Attached files
| file | filename |
|---|---|
| 8-K - ICON Equipment & Corporate Infrastructure Fund Fourteen, L.P. | body.htm |
Exhibit 99.1
ICON EQUIPMENT AND CORPORATE
INFRASTRUCTURE FUND FOURTEEN, L.P.
PORTFOLIO OVERVIEW
SECOND QUARTER
2012
Letter from the CEOs As of October 16, 2012
Dear investor in ICON Equipment and Corporate Infrastructure Fund Fourteen, L.P.:
We write to briefly summarize our activity for the second quarter ended June 30, 2012. A more detailed analysis, which we encourage you to read, is contained in our Form 10-Q. Our Form 10-Q and our other quarterly, annual and current reports are available in the Investor Relations section of our website, www.iconinvestments.com.
As of June 30, 2012, Fund Fourteen was in its operating period. As of June 30th, Fund Fourteen had invested $225,858,6001 of capital, or 98.72% of capital available for investment, in business-essential equipment and corporate infrastructure.
On May 2, 2012, the term loan to affiliates of Northern Leasing Systems, Inc. was satisfied in full prior to its maturity date. Our initial investment was approximately $9,858,000 and, during the term of this investment, we collected approximately $12,896,000 in loan proceeds.
In addition, on May 22, 2012, the term loan to Northern Crane Services Inc. was satisfied in full prior to its maturity date. Our initial investment was approximately $5,250,000 and, during the term of this investment, we collected approximately $6,759,000 in loan proceeds.
During the second quarter of 2012, Fund Fourteen made two loans for a total investment amount of approximately $2,917,000. The loans are secured by business essential equipment of each borrower.
We believe that there will be many opportunities for us to continue to deploy our equity in well structured deals collateralized by business-essential equipment and corporate infrastructure.
We invite you to read through our portfolio overview on the pages that follow for a more detailed explanation of the investments noted above as well as more information regarding Fund Fourteen’s operations to date. As always, thank you for entrusting ICON with your investment assets.
Sincerely,
 |
 |
||
|
Michael A. Reisner
|
Mark Gatto
|
||
|
Co-President and Co-Chief Executive Officer
|
Co-President and Co-Chief Executive Officer
|
1
ICON Equipment and Corporate Infrastructure
Fund Fourteen, L.P.
Second Quarter 2012 Portfolio Overview
We are pleased to present ICON Equipment and Corporate Infrastructure Fund Fourteen, L.P.’s (the “Fund”) Portfolio Overview for the second quarter of 2012. References to “we,” “us,” and “our” are references to the Fund, references to the “General Partner” are references to the general partner of the Fund, ICON GP 14, LLC, and references to the “Investment Manager” are references to the investment manager of the Fund, ICON Capital Corp.
The Fund
We raised $257,646,987 commencing with our initial offering on May 18, 2009 through the closing of our offering on May 18, 2011.
Our operating period commenced in May 2011. During our operating period, we will invest our offering proceeds and cash generated from operations in business-essential equipment and corporate infrastructure.
Our operating period is anticipated to continue for a period of five years from the closing of the offering, unless extended at our General Partner’s sole discretion. Following our operating period, we will enter our liquidation period, during which time the leases and loans we own will mature or be sold in the ordinary course of business.
Recent Transactions
|
·
|
On July 23, 2012, we participated in a $5,000,000 loan facility by making a $2,000,000 term loan to affiliates of Frontier Oilfield Services, Inc. (collectively, “Frontier”). The loan is secured by, among other things, a first priority security interest in all of Frontier’s saltwater disposal wells and related equipment valued at approximately $38,925,000. The loan bears interest at 14% per year and is payable through February 2018.
|
|
·
|
On July 30, 2012, we made an additional capital expenditure loan to subsidiaries of Revstone Transportation, LLC (collectively, “Revstone”) in the amount of approximately $1,529,000. The loan is secured by a first priority security interest in the Fund’s pro rata share of the machining equipment purchased with the proceeds from the loan, as well as a second priority security interest in, among other things, manufacturing equipment and related collateral. The loan bears interest at 17% per year and matures on March 1, 2017.
|
|
·
|
On September 7, 2012, at the expiration of the lease and in accordance with its terms, we, through a joint venture owned 90.92% by us, sold telecommunications equipment subject to lease with Global Crossing Telecommunications, Inc. (“Global Crossing”) to Global Crossing for approximately $1,065,000. The joint venture initially invested approximately $5,323,000 to purchase the equipment, and, during the term of this investment, the joint venture collected approximately $6,758,000 in rental and sale proceeds.
|
|
·
|
On September 10, 2012, we participated in a $17,000,000 loan facility by making a $12,410,000 term loan to Superior Tube Company, Inc. and its affiliate (collectively, “Superior Tube”). The loan is secured by collateral valued at approximately $45,206,000, which includes, among other things, a first priority security interest in all of Superior Tube’s tube manufacturing equipment consisting of tube mills, reducers, finishing machines and heat treatment furnaces. The loan bears interest at 12% per year and is payable in sixty monthly payments beginning on October 1, 2012.
|
|
·
|
On September 27, 2012, we made an additional term loan to NTS Communications, Inc. and certain affiliates (collectively, “NTS Communications”) in the amount of approximately $1,565,000. The loan is secured by a first priority security interest in the assets purchased with the proceeds from the loan, which consists of equipment to be used in NTS Communications’ high speed broadband services operation. The loan bears interest at 12.75% per year and is payable in fifty-eight monthly payments beginning on October 1, 2012.
|
2
Portfolio Overview
Our portfolio consists of investments that we have made directly, as well as those that we have made with our affiliates and third parties. As of June 30, 2012, our portfolio consisted primarily of the following investments:
|
·
|
We made a term loan to VAS Aero Services, LLC (“VAS”). The loan is secured by a second priority security interest in, among other things, aircraft engines and related parts in VAS’s airplane component aftermarket sales operation. The loan bears interest at rates between 12% and 14.5% per year and is payable through October 2014.
|
|
·
|
A 40.53% interest in eight Ariel gas compressors. The compressors are subject to a forty-eight month lease with Atlas Pipeline Mid-Continent, LLC that expires on August 31, 2013.
|
|
·
|
We made term loans to Ocean Navigation 5 Co. Ltd. and Ocean Navigation 6 Co. Ltd. The proceeds from the loans were used for the purchase of two Aframax tanker vessels, the Shah Deniz and the Absheron. The loans bear interest at 15.25% per year and mature in July 2016 and September 2016.
|
|
·
|
We made a term loan to Jurong Aromatics Corporation Pte. Ltd. (“Jurong Aromatics”) that helped finance the construction and operation of a condensate splitter and aromatics complex on Jurong Island in Singapore (the “Jurong Complex”). The loan is secured by a second priority security interest in all of Jurong Aromatics’ assets which include, among other things, all equipment, plant, and machinery associated with the Jurong Complex. The loan bears interest at rates ranging from 12.5% to 15% per year and matures in January 2021.
|
|
·
|
A 40% interest in the offshore support vessel, the Lewek Ambassador. The vessel is subject to a one hundred-eight month bareboat charter with Gallatin Maritime Management that commenced on June 4, 2012.
|
|
·
|
We participated in an amended loan facility with NTS Communications. The loan is secured by, among other things, a first priority security interest in equipment used in NTS Communications’ high speed broadband services operation, which provides internet access, digital cable television programming and local and long distance telephone service to residential and business customers. The loan bears interest at 12.75% per year and is payable for a period of sixty months beginning on July 1, 2012.
|
|
·
|
We made a term loan to ARAM Rentals Corporation and ARAM Seismic Rentals, Inc. (collectively, the “ARAM Borrowers”). The ARAM Borrowers are wholly-owned subsidiaries of ION Geophysical Corporation. The loans are secured by, among other things, a first priority security interest in all of the ARAM Borrowers analog seismic system equipment owned by the ARAM Borrowers. The loan bears interest at 15% per year for a period of sixty months, beginning on August 1, 2009.
|
|
·
|
A 75% interest in two Aframax tankers, the Eagle Otome and the Eagle Subaru (the “Tankers”), and two Very Large Crude Carriers, the Eagle Virginia and the Eagle Vermont (the “VLCCs”). The Tankers are subject to thirty-six month bareboat charters with AET, Inc. Limited (“AET”) through March 2014. The VLCCs are subject to one hundred twenty month bareboat charters with AET through March 2021. On April 20, 2012, we were notified of an event of default on the senior loan. Due to a change in the fair value of the Tankers and the VLCCs, a provision in the senior loan agreement restricts our ability to utilize cash generated by the charters of the Tankers and the VLCCs as of January 12, 2012 for purposes other than paying the senior loan. While this restriction is in place, we are prevented from applying the charter proceeds to the subordinated debt. The subordinated debt lender has reserved, but not exercised, its rights under the loan agreement.
|
|
·
|
We made a term loan to EMS Enterprise Holdings, LLC and its affiliates (collectively, “EMS”). The loan is secured by, among other things, (i) a first priority security interest in all of EMS’s existing and hereafter acquired U.S. assets, (ii) a first priority mortgage over real property located in Hamburg, Pennsylvania, and (iii) a second priority security interest in all of EMS’s accounts receivable and inventory. The loan bears interest at 13% per year and is payable for a period of forty-eight months beginning on September 1, 2010.
|
|
·
|
A crude oil tanker, the Center. The tanker is subject to a sixty month bareboat charter with Center Navigation Ltd., a wholly-owned subsidiary of Geden Holdings Limited (“Geden”), which commenced on June 21, 2011.
|
|
·
|
Two supramax bulk carrier vessels, the Amazing and the Fantastic. The vessels are subject to eighty-four month bareboat charters with subsidiaries of Geden that commenced on October 1, 2010.
|
3
|
·
|
We made a term loan to Kanza Construction, Inc. (“Kanza”). The loan is secured by, among other things, equipment used in Kanza’s railroad services business comprised of trucks, trailers, cranes, crawlers and excavators. The loan bears interest at 13% per year and is payable for a period of sixty months beginning on April 1, 2012. During the three months ended June 30, 2012, as a result of Kanza’s unexpected financial hardship, Kanza failed to meet its payment obligations to us. While it is not possible to determine our ability to collect on the amounts due from Kanza, subsequent to June 30th, Kanza sold certain equipment subject to our security interest for amounts that exceeded the estimate forced liquidation value of such equipment. The proceeds from the sales were applied to partially satisfy Kanza’s obligations to us.
|
|
·
|
We made a term loan to Revstone. The term loan is secured by, among other things, a first priority security interest in all of Revstone’s manufacturing equipment and related collateral and a mortgage on certain real property. The term loan bears interest at 15% per year and is payable for a period of sixty months beginning on March 1, 2012. We also made a capital expenditure loan to Revstone. The capital expenditure loan is secured by a first priority security interest in the machining equipment purchased with the proceeds from the loan, as well as a second priority security interest in the term loan collateral. The capital expenditure loan bears interest at 17% per year and matures on March 1, 2017.
|
|
·
|
A 3-layer blown film extrusion line and an eight color flexographic printing press. The equipment is subject to sixty-month leases with Exopack, LLC that expire on July 31, 2014 and September 30, 2014.
|
|
·
|
We made a term loan to Western Drilling Inc. and Western Landholdings, LLC. The loan is secured by, among other collateral, oil and drilling rigs and a mortgage over real property. The loan bears interest at 14% per year and matures in September 2016.
|
|
·
|
Twenty-six 2010 MCI J4500 motor coach buses subject to leases with Dillon's Bus Service, Inc. (“DBS”), Lakefront Lines, Inc. (“Lakefront”), and CUSA GCT, LLC (“CUSA GCT”), affiliates of Coach America Holdings, Inc. The leases are for sixty months and commenced on June 1, 2010. On January 3, 2012, DBS, Lakefront, CUSA GCT and their parent-company, Coach Am Group Holdings Corp., commenced a voluntary Chapter 11 proceeding in U.S. Bankruptcy Court. As a result, on July 20, 2012, Lakefront, DBS, and CUSA GCT assigned their respective interests in the leases of twenty-four motor coaches to CAM Leasing, LLC.
|
|
·
|
We made a second priority term loan to Quattro Plant Limited (“Quattro Plant”), a wholly-owned subsidiary of Quattro Group Limited. The loan is secured by (i) all of Quattro Plant’s rail support construction equipment, (ii) all of Quattro Plant’s accounts receivable, and (iii) a mortgage over certain real property in London, England. The loan bears interest at 20% per year for a period of thirty-three months, which began on January 1, 2010.
|
|
·
|
Information technology equipment that is subject to various leases with Global Crossing. The leases are for thirty-six months and commenced between March 1, 2011 and July 1, 2011.
|
|
·
|
A 90.92% interest in a joint venture that owns telecommunications equipment subject to various leases with Global Crossing. The leases are scheduled to expire at various times through February 28, 2013.
|
Revolving Line of Credit
On May 10, 2011, the Fund entered into a loan agreement with California Bank & Trust (“CB&T”) for a revolving line of credit of up to $15,000,000 (the “Facility”), which is secured by all of the Fund’s assets not subject to a first priority lien. Amounts available under the Facility are subject to a borrowing base that is determined, subject to certain limitations, on the present value of the future receivables under certain loans and lease agreements in which the Fund has a beneficial interest.
4
The Facility expires on March 31, 2013 and the Fund may request a one year extension to the revolving line of credit within 390 days of the then-current expiration date, but CB&T has no obligation to extend. The interest rate for general advances under the Facility is CB&T’s prime rate and the interest rate on up to five separate non-prime rate advances that are permitted to be made under the Facility is the 90-day rate at which U.S. dollar deposits can be acquired by CB&T in the London Interbank Eurocurrency Market plus 2.5% per year, provided that all interest rates on advances under the Facility are subject to an interest rate floor of 4.0% per year. In addition, the Fund is obligated to pay a commitment fee based on an annual rate of 0.50% on unused commitments under the Facility. At June 30, 2012, there were no obligations outstanding under the Facility.
Additional Disclosures
As of June 30, 2012, the Fund maintained a leverage ratio of 1.14:11. We collected 99.05%2 of all scheduled receivables due for the second quarter of 2012, with the uncollected receivables relating to our investment with Kanza.
One of our objectives is to provide cash distributions to our members. In order to assess our ability to meet this objective, unaffiliated broker dealers, third party due diligence providers and other members of the investing community have requested that we report a financial measure that can be reconciled to our financial statements and can be used to assess our ability to support cash distributions from our business operations. We refer to this financial measure as cash available from our business operations, or CABO. CABO is not equivalent to our net operating income or loss as determined under GAAP. Rather, it is a measure that may be a better financial measure for an equipment fund because it measures cash generated by investments, net of management fees and expenses, during a specific period of time. We define CABO as the net change in cash during the period plus distributions to members and investments made during such period, less the debt proceeds used to make such investments and the activity related to the revolver, as well as the net proceeds from equity raised through the sale of interests during such period.
We believe that CABO may be an appropriate supplemental measure of an equipment fund’s performance because it is based on a measurement of cash during a specific period that excludes cash from non-business operations, such as distributions, investments and equity raised.
Presentation of this information is intended to assist unaffiliated broker dealers, third party due diligence providers and other members of the investing community in understanding the Fund’s ability to support its distributions from its business operations. It should be noted, however, that no other equipment funds calculate CABO, and therefore comparisons with other equipment funds are not meaningful. CABO should not be considered as an alternative to net income (loss) as an indication of our performance or as an indication of our liquidity. CABO should be reviewed in conjunction with other measurements as an indication of our performance.
Cash Available from Business Operations, or CABO, is the cash generated by investments during a specific period of time, net of management fees and expenses, excluding distributions to partners, net equity raised and investments made.
|
Net Change in Cash per GAAP Statement of Cash Flows
|
Business Operations
Net cash flow generated by our investments, net of management fees and expenses (CABO)
|
Non-Business Operations
Net equity raised
Cash expended to make investments and
Distributions to Partners
|
2 Collections as of July 31, 2012.
5
As indicated above, the total net change in cash is the aggregate of the net cash flows from Business Operations and the net cash flows from Non-Business Operations. By taking the total net change in cash and deducting the cash activity related to Non-Business Operations (distributions, investments and equity raised), the amount remaining is the net cash available from Business Operations (net cash flows generated by investments, net of management fees and expenses).
In summary, CABO is calculated as:
Net change in cash during the period from the GAAP statements of cash flows
+ distributions to partners during the period
+ investments made during the period to the extent of equity raised and cash on hand at the beginning of theperiod
- debt proceeds specifically used to make an investment and the activity related to the revolver
- net proceeds from the sale of Interests during the period
= CABO
|
Cash Available From Business Operations
|
||||||||
|
for the Period January 1, 2012 through June 30, 2012
|
||||||||
|
Cash Balance at January 1, 2012
|
$ | 48,783,509 | ||||||
|
Cash Balance at June 30, 2012
|
$ | 27,962,091 | ||||||
|
Net Change in Cash
|
$ | (20,821,418 | ) | |||||
|
Add Back:
|
||||||||
|
Distributions Paid to Partners from January 1, 2012 through June 30, 2012
|
$ | 10,457,852 | ||||||
|
Investments made during the Period
|
||||||||
|
Investment in Notes Receivable
|
$ | 32,610,643 | ||||||
|
Investment in Joint Ventures
|
117,500 | |||||||
|
Investment by Noncontrolling Interests, net
|
(137,500 | ) | ||||||
| $ | 32,590,643 | |||||||
|
Deduct:
|
||||||||
|
Net Equity raised during the Period
|
$ | (4,486 | ) (1) | |||||
|
Debt Proceeds used specifically for Investments and activity related to the revolver
|
$ | - | ||||||
|
Cash Available from Business Operations (CABO)
|
$ | 22,231,563 | (2) | |||||
|
1 This amount is the net amount of (a) Sale of Limited Partnership Interests, (b) Sales and Offering Expenses Paid, (c) Deferred Charges and (d) Repurchase of Limited Partnership Interests, all directly from the GAAP Cash Flow statement. This amount is deducted as it is not considered a source for distributions.
|
||||||||
|
2 Cash available from business operations includes the collection of principal and interest from our investments in notes receivable and finance leases.
|
||||||||
6
Transactions with Related Parties
We have entered into certain agreements with our General Partner, our Investment Manager, and ICON Securities Corp. (“ICON Securities”), a wholly-owned subsidiary of our Investment Manager, whereby we pay certain fees and reimbursements to these parties. ICON Investments is entitled to receive a 3% underwriting fee from the gross proceeds from sales of our limited partnership interests, of which up to 1% may be paid to unaffiliated broker-dealers as a fee for their assistance in marketing the Fund and coordinating sales efforts.
In addition, we reimbursed our General Partner and its affiliates for organizational and offering expenses incurred in connection with our organization and offering. The reimbursement of these expenses were capped at the lesser of 1.44% of the gross offering proceeds (assuming all of our limited partnership interests were sold in the offering) and the actual costs and expenses incurred by our General Partner and its affiliates. These costs included, but were not limited to, legal, accounting, printing, advertising, administrative, investor relations and promotional expenses for registering, offering, and distributing our limited partnership interests to the public.
We pay or paid our Investment Manager (i) a management fee equal to 3.5% of the gross periodic payments due and paid from our investments, and (ii) acquisition fees, through the end of the operating period, equal to 2.5% of the total purchase price of our investments. The purchase price includes the cash paid, indebtedness incurred, assumed or to which our gross revenues from the investment are subject and/or the value of the equipment secured by or subject to such investment, and the amount of the related acquisition fees on such investment, plus that portion of the expenses incurred by our General Partner or its affiliates in making investments on an arm’s length basis with a view to transferring such investments to us, which is allocated to the investments in question in accordance with allocation procedures employed by our General Partner or such affiliate from time to time and within generally accepted accounting principles. In connection with the investments described in the recent transactions section, we paid our Investment Manager aggregate acquisition fees in the amount of $979,806.
Our General Partner and its affiliates also perform certain services relating to the management of our portfolio. Such services include, but are not limited to, credit analysis and underwriting, receivables management, portfolio management, accounting, financial and tax reporting, and remarketing and marketing services.
In addition, our General Partner and its affiliates are reimbursed for administrative expenses incurred in connection with our operations. Administrative expense reimbursements are costs incurred by our General Partner or its affiliates that are necessary to our operations. These costs include our General Partner’s and its affiliates’ legal, accounting, investor relations, and operations personnel, as well as professional fees and other costs that are charged to us based upon the percentage of time such personnel dedicate to us. Excluded are salaries and related costs, office rent, travel expenses, and other administrative costs incurred by individuals with a controlling interest in our General Partner.
Our General Partner also has a 1% interest in our profits, losses, cash distributions and liquidation proceeds. We paid distributions to our General Partner in the amounts of $52,289 and $104,578 for the three and six months ended June 30, 2012, respectively. Additionally, our General Partner’s interest in our net (loss) income was $(14,850) and $37,837 for the three and six months ended June 30, 2012, respectively.
Fees and other expenses paid or accrued by us to our General Partner or its affiliates were as follows:
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||||||
|
Entity
|
Capacity
|
Description
|
2012
|
2011
|
2012
|
2011
|
||||||||||||||
|
ICON Capital Corp.
|
Investment Manager
|
Organizational and offering
|
||||||||||||||||||
|
expense reimbursements (1)
|
$ | - | $ | 214,071 | $ | - | $ | 273,438 | ||||||||||||
|
ICON Securities Corp.
|
Dealer-Manager
|
Underwriting fees (2)
|
- | 933,757 | - | 1,877,234 | ||||||||||||||
|
ICON Capital Corp.
|
Investment Manager
|
Acquisition fees (3)
|
72,928 | 4,050,184 | 1,563,596 | 7,541,296 | ||||||||||||||
|
ICON Capital Corp.
|
Investment Manager
|
Management fees (4)
|
883,818 | 480,542 | 1,459,506 | 816,728 | ||||||||||||||
|
ICON Capital Corp.
|
Investment Manager
|
Administrative expense
|
||||||||||||||||||
|
reimbursements (4)
|
1,535,521 | 2,162,386 | 2,325,786 | 3,355,347 | ||||||||||||||||
|
Total
|
$ | 2,492,267 | $ | 7,840,940 | $ | 5,348,888 | $ | 13,864,043 | ||||||||||||
|
(1) Amount capitalized and amortized to partners' equity.
|
||||||||||||||||||||
|
(2) Amount charged directly to partners' equity.
|
||||||||||||||||||||
|
(3) Amount capitalized and amortized to operations over the estimated service period in accordance with the Fund's accounting policies.
|
||||||||||||||||||||
|
(4) Amount charged directly to operations.
|
||||||||||||||||||||
At June 30, 2012 and December 31, 2011, we had a net payable of $286,654 and $398,466, respectively due to our General Partner and its affiliates that primarily consisted of administrative expense reimbursements.
Your participation in the Fund is greatly appreciated.
We are committed to protecting the privacy of our investors in compliance with all applicable laws. Please be advised that, unless required by a regulatory authority such as FINRA or ordered by a court of competent jurisdiction, we will not share any of your personally identifiable information with any third party.
7
|
ICON Equipment and Corporate Infrastructure Fund Fourteen, L.P.
|
||||||||
|
(A Delaware Limited Partnership)
|
||||||||
|
Assets
|
||||||||
|
June 30,
|
||||||||
|
2012
|
December 31,
|
|||||||
|
(unaudited)
|
2011
|
|||||||
|
Cash and cash equivalents
|
$ | 27,962,091 | $ | 48,783,509 | ||||
|
Restricted cash
|
6,097,632 | 2,500,000 | ||||||
|
Net investment in finance leases
|
141,875,388 | 145,974,532 | ||||||
|
Leased equipment at cost (less accumulated depreciation of
|
||||||||
|
$27,050,871 and $18,302,163, respectively)
|
172,361,488 | 181,110,196 | ||||||
|
Net investment in notes receivable
|
85,692,328 | 70,406,783 | ||||||
|
Note receivable from joint venture
|
2,364,230 | 2,800,000 | ||||||
|
Investments in joint ventures
|
707,332 | 1,029,336 | ||||||
|
Other assets
|
7,178,418 | 6,044,435 | ||||||
|
Total Assets
|
$ | 444,238,907 | $ | 458,648,791 | ||||
|
Liabilities and Equity
|
||||||||
|
Liabilities:
|
||||||||
|
Non-recourse long-term debt
|
$ | 211,740,740 | $ | 221,045,626 | ||||
|
Derivative financial instruments
|
11,717,447 | 10,663,428 | ||||||
|
Deferred revenue
|
3,257,030 | 3,245,739 | ||||||
|
Due to General Partner and affiliates, net
|
286,654 | 398,466 | ||||||
|
Accrued expenses and other liabilities
|
10,068,362 | 9,418,900 | ||||||
|
Total Liabilities
|
237,070,233 | 244,772,159 | ||||||
|
Commitments and contingencies
|
||||||||
|
Equity:
|
||||||||
|
Partners’ Equity:
|
||||||||
|
Limited Partners
|
195,880,897 | 202,492,816 | ||||||
|
General Partner
|
(344,685 | ) | (277,944 | ) | ||||
|
Total Partners’ Equity
|
195,536,212 | 202,214,872 | ||||||
|
Noncontrolling Interests
|
11,632,462 | 11,661,760 | ||||||
|
Total Equity
|
207,168,674 | 213,876,632 | ||||||
|
Total Liabilities and Equity
|
$ | 444,238,907 | $ | 458,648,791 | ||||
8
|
(A Delaware Limited Partnership)
|
||||||||||||||||
|
(unaudited)
|
||||||||||||||||
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
Revenue:
|
||||||||||||||||
|
Finance income
|
$ | 6,648,576 | $ | 4,008,585 | $ | 13,438,393 | $ | 7,643,731 | ||||||||
|
Rental income
|
7,916,683 | 7,994,863 | 15,823,400 | 9,694,654 | ||||||||||||
|
(Loss) income from investments in joint ventures
|
(84,670 | ) | 154,718 | (227,732 | ) | 300,828 | ||||||||||
|
Other (loss) income
|
(11,235 | ) | 83,477 | 65,731 | 259,956 | |||||||||||
|
Total revenue
|
14,469,354 | 12,241,643 | 29,099,792 | 17,899,169 | ||||||||||||
|
Expenses:
|
||||||||||||||||
|
Management fees
|
883,818 | 480,542 | 1,459,506 | 816,728 | ||||||||||||
|
Administrative expense reimbursements
|
1,535,521 | 2,162,386 | 2,325,786 | 3,355,347 | ||||||||||||
|
General and administrative
|
761,680 | 569,200 | 1,127,212 | 937,659 | ||||||||||||
|
Credit loss
|
2,976,066 | - | 2,636,066 | - | ||||||||||||
|
Depreciation
|
4,374,354 | 4,423,544 | 8,748,708 | 5,474,964 | ||||||||||||
|
Interest
|
2,833,000 | 2,504,735 | 5,775,730 | 3,103,865 | ||||||||||||
|
Loss on derivative financial instruments
|
2,693,172 | 4,811,119 | 2,922,747 | 4,811,119 | ||||||||||||
|
Total expenses
|
16,057,611 | 14,951,526 | 24,995,755 | 18,499,682 | ||||||||||||
|
Net (loss) income
|
(1,588,257 | ) | (2,709,883 | ) | 4,104,037 | (600,513 | ) | |||||||||
|
Less: Net (loss) income attributable to noncontrolling interests
|
(103,238 | ) | (858,914 | ) | 320,359 | (817,905 | ) | |||||||||
|
Net (loss) income attributable to Fund Fourteen
|
$ | (1,485,019 | ) | $ | (1,850,969 | ) | $ | 3,783,678 | $ | 217,392 | ||||||
|
Net (loss) income attributable to Fund Fourteen allocable to:
|
||||||||||||||||
|
Limited Partners
|
$ | (1,470,169 | ) | $ | (1,832,459 | ) | $ | 3,745,841 | $ | 215,218 | ||||||
|
General Partner
|
(14,850 | ) | (18,510 | ) | 37,837 | 2,174 | ||||||||||
| $ | (1,485,019 | ) | $ | (1,850,969 | ) | $ | 3,783,678 | $ | 217,392 | |||||||
|
Weighted average number of limited
|
||||||||||||||||
|
partnership interests outstanding
|
258,831 | 247,140 | 258,831 | 227,896 | ||||||||||||
|
Net (loss) income attributable to Fund Fourteen
|
||||||||||||||||
|
per weighted average limited partnership
|
||||||||||||||||
|
interest outstanding
|
$ | (5.68 | ) | $ | (7.41 | ) | $ | 14.47 | $ | 0.94 | ||||||
9
|
ICON Equipment and Corporate Infrastructure Fund Fourteen, L.P.
|
||||||||||||||||||||||||
|
(A Delaware Limited Partnership)
|
||||||||||||||||||||||||
|
Partners' Equity
|
||||||||||||||||||||||||
|
Limited
|
Total
|
|||||||||||||||||||||||
|
Partnership
|
Limited
|
Partners'
|
Noncontrolling
|
Total
|
||||||||||||||||||||
|
Interests
|
Partners
|
General Partner
|
Equity
|
Interests
|
Equity
|
|||||||||||||||||||
|
Balance, December 31, 2011
|
258,832 | $ | 202,492,816 | $ | (277,944 | ) | $ | 202,214,872 | $ | 11,661,760 | $ | 213,876,632 | ||||||||||||
|
Net income
|
- | 5,216,010 | 52,687 | 5,268,697 | 423,597 | 5,692,294 | ||||||||||||||||||
|
Cash distributions
|
- | (5,176,637 | ) | (52,289 | ) | (5,228,926 | ) | (390,703 | ) | (5,619,629 | ) | |||||||||||||
|
Balance, March 31, 2012 (unaudited)
|
258,832 | 202,532,189 | (277,546 | ) | 202,254,643 | 11,694,654 | 213,949,297 | |||||||||||||||||
|
Net loss
|
- | (1,470,169 | ) | (14,850 | ) | (1,485,019 | ) | (103,238 | ) | (1,588,257 | ) | |||||||||||||
|
Repurchase of limited partnership interests
|
(5 | ) | (4,486 | ) | - | (4,486 | ) | - | (4,486 | ) | ||||||||||||||
|
Investment by noncontrolling interest
|
- | - | - | - | 137,500 | 137,500 | ||||||||||||||||||
|
Cash distributions
|
- | (5,176,637 | ) | (52,289 | ) | (5,228,926 | ) | (96,454 | ) | (5,325,380 | ) | |||||||||||||
|
Balance, June 30, 2012 (unaudited)
|
258,827 | $ | 195,880,897 | $ | (344,685 | ) | $ | 195,536,212 | $ | 11,632,462 | $ | 207,168,674 | ||||||||||||
10
|
ICON Equipment and Corporate Infrastructure Fund Fourteen, L.P.
|
||||||||
|
(A Delaware Limited Partnership)
|
||||||||
|
(unaudited)
|
||||||||
|
Six Months Ended June 30,
|
||||||||
|
2012
|
2011
|
|||||||
|
Cash flows from operating activities:
|
||||||||
|
Net income (loss)
|
$ | 4,104,037 | $ | (600,513 | ) | |||
|
Adjustments to reconcile net income (loss) to net cash
|
||||||||
|
provided by operating activities:
|
||||||||
|
Finance income, net of costs and fees
|
558,719 | 341,767 | ||||||
|
Loss (income) from investments in joint ventures
|
227,732 | (300,828 | ) | |||||
|
Depreciation
|
8,748,708 | 5,474,964 | ||||||
|
Credit loss
|
2,636,066 | - | ||||||
|
Interest expense from amortization of debt financing costs
|
502,095 | 189,589 | ||||||
|
Interest expense, other
|
190,128 | 26,857 | ||||||
|
Other income
|
(22,562 | ) | (114,894 | ) | ||||
|
Loss on derivative financial instruments
|
1,054,019 | 4,811,119 | ||||||
|
Changes in operating assets and liabilities:
|
||||||||
|
Restricted cash
|
(3,597,632 | ) | (1,250,000 | ) | ||||
|
Other assets, net
|
(1,635,067 | ) | (2,388,888 | ) | ||||
|
Accrued expenses and other liabilities
|
459,334 | 366,255 | ||||||
|
Deferred revenue
|
11,291 | 1,924,992 | ||||||
|
Due to General Partner and affiliates
|
(111,812 | ) | 1,627,867 | |||||
|
Distributions from joint ventures
|
- | 300,828 | ||||||
|
Net cash provided by operating activities
|
13,125,056 | 10,409,115 | ||||||
|
Cash flows from investing activities:
|
||||||||
|
Purchase of equipment
|
- | (79,564,939 | ) | |||||
|
Principal repayment on finance leases
|
3,988,396 | 2,761,275 | ||||||
|
Investments in joint ventures
|
(117,500 | ) | - | |||||
|
Distributions received from joint ventures in excess of profits
|
211,772 | 182,704 | ||||||
|
Investment in notes receivable
|
(32,610,643 | ) | - | |||||
|
Principal repayment on notes receivable
|
14,698,382 | 3,012,046 | ||||||
|
Net cash used in investing activities
|
(13,829,593 | ) | (73,608,914 | ) | ||||
|
Cash flows from financing activities:
|
||||||||
|
Proceeds from non-recourse long-term debt
|
- | 22,000,000 | ||||||
|
Repayment of non-recourse long-term debt
|
(9,304,886 | ) | (5,331,524 | ) | ||||
|
Debt financing costs
|
- | (4,420,000 | ) | |||||
|
Sale of limited partnership interests
|
- | 65,673,533 | ||||||
|
Sales and offering expenses paid
|
- | (6,166,877 | ) | |||||
|
Deferred charges
|
- | (257,226 | ) | |||||
|
Investment by noncontrolling interest
|
137,500 | 12,191,868 | ||||||
|
Distributions to noncontrolling interests
|
(487,157 | ) | (5,718,806 | ) | ||||
|
Cash distributions to partners
|
(10,457,852 | ) | (8,720,956 | ) | ||||
|
Repurchase of limited partnership interests
|
(4,486 | ) | (53,498 | ) | ||||
|
Net cash (used in) provided by financing activities
|
(20,116,881 | ) | 69,196,514 | |||||
|
Net (decrease) increase in cash and cash equivalents
|
(20,821,418 | ) | 5,996,715 | |||||
|
Cash and cash equivalents, beginning of the period
|
48,783,509 | 64,317,006 | ||||||
|
Cash and cash equivalents, end of the period
|
$ | 27,962,091 | $ | 70,313,721 | ||||
11
|
(A Delaware Limited Partnership)
|
||||||||
|
Consolidated Statements of Cash Flows
|
||||||||
|
(unaudited)
|
||||||||
|
Six Months Ended June 30,
|
||||||||
|
2012
|
2011
|
|||||||
|
Supplemental disclosure of cash flow information:
|
||||||||
|
Cash paid during the period for interest
|
$ | 6,292,184 | $ | 2,739,086 | ||||
|
Supplemental disclosure of non-cash investing and financing activities:
|
||||||||
|
Organizational and offering expenses due to Investment Manager
|
$ | - | $ | 22,571 | ||||
|
Organizational and offering expenses charged to equity
|
$ | - | $ | 1,124,718 | ||||
|
Equipment purchased with non-recourse long-term debt paid directly by lender
|
$ | - | $ | 172,000,000 | ||||
|
Exchange of noncontrolling interest in investment in joint ventures for notes receivable
|
$ | - | $ | 10,450,296 | ||||
12
Forward-Looking Information – Certain statements within this document may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). These statements are being made pursuant to the PSLRA, with the intention of obtaining the benefits of the “safe harbor” provisions of the PSLRA, and, other than as required by law, we assume no obligation to update or supplement such statements. Forward-looking statements are those that do not relate solely to historical fact. They include, but are not limited to, any statement that may predict, forecast, indicate or imply future results, performance, achievements or events. You can identify these statements by the use of words such as “may,” “will,” “could,” “anticipate,” “believe,” “estimate,” “expect,” “continue,” “further,” “plan,” “seek,” “intend,” “predict” or “project” and variations of these words or comparable words or phrases of similar meaning. These forward-looking statements reflect our current beliefs and expectations with respect to future events and are based on assumptions and are subject to risks and uncertainties and other factors outside our control that may cause actual results to differ materially from those projected. We undertake no obligation to update publicly or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
Additional Required Disclosure
To fulfill our promises to you we are required to make the following disclosures when applicable:
A detailed financial report on SEC Form 10-Q or 10-K (whichever is applicable) is available to you. It is typically filed either 45 or 90 days after the end of a quarter or year, respectively. Usually this means a filing will occur on or around March 31, May 15, August 15, and November 15 of each year. It contains financial statements and detailed sources and uses of cash plus explanatory notes. You are always entitled to these reports. Please access them by:
|
·
|
Visiting www.iconinvestments.com
|
or
|
·
|
Visiting www.sec.gov
|
or
|
·
|
Writing us at: Angie Seenauth c/o ICON Investments, 3 Park Avenue, 36th Floor, New York, NY 10016
|
We do not distribute these reports to you directly in order to keep our expenses down as the cost of mailing this report to all investors is significant. Nevertheless, the reports are immediately available upon your request.
| 13 |