incur costs in  connection
with the  organization,  registration  and  issuance  of the  Limited  Liability
Company  Units  (Units)  (Note 5).  The  amount of such costs to be borne by the
Company is limited by certain provisions of the Company's Operating Agreement.

The Company's principal  objectives are to invest in a diversified  portfolio of
equipment  that will (i)  preserve,  protect and return the  Company's  invested
capital;  (ii)  generate  regular  distributions  to the  members  of cash  from
operations and cash from sales or refinancing,  with any balance remaining after
certain minimum distributions to be used to purchase additional equipment during
the  Reinvestment  Period (ending six calendar years after the completion of the
Company's public offering of Units) and (iii) provide  additional  distributions
following the  Reinvestment  Period and until all  equipment has been sold.  The
Company  is  governed  by its  Limited  Liability  Company  Operating  Agreement
(Operating Agreement).


2. Summary of significant accounting policies:

Cash and cash equivalents:

Cash and cash equivalents includes cash in banks and cash equivalent investments
with original maturities of ninety days or less.

Accounts receivable:

Accounts  receivable  represent  the amounts  billed under lease  contracts  and
currently  due to the Company.  Allowances  for doubtful  accounts are typically
established  based on historical  charge offs and collection  experience and are
usually  determined by  specifically  identified  lessees and invoiced  amounts.
Accounts receivable are charged off on specific identification by AFS.

Investment in notes receivable:

Income  from  notes  receivable  is  reported  using  the  financing  method  of
accounting.  The  Company's  investment  in notes  receivable is reported as the
present  value of the future  note  payments.  The  income  portion of each note
payment is  calculated  so as to  generate a constant  rate of return on the net
balance outstanding. Notes receivable are charged off on specific identification
by AFS.  To  date,  the  Company  has made no  provisions  for  losses  on notes
receivable nor has the Company written off any notes receivables.



                                       16


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004


2. Summary of significant accounting policies (continued):

Equipment on operating leases:

Equipment on operating leases is stated at cost.  Depreciation is being provided
by use of the  straight-line  method over the terms of the related leases to the
equipment's  estimated  residual values at the end of the leases.  Revenues from
operating leases are recognized evenly over the lives of the related leases.

Direct financing leases:

Income from direct financing lease  transactions is reported using the financing
method of accounting,  in which the Company's  investment in the leased property
is reported  as a  receivable  from the lessee to be  recovered  through  future
rentals.  The income  portion of each  rental  payment  is  calculated  so as to
generate a constant rate of return on the net receivable outstanding.

Allowances for losses on direct financing leases are typically established based
on historical charge offs and collections  experience and are usually determined
by specifically identified lessees and billed and unbilled receivables.

Direct financing leases are placed in a non-accrual status based on specifically
identified lessees.  Such leases are only returned to an accrual status based on
a case by case  review  of AFS.  Direct  financing  leases  are  charged  off on
specific identification by AFS.

Initial direct costs:

The Company  capitalizes initial direct costs associated with the acquisition of
lease assets. The costs are amortized over a five year period using the straight
line method.

Income taxes:

The Company  does not  provide for income  taxes since all income and losses are
the  liability of the  individual  members and are  allocated to the members for
inclusion in their individual tax returns.

The tax basis of the  Company's  net  assets  and  liabilities  varies  from the
amounts presented in these financial statements at December 31 :

                                                     2004             2003
   Financial statement basis of net assets       $  94,861,396    $  37,815,563
   Tax basis of net assets (unaudited)             104,295,819       43,059,556
                                                ---------------  ---------------
   Difference                                    $   9,434,423    $   5,243,993
                                                ===============  ===============

The  primary  differences  between  the tax basis of net assets and the  amounts
recorded in the financial statements are the result of differences in accounting
for syndication costs and differences  between the depreciation  methods used in
the financial statements and the Company's tax returns.



                                       17


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004

2. Summary of significant accounting policies (continued):

Income taxes (continued):

The  following  reconciles  the net income  (loss)  reported in these  financial
statements to the loss reported on the Company's federal tax return  (unaudited)
for each of the years ended December 31:

                                                   2004             2003
 Net income (loss) per financial statements    $     169,752    $    (183,013)
 Adjustment to depreciation expense               (6,013,054)        (778,726)
 Adjustments to lease revenues                       818,145          200,884
                                              ---------------  ---------------
 Net loss per federal tax return               $  (5,025,157)   $    (760,855)
                                              ===============  ===============

Per unit data:

Net income and distributions per unit are based upon the weighted average number
of units outstanding during the period.

Asset valuation:

Recorded values of the Company's asset portfolio are  periodically  reviewed for
impairment in accordance with Statement of Financial Accounting Standards (SFAS)
No. 144,  Accounting  for the  Impairment or Disposal of Long-Lived  Assets.  An
impairment  loss is measured and recognized  only if the estimated  undiscounted
future cash flows of the asset are less than their net book value. The estimated
undiscounted  future cash flows are the sum of the estimated  residual  value of
the asset at the end of the asset's  expected  holding  period and  estimates of
undiscounted future rents. The residual value assumes,  among other things, that
the asset is  utilized  normally  in an open,  unrestricted  and stable  market.
Short-term  fluctuations  in the market place are  disregarded and it is assumed
that there is no  necessity  either to dispose  of a  significant  number of the
assets, if held in quantity,  simultaneously or to dispose of the asset quickly.
Impairment is measured as the  difference  between the fair value (as determined
by the  discounted  estimated  future cash flows) of the assets and its carrying
value on the measurement date.

Credit risk:

Financial  instruments that potentially subject the Company to concentrations of
credit risk include cash and cash equivalents, direct finance lease receivables,
accounts  and  notes  receivable.  The  Company  places  its cash  deposits  and
temporary  cash   investments   with   creditworthy,   high  quality   financial
institutions.  The concentration of such deposits and temporary cash investments
is not deemed to create a significant risk to the Company.  Accounts  receivable
represent amounts due from lessees in various  industries,  related to equipment
on  operating  and direct  financing  leases.  See Note 8 for a  description  of
lessees by industry as of December 31, 2004.

Derivative financial instruments:

In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial  Accounting  Standards ("SFAS") No. 133,  Accounting for Derivative
Instruments  and  Hedging  Activities,  which  established  new  accounting  and
reporting standards for derivative instruments. SFAS No. 133 has been amended by
SFAS No. 137,  issued in June 1999, by SFAS No. 138,  issued in June 2000 and by
SFAS No. 149, issued June 2003.

SFAS No. 133, as amended,  requires the Company to recognize all  derivatives as
either assets or liabilities in the balance sheet and measure those  instruments
at fair value.  It further  provides  criteria for derivative  instruments to be
designated as fair value, cash flow, or foreign currency hedges, and establishes
accounting  standards for reporting  changes in the fair value of the derivative
instruments. The Company has not utilized derivative financial instruments.



                                       18


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004


2. Summary of significant accounting policies (continued):

Use of estimates:

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting  period.  Actual  results  could  differ  from those  estimates.  Such
estimates primarily relate to the determination of residual values at the end of
the lease term.

Basis of presentation:

The accompanying financial statements have been prepared in accordance with U.S.
generally accepted accounting  principles.  Certain prior year amounts have been
reclassified to conform to the current year presentation.

Recent accounting pronouncements:

On October 13, 2004, the FASB concluded that SFAS No. 123R,  Share-Based Payment
("SFAS 123R"), which requires all companies to measure compensation cost for all
share-based payments (including stock options and employee stock purchase plans)
at fair value,  will be  effective  for public  companies  for interim or annual
periods beginning after June 15, 2005.  Nonpublic  companies will be required to
adopt the new statement at the  beginning of the first annual  period  beginning
after  December 15, 2005.  The Company does not expect the adoption of SFAS 123R
to have a material impact on its financial statements.

In  January   2003,   the  FASB  issued   Interpretation   No.  46  ("FIN  46"),
"Consolidation of Variable Interest Entities,  an interpretation of ARB 51." The
primary  objectives  of  this  interpretation  are to  provide  guidance  on the
identification  of entities for which  control is achieved  through  means other
than through voting rights ("variable  interest  entities") and how to determine
when  and  which  business   enterprise  (the  "primary   beneficiary")   should
consolidate  the  variable  interest  entity.  This new model for  consolidation
applies to an entity in which  either (i) the equity  investors  (if any) do not
have a controlling  financial interest; or (ii) the equity investment at risk is
insufficient to finance that entity's  activities  without receiving  additional
subordinated  financial support from other parties. In addition, FIN 46 requires
that  the  primary  beneficiary,  as  well  as  all  other  enterprises  with  a
significant  variable  interest in a variable  interest entity,  make additional
disclosures.  Certain  disclosure  requirements  of FIN 46  were  effective  for
financial statements issued after January 31, 2003.

In  December  2003,  the  FASB  issued  FIN  No.  46  (revised  December  2003),
"Consolidation  of Variable  Interest  Entities" ("FIN 46-R") to address certain
FIN 46 implementation  issues.  The effective dates and impact of FIN 46 and FIN
46-R are as follows:

(i) Special  purpose  entities  ("SPEs")  created prior to February 1, 2003. The
company must apply either the provisions of FIN 46 or early adopt the provisions
of FIN 46-R at the end of the first  interim or annual  reporting  period ending
after December 15, 2003.

(ii)  Non-SPEs  created  prior to February  1, 2003.  The company is required to
adopt FIN 46-R at the end of the first interim or annual reporting period ending
after March 15, 2004.

(iii) All entities, regardless of whether a SPE, that were created subsequent to
January  31,  2003.  The  provisions  of FIN 46  were  applicable  for  variable
interests in entities obtained after January 31, 2003.

The Company  adopted FIN 46-R as of March 31, 2004.  The adoption of FIN 46-R as
of March 31,  2004 did not have a  material  impact on the  Company's  position,
results of operations, or liquidity.



                                       19


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004



3. Investment in leases:

The Company's investment in leases consists of the following:



                                                                        Depreciation /
                                                                        Amortization
                                                                         Expense or                            Net
                                          Balance                      Amortization of     Reclassi-         Balance
                                        December 31,                   Direct Financing  fications or     December 31,
                                           2003          Additions         Leases        Dispositions         2004

                                                                                            
Net investment in operating leases      $ 12,967,263     $26,125,770     $ (3,601,196)       $ (994,445)   $ 34,497,392
Net investment in direct financing
   leases                                    735,451       1,882,879         (453,374)          994,445       3,159,401
Initial direct costs                       1,023,966         875,721         (338,435)           (9,395)      1,551,857
                                       --------------  --------------  ---------------  ----------------  --------------
                                        $ 14,726,680     $28,884,370     $ (4,393,005)         $ (9,395)   $ 39,208,650
                                       ==============  ==============  ===============  ================  ==============


All of the property on leases was acquired in 2003 and 2004.

Operating leases:

Property on operating leases consists of the following:




                                                                                                               Net
                                          Balance                                          Reclassi-         Balance
                                        December 31,   Depreciation                      fications or     December 31,
                                           2003           Expense        Additions       Dispositions         2004
                                                                                             
Manufacturing                           $  5,848,508         $     -     $    689,352           $     -    $  6,537,860
Materials handling                         4,827,588               -        3,434,134          (994,445)      7,267,277
Mining                                     2,000,000               -       14,022,058                 -      16,022,058
Data processing                            1,046,434               -           33,288                 -       1,079,722
Transportation                                     -               -        7,946,938                 -       7,946,938
                                       --------------  --------------  ---------------  ----------------  --------------
                                          13,722,530               -       26,125,770          (994,445)     38,853,855
Less accumulated depreciation               (755,267)     (3,601,196)               -                 -      (4,356,463)
                                       --------------  --------------  ---------------  ----------------  --------------
                                        $ 12,967,263    $ (3,601,196)   $  26,125,770      $   (994,445)    $34,497,392)
                                       ==============  ==============  ===============  ================  ==============



The average assumed  residual  values for assets on operating  leases was 21% at
December 31, 2004.



                                       20


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004


3. Investment in leases (continued):

Direct financing leases:

The  following  lists  the  components  of the  Company's  investment  in direct
financing leases as of December 31, 2004:

Total minimum lease payments receivable                         $  3,326,851
Estimated residual values of leased equipment (unguaranteed)         338,680
                                                              ---------------
Investment in direct financing leases                              3,665,531
Less unearned income                                                (506,130)
                                                              ---------------
Net investment in direct financing leases                        $ 3,159,401
                                                              ===============

At December 31, 2004, the aggregate  amounts of future minimum lease payments to
be received are as follows:


                                            Direct
          Year ending     Operating       Financing
           December 31,    Leases           Leases            Total
                 2005    $ 7,128,867      $ 1,032,647      $ 8,161,51447
                 2006       6,566,005          863,430         7,429,435
                 2007       5,928,045          548,848         6,476,893
                 2008       5,281,707          483,446         5,765,153
                 2009       3,341,438          398,480         3,739,918
           Thereafter         198,766                -           198,766
                        --------------  ---------------  ----------------
                          $28,444,828      $ 3,326,851      $ 31,771,679
                        ==============  ===============  ================

4. Notes receivable:

The Company has various  notes  receivable  from  parties who have  financed the
purchase of equipment through the Company. The terms of the notes receivable are
18 to 60 months and bear  interest at rates  ranging  from 11% to 22%. The notes
are secured by the  equipment  financed.  As of December 31,  2004,  the minimum
future payments receivable are as follows:

                               Year ending
                               December 31,
                                      2005     $ 1,576,031
                                      2006       1,225,242
                                      2007         822,598
                                      2008         457,030
                                      2009       1,818,006
                                            ---------------
                                                 5,898,907
         Less portion representing interest     (1,349,518)
                                            ---------------
                                               $ 4,549,389
                                            ===============




                                       21


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004


5. Related party transactions:

The terms of the Limited Liability Company Operating  Agreement provide that AFS
and/or   affiliates   are  entitled  to  receive   certain  fees  for  equipment
acquisition, management and resale and for management of the Company.

The Limited Liability  Company Operating  Agreement allows for the reimbursement
of costs incurred by AFS in providing services to the Company. Services provided
include  Company  accounting,  investor  relations,  legal counsel and lease and
equipment documentation. AFS is not reimbursed for services where it is entitled
to receive a separate fee as compensation for such services, such as acquisition
and management of equipment. Reimbursable costs incurred by AFS are allocated to
the Company based upon estimated  time incurred by employees  working on Company
business and an allocation of rent and other costs based on utilization studies.

Each of ATEL Leasing Corporation  ("ALC"),  ATEL Equipment  Corporation ("AEC"),
ATEL Investor Services ("AIS") and ATEL Financial Services LLC is a wholly-owned
subsidiary  of ATEL  Capital  Group  and  performs  services  for  the  Company.
Acquisition services are performed for the Company by ALC, equipment management,
lease  administration  and asset  disposition  services  are  performed  by AEC,
investor relations and communications  services are performed by AIS and general
administrative services for the Company are performed by AFS.

Cost  reimbursements  to Managing  Member are based on costs  incurred by AFS in
performing  administrative  services for the Company that are  allocated to each
Company  that AFS  manages  based on certain  criteria  such as  existing or new
leases,  number of investors or equity  depending on the type of cost  incurred.
AFS  believes  that the  costs  reimbursed  are the  lower of (i)  actual  costs
incurred  on behalf of the  Company  or (ii) the  amount  the  Company  would be
required to pay independent  parties for comparable  administrative  services in
the same geographic location.

AFS and/or affiliates earned fees,  commissions and reimbursements,  pursuant to
the Limited Liability Company Operating  Agreement as follows for the year ended
December 31, 2004:



                                                                                            2004            2003
                                                                                                      
Selling commissions (equal to 9% of the selling price of the Limited Liability
   Company Units, deducted from Other Members' capital)                                   $ 6,553,702       4,034,999
Reimbursement of other syndication costs to Managing Member, deducted from
   Other Members' capital                                                                   2,126,737       2,491,736
Asset management fees to AFS                                                                  211,761          48,550
Costs reimbursed to AFS                                                                       356,797          48,235
                                                                                       --------------- ---------------
                                                                                          $ 9,248,997     $ 6,623,520
                                                                                       =============== ===============


The Managing  Member makes  certain  payments to third  parties on behalf of the
Company for convenience  purposes.  During the years ended December 31, 2004 and
2003,  the  Managing   Member  made  such  payments  of  $234,835  and  $98,402,
respectively.

On December 31,  2003,  the Company  sold  certain  assets  subject to operating
leases and direct financing  leases to the lessee.  The assets being sold were a
part of a larger sale involving the sale of assets  belonging to an affiliate of
the Company. On December 31, 2003, the lessee/purchaser sent the proceeds of the
sale by wire  transfer  to the  account of the  Company's  affiliate.  The funds
belonging to the Company were  transferred  to the Company on the Company's next
business day.



                                       22


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004


6. Members' capital:

As of December  31,  2004,  11,722,823  Units were issued and  outstanding.  The
Company is authorized to issue up to 15,000,050 Units.

As defined in the Limited Liability Company Operating  Agreement,  the Company's
Net Income,  Net Losses,  and  Distributions  are to be  allocated  92.5% to the
Members  and 7.5% to ATEL.  In  accordance  with the  terms of the of  Operating
Agreement,  an  additional  allocations  of income  were made to AFS in 2004 and
2003.  The amounts  allocated  were  determined  to bring AFS's  ending  capital
account balance to zero at the end of 2004 and 2003.

7. Commitments:

As of December 31, 2004,  the Company had  outstanding  commitments  to purchase
lease equipment totaling approximately $21,778,000.

8. Concentration of credit risk and major customers:

The Company leases equipment to lessees and provides debt financing to borrowers
in  diversified  industries.  Leases and notes  receivable  are subject to AFS's
credit committee review.  The leases and notes receivable provide for the return
of the equipment upon default.

As of December 31 2004 and 2003, there were concentrations (greater than 10%) of
equipment leased to lessees and/or financial borrowers in certain industries (as
a percentage of total equipment cost) as follows:

                                                           2004            2003
                         Mining                             42%            14%
                         Manufacturing                      31%            79%
                         Transportation                     20%             *
         * Less than 10%

During  2004,  three  customers  comprised  22%,  19% and  11% of the  Company's
revenues from leases. During 2003, three customers comprised 37%, 26% and 14% of
the Company's revenues from leases.


9. Selected quarterly data (unaudited):



                                                         March 31,       June 30,      September 30,    December 31,
Quarter ended                                              2003            2003             2003            2003

                                                                                                
Total revenues                                                   $ -       $ 114,291        $ 239,996       $ 553,627
Net loss                                                         $ -       $ (67,686)      $ (103,187)      $ (12,140)
Net income (loss) per Limited Liability Company Unit             $ -         $ (0.12)         $ (0.05)          $0.05




                                                         March 31,       June 30,      September 30,    December 31,
Quarter ended                                              2004            2004             2004            2004

                                                                                              
Total revenues                                             $ 734,763     $ 1,082,107      $ 1,266,482     $ 1,886,302
Net income (loss)                                         $ (100,518)       $ 19,386         $ 58,856       $ 192,028
Net income (loss) per Limited Liability Company Unit         $ (0.03)        $ (0.01)         $ (0.01)          $0.01




                                       23


                       ATEL CAPITAL EQUIPMENT FUND X, LLC

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2004


10. Line of credit:

The Company  participates  with AFS and certain of its affiliates in a financing
arrangement  (comprised  of a term loan to AFS, an  acquisition  facility  and a
warehouse facility) with a group of financial institutions that includes certain
financial  covenants.  The financial  arrangement is $75,000,000  and expires in
June 2006. The  availability  of borrowings  available to the Company under this
financing  arrangement  is reduced by the amount AFS has  outstanding  as a term
loan. As of December 31, 2004 borrowings under the facility were as follows:

Total amount available under the financing arrangement           $  75,000,000
Term loan to AFS as of December 31, 2004                            (2,027,636)
                                                                 --------------
Total available under the acquisition and warehouse facilities      72,972,364

Amount borrowed by the Company under the acquisition facility                -
Amounts borrowed by affiliated partnerships and limited liability
   companies under the acquisition facility                        (30,500,000)
                                                                 --------------
Total remaining available under the acquisition and warehouse
   facilities                                                    $  42,472,364
                                                                 ==============

Draws on the acquisition facility by any individual borrower are secured only by
that borrower's assets,  including  equipment and related leases.  Borrowings on
the  warehouse  facility  are  recourse  jointly to  certain  of the  affiliated
partnerships and limited liability companies, the Company and AFS.

The Company has not borrowed  under the line of credit.  Interest on the line of
credit is based on either the thirty day LIBOR rate or the bank's prime rate.

The credit agreement  includes certain  financial  covenants  applicable to each
borrower.  The Company was in  compliance  with its covenants as of December 31,
2004.


11. Fair value of financial instruments:

The  recorded  amounts  of the  Company's  cash and cash  equivalents,  accounts
receivable,  accounts payable and accruals at December 31, 2004 approximate fair
value because of the liquidity and short-term maturity of these instruments.

12. Guarantees:

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




                                       24


Item  9.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURES

None.

Item 9A.  CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures

Under  the  supervision  and  with the  participation  of our  management  (ATEL
Financial  Services,  LLC as Managing  Member of the  registrant,  including the
chief  executive  officer and chief  financial  officer),  an  evaluation of the
effectiveness of the design and operation of the Company's  disclosure  controls
and procedures [as defined in Rules  240.13a-14(c) under the Securities Exchange
Act of 1934] was  performed  as of a date  within  ninety days before the filing
date of this annual  report.  Based upon this  evaluation,  the chief  executive
officer and the chief  financial  officer  concluded  that, as of the evaluation
date, our disclosure  controls and procedures were effective for the purposes of
recording, processing, summarizing, and timely reporting information required to
be disclosed by us in the reports that we file under the Securities Exchange Act
of 1934;  and that such  information  is  accumulated  and  communicated  to our
management in order to allow timely decisions regarding required disclosure.

Changes in internal controls

There have been no  significant  changes in our  internal  controls  or in other
factors that could  significantly  affect our disclosure controls and procedures
subsequent to the evaluation date nor were there any significant deficiencies or
material weaknesses in our internal controls.


                                    PART III

Item 10.  DIRECTORS AND EXECUTIVE OFFICERS

The registrant is a Limited Liability Company and, therefore, has no officers or
directors.

All of the outstanding capital stock of AFS is held by ATEL Capital Group ("ACG"
or "ATEL"),  a holding company formed to control ATEL and affiliated  companies.
The outstanding voting capital stock of ATEL Capital Group is owned 100% by Dean
Cash.

Each of ATEL Leasing Corporation  ("ALC"),  ATEL Equipment  Corporation ("AEC"),
ATEL  Investor  Services  ("AIS") and ATEL  Financial  Services LLC ("AFS") is a
wholly-owned  subsidiary  of ATEL Capital  Group and  performs  services for the
Company.  Acquisition  services are performed for the Company by ALC,  equipment
management, lease administration and asset disposition services are performed by
AEC,  investor  relations and  communications  services are performed by AIS and
general  administrative  services  for the Company are  performed  by AFS.  ATEL
Securities Corporation ("ASC") is a wholly-owned subsidiary of AFS.

The officers  and  directors of ATEL  Capital  Group and its  affiliates  are as
follows:

Dean L. Cash             Chairman of the Board of Directors of ACG, AFS, ALC,
                                AEC, AIS and ASC; President and Chief Executive
                                Officer of ACG, AFS and AEC

Paritosh K. Choksi       Director, Executive Vice President, Chief Operating
                                Officer and Chief Financial Officer of ACG, AFS,
                                ALC, AEC and AIS

Donald E. Carpenter      Vice President and Controller of ACG, AFS, ALC, AEC and
                                AIS; Chief Financial Officer of ASC

Vasco H. Morais          Senior Vice President, Secretary and General Counsel
                                for ACG, AFS, ALC, AIS and AEC

Dean L. Cash,  age 54, joined ATEL as director of marketing in 1980 and has been
a vice president since 1981,  executive vice president since 1983 and a director
since 1984.  He has been  President  and CEO since April 2001.  Prior to joining
ATEL,  Mr.  Cash was a  senior  marketing  representative  for  Martin  Marietta
Corporation, data systems division, from 1979 to 1980. From 1977 to 1979, he was
employed  by  General  Electric  Corporation,   where  he  was  an  applications
specialist in the medical systems division and a marketing representative in the
information  services division.  Mr. Cash was a systems engineer with Electronic
Data Systems from 1975 to 1977, and was involved in  maintaining  and developing
software  for  commercial  applications.  Mr.  Cash  received  a B.S.  degree in
psychology and mathematics in 1972 and an M.B.A.  degree with a concentration in
finance in 1975 from Florida State  University.  Mr. Cash is an arbitrator  with
the American Arbitration Association.



                                       25


Paritosh K.  Choksi,  age 51,  joined  ATEL in 1999 as a  director,  senior vice
president  and its  chief  financial  officer.  He  became  its  executive  vice
president  and COO in April 2001.  Prior to joining  ATEL,  Mr. Choksi was chief
financial officer at Wink  Communications,  Inc. from 1997 to 1999. From 1977 to
1997, Mr. Choksi was with Phoenix American  Incorporated,  a financial  services
and management  company,  where he held various positions during his tenure, and
was senior vice president, chief financial officer and director when he left the
company.  Mr.  Choksi was involved in all  corporate  matters at Phoenix and was
responsible  for Phoenix's  capital  market needs.  He also served on the credit
committee  overseeing  all  corporate  investments,  including its venture lease
portfolio.  Mr. Choksi was a part of the executive  management team which caused
Phoenix's  portfolio to increase  from $50 million in assets to over $2 billion.
Mr. Choksi  received a bachelor of technology  degree in mechanical  engineering
from the Indian Institute of Technology,  Bombay; and an M.B.A.  degree from the
University of California, Berkeley.

Donald E. Carpenter, age 56, joined ATEL in 1986 as controller. Prior to joining
ATEL, Mr. Carpenter was an audit supervisor with Laventhol & Horwath,  certified
public accountants in San Francisco, California, from 1983 to 1986. From 1979 to
1983,  Mr.  Carpenter  was an  audit  senior  with  Deloitte,  Haskins  & Sells,
certified public accountants,  in San Jose,  California.  From 1971 to 1975, Mr.
Carpenter was a Supply Corp officer in the U. S. Navy. Mr. Carpenter  received a
B.S. degree in mathematics  (magna cum laude) from California State  University,
Fresno in 1971 and completed a second major in accounting in 1978. Mr. Carpenter
has been a California certified public accountant since 1981.

Vasco H. Morais, age 46, joined ATEL in 1989 as general counsel to provide legal
support in the  drafting  and  reviewing  of lease  documentation,  advising  on
general corporate law matters, and assisting on securities law issues. From 1986
to 1989,  Mr.  Morais was  employed  by the  BankAmeriLease  Companies,  Bank of
America's  equipment leasing  subsidiaries,  providing in-house legal support on
the  documentation  of  tax-oriented  and non-tax  oriented direct and leveraged
lease transactions, vendor leasing programs and general corporate matters. Prior
to the BankAmeriLease  Companies,  Mr. Morais was with the Consolidated  Capital
Companies in the corporate and securities legal department  involved in drafting
and reviewing  contracts,  advising on corporate law matters and  securities law
issues.  Mr.  Morais  received  a B.A.  degree  in 1982 from the  University  of
California in Berkeley,  a J.D.  degree in 1986 from Golden Gate  University Law
School and an M.B.A.  (Finance) in 1997 from Golden Gate University.  Mr. Morais
has been an active member of the State Bar of California since 1986.

Audit Committee

ATEL Leasing Corporation is the managing member of ATEL Financial Services, LLC.
ATEL Financial Services LLC is the Managing Member of the registrant.  The board
of  directors  of ATEL Leasing  Corporation  acts as the audit  committee of the
registrant.  Dean L. Cash and  Paritosh  K.  Choksi are  members of the board of
directors  of  ALC  and  are  deemed  to be  financial  experts.  They  are  not
independent of the Company.


Code of Ethics

ACG on  behalf  of AFS and ALC  has  adopted  a code  of  ethics  for its  Chief
Executive  Officer,  Chief Financial Officer and Chief Accounting  Officer.  The
Code of Ethics is included as Exhibit 14.1 to this report.


Item 11.  EXECUTIVE COMPENSATION

The registrant is a Limited Liability Company and, therefore, has no officers or
directors.

Set forth hereinafter is a description of the nature of remuneration paid and to
be paid to ATEL and its Affiliates. The amount of such remuneration paid in 2004
is set forth in Item 8 of this report  under the caption  "Financial  Statements
and  Supplementary  Data - Notes to the  Financial  Statements  - Related  party
transactions," at Note 5 thereof,  which  information is hereby  incorporated by
reference.

Selling Commissions

The Company paid selling  commissions in the amount of 9% of Gross Proceeds,  as
defined, to ATEL Securities Corporation, an affiliate of ATEL.

Through December 31, 2004,  $10,571,421 of such commissions had been paid to AFS
or its  affiliate.  Of that  amount,  $8,809,517  has been  re-allowed  to other
broker/dealers.



                                       26


Asset Management Fee

The  Company  pays  AFS an  Asset  Management  Fee in an  amount  equal to 4% of
Operating  Revenues,  which includes Gross Lease Revenues and Cash From Sales or
Refinancing. The Asset Management Fee are paid on a monthly basis. The amount of
the Asset  Management  Fee  payable in any year is reduced  for that year to the
extent it would  otherwise  exceed the Asset  Management Fee Limit, as described
below.  The Asset  Management  Fee is paid for services  rendered by AFS and its
affiliates  in   determining   portfolio  and   investment   strategies   (i.e.,
establishing  and maintaining  the  composition of the Equipment  portfolio as a
whole and the  Company's  overall  debt  structure)  and  generally  managing or
supervising the management of the Equipment.

AFS  supervises  performance  of among others  activities,  collection  of lease
revenues,  monitoring  compliance by lessees with the lease terms, assuring that
Equipment  is  being  used  in  accordance   with  all   operative   contractual
arrangements,  paying operating expenses and arranging for necessary maintenance
and  repair  of  Equipment  in the  event a lessee  fails  to do so,  monitoring
property,  sales and use tax compliance and  preparation of operating  financial
data.  AFS  intends  to  delegate  all or a portion  of its duties and the Asset
Management  Fee to one or more of its  affiliates  who  are in the  business  of
providing such services.

Asset Management Fee Limit:

The Asset Management Fee is subject to the Asset Management Fee Limit. The Asset
Management  Fee Limit is  calculated  each year  during  the  Company's  term by
calculating  the  total  fees  that  would  be  paid  to AFS if AFS  were  to be
compensated on the basis of an alternative fee schedule, to include an Equipment
Management Fee, Incentive Management Fee, and Equipment  Resale/Re-Leasing  Fee,
plus AFS's Carried  Interest,  as described below. To the extent that the amount
paid to AFS as the Asset  Management Fee plus its Carried  Interest for any year
would exceed the aggregate  amount of fees calculated under this alternative fee
schedule for the year, the Asset Management Fee and/or Carried Interest for that
year is reduced to equal the maximum  aggregate fees under the  alternative  fee
schedule.

To the extent any such fees are reduced,  the amount of such  reduction  will be
accrued and deferred,  and such accrued and deferred  compensation would be paid
to AFS in a subsequent  period, but only if and to the extent that such deferred
compensation  would be  payable  within the Asset  Management  Fee Limit for the
subsequent  period.  Any deferred fees which cannot be paid under the applicable
limitations  in any subsequent  period through the date of liquidation  would be
forfeited by AFS upon liquidation.

Alternative Fee Schedule:

For purposes of the Asset  Management  Fee Limit,  the Company will calculate an
alternative schedule of fees, including a hypothetical Equipment Management Fee,
Incentive Management Fee, Equipment Resale/Re- Leasing Fee, and Carried Interest
as follows:

An Equipment  Management  Fee will be calculated to equal the lesser of (i) 3.5%
of annual Gross Revenues from  Operating  Leases and 2% of annual Gross Revenues
from Full Payout  Leases which contain Net Lease  Provisions),  or (ii) the fees
customarily  charged by others  rendering  similar services as an ongoing public
activity in the same geographic location and for similar types of equipment.  If
services with respect to certain Operating Leases are performed by nonaffiliated
persons under the active supervision of AFS or its Affiliate, then the amount so
calculated shall be 1% of Gross Revenues from such Operating Leases.

An Incentive  Management Fee will be calculated to equal 4% of  Distributions of
Cash from  Operations  until  Holders have  received a return of their  Original
Invested Capital plus a Priority Distribution, and, thereafter, to equal a total
of 7.5%  of  Distributions  from  all  sources,  including  Sale or  Refinancing
Proceeds.  In  subordinating  the increase in the Incentive  Management Fee to a
cumulative  return of a  Holder's  Original  Invested  Capital  plus a  Priority
Distribution,  a Holder  would  be  deemed  to have  received  Distributions  of
Original  Invested  Capital only to the extent that  Distributions to the Holder
exceed the amount of the Priority Distribution.

An Equipment  Resale/Re-Leasing Fee will be calculated in an amount equal to the
lesser of (i) 3% of the sale price of the Equipment, or (ii) one-half the normal
competitive equipment sale commission charged by unaffiliated parties for resale
services.  Such fee would apply only after the Holders have received a return of
their Original Invested Capital plus a Priority Distribution. In connection with
the  releasing  of  Equipment to lessees  other than  previous  lessees or their
Affiliates,  the fee  would  be in an  amount  equal  to the  lesser  of (i) the
competitive rate for comparable  services for similar  equipment,  or (ii) 2% of
the gross rental payments  derived from the re-lease of such Equipment,  payable
out of each rental payment received by the Company from such re-lease.

A Carried  Interest equal to 7.5% of all  Distributions  of Cash from Operations
and Cash from Sales or Refinancing.

See Note 5 to the financial statements included in Item 8 for amounts paid.



                                       27


Managing Member's Interest in Operating Proceeds

Net income,  net loss and  investment  tax credits  are  allocated  92.5% to the
Members and 7.5% to AFS. See financial  statements included in Item 8, Part I of
this report for amounts allocated to AFS in 2004 and 2003.

Item 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
            MANAGEMENT

Security Ownership of Certain Beneficial Owners

At December 31, 2004, no investor is known to hold  beneficially more than 5% of
the issued and outstanding Units.

Security Ownership of Management

The parent of AFS is the beneficial owner of Limited  Liability Company Units as
follows:



(1)                                  (2)                                   (3)                              (4)
                                     Name and Address of              Amount and Nature of             Percent
Title of Class                       Beneficial Owner                 Beneficial Ownership             of Class

                                                                                                 
Limited Liability                    ATEL Capital Group               Initial Limited Liability           0.0011%
Company Units                        600 California Street, 6th Floor Company Units
                                     San Francisco, CA  94108         50 Units ($500)


Changes in Control

The Members have the right,  by vote of the Members  owning more than 50% of the
outstanding Limited Liability Company Units, to remove a Managing Member.

AFS may at any time  call a  meeting  of the  Members  or a vote of the  Members
without a meeting, on matters on which they are entitled to vote, and shall call
such  meeting  or for vote  without a  meeting  following  receipt  of a written
request  therefore  of  Members  holding  10% or more of the  total  outstanding
Limited Liability Company Units.

Item 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The  responses  to Item 1 of this report  under the caption  "Equipment  Leasing
Activities," Item 8 of this report under the caption  "Financial  Statements and
Supplemental  Data  -  Notes  to  the  Financial   Statements  -  Related  party
transactions"  at Note 5 thereof,  and Item 11 of this report  under the caption
"Executive Compensation," are hereby incorporated by reference.

Item 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES

During the last two years,  the Company incurred audit,  audit related,  tax and
other fees with its principal auditors as follows:

                                        2004            2003
      Audit fees                     $     44,672   $      14,360
      Audit related fees                        -               -
      Tax fees                             17,878               -
      Other                                     -               -
                                    -------------- ---------------
                                         $ 62,550        $ 14,360
                                    ============== ===============

ATEL Leasing Corporation is the managing member of ATEL Financial Services, LLC.
ATEL Financial Services LLC is the Managing Member of the registrant.  The board
of  directors  of ATEL Leasing  Corporation  acts as the audit  committee of the
registrant.  Engagements  for audit  services,  audit  related  services and tax
services are approved in advance by the Chief Financial  Officer of ATEL Leasing
Corporation acting on behalf the board of directors of ATEL Leasing  Corporation
in its role as the audit committee of the Company.




                                       28


                                     PART IV

Item 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
               ON FORM 8-K

  (a)Financial Statements and Schedules
     1.  Financial Statements
         Included in Part II of this report:

          Report of Independent Registered Public Accounting Firm

          Balance Sheets at December 31, 2004 and 2003

          Statements  of  operations  for the years ended  December 31, 2004 and
          2003 and for the period  from  August  12,  2002  (inception)  through
          December 31, 2002

          Statements of Changes in Members' Capital for the years ended December
          31, 2004 and 2003 and for the period from August 12, 2002  (inception)
          through December 31, 2002

          Statements  of Cash Flows for the years  ended  December  31, 2004 and
          2003 and for the period  from  August  12,  2002  (inception)  through
          December 31, 2002

         Notes to Financial Statements

     2.  Financial Statement Schedules

          All schedules for which provision is made in the applicable accounting
          regulations of the Securities and Exchange Commission are not required
          under the related  instructions or are  inapplicable  and,  therefore,
          have been omitted.

  (b)Reports on Form 8-K for the fourth quarter of 2003 None.

  (c)Exhibits

          (3) and (4)  Agreement  of  Limited  Liability  Company,  included  as
          Exhibit B to Prospectus,  is  incorporated  herein by reference to the
          report on Form 10K for the period ended December 31, 2003 (File Number
          333-100452) (Exhibit 28.1)

          (14.1) Code of Ethics

          (31.1) Certification of Paritosh K. Choksi

          (31.2) Certification of Dean L. Cash

          (32.1)  Certification  Pursuant to 18 U.S.C.  section  1350 of Dean L.
          Cash

          (32.2) Certification Pursuant to 18 U.S.C. section 1350 of Paritosh K.
          Choksi

                                       29


                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.



         Date:           3/29/2005

                       ATEL Capital Equipment Fund X, LLC
                                       (Registrant)


         By: ATEL Financial Corporation,
             Managing Member of Registrant



            By:   /s/ Dean L. Cash
                  -----------------------
                  Dean Cash
                  President of ATEL Financial Services LLC (Managing Member)





            By:   /s/ Paritosh K. Choksi
                  -----------------------
                  Paritosh K. Choksi
                  Executive Vice President of ATEL Financial
                  Services LLC (Managing Member)






                                       30


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has  been  signed  below  by the  persons  in the  capacities  and on the  dates
indicated.


SIGNATURE                         CAPACITIES                             DATE



     /s/ Dean L. Cash     President, Chairman and Chief Executive      3/29/2005
- ------------------------  Officer of ATEL Financial Services LLC
        Dean Cash



  /s/ Paritosh K. Choksi  Executive Vice President and director of     3/29/2005
- ------------------------  ATEL Financial Services LLC, Principal
    Paritosh K. Choksi    financial officer of registrant; principal
                          financial officer and director of ATEL
                          Financial Services LLC




 /s/ Donald E. Carpenter  Principal accounting officer of registrant;  3/29/2005
- ------------------------  principal accounting officer of ATEL
   Donald E. Carpenter    Financial Services LLC








No proxy  materials  have been or will be sent to  security  holders.  An annual
report will be furnished to security  holders  subsequent  to the filing of this
report on Form 10-K, and copies thereof will be furnished  supplementally to the
Commission when forwarded to the security holders.


                                       31